[Federal Register Volume 88, Number 225 (Friday, November 24, 2023)]
[Rules and Regulations]
[Pages 82658-82737]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-25372]



[[Page 82657]]

Vol. 88

Friday,

No. 225

November 24, 2023

Part III





Department of Labor





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Employment and Training Administration





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20 CFR Parts 651, 652, 653, et al.





Wagner-Peyser Act Staffing; Final Rule

Federal Register / Vol. 88, No. 225 / Friday, November 24, 2023 / 
Rules and Regulations

[[Page 82658]]


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DEPARTMENT OF LABOR

Employment and Training Administration

20 CFR Parts 651, 652, 653, and 658

[Docket No. ETA-2022-0003]
RIN 1205-AC02


Wagner-Peyser Act Staffing

AGENCY: Employment and Training Administration, Labor.

ACTION: Final rule.

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SUMMARY: The U.S. Department of Labor (Department or DOL) is issuing a 
final rule that requires States to use State merit staff to provide 
Wagner-Peyser Act Employment Service (ES) services. In the notice of 
proposed rulemaking (NPRM), the Department proposed that this 
requirement would apply to all States. However, the Department 
recognizes three States that have been approved by the Department to 
administer ES services using alternative staffing models for decades 
and is allowing only these three States to continue using the 
alternative staffing models. The requirement to use State merit staff 
to provide all ES services applies to all other States, including those 
States that implemented staffing flexibility under the 2020 Final Rule. 
The Department additionally is revising the ES regulations to 
strengthen the provision of services to migrant or seasonal farmworkers 
(MSFWs) and to enhance the protections afforded by the Monitor Advocate 
System and the Employment Service and Employment-Related Law Complaint 
System (Complaint System). States have 24 months to comply with this 
final rule.

DATES: 
    Effective Date: This final rule is effective January 23, 2024.
    Compliance Date: All States will have 24 months from the effective 
date to comply with the requirements of this final rule. The compliance 
date of the final rule is January 22, 2026.

FOR FURTHER INFORMATION CONTACT: Kim Vitelli, Administrator, Office of 
Workforce Investment, Employment and Training Administration, U.S. 
Department of Labor, 200 Constitution Avenue NW, Room C-4526, 
Washington, DC 20210, Telephone: (202) 693-3980 (voice) (this is not a 
toll-free number). For persons with a hearing or speech disability who 
need assistance to use the telephone system, please dial 711 to access 
telecommunications relay services.

SUPPLEMENTARY INFORMATION: 

Preamble Table of Contents

I. Acronyms and Abbreviations
II. Executive Summary
III. Background and Justification
IV. General Comments on the Proposed Rule
V. Section-by-Section Discussion of Final Rule
    A. Technical Amendments and Global Edits
    B. Part 651--General Provisions Governing the Wagner-Peyser Act 
Employment Service
    C. Part 652--Establishment and Functioning of State Employment 
Service
    D. Part 653--Services of the Wagner-Peyser Act Employment 
Service System
    E. Part 658--Administrative Provisions Governing the Wagner-
Peyser Act Employment Service
VI. Rulemaking Analyses and Notices
    A. Executive Orders 12866 (Regulatory Planning and Review), 
13563 (Improving Regulation and Regulatory Review), and 14094 
(Modernizing Regulatory Review) and Subtitle E of the Small Business 
Regulatory Enforcement Fairness Act of 1996
    B. Regulatory Flexibility Act, Small Business Regulatory 
Enforcement Fairness Act of 1996, and Executive Order 13272 (Proper 
Consideration of Small Entities in Agency Rulemaking)
    C. Paperwork Reduction Act of 1995
    D. Executive Order 13132 (Federalism)
    E. Unfunded Mandates Reform Act of 1995
    F. Executive Order 13175 (Indian Tribal Governments)
    G. Plain Language

I. Acronyms and Abbreviations

2020 Final Rule Wagner-Peyser Act Staffing Flexibility; Final Rule, 85 
FR 592 (Jan. 6, 2020)
AJC(s) American Job Center(s) (also known as one-stop(s) or one-stop 
center(s))
AOP(s) Agricultural Outreach Plan(s)
ARS Agricultural Recruitment System
BFOQ bona fide occupational qualification
BLS U.S. Bureau of Labor Statistics
CARES Act Coronavirus Aid, Relief, and Economic Security Act
CFR Code of Federal Regulations
Complaint System Employment Service and Employment-Related Law 
Complaint System
COVID-19 coronavirus disease 2019
CRC DOL Civil Rights Center
CSRA Civil Service Reform Act
Department or DOL U.S. Department of Labor
EEOC Equal Employment Opportunity Commission
E.O. Executive Order
EO Officer(s) Equal Opportunity Officer(s)
ES Wagner-Peyser Act Employment Service
ETA Employment and Training Administration
FR Federal Register
FTE(s) full-time equivalent(s)
FY(s) Fiscal Year(s)
IC(s) information collection(s)
ICR(s) information collection request(s)
IPA Intergovernmental Personnel Act of 1970
IT information technology
LEP limited English proficiency
MOU(s) Memorandum/a of Understanding
MSFW(s) migrant or seasonal farmworker(s)
MSPA Migrant and Seasonal Agricultural Worker Protection Act
NAICS North American Industry Classification System
NFJP National Farmworker Jobs Program
NMA National Monitor Advocate
NPRM or proposed rule notice of proposed rulemaking
O*NET Occupational Information Network
OALJ Office of Administrative Law Judges
OFLC Office of Foreign Labor Certification
OIRA Office of Information and Regulatory Affairs
OMB Office of Management and Budget
OPM Office of Personnel Management
OSHA Occupational Safety and Health Administration
OWI Office of Workforce Investment
PIRL Participant Individual Record Layout
PRA Paperwork Reduction Act of 1995
Pub. L. Public Law
PY(s) Program Year(s)
QCEW Quarterly Census of Employment and Wages
RA(s) Regional Administrator(s)
RESEA Reemployment Services and Eligibility Assessment
RFA Regulatory Flexibility Act
RIN Regulation Identifier Number
RMA(s) Regional Monitor Advocate(s)
Secretary Secretary of Labor
SMA(s) State Monitor Advocate(s)
SNAP Supplemental Nutrition Assistance Program
SOC Standard Occupational Classification
SSA Social Security Act
Stat. United States Statutes at Large
SWA(s) State Workforce Agency/ies
TAA Trade Adjustment Assistance
TANF Temporary Assistance to Needy Families
UI unemployment insurance
UMRA Unfunded Mandates Reform Act of 1995
U.S.C. United States Code
WHD Wage and Hour Division
WIA Workforce Investment Act of 1998

