U.S. DEPARTMENT OF LABOR
Employment and Training Administration
Washington, D. C. 20210
December 28, 1993
January 31, 1995
GENERAL ADMINISTRATION LETTER NO. 07-94
ALL STATE EMPLOYMENT SECURITY AGENCIES
Barbara Ann Farmer
Operating Instructions for Implementing the Amendments to the Trade Adjustment Assistance for Workers Program in Title V of the North American Free Trade Agreement (NAFTA) Implementation Act.
Purpose: To assist the States with implementing the Transitional Adjustment Assistance Program in Title V of the NAFTA Implementation Act. These operating instructions shall remain in effect until superseded or supplemented by further operating instructions or un
To alert the States to the opportunity for the provision of adjustment assistance under Title III of the Job Training Partnership Act (JTPA) to workers in secondary firms who are adversely affected by NAFTA.
References: The NAFTA Implementation Act (Pub. L. 103-182) is referred to as "the Act." The program of trade adjustment assistance for workers established by Chapter 2 of Title II of the Trade Act of 1974 is referred to as the "TAA Program". The Trade Act of 1974 may be referred to as simply the "Trade Act." The NAFTA Implementation Act Title V--NAFTA Transitional Adjustment Assistance and Other Provisions, affecting the TAA program is referred to as Title V or NAFTA-TAA.
Background: The Trade Act of 1974 made major changes to the trade adjustment assistance program for workers displaced because of increased imports of articles like or directly competitive with articles produced by the workers' firm. On receiving a petition for trade adjustment assistance from a group of workers or its authorized representative, the Department of Labor conducts a factfinding investigation in response to the petition. If the findings substantiate that the workers of a firm or subdivision of have been adversely affected by import competition, a certification is issued by the Secretary of Labor to the worker group stating that the workers are eligible to apply at a local office of the State employment security agency for TAA benefits. Benefits include up to 104 weeks of training in new occupational skills, and job search assistance and relocation allowances when jobs are not available within the commuting area from the worker's residence. Workers participating in training (unless the training requirement is waived) may also receive up to 52 weeks of trade readjustment allowance (TRA) payments which are generally equivalent to the worker's unemployment insurance payment.
Regulations implementing the adjustment assistance program for workers in Chapter 2, Title II, of the Trade Act are published at 20 CFR Part 617.
On December 8, 1993, the President signed into law the "North American Free Trade Agreement Implementation Act." These imple- menting instructions relate only to those provisions of Title V affecting the TAA Program. Most of the provisions of Title V are in the form of amendments to Chapter 2 of Title II of the Trade Act of 1974, and while some of the provisions of Title V are not in the form of amendments to the Trade Act, they nonetheless must be given effect in implementing the NAFTA-TAA program.
While the NAFTA-TAA is generally similar to the existing TAA Program, it does differ in several ways. Governors have a specific role in the new adjustment assistance program targeted to workers who may be displaced because of trade with Canada or Mexico. State agencies also have new program responsibilities. The NAFTA-TAA program requires workers to be enrolled in training to qualify for trade readjustment allowance (TRA) payments and does not allow the waiver of the training requirement when training is not "feasible or appropriate", which is now available to eligible workers in the regular TAA program. To provide for these differences, Section 502 of the Act adds a new Subchapter D--NAFTA Transitional Adjustment Assistance Program, to Chapter 2 of Title II of the Trade Act. Subchapter D adds one section-- Section 250, Establishment of a Transitional Program--to Chapter 2, Title II of the Trade Act, creating the new NAFTA-TAA program.
Adjustment assistance to workers adversely affected by NAFTA is also available under Title III of the JTPA. States are responsi- ble for providing assistance and services to workers whom the Governor preliminarily finds to be adversely affected by NAFTA. In addition, dislocated workers who are indirectly affected by NAFTA, e.g., workers in firms which supply components to a firm whose final product is adversely affected, may seek assistance similar to that available through the NAFTA-TAA program. Effective delivery of these Title III funded services will require governors to ensure close planning and coordination between the TAA and Title III program operators.
Operating Instructions: The operating instructions in this document are issued to the States and the cooperating State agencies as guidance provided by the Department of Labor in its role as the principal in the TAA Program. As agents of the United States, the States and cooper- ating State agencies may not vary from the operating instructions in this document without prior approval from the Department of Labor (DOL)
Pending the issuance of regulations implementing the provisions of Title V, the operating instructions in this document shall constitute the controlling guidance for the States and the cooperating State agencies in implementing and administering the new NAFTA-TAA program, pursuant to the agreements between the States and the Secretary of Labor under Section 239 of the Trade Act.