[[Page 82659]]

WIOA Workforce Innovation and Opportunity Act

II. Executive Summary

    The Department is amending its regulations regarding Wagner-Peyser 
Act staffing to require that States use State merit staff to provide ES 
services, except three States--Colorado, Massachusetts, and Michigan--
that have longstanding reliance interests in using alternative staffing 
models. The final rule requires these three States to participate in 
rigorous multistate evaluation activities to be conducted by the 
Department to determine whether such models are empirically supported. 
This evaluation will include review of services delivered by States 
that use State merit-staffing, as necessary.
    In the NPRM, the Department proposed to require that all States use 
State merit staff to deliver ES services. The Department determined 
that it is vital for the ES to be administered so that States deliver 
services effectively and equitably to unemployment insurance (UI) 
beneficiaries and other ES customers, including services provided to 
MSFWs. In the NPRM, the Department reasoned that the demands placed on 
State UI systems by the economic impact of the coronavirus disease 2019 
(COVID-19) pandemic highlighted the necessity of States to be able to 
rely on eligible ES State merit staff to be deployed to assist with UI 
activities that must be performed by State merit staff.\1\ The 
Department noted that States also have experienced the benefits of 
deploying ES State merit staff to assist with UI activities in response 
to recessions, the onset of natural disasters, and mass regional 
layoffs. The Department also noted that requiring States to utilize 
State merit staff to deliver ES services would help to ensure that ES 
services are delivered by qualified, nonpartisan personnel. These 
professionals would be required to meet objective professional 
qualifications, trained to assure high-quality performance, and 
expected to maintain certain transparent standards of performance. 
States would be required to assure that employees are treated fairly 
and protected against partisan political coercion. This final rule 
adopts the proposal that States are required to use State merit staff 
to deliver ES services, with one change explained in the following 
paragraph.
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    \1\ https://www.dol.gov/agencies/eta/advisories/unemployment-insurance-program-letter-no-12-01-change-2.
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    While the Department maintains its position that aligning ES and UI 
promotes efficiency and uniformity in the operation of the ES, the 
Department also recognizes that three States--Colorado, Massachusetts, 
and Michigan--have been approved by the Department for decades to 
deliver ES services using staffing models alternative to full State 
merit-staffing. The Department received many comments on the NPRM 
regarding the longstanding reliance interests of these States and the 
potential disruptions to service delivery in these States specifically 
that could result from having to implement a complete State merit-
staffing requirement. Based on these comments, the Department is 
permitting these three States, which were authorized to use alternative 
staffing models since the 1990s, to use the staffing model consistent 
with that previously authorized for that State. These three States may 
use the merit-staffing flexibility only to the same extent the 
Department previously authorized prior to February 5, 2020. Also, the 
final rule requires these three States to participate in rigorous 
evaluation activities to be conducted by the Department to determine 
whether such models are empirically supported. The Department is 
requiring that State Monitor Advocate (SMA) functions be performed by 
State merit staff in all States because SMAs monitor the State 
Workforce Agency (SWA), must report on SWA compliance to the State 
Administrator, and liaise between the SWA and external groups. Because 
the SMA position requires overseeing State agency functions and 
creating accountability for those functions, including discussing 
needed process improvements with State officials and ETA's Regional and 
National Monitor Advocates, such oversight functions are more 
appropriately performed through State merit-staffing.
    The Department is additionally revising the ES regulations to 
strengthen the provision of services to MSFWs and to enhance the 
protections afforded by the Monitor Advocate System and the Complaint 
System. These changes include the following:
    <bullet> Better serving MSFWs and promoting equity in the workforce 
system, including requiring States to use State merit staff to provide 
ES services to MSFWs.
    <bullet> Revising several defined terms related to the provision of 
ES services to MSFWs to modify the criteria for designating significant 
MSFW one-stop centers and significant MSFW States, and to ensure that 
full-time students who otherwise meet the criteria set forth in the 
definitions will be afforded the same benefits and protections under 
the ES as other MSFWs.
    <bullet> Strengthening the role and status of SMAs, including 
requirements to help to ensure that States employ highly qualified 
candidates, that SMAs have the appropriate authority necessary to 
effectively carry out their duties, and that SMAs are not assigned 
duties that are inconsistent with their role to provide oversight.
    <bullet> Prohibiting the State Administrator or ES staff from 
retaliating against staff, including against the SMA, for monitoring or 
raising any issues or concerns regarding non-compliance with the ES 
regulations.
    <bullet> Requiring SMAs to conduct onsite reviews of one-stop 
centers regardless of whether the one-stop center is designated as a 
significant MSFW one-stop center.
    <bullet> Requiring the SMA to establish an ongoing liaison with the 
State-level Equal Opportunity Officer (E.O. Officer) to enhance equity 
and inclusion for farmworkers.
    <bullet> Further specifying SWA staffing requirements for 
significant MSFW one-stop centers.
    <bullet> Requiring SWAs to collect and report data on the number of 
reportable individuals who are MSFWs to help SWAs, SMAs, and ETA 
monitor equity in the provision of ES services to MSFWs.
    <bullet> Aligning the ES regulations with the language access 
requirements of the Workforce Innovation and Opportunity Act (WIOA) 
nondiscrimination regulations at 29 CFR 38.9 to reduce duplication and 
to ensure States provide the broadest language access protections 
available for MSFWs with limited English proficiency (LEP).
    <bullet> Strengthening outreach to MSFWs by, among other things, 
requiring SWAs to conduct outreach to MSFWs on an ongoing basis; 
specifying that all States must have some degree of outreach at all 
times and full-time outreach staff must spend 100 percent of their time 
on the outreach responsibilities described at Sec.  653.107(b); 
requiring SWAs to employ enough outreach staff to contact a majority of 
MSFWs in their States annually; prohibiting SWAs from relying on 
National Farmworker Jobs Program (NFJP) grantee activities as a 
substitute to meet outreach obligations; specifying that SWAs must 
ensure hiring officials put a strong emphasis on hiring qualified 
candidates for outreach staff positions; and requiring outreach 
staffing levels to align with and be supported by information in the 
Agricultural Outreach Plan (AOP) that a State must submit pursuant to 
Sec.  653.107(d).
    <bullet> Changing the record retention requirement for outreach 
logs from 2

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years to 3 years to align with the Office of Management and Budget 
(OMB) Uniform Administrative Requirements, Cost Principles, and Audit 
Requirements for Federal awards to non-Federal Entities (Uniform 
Guidance) record retention requirements at 2 CFR 200.334.
    <bullet> Amending the information SWAs must include in their AOP to 
include the number of full-time and part-time outreach staff that the 
State will employ and a description of how the SWA intends to staff 
significant MSFW one-stop centers in accordance with Sec.  653.111.
    <bullet> Removing ``random'' from the definition of field check to 
ensure SWAs are able to target the field checks that they conduct in 
response to known or suspected compliance issues.
    <bullet> Revising several regulations within part 658, subpart E, 
to conform with proposed revisions to definitions listed at Sec.  
651.10, remove redundancies and make other non-substantive technical 
edits, clarify or modify certain requirements, and improve equity and 
inclusion for MSFWs in the ES system.
    <bullet> Revising requirements for how ETA regional offices process 
complaints to align with the revised process SWAs must follow in 
referring nondiscrimination complaints under Sec.  658.411(c) and to 
refine other requirements applicable to regional offices.
    The Department also is making technical amendments and global edits 
to modernize the ES regulations, to clarify and use plain language, and 
to further promote equity by using gender-inclusive language throughout 
the regulations.
    In the NPRM, the Department proposed an 18-month transition period 
for States to comply with the requirements in this rulemaking. Based on 
comments received on the NPRM indicating that States would need more 
time to comply, the Department is providing 24 months to comply with 
the provisions of the final rule.
    The final rule adds severability provisions in parts 652, 653, and 
658.
    This final rule reflects changes made in response to public 
comments received on the NPRM that was published on April 20, 2022, at 
87 FR 23700. The Department received many comments from the public and 
nonprofit sectors, as well as private citizens. The Department 
considered these comments in determining this final rule, and the 
changes made to the regulatory text are detailed below in the 
Department's responses to related comments.

III. Background and Justification

    The Wagner-Peyser Act of 1933, 29 U.S.C. 49 et seq., established 
the ES program, which is a nationwide system of public employment 
offices that provide public labor-exchange services. The ES program 
seeks to improve the functioning of the nation's labor markets by 
matching job seekers with employers that are seeking workers. Section 
3(a) of the Wagner-Peyser Act directs the Secretary of Labor 
(Secretary) to assist States by developing and prescribing minimum 
standards of efficiency and promoting uniformity in the operation of 
the system of public employment offices. See 29 U.S.C. 49b(a). This 
final rule amends regulations in 20 CFR parts 651, 652, 653, and 658. 
With limited exceptions, the final rule requires States to use State 
merit staff to provide ES services, including services and activities 
under parts 653 and 658. The Department also is targeting revisions to 
the regulations at parts 651, 653, and 658. These revisions are 
intended to ensure that SWAs provide MSFWs with adequate access to ES 
services and that the role of the SMA is effective. In addition, this 
final rule amends parts 651, 652, 653, and 658 to further integrate 
gender-inclusive language. Finally, the Department is making technical 
corrections to these CFR parts to improve consistency across the parts 
and to make them easier to understand.
    Historically, the Department relied on its authority in secs. 3(a) 
and 5(b) of the Wagner-Peyser Act to require that ES services, 
including Monitor Advocate System activities for MSFWs and Complaint 
System intake, be provided by State merit-staff employees.\2\ The 
Department consistently applied this requirement, with limited 
exceptions, until 2020. Specifically, beginning in the early 1990s, the 
Department authorized demonstration projects in which it allowed 
Colorado and Massachusetts limited flexibility to set their own 
staffing requirements for the provision of ES services. Colorado was 
authorized to use county and State merit staff to deliver ES services. 
The State contracts for these services with county and State sub-
recipients, but has not allowed further sub-contracting by the sub-
recipients. Massachusetts was approved to use non-State-merit staff to 
provide ES services in just four of the State's 16 local areas. In 
these local areas, the State has generally relied on local one-stop 
career center/American Job Center (AJC) staff for ES services. In 1998, 
the Department permitted Michigan to use State and local merit-staff 
employees to deliver ES services, pursuant to a settlement agreement 
arising out of Michigan v. Herman, 81 F. Supp. 2d 840 (W.D. Mich. 
1998). Michigan was still required to use State merit staff for 
services to MSFWs, veterans, and individuals with disabilities. All 
three States continued to operate with staffing flexibility through 
their approved State plans,\3\ though all three also used State merit 
staff for the SMA position. Through rulemaking effective February 5, 
2020, the Department removed the requirement that ES services be 
provided only by State merit staff. See Wagner-Peyser Act Staffing 
Flexibility; Final Rule, 85 FR 592 (Jan. 6, 2020) (2020 Final Rule). In 
the preamble to the 2020 Final Rule, the Department explained that it 
sought to allow States maximum flexibility in staffing arrangements. 
Ibid. Accordingly, under the regulations in effect under the 2020 Final 
Rule, several States were approved to use a variety of staffing models 
to provide ES services, as described in their approved State plans.
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    \2\ Workforce Innovation and Opportunity Act; Department of 
Labor; Final Rule, 81 FR 56072 (Aug. 19, 2016) (WIOA DOL-only Rule) 
(see 20 CFR 652.215, 653.108, 653.111, 658.602).
    \3\ See WIOA DOL-only Rule, 81 FR at 56267 and 56341 (2016).
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    In light of the events of the last few years, the Department has 
reassessed the approach adopted in the 2020 Final Rule and determined 
instead to reinstate the requirement that States use State merit staff 
to deliver ES services. State merit-staffing is a generally reliable 
method to ensure quality and consistency in ES delivery, and the 
demands placed on State UI systems by the economic impact of the COVID-
19 pandemic highlighted the necessity of States to be able to rely on 
eligible ES State merit staff to be deployed to assist with UI 
activities as needed.
    In adopting this State merit-staffing requirement, the Department 
relies on its authority under secs. 3(a) and 5(b)(2) of the Wagner-
Peyser Act, as well as authority under sec. 208 of the 
Intergovernmental Personnel Act (IPA), 42 U.S.C. 4728, as amended. Each 
of these provisions, standing alone, provides the Department with the 
authority to require States to use State merit staff to provide ES 
services.
    Specifically, sec. 3(a) of the Wagner-Peyser Act requires the 
Secretary to assist in coordinating the ES offices by ``developing and 
prescribing minimum standards of efficiency.'' 29 U.S.C. 49b(a). As the 
court in Michigan v. Herman concluded, ``the language in [sec. 3(a)] 
authorizing the Secretary to develop and prescribe `minimum standards 
of efficiency' is broad enough