Instructions for implementing the JTPA Title III component, including procedures for accessing the national reserve funds to provide assistance to workers of secondary firms who are adversely affected by NAFTA, will be issued shortly.
NAFTA-TAA amendments are set out in this document according to the section number of the Trade Act affected by each of the amendments. An explanation of each amendment is furnished with an explanation of the regulations principally affected, and with additional instructions on the administration of each amendment.
ESTABLISHMENT OF TRANSITIONAL PROGRAM
Section 502 of the Act establishes a new Subchapter D in Chapter 2 of Title II of the Trade Act as follows:
A.1. Group Eligibility Requirements.
AMENDED LAW. Subsection (a) of section 250 is titled Group Eligibility Requirements. Paragraph (1) of subsection (a) sets out the criteria for certifying a worker group for NAFTA-TAA as follows:
A group of workers (including workers in any agricultural firm or subdivision of an agricultural firm) shall be certi- fied as eligible to apply for adjustment assistance under subsection (b) if the Secretary determines that a signifi- cant number or proportion of the workers in such workers' firm or an appropriate subdivision of the firm have become totally or partially separated, or are threatened to become totally or partially separated, and either--
(i) the sales or production, or both, of such firm or subdivision have decreased absolutely,
(ii) imports from Mexico or Canada of articles like or directly competitive with articles produced by such firm or subdivision have increased, and
(iii) the increase in imports under clause (ii) contributed importantly to such workers' separation or threat of separation and to the decline in sales or production of such firm or subdivi-sion; or
(B) that there has been a shift in production by such workers' firm or subdivision to Mexico or Canada of articles like or directly competitive with articles which are produced by the firm or subdivision.
ADMINISTRATION. As mentioned above, paragraph (a)(1) sets out the group eligibility criteria for certifying worker groups for transitional adjustment assistance. Two sets of criteria are included in subparagraphs (A) and (B). The criteria in sub- paragraph (A) are similar to the eligibility criteria in the regular TAA program (section 222 of the Trade Act), except that the criteria for NAFTA-TAA petitions provide that increased imports must come from Mexico or Canada.
Alternatively, and without reference to whether there have been increased imports from Mexico or Canada under subparagraph (A), the criterion under subparagraph (B) confers eligibility if the firm or subdivision of the firm has shifted production to Mexico or Canada of articles like or directly competitive with those produced by the firm or subdivision.
Application of Criteria:
For purposes of section 250, the following terms are applied:
Appropriate subdivision means an establishment in a multi-establishment firm which produces the domestic articles in question or a distinct part or section of an establishment (whether or not the firm has more than one establishment) where the articles are produced. The term "appropriate subdivision" includes auxiliary facilities operated in conjunction with (whether or not physically separate from) production facilities. (OTAA has interpreted the term "establishment" to include a place of business together with its employees, merchandise, equipment, etc.)
Firm means an individual proprietorship, partnership, joint venture, association, corporation (including a development corpo- ration), business trust, cooperative, trustee in bankruptcy, and receiver under decree of any court. A firm, together with any predecessor or successor-in-interest, or together with any affiliated firm controlled or substantially beneficially owned by substantially the same persons, may be considered a single firm.
Significant number or proportion of workers means that:
In most cases the total or partial separations, or both, in a firm or appropriate subdivision thereof, are the equivalent to a total unemployment of five (5) percent of the workers or 50 workers, whichever is less; or
At least three workers in a firm (or appropriate subdivision thereof) with a work force of fewer than 50 workers would ordinarily have to be affected.
Total or partial separation. All analyses of separations must treat total and partial separations equally.
Partial separation means, with respect to an individual who has not been totally separated, that the worker's:
(1) Hours of work have been reduced to 80 percent or less of the worker's average weekly hours at the firm or appropriate subdivi- sion thereof, and
(2) Wages have been reduced to 80 percent or less of the worker's average weekly wage at the firm or appropriate subdivision there-of.
Total separation means the layoff or severance of an individual from a firm or an appropriate subdivision thereof.
Criteria in Subparagraph (A): The following guidance and definitions shall apply:
Sales and production data must be obtained from the subject firm for the current 12-month period and the previous 12-month period in order to determine whether an absolute decrease in sales or production has occurred.