[[Page 82661]]

to permit the Secretary of Labor to require merit staffing.'' 81 F. 
Supp. 2d at 848.
    In addition, sec. 5(b)(2) of the Wagner-Peyser Act provides that 
the Secretary shall from time to time certify to the Secretary of the 
Treasury for payment to each State that, among other things, ``is found 
to have coordinated the public employment services with the provision 
of [UI] claimant services.'' 29 U.S.C. 49d(b). As explained previously, 
the State merit-staffing requirement would align the staffing of ES 
services with the staffing that States are required to use in the 
administration of critical UI services. Therefore, it is reasonable for 
the Department to base the finding required by sec. 5(b)(2) of the 
Wagner-Peyser Act, in part, on a State's agreement to use State merit 
staff to administer and provide ES services.
    Furthermore, sec. 208 of the IPA authorizes Federal agencies to 
require, as a condition of participation in Federal assistance 
programs, systems of personnel administration consistent with personnel 
standards prescribed by the Office of Personnel Management (OPM).\4\ In 
accordance with 5 CFR 900.605, the Department submitted the proposed 
rule to OPM for review and received approval prior to the publication 
of the NPRM.
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    \4\ 42 U.S.C. 4728(b); see also 5 CFR 900.605 (authorizing 
Federal agencies to adopt regulations that require the establishment 
of a merit personnel system as a condition for receiving Federal 
assistance or otherwise participating in an intergovernmental 
program with the prior approval of OPM).
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    In the IPA, 42 U.S.C. 4701, et seq., Congress found that the 
quality of public service could be improved if government personnel 
systems are administered consistent with certain merit-based 
principles. Requiring States to employ the professionals who deliver ES 
services in accordance with these principles would help ensure that ES 
services are delivered by qualified, non-partisan personnel who are 
directly accountable to the State. Among other things, such 
professionals would be required to meet objective professional 
qualifications, be trained to assure high-quality performance, and 
maintain certain standards of performance. See 42 U.S.C. 4701. They 
would also be prohibited from using their official authority for 
purposes of political interference, and States would be required to 
assure that they are treated fairly and protected against partisan 
political coercion. Ibid.
    The Department acknowledges that this constitutes a change in its 
position taken under the 2020 Final Rule and requires certain States to 
adjust how they deliver ES services. The Department notes that Federal 
agencies are permitted to change their existing policies if they 
acknowledge the change and provide a reasoned explanation for the 
change. See, e.g., Encino Motorcars, LLC v. Navarro, 579 U.S. 211, 221-
22 (2016). In the NPRM, the Department acknowledged the proposed policy 
change and explained the reason for the change. The ES system is 
designed to ``promote the establishment and maintenance of a national 
system of public employment service offices,'' 29 U.S.C. 49, and the UI 
and ES systems together provide a basic level of employment support for 
more than 4 million job seekers per year to enter and re-enter the 
workforce. The Department believes that it is vital that the ES be 
administered so that services are delivered effectively and equitably 
to UI beneficiaries and other ES customers. The COVID-19 pandemic and 
the ensuing demand placed on the UI system demonstrated a need for 
centrally trained, high-quality staff to be able to step in to assist 
States as needed. Further, the ES is a universal access program, and it 
is critical that it be administered by nonpartisan personnel held to 
transparent, objective standards designed to assure high-quality 
performance. A State merit-staffing requirement is a generally reliable 
method to ensure quality and consistency in delivery of ES services and 
supports the well-established connection between ES and UI services. As 
explained further in this preamble, the Department believes an 
evaluation of the alternative staffing models, though not legally 
required, is prudent to determine whether use of such alternative 
staffing models is empirically supported.
    The Department is further adjusting its position to account for the 
unique history of three States' administration of ES services. 
Colorado, Massachusetts, and Michigan have been allowed by the 
Department to use various forms of non-State-merit staff models to 
deliver ES services since the 1990s. The Department acknowledges the 
longstanding reliance interests of these three States. The final rule 
allows these States to continue to use those alternative staffing 
models, but the States must continue to use merit staff to the same 
extent they were using it prior to February 5, 2020, the effective date 
of the 2020 Final Rule. Those are the staffing models on which the 
three States have decades-long reliance. Adopting a standard that 
preserves the level of merit-staffing each of the three States had been 
implementing since the 1990s is reasonable and consistent with the 
final rule's overall State merit-staffing requirement.
    Establishing a different standard for these three States is 
supported by the text of section 3(a) of the Wagner-Peyser Act, which 
permits the Department to establish ``standards of efficiency.'' The 
Department's history of allowing these States to use alternative 
staffing models since the 1990s has created the present reality that 
requiring complete State merit-staffing in these three States would 
have a harmful effect on the States' ES services and program 
participants. While the final rule explains above the benefits of 
requiring all the other States to use State merit staff to deliver all 
ES services, and the proposed rule articulated the strong preference 
for uniformity in staffing across all States, those interests are 
outweighed by the disruptive and negative effects that a complete State 
merit-staffing requirement would have on these States' programs that 
have such long reliance on alternative staffing models.
    These three States have provided some initial justification and 
data for being able to continue using their longstanding alternative 
staffing models. These three States also provided information about the 
service disruption that would result from having to upend their 
longstanding service delivery models. However, the justifications and 
data presented do not provide clear evidence of causation. Therefore, 
the Department will further examine various staffing models and methods 
of delivering labor exchange services through a rigorous evaluation. 
Given the Department's clear and supported policy preference for State 
merit-staffing in the ES program, it logically follows that the 
Department believes it is prudent to evaluate whether alternative 
staffing models are empirically supported. The rule requires these 
States' participation in any evaluation activities about merit-
staffing, which will likely consist of a single evaluation but may span 
more than one study, including any data collection associated with 
those evaluation activities. The Department will seek required 
approvals under the Paperwork Reduction Act for data collection, as 
necessary. This plan for evaluations is consistent with the Secretary's 
authority under section 3(c)(2) of the Wagner-Peyser Act, which 
requires the Secretary to ``assist in the development of continuous 
improvement models for [the nationwide system of labor exchange 
services] that ensure private sector satisfaction with the system and 
meet the demands of jobseekers relating

[[Page 82662]]

to the system, and identify and disseminate information on best 
practices for such system.'' 29 U.S.C. 49b(c)(2). The Department will 
conduct this evaluation of the three States' provision of ES services, 
including review of services of other States that participate, as 
necessary, to determine whether such models are empirically supported.
    In the section-by-section discussion, the Department further 
explains why it is requiring that States use State merit staff to 
provide ES services.

Comments Expressing Support for the Department's Legal Authority for 
the State Merit-Staffing Requirement

    Comment: Some commenters, including unions, a State employee 
association, an advocacy organization, and private citizens, expressed 
support for the Department's authority to institute a nationwide merit-
staffing requirement in the Wagner-Peyser Act regulations for ES 
services. In particular, a State employee association, an advocacy 
organization, and private citizens agreed with the Department that 
clear legal authority for reinstituting a nationwide ES merit-staffing 
requirement is found under secs. 3(a) and 5(b) of the Wagner-Peyser 
Act, which give the Department authority to develop and prescribe 
minimum standards of efficiency for ES services and to promote 
uniformity in their administrative procedures. A union argued that the 
statutory requirement to prescribe minimum standards of efficiency and 
promote uniformity requires that States use merit staff to administer 
ES programs, citing studies the commenter said show that State merit-
staffed ES offices deliver services more equitably and effectively.
    An advocacy organization and a State employee association argued 
that the proposed merit-staffing requirement is supported by the 
historical record and reinstates the Department's longstanding 
requirement that ES services be administered by State merit staff. 
Specifically, according to these commenters, the Wagner-Peyser Act 
establishes ``a national system of public employment service offices'' 
and, because a principal component of a public system is State 
government employees who are hired and promoted on a merit basis under 
a civil service system, the Department argued in Michigan v. Herman 
that merit-based staffing is required by the Wagner-Peyser Act because 
Congress intended merit-staffing to be a key component of ``public'' 
employment service.
    Similarly, a private citizen argued that the Wagner-Peyser Act's 
use of the word ``public'' clearly falls within the word's common 
dictionary usage as something ``of or relating to government.'' Given 
that the Wagner-Peyser Act defines ``employment service office'' as ``a 
local office of a State agency,'' this commenter concluded that the 
Wagner-Peyser Act created a network of State governmental ES offices. 
Similarly, the commenter argued that the statutory text does not 
envision using local agencies to provide ES services. Referencing 1998 
and 2014 amendments to the Wagner-Peyser Act, this commenter said that 
Congress has never altered the language providing authority for the 
Secretary to require merit-staffing for ES services. In conclusion, 
this commenter argued that ``claims of flexibility do not give the 
Department sufficient legal authority to permit local agencies, 
community colleges, local governments, or other entities to [provide] 
ES [services] in substitution of state agency merit-staffed 
employees,'' although a State is free to provide additional resources 
to job seekers beyond ES-staffed services.
    A union commented that the Wagner-Peyser Act's creation of 
nationwide ES offices was intended to displace and transform the 
ineffectual system of employment placement services available to the 
jobless that existed prior to the Act's passage. The commenter 
described that system as a patchwork, fragmented, and inequitable 
system that consisted primarily of private agencies, which the 
commenter said were usually exploitative, predatory, and corrupt, as 
well as a handful of local public employment offices, which the 
commenter asserted were tainted by underfunding, patronage hiring, and 
political influence.
    Asserting that Congress has reaffirmed the Wagner-Peyser Act's 
requirement of merit-staffing over time, an advocacy organization said 
that the Intergovernmental Personnel Act of 1970 (IPA) specifically 
named the Wagner-Peyser Act as one of two acts administered by the 
Department that transferred merit authority to the Civil Service 
Commission (succeeded by OMB). Further, according to the commenter, the 
Civil Service Reform Act (CSRA) in 1978 amended the IPA to make clear 
the intent that merit system guarantees for public employees are to 
remain a condition of Wagner-Peyser Act funding to States. In support 
of this assertion, one of the commenters cited Pub. L. 95-454 (Oct. 13, 
1978), 92 Stat 1111, which the commenter stated added subsection (h) to 
42 U.S.C. 4271 to exempt the Wagner-Peyser Act's merit-staffing 
requirement, among others, from the CSRA provision otherwise abolishing 
all statutory personnel requirements established as a condition of the 
receipt of Federal grants-in-aid by State and local governments.
    Additionally, a State employee association asserted that the State 
merit-staffing requirement is rooted in the Wagner-Peyser Act's 
provisions giving the Department the authority to develop and prescribe 
minimum standards of efficiency for public employment services and to 
promote uniformity in their administrative procedure. Finally, these 
commenters remarked that, when the Department attempted to change its 
legal interpretation of the Wagner-Peyser Act in 2006, Congress 
reaffirmed its position by blocking the proposal by including language 
in the Fiscal Year (FY) 2007 and subsequent annual appropriations to 
prohibit the Department from taking such action. A State employee 
association commented that this 90-year history of the ES State merit-
staffing requirement remaining in place through statutory amendments 
and court decisions is highly suggestive of a Congressional intent to 
require the delivery of ES services by merit-based employees.
    An advocacy organization and a State employee association discussed 
additional components of the Wagner-Peyser Act historical record that 
they said supported the necessity of delivery of ES services by 
qualified, non-partisan personnel who are directly accountable to the 
State. For example, the commenters said the first ES director concluded 
that, to avert patronage and favoritism in hiring, State ES programs 
were legally required to adopt merit personnel systems for appointments 
and promotions. These commenters and a union also stated that, as 
States adopted companion laws to conform with the Wagner-Peyser Act in 
the 1930s, the Department withheld certification of nine States until 
they provided assurances that they would merit staff any State-
administered public employment office.
    A State employee association quoted the CSRA implementing 
regulations as describing the Wagner-Peyser Act merit-staffing 
requirement as ``a statutory requirement for the establishment and 
maintenance of personnel standards on a merit basis'' in Wagner-Peyser 
Act-funded programs (5 CFR part 900, subpart F, Appendix A). Further, 
this commenter quoted the final rule implementing the Workforce 
Investment Act of 1998 (WIA) in which the Department responded to 
inquiries asking if States may seek a waiver of the merit-staffing 
requirement for its ES program by stating, ``The requirement that 
Wagner-Peyser Act services be