Increased imports. The Department's Office of Trade Adjustment Assistance (OTAA) will provide information based on available data regarding imports from Mexico or Canada of arti- cles like or directly competitive with those produced by the firm or subdivision of the firm.
Like or directly competitive means that "like" articles are those which are substantially identical in inherent or intrinsic characteristics (i.e., materials from which the articles are made, appearance, quality, texture, etc.); and "directly competitive" articles are those which, although not substantially identical in their inherent or intrinsic characteristics, are substantially equivalent for commercial purposes (i.e., adapted to the same uses and essentially interchangeable therefor).
An imported article is "directly competitive" with a domestic article at an earlier or later stage of processing, and a domestic article is "directly competitive with" an imported article at an earlier or later stage of processing, if the importation of the article has an economic effect on producers of the domestic article comparable to the effect of importation of articles in the same stage of processing as the domestic article.
Criterion in Subparagraph (B): The criterion under subparagraph (B) breaks down into the following elements:
Determination of article. The article must be like or directly competitive with the article that has been produced in the U.S. by the subject firm or subdivision of the firm.
Workers of firms that provide a service rather than produce an article are excluded from coverage.
Workers of firms that are suppliers of "components" related to the defined "like or competitive article" may be covered only if those articles produced by such firms independently meet the eligibility criteria for certification or the shift in production criterion.
Action. The article must have been formerly produced by a U.S. located firm or subdivision of the firm and is now produced in Mexico or Canada. Since the law does not address ownership of the producing firm, the shift in production can be either by the firm or subdivision moving the plant to Mexico or Canada, or the U.S. firm contracting with a different firm located in Mexico or Canada.
Definition. A "shift of production" is defined to mean a tangible action or commitment to contract or license production of an article within a definite period of time by the workers' firm with a firm in Mexico or Canada, including the actual pro- duction of an article that was formerly produced by a U.S. located firm or subdivision, by a producing plant located in Mexico or Canada.
A.2. Definition of Contributed Importantly.
AMENDED LAW. Subparagraph (a)(2) of section 250 states that the term "contributed importantly" means a cause which is important but not necessarily more important than any other cause.
ADMINISTRATION. The term "contributed importantly" is the same as used in section 222(b) of the Trade Act for administering the regular TAA program. The "contributed importantly" provision is used by the Department of Labor in its review of petitions for eligibility for the regular TAA Program and will also be used for the NAFTA-TAA program. Pursuant to section 250(b)(2)(B)(i), Governors, when making a preliminary finding as to whether a petition meets the eligibility requirements for NAFTA-TAA, discussed above, will not apply the "contributed importantly" test when reviewing NAFTA-TAA petitions.
When the Governor or the designated State official substantiates that the criteria in clauses (i) and (ii) of sections 250(a)(1) (A) have been met, the petition package including a statement of affirmative preliminary finding is forwarded to the OTAA for review. To confirm the State's affirmative preliminary finding, the OTAA will apply the criteria in section 250(a)(1)(A), including the "contributed importantly" test in clause (iii).
AMENDED LAW. Paragraph (a)(3) of section 250 provides that the Secretary shall issue regulations relating to the application of the criteria described above in making the preliminary finding and determinations.
ADMINISTRATION. Because of the time constraints for implementing the NAFTA-TAA program on January 1, 1994, regulations will not be in place until after this date. Accordingly, to begin operation of the program, operating instructions will be issued and pub-lished in the Federal Register. States should proceed to imple ment the NAFTA-TAA program based on these operating instructions.
A.4. Filing of petitions.
AMENDED LAW. Paragraph (b)(1) of section 250 provides that a petition for certification of eligibility to apply for NAFTA-TAA may be filed by a group of workers (including workers in any agricultural firm or subdivision of an agricultural firm) or by their certified or recognized union or other duly authorized representative with the Governor of the State in which such workers' firm or subdivision thereof is located.
ADMINISTRATION. This section provides that a petition for certification of eligibility may be filed by a group of workers (including workers in any agricultural firm or subdivision of an agricultural firm) or by their certified or recognized union or other duly authorized representative. It should be noted that a community-based organization may serve as a duly authorized representative of the workers.
Group means three or more workers in a firm or an appropriate subdivision thereof.
A new petition form has been designed for use by worker groups to file petitions for NAFTA-TAA. The NAFTA-TAA petition form will include a space in the filing instructions on the reverse side to permit the State to add the address of where the petitions are to be filed. A supply of the NAFTA-TAA petition forms will be furnished to each State. States should reproduce the NAFTA-TAA petition form to meet its needs.