[[Page 82663]]

provided by State merit staff employees derives from sections 3 and 
5(b)(1) of the Wagner-Peyser Act. Accordingly, we do not intend to, nor 
do we have authority to entertain or grant waivers of the Wagner-Peyser 
Act merit-staffing requirement.'' 65 FR 49294, 49306 (Aug. 11, 2000).
    Citing the public comment it submitted on the 2019 proposal to 
allow ES services to be provided under flexible staffing models, an 
advocacy organization said that, for more than 85 years, Congress acted 
many times to require merit-staffing in the ES program to guarantee 
workers receive unbiased and high-quality employment services.
    Response: The Department generally agrees with these commenters 
that the Department has authority to require State merit-staffing under 
the Wagner-Peyser Act and the IPA. The Department also generally agrees 
that Congressional actions over time have affirmed the Department's 
authority to require State merit-staffing. The Department weighed this 
authority and historic precedent when it proposed uniform State merit-
staffing in the NPRM. As explained above, the Department also weighed 
the public comments that described the detrimental effects that the 
uniform requirement would have on the three States with longstanding 
reliance on using alternative staffing models. Congress' decision not 
to disturb these three States' alternative staffing models when it 
passed both WIA and WIOA suggests Congressional acquiescence with these 
States' arrangements. The Department is therefore returning to the 
longstanding requirement of State merit-staffing for ES, with the 
limited exception that Colorado, Massachusetts, and Michigan may 
continue to use the alternative staffing models they had been using 
before the 2020 Final Rule became effective. This includes the 
requirement that these three States use merit-staffing to deliver ES 
services to the same extent they had been using it.

Comments Expressing Concerns About the Department's Legal Authority

    Comment: Some commenters, including an association of workforce 
boards, a think tank, and a one-stop center employee, expressed doubts 
about the Department's interpretation of its legal authority to require 
nationwide merit-staffing for ES services. In particular, an 
association of workforce boards and a think tank commented that the 
Wagner-Peyser Act does not mandate a one-size-fits-all staffing model. 
Specifically, an association of workforce boards asserted that the 
Wagner-Peyser Act does not explicitly require that ES staff in States 
be merit-based, nor do existing statutes speak specifically to State 
merit-staffing requirements for ES offices. This commenter stated that 
the Michigan v. Herman court suggested that the Department may 
interpret section 3(a) of the Wagner-Peyser Act to permit staffing 
flexibility, based on the court's statements that the Wagner-Peyser Act 
``does not explicitly require merit-staffing'' and that the language of 
section 3(a) is ``broad enough to permit [the Department] to require 
merit-staffing.'' Further, the commenter remarked that, since the 
Michigan v. Herman ruling, the Department has twice affirmed that 
Federal law does not require delivery of ES services by State merit 
staff: (1) allowing existing exemptions from ES State merit-staffing 
requirements to continue (2016), and (2) the 2020 Final Rule. The 
commenter concluded that dictating to States and local communities how 
to appropriately staff ES offices is a Departmental interpretation that 
will cause significant disruption and harm to the workforce system.
    Response: The Department proposed in the NPRM to require that all 
States use State merit staff to provide ES services. The Department has 
considered the alternative viewpoints provided. As these commenters 
noted, the Wagner-Peyser Act does not require the use of State merit 
staff for ES services, but the Act does provide the Secretary with 
discretion to require State merit-staffing, as explained above. State 
merit-staffing for ES services is widely used in many States and its 
requirement will not create disruption for the vast majority of States. 
Upon consideration of the public comments that described the 
detrimental effects that the State merit-staffing requirement would 
have on the three States with longstanding reliance on alternative 
staffing models, the Department will allow the three States with such 
reliance to continue use of the models they had been using prior to 
February 5, 2020, the effective date of the 2020 Final Rule. Further, 
the Department is committed to evaluating ES programs in these States 
to determine whether such models are empirically supported. With 
respect to States that may have adopted ES staffing flexibilities as a 
result of the 2020 Final Rule, the Department understands there may be 
some additional costs associated with the transition from non-merit 
staff to State merit staff. In response to comments, the Department is 
providing a 24-month compliance period from the effective date of this 
final rule to minimize disruption of services in those States.

IV. General Comments on the Proposed Rule

    The NPRM, published on April 20, 2022, invited written comments 
from the public concerning the proposed rulemaking; the comment period 
closed on June 21, 2022. The comments received on the NPRM may be 
viewed at https://www.regulations.gov by entering docket number ETA-
2022-0003.
    The Department received timely comment submissions from 1,090 
commenters, of which 776 were unique. The Department identified 12 form 
letter campaigns, which were read and considered with the other 
comments received. The Department also received additional comments 
that were duplicates or not related to the subject of this rule. The 
commenters represented a range of stakeholders from the public and 
nonprofit sectors. Public sector commenters included State and local 
government agencies, local workforce development boards, and one-stop 
operators. Nonprofit sector commenters included public policy 
organizations, advocacy groups, national and local labor unions, and a 
trade association. Of the unique comments, nearly one-third came from 
SWAs. The Department also received several comments from private 
citizens.
    These comments are addressed in the summary of general comments and 
the section-by-section discussion. About half of the unique comments 
supported aspects of the proposal but opposed others, while a smaller 
number conditioned their support for the proposal on the Department 
adopting certain changes in this final rule.

Summary of General Comments on the Proposed Rule

    Comment: A State government agency expressed its support for the 
rule on the grounds that the State already provides ES services with 
State merit staff only and thus the rule would require no change in its 
operations.
    Several commenters, mostly private citizens, expressed general 
support for the proposed merit-staffing requirement without providing 
detailed rationale or supporting data. Some arguments provided by 
commenters supporting the rule included:
    <bullet> States are better equipped than local areas or contractors 
to administer ES services professionally, consistently, and with 
greater transparency and accountability.
    <bullet> A State merit-staffing requirement would ensure the (UI) 
system remains effective in times of need.
    <bullet> State merit staff have consistently provided job seekers 
with career

[[Page 82664]]

enhancement and reemployment services to ensure they have productive 
lives.
    A union called the proposed rule a policy correction from the 2020 
Final Rule and agreed the proposed rule is appropriate, given the 
environment in which that rule was developed (historically low demand 
for ES services and UI) and the subsequent severe labor market impacts 
of the COVID-19 pandemic that sent demand for ES and UI services 
surging. Similarly supporting the return to the pre-2020 standard for 
ES staffing, a farmworker advocacy organization commented that the 
decision to depart from a merit-based staffing model was unsupported by 
the Department's own findings on the efficiency of merit-based 
staffing. Specifically, this commenter cited a 2004 ETA study that they 
said compared merit-based ES staffing models with non-merit models, and 
it found that the States with non-merit models listed significantly 
fewer jobs and fewer referrals and job placement than merit-based 
staffing States.
    Response: The Department is adopting the proposed State merit-
staffing requirement as a generally reliable method to ensure quality 
and consistency in ES delivery and one that supports the well-
established connection between ES and UI services. The Department notes 
that it has allowed three States to use alternative staffing models for 
decades, and these States have provided some justification and data for 
being able to keep such models. The States also provided information 
about the service disruption that would result from having to upend 
their longstanding service delivery models. However, the justifications 
and data presented do not provide clear evidence of causation; that is, 
no compelling data emerged in the public comment period or in previous 
research that showed that alternative staffing models are the cause of 
higher or more consistent employment outcomes. While the Department 
recognizes the decades-long practice on which three States rely, such 
partial and correlation-only data are not sufficient to expand these 
models to other States, especially not when, as explained in the NPRM, 
fluctuations in UI demand from a pandemic or natural disasters clearly 
show a need for centrally trained, high-quality staff to be able to 
step in to bolster State review of UI claims and appeals if needed.
    Therefore, the Department is adopting the State merit-staffing 
requirement as proposed with a partial adjustment: the final rule is 
requiring all States, except Colorado, Massachusetts, and Michigan, to 
use State merit staff to provide ES services. The Department will 
further examine various staffing models and methods of delivering labor 
exchange services through a rigorous evaluation, as discussed above. 
Given the Department's clear and supported policy preference for State 
merit-staffing in the ES program, the Department believes it is prudent 
to evaluate the delivery of ES services using the experience of States 
operating longstanding alternative staffing models to determine whether 
such models are empirically supported. The three States with decades-
long reliance on using alternative staffing models may use the same 
service-delivery models they used prior to February 5, 2020, and will 
be required to participate in this forthcoming evaluation activities. 
All other States will have 24 months to comply with the requirement to 
use State merit staff to provide all ES services.
    Comment: Several commenters, including one-stop center staff and 
private citizens, opposed the proposed merit-staffing requirement. Some 
arguments provided by commenters against the proposed merit-staffing 
requirement included:
    <bullet> Commenters from States operating longstanding alternative 
staffing models stated that they view local resource centers and the 
services they provide as essential.
    <bullet> Commenters from States operating longstanding alternative 
staffing models stated that the change would ruin the one-stop service 
model that provides seamless, equitable services that facilitate real-
time, meaningful referrals.
    <bullet> Commenters stated that the Federal government has 
consistently demonstrated inadequacy when it comes to administration of 
programs that directly affect those at the local level.
    <bullet> Commenters from States operating longstanding alternative 
staffing models stated that there is great value in staffing local 
offices with local staff rather than State merit employees. Each 
individual and business has their own unique challenges to progress, 
development, and success, which can only be understood and addressed at 
the local level.
    <bullet> Commenters from States operating longstanding alternative 
staffing models stated that the proposed change would redirect 
responsibilities and funds to the State, which would be a mistake. The 
commenters said that the current system at the local level is working 
well without any issues.
    <bullet> Commenters from States operating longstanding alternative 
staffing models stated that the proposed change would harm job seekers 
and businesses, resulting in lower quality and fewer services being 
provided, including services to veterans, immigrant and refugee 
navigator services, Clean Slate services for formerly incarcerated 
people, support navigating the UI benefits process, job training, 
career events, job fairs, and industry led collaboratives.
    <bullet> Commenters from States operating longstanding alternative 
staffing models stated that the proposed rule would have a negative 
impact on local communities, including causing job centers to close and 
the loss of many jobs. The loss of centers would also impact students 
who rely on local offices to assist with educational support and other 
assistance.
    Many private citizens from States operating longstanding 
alternative staffing models provided personal experiences asserting the 
value and need for services at one-stop centers, which they stated 
would be impacted if a State merit-staffing requirement changed the 
availability of services or the number of one-stop centers. Other 
commenters, including one-stop center staff, described their experience 
as local merit staff or working with the workforce development system 
and the positive impact on the community.
    Response: The Department proposed to require that all States use 
State merit staff to provide ES services and has considered reasons 
provided by these commenters for opposing the proposed rule. The 
proposal to require State merit staff does not preclude the State from 
providing services locally, and the vast majority of States provide 
high quality services in one-stop centers with a mix of State merit 
staff delivering ES locally and other staff providing other services 
locally. Without evidence that alternative staffing models directly 
cause higher employment outcomes, balanced against widespread success 
in delivering services while maintaining State merit staff for ES, and 
further balanced by the need for ES State merit staff to be available 
for surges in UI claims and appeals, the Department is generally 
adopting the proposed requirement that States use State merit staff to 
provide ES services.
    However, the Department recognizes that three States (Colorado, 
Massachusetts, and Michigan) have been allowed to administer ES 
services using alternative staffing models for decades. The Department 
understands that these States' long experience with their particular 
models results in an affinity and preference for their model. During 
the comment period, these States