Copies of the NAFTA-TAA petition form with the address for filing the petition are to be made available by the States, at a mini- mum, in every local employment service and unemployment insurance office. Staff in local offices must be familiar with the NAFTA-TAA program, as well as the regular TAA program, and the procedures being put in place to assure that workers applying for employment services and unemployment insurance benefits are advised properly regarding both TAA programs and on filing the proper petition form to the correct location.
NAFTA-TAA petition forms will be submitted to the State official or organization designated by the Governor to review such petitions.
Worker petitions for the regular TAA program will continue to be submitted directly to the Department of Labor's Office of Trade Adjustment Assistance, at the address on the reverse side of the form.
A.5. Findings and Assistance.
AMENDED LAW. Paragraph (b)(2) of section 250 specifies that upon the receipt of a NAFTA-TAA petition, the Governor will take the following actions:
Notify the Secretary of Labor that the Governor has received the petition.
Within 10 days after receiving the petition--
(i) make a preliminary finding as to whether the petition meets the criteria described in subsection (a)(1) (and for purposes of this clause the criteria described in subparagraph (A)(iii) shall be disregarded), and
(ii) transmit the petition, together with a statement of finding under clause (i) and the reasons therefor, to the Secretary for action under subsection (c); and
If the preliminary finding under subparagraph (B)(i) is affirmative, ensure that rapid response and basic readjustment services authorized under other Federal law are made available to the workers.
ADMINISTRATION. This section establishes a role, as well as precise time frames, for Governors in processing NAFTA-TAA petitions. Because of these time frames, rigid processing procedures have been designed for coordinating the Governors' activities with the OTAA.
The Governor receives a petition for NAFTA-TAA.
The State records the receipt date on the face of the petition, reviews the petition for completeness and clarity, and telephones the company official listed as the contact person on the petition.
Telephone contact with the company official is to cover the following:
(1) Determine if the official listed on the petition is the appropriate contact. If not, show the name, telephone number and FAX number (if available) of the appropriate contact person on the face of the petition.
(2) Confirm the product description reported on the petition. Accuracy is critical to DOL in determining whether imports of like or directly competitive products have increased.
(3) Ask the company official about total and partial worker separations at the firm during the past 12 months. If there were separations, ascertain if it was because of increased company imports from Mexico or Canada, an actual or threatened shift of production to either country, or lost sales to customers who purchase from firms importing from Mexico or Canada.
(4) Alert company official that data request forms will be sent by FAX (if available) or by mail, and obtain the official's cooperation to supply the requested information within 5 days of petition receipt. If the company official fails to cooperate, inform the company of subpoena authority to obtain the requested data.
If the company continues to refuse to supply the data, the State must notify the company in writing of its subpoena authority and determine if the data is to be furnished. Subpoena procedures should be instituted when there is non-compliance with the request. TAA program regulations at 20 CFR 617.53 provide that States may issue subpoenas for attendance of witnesses and production of records on the same terms and conditions as under State law. If a State court declines to enforce a subpoena, the State agency may petition for an order requiring compliance with such subpoena to the United States District Court within the jurisdiction of which the relevant proceeding under 20 CFR Part 617 is conducted.
Obviously, encouraging company cooperation is the best solution to obtaining requested information. Use of subpoena procedures often result in lengthy legal negotiations and even court proceedings. Notify OTAA when subpoena procedures are being considered.
(5) Use the dedicated line (telephone number 202-501-6489) to FAX to OTAA the face page of the petition form as well as any corrections or additions obtained during telephone contacts with the company official. This action will serve as notification to the Secretary that the Governor has received a petition and that the investigation has been initiated.
(6) FAX (if available) or mail the data request forms, which include a request for a listing of company customers, to the company official, specifying a due date for the information to be returned via FAX or mail. If appropriate, inform the State employment security agency that an investigation is underway.
(7) OTAA will check its records for duplicate petitions and assign a NAFTA-TAA number to the case. OTAA will enter the case number in the OTAA Management Information System and institute the investigation of the petition. A notice of the investigation will be forwarded for publication in the Federal Register and the regional offices and State agencies notified according to established procedures in the regular TAA Program.
(8) OTAA will begin the analysis of aggregate U.S. imports for the article(s) listed in the petition that are like or directly competitive with the article(s) produced at the subject firm.
OTAA will complete the aggregate import analysis and FAX a determination to the State as to whether relevant imports from Mexico or Canada have increased. This determination will be made part of the case file as it will be used by the State in making its preliminary finding.
If the data package has not been received from the company official, the State will contact the company official to urge completion and transmittal by mail or FAX (if available) of the data.
State will make a preliminary finding regarding whether the petition meets the criteria in section 250(a)(1), except clause (A)(iii), and will prepare a brief statement on the basis for the finding.
State will FAX the petition face sheet, the data packet (including the customer list), and the preliminary finding and reasons for the finding, to OTAA.
State will notify the petitioners of the Governor's prelim- inary finding on the NAFTA-TAA petition and that the petition package is being submitted to the Secretary of Labor for review and final determination.
When an affirmative determination is made, the State will take the necessary action to ensure that the JTPA Title III (Economic Dislocated Worker Adjustment Assistance) rapid response and basic readjustment services are made available to the impacted workers.
A.6. Review of Petition by Secretary: Certifications.
AMENDED LAW. Subparagraph (c)(1) of section 250 provides that the Secretary of Labor, within 30 days after receiving from the Governor a petition for NAFTA-TAA, shall determine whether the petition meets the group eligibility requirement for certification. Upon a determination that the petition meets such crite- ria, the Secretary shall issue to workers covered by the petition a certification of eligibility to apply for assistance under NAFTA-TAA.
ADMINISTRATION. The OTAA will review the State's preliminary finding on all NAFTA-TAA petitions. If an affirmative prelim- inary finding from the State, based on a shift in production to, or imports from, Mexico or Canada, is confirmed through an inde- pendent review by the OTAA, the Secretary will issue a certifica- tion of eligibility to apply for assistance. This determination will be published in the Federal Register.
If the affirmative preliminary finding from the State is not based on a shift in production to Mexico or Canada by the subject firm or on company imports from Mexico or Canada, OTAA will initiate a customer survey to determine whether the increase in aggregate imports contributed importantly to the workers' separations and to the decline in sales or production at the subject firm.
The OTAA will complete the customer survey, and the Secretary will issue a final determination within 30 days of the receipt of the State's preliminary finding.
The Secretary's determination to grant or deny certification will be sent by FAX to the State and appropriate regional office. This determination will also be published in the Federal Register.
A.7 Denial of Certification.
AMENDED LAW. Paragraph (c)(2) of section 250 provides that upon denial of certification with respect to a petition under paragraph (1), the Secretary shall review the petition in accordance with the requirements of the regular TAA program under subchapter A of chapter 2 of title II the Trade Act to determine if the workers may be certified under such subchapter.
ADMINISTRATION. When a determination is made by the Secretary of Labor that the petition does not meet the eligibility require- ments for NAFTA-TAA, the petition will immediately be reviewed by the OTAA under subchapter A of the Trade Act.
The 60-day time period under section 223 of Chapter 2 of Title II of the Trade Act for completing the review of a petition under subchapter A will begin on the date the denial of the NAFTA-TAA petition is issued.
A.8. Comprehensive Assistance.
AMENDED LAW. Subsection (d) of section 250 provides that workers covered by a certification for NAFTA-TAA shall be provided, in the same manner and to the same extent as workers covered under a certification for regular TAA, the following:
Employment services described in section 235 of the Trade Act.
Training described in section 236 of the Trade Act, except that notwithstanding the provisions of section 236 (a)(2)(A), the total amount of payments for any fiscal year shall not exceed $30 million.
Trade readjustment allowances (TRA) described in sec-tions 231 through 234 of the Trade Act, except that--
The provisions of sections 231(a)(5)(C) and 231(c) of the Trade Act, authorizing the payment of TRA upon a finding that it is not feasible or appropriate to approve a training program for a worker, shall not be applicable to payment of such allowance under subchapter D; and
Notwithstanding the provision of section 233(b) of the Trade Act, in order for a worker to qualify for TRA under the NAFTA-TAA program, the worker shall be enrolled in a training program approved by the Secretary under section 236(a) by the later of--
(i) the last day of the 16th week of such worker's initial unemployment compensation period, or
(ii) the last day of the 6th week after the week in which the Secretary of Labor issues a certification covering such worker.
In cases of extenuating circumstances related to enrollment in a training program, the Secretary mayextend the time for enrollment for a period not to exceed 30 days.
Job search allowances described in section 237.
Relocation allowances described in section 238.
ADMINISTRATION. The administration of the benefit provisions of the NAFTA-TAA program is similar to the regular TAA program except that the NAFTA-TAA program requires workers to be enrolled in training to qualify for TRA payments. The NAFTA-TAA program prohibits the waiver of the training requirement when training is not "feasible or appropriate," which is available to eligible workers in the regular TAA program. Also, the NAFTA-TAA program requires workers to be enrolled in training by prescribed time periods to qualify for TRA.
Employment Services. Employment services described in section 235 of the Trade Act are to be provided to NAFTA-TAA certified workers as provided to workers certified for regular TAA. Employment services are to be provided to NAFTA-TAA certified workers to the same extent that such services are provided to any workers seeking employment services under other Federal laws; i.e., Wagner-Peyser Act and Title III of JTPA. (See 20 CFR 617.20 and 617.21)
Training. Training is to be provided to NAFTA-TAA certified workers according to section 236 of the Trade Act.
Workers certified under NAFTA-TAA will have to satisfy the same criteria in 20 CFR 617.22(a) as apply to workers certi- fied under the regular TAA program.
The Act provides that payments for NAFTA-TAA training for any fiscal year shall not exceed $30 million. With regard to this funding limitation, the Department will track nationally the amount of program funds allocated to the States and the amount of funds committed by the States in order to satisfy this statutory provision. States will be informed when the amount approaches $30 million nationally. Should the demand for funds exceed the limitation, instructions will be furnished on how to handle demands for training that exceed the statutory limitation.
Trade Readjustment Allowances. To qualify for TRA payments, an eligible worker must be enrolled in a training program approved by the later of--
(i) the last day of the 16th week of such worker's initial unemployment compensation period, or
(ii) the last day of the 6th week after the week in which the Secretary of Labor issues a certification covering such worker.
Application of time periods. 16-week time requirement for enrolling in training in order to qualify for TRA will be applied literally. In order to be eligible to receive TRA under a NAFTA-TAA certification, the worker must be enrolled in an approved training program by the end of the 16th week of that worker's initial unemployment compensation benefit period.
This fixed 16-week period begins with the effective date of the claim and ends with the last day of the 16th week there-after. Included in this 16-week fixed period are weeks of waiting period credit, weeks of disqualification, weeks of employment, and weeks of unemployment.
Initial unemployment compensation benefit period means the same as the term "first benefit period" defined at 20 CFR 617.3(r). "First benefit period" means the benefit period established after the individual's first qualifying separation or in which such separation occurs.
Enrolled in Training. For purposes of this provision, a worker shall be considered to be enrolled in training when the worker's application for training is approved by the State agency and the training institution has furnished written notice to the State agency that the worker has been accepted in the approved training program beginning within 30 calendar days.
Extenuating Circumstances. The Act provides that the Secretary , for justifiable cause, may extend the time for enrollment for a period not to exceed 30 days. It is anticipated that there will be situations beyond the worker's control where the worker is unable to enroll in training by the later of the last day of the 16th week of the worker's initial benefit period or the 6th week after the week that a certification was issued. Such situations could involve training programs that are abruptly canceled or circumstances where the first available enrollment date is past the deadline, as well as injury or illness which may adversely affect the ability of workers to enroll in training. The authority to grant 30-day extensions to workers is delegated to States or State agencies as one of their responsibilities under section 239 of the Trade Act.
The application of this 30-day grace period will be used only in rare circumstances. Workers who fail to enroll in training by the end of this 30-day period are still eligible to participate in approved training and have the training costs paid with NAFTA-TAA program funds but will not qualify for TRA. This provision places added responsibilities on both the worker and the State agency to satisfy the time limits for enrolling in training in order to qualify for TRA. Workers certified for NAFTA-TAA must be informed promptly of the time provisions by the State agency when a NAFTA-TAA certification is issued.
In order to satisfy these provisions, information bulletins or brochures furnished to claimants by the State unemployment insurance agency and to applicants for employment services should include information on the time provisions for NAFTA-TAA certified workers to qualify for TRA. Other means of informing workers of the time limits are through newspaper notices and letters sent to individual workers when a certification is issued, as required in section 225 of the Trade Act and regulations at 20 CFR 617.4.
Although the use of brochures, newspaper notices and individual letters are important resources for informing workers of the time provision for enrolling in training, they do not relieve States of their responsibility for helping workers enroll in a training program in a timely manner.
State agencies shall follow existing funding and precertification procedures for NAFTA-TAA program petitions now used for regular TAA Program petitions. Initiation of fact-finding investigations in response to NAFTA-TAA petitions will be announced through publication of the information in the Federal Register, in the same manner as regular TAA petitions.
Under precertification responsibilities, State agencies must obtain information from the subject firm about layoffs beginning on and after December 8, 1993, including the names and social security numbers of the affected workers. The State agency staff shall also follow the procedures used for the regular TAA Program to check UI files, flag appropriate claims, and maintain coordination between the UI and ES offices to ensure that workers are enrolled in approved training within the statutory time frames so they are not denied TRA eligibility.
Prohibition of Training Waivers. Provisions of sections 231(a)(5)(C) and 231(c) of the Trade Act, authorizing the payment of TRA upon a finding that it is "not feasible or appropriate" to approve a training program for a worker, are not applicable to payment of TRA under the NAFTA-TAA program.
Thus, in order for a worker to qualify for TRA under the NAFTA-TAA program, the worker must be enrolled in training approved under section 236(a) of the Trade Act.
Job search allowances. Workers certified for NAFTA-TAA are eligible for job search allowances to the same extent and under the same conditions as workers certified for the regular TAA program under section 237 of the Trade Act.
Relocation allowances. Workers certified for NAFTA-TAA are eligible for relocation allowances to the same extent and under the same conditions as workers certified for the regular TAA program under section 238 of the Trade Act.
A.9. Administration of NAFTA-TAA.
AMENDED LAW. Subsection (e) of section 250 states that the provisions of subchapter C of Chapter 2, Title II, of the Trade Act shall apply to the administration of the NAFTA-TAA program in the same manner and to the same extent as such provisions apply to the administration of the regular TAA program under subchap- ters A and B of the Trade Act, except that the agreement between the Secretary and the States described in section 239 of the Trade Act shall specify the procedures that will be used to carry out the certification process under subsection (c) of section 250 and the procedures for providing relevant data by the Secretary to assist the States in making preliminary findings under subsection (b) of section 250.
ADMINISTRATION. The procedures for NAFTA-TAA certification process under subchapter D of Chapter 2, Title II, of the Trade Act are:
The certification procedures set forth in Sections A.5 and A.6 of this document provide operating instructions on the methods for making preliminary determinations under section 250(b) of the Trade Act and the Secretary's review of petitions under subsection (c).
Upon request from the Governor, the Secretary will make a determination of what relevant import data is needed to satisfy the criteria for making a preliminary finding under subsection (b) and provide such data to the State.
Pursuant to section 250(c), the Secretary will conduct a full investigation to determine if the petition for NAFTA-TAA certification meets the criteria specified in sub-section (a).
Section 503 of the new law provides conforming amendments to the Trade Act as follows:
AMENDED LAW. Subsection (a) of section 503 of the new law amends sections 221(a), 222(a), and 223(a) by striking out "assistance under this chapter" and inserting "assistance under this subchapter".
ADMINISTRATION. These are technical changes which do not have a material effect on the administration and operation of the TAA and NAFTA-TAA programs.
B.2. Benefit Information.
AMENDED LAW. Subsection (b) of section 225 is amended by inserting "or subchapter D" after "subchapter A" each place it appears.
Administration. This change is needed because of the addition of subchapter D in Chapter 2, Title II, of the Trade Act. The impact of this amendment is to require that the same types of benefit information be furnished by State agencies to workers applying for unemployment insurance and to workers certified for NAFTA-TAA as are required by the regular TAA program.
B.3. Nonduplication of Assistance.
AMENDED LAW. Subsection (c) of section 503 amends subchapter C of Chapter 2, Title II, of the Trade Act by adding a new section 249A at the end on nonduplication of assistance. This new sec tion provides that no worker may receive assistance relating to a separation pursuant to certifications under both subchapters A and D.
ADMINISTRATION. This new section is intended to eliminate duplication of assistance and benefits to a worker in situations where a worker group is certified concurrently for both regular TAA and NAFTA-TAA. These situations should be uncommon. However, should this occur, the worker will be provided benefits under one or the other certification. The worker is to make the decision regarding which certification will apply. Once a decision is made by the worker, it cannot be changed. Also, State agency staff must explain the differences between programs so workers can make an informed choice.
B.4. Judicial Review.
AMENDED LAW. Subsection (d) of section 503 amends section 284 of the Trade Act by inserting "or section 250(c) after "section 223."
ADMINISTRATION. Section 284 (19 U.S.C. 2395(a)) of the Trade Act addresses judicial review.
Subsection (d) has the effect of providing workers aggrieved by a decision of the Secretary of Labor on a petition, the same rights for judicial review as provided to workers pursuant to section 284 of the Trade Act. Regulations addressing judicial review are also set out at 29 CFR 90.19.
TERMINATION OF TRANSITION PROGRAM
C.1. Termination of Transition Program.
AMENDED LAW. Section 505 of the Act amends subsection (c) of section 285 of the Trade Act by--
(1) striking "No" and inserting "(1) except as provided in paragraph (2), no"; and
(2) adding at the end the following new paragraph:
(2)(A) Except as provided in subparagraph (B), no assistance, voucher, allowance, or other payments may be provided under subchapter D of chapter 2 after the day that is the earlier of--
(i) September 30, 1998, or
(ii) the date on which legislation, establishing a program providing dislocated workers with comprehensive assistance substantially similar to the assistance provided by such subchapter D, becomes effective.
(B) Notwithstanding subparagraph (A), if, on or before the day described in subparagraph (A), a worker--
(i) is certified as eligible to apply for assistance, under subchapter D of chapter 2; and
(ii) is otherwise eligible to receive assistance in accordance with section 250, such worker shall continue to be eligible to receive such assistance for any week for which the worker meets the eligibility requirements of such section.
ADMINISTRATION. Although the amended section is not part of Chapter 2 of Title II of the Trade Act, it does have a signifi- cant impact on the payment of benefits to NAFTA-TAA certified workers after the September 30, 1998 expiration date of the TAA program or an earlier expiration date prescribed in any new law. While it is important to be aware of this provision, the Depart- ment of Labor will provide precise closeout information to States in advance of the statutory expiration date, or if the expiration date is impacted by a law change.
AMENDED LAW. Subsection (a) of section 506 of the Act provides that sections 501, 502, 503, 504, and 505 shall take effect on the date the Agreement enters into force with respect to the United States.
ADMINISTRATION. It is expected that NAFTA will enter into force on January 1, 1994.
D.2. Covered Workers; In General.
AMENDED LAW. Subsection (b)(1), of section 506 of the Act states that, except as provided in paragraph (2) of section 506, no worker shall be certified as eligible to receive assistance under subchapter D of chapter 2 of title II of the Trade Act (as added by this subtitle) whose last total or partial separation from a firm (or appropriate subdivision of a firm) occurred before such date of entry into force.
ADMINISTRATION. With the exception of the reachback provision, which is discussed in the next section, no worker is to be certified as eligible to receive assistance under NAFTA-TAA whose last separation under a certification occurred before the NAFTA date of entry into force.
D.3. Covered Workers; Reachback.
AMENDED LAW. Subsection (b)(2), of section 506 of the new law provides that notwithstanding paragraph (1), any worker--
(A) whose last total or partial separation from a firm (or appropriate subdivision or a firm) occurs--
(i) after the date of the enactment of this Act, and
(ii) before such date of entry into force, and
(B) who would otherwise be eligible to receive assistance under subchapter D of chapter 2 of title II of the Trade Act of 1974, shall be eligible to receive such assistance in the same manner as if such separation occurred on or after such date of entry into force.
ADMINISTRATION. In determining the eligibility of workers for benefits under NAFTA-TAA, consideration must be given to the date a worker is separated from employment. A worker whose last total or partial separation from a firm occurred after the enactment of Pub. L. 103-182 on December 8, 1993, but before the date of entry into force of NAFTA (which is anticipated to be on January 1, 1994), may be eligible for certification under the "reachback" provision in section 506(b)(2) of the Act.
Workers whose total or partial separation occurred at an earlier time must petition under the regular TAA program to be eligible for TAA services and benefits. The regular TAA program allows workers laid off up to one year prior to the date of the petition on which a certification of eligibility is issued to qualify for services and benefits.
It is important for State agency staff members to be familiar with the reachback provisions of both the NAFTA-TAA and regular TAA programs so that they can properly advise workers regarding which program may be applicable to their situation.
Action Required: States are required to implement the provi- sions of the NAFTA Amendments as set forth in this document as of the date of NAFTA entry into force which is expected to be on January 1, 1994. States are advised to inform all appropriate staff of the contents of this document.
Attachments: Title V -- NAFTA Transitional Adjustment Assistance and Other Provisions.
NOTE: Attachment not available to DMS