[[Page 82665]]

provided information that the State merit-staffing requirement proposed 
to be applied to all States would have extremely detrimental impacts on 
the provision of ES services in these three States because of the facts 
and circumstances, particularly the decades-long reliance interests, in 
these States. Based on this information, the Department is adjusting 
the final rule from the original proposal. The final rule requires all 
States, except the three States with decades-long reliance on using 
alternative staffing models, to use State merit staff to provide ES 
services. The expansion of alternative staffing models to additional 
States occurred without study, before the landscape-altering impact of 
the pandemic on the UI and workforce system. The Department will 
require the three States to participate in a rigorous evaluation of the 
services provided in the three alternative States to determine if using 
alternative models benefit ES service delivery. All other States will 
have 24 months to comply with the requirement to use State merit staff 
to provide ES services.
    Comment: Several commenters, including private citizens, presented 
a mixed stance or unclear position on the proposed rule. Many 
commenters, including private citizens, employers, and one-stop center 
staff, discussed Michigan's public workforce system, known as Michigan 
Works!, without addressing the proposed rule. Other commenters, 
including a trade association, career service provider, and employer, 
generally discussed the importance of programs or ``communities.'' A 
one-stop center employee commented that ES services offer job seekers 
help navigating the UI process.
    Response: The Department agrees that one-stop centers are valuable 
assets in a community, often provide services to a wide range of 
individuals, and are instrumental in shaping a local workforce's skills 
as part of larger economic development. The Department also notes that 
one-stop centers play this role across the country, including in the 
vast majority of States that maintain State merit staff in delivering 
ES services. Changes in how a one-stop center operates can impact a 
local community, and thus the Department weighs such impacts very 
carefully in its regulations. The Department recognizes the significant 
challenges that a return to State merit-staffing would present for 
States with decades-long reliance on using alternative models. 
Therefore, after serious consideration of comments received from the 
public, the Department is requiring all States to use State merit staff 
to deliver ES services, except the three States that have been allowed 
to use alternative staffing models for decades. Due to their 
longstanding reliance, these States are permitted to use merit-staffing 
flexibility to the same extent the Department allowed them to use it 
before the 2020 Final Rule became effective, but the Department is not 
permitting them to expand their staffing flexibility any further.
    Comment: An anonymous commenter asked whether State merit staff 
will be required to colocate in one-stop centers.
    Response: WIOA requires ES offices to be colocated in AJCs, also 
known as one-stop centers, regardless of the staffing model used. This 
is unchanged under this final rule.
    Comment: An anonymous commenter asked whether Federal 
appropriations will provide adequate resources to support the 
recruitment, hiring, and training of ES State merit staff or if the 
costs will be assumed by the States.
    Response: Recruiting, hiring, and training ES staff is an allowable 
cost for ES grants to States. In considering this comment, the 
Department determined that a greater amount of Federal funding is 
available now compared to other years. The FY 2022 and FY 2023 
appropriations each provided an increase for Wagner-Peyser Employment 
Service grants to States over the years prior. In FY 2023, Congress 
appropriated $5 million more than in FY 2022 for the ES formula grants 
to States, which are the grants allotted to States to operate the ES. 
With the increased funding, the Department expects the ES to serve 
approximately 20,000 more individuals nationwide in 2023 (2,913,438). 
The estimates are not dependent on the type of staffing model a State 
uses to deliver ES services. The States' latest financial reports show 
that many States, including those States that must make changes to come 
into compliance with the final rule's State merit-staffing requirement, 
still have previous years' ES grant funds not yet expended. One of 
these States has expended under half of its Program Year (PY) 2022 
allotment, and all of these States had lower expenditure rates in PY 
2022 than in previous years. The Department notes that many States have 
used general funds made available under the American Rescue Plan Act 
and other resources to bolster overall workforce development services. 
Therefore, compared to other years, this is an appropriate time for a 
transition back to the use of State merit staff because of the above 
average resources available.
    Comment: An anonymous commenter asked what impact implementation of 
the proposed rule will have on the monitor advocate requirements.
    Response: Because the Monitor Advocate System is a part of the 
Wagner-Peyser ES, the requirement for States to use State merit staff 
for ES services also applies to Monitor Advocate services described at 
parts 653 and 658. Aside from Colorado, Massachusetts, and Michigan, 
the Department is requiring States to use State merit staff to conduct 
outreach to MSFWs, as described at Sec.  653.107. Colorado, 
Massachusetts, and Michigan must use merit-staffing for MSFW outreach 
to the same extent authorized in their approved longstanding 
alternative staffing model. This means that if the State was required 
to use State merit staff for MSFW outreach (as in the case of Michigan) 
prior to February 5, 2020, then the State must continue to use State 
merit staff for MSFW outreach. If the State was permitted to use a 
combination of local merit staff and State merit staff for MSFW 
outreach prior to February 5, 2020, then the State must continue using 
merit staff for MSFW outreach. The Department is also requiring all 
States to use State merit staff to fulfill their SMA responsibilities, 
as described at Sec.  653.108. Colorado, Massachusetts, and Michigan 
all use State merit staff for the SMA position as part of their 
longstanding staffing model and are required to continue doing so. All 
States will have 24 months to comply with this final rule.
    Comment: The Department received several comments that were beyond 
the scope of the proposed rule and included issues with the processing 
of UI claims, the politics of social justice campaigns, the status of 
pandemic unemployment assistance, and the actions of President Biden's 
administration generally.
    Response: These are issues that cannot be resolved or implemented 
through this regulatory process or are not within the Department's 
purview.

V. Section-by-Section Discussion of Final Rule

    The discussion below details the decisions the Department made in 
adopting the final rule text. It responds to section-specific comments 
and explains any changes made in response to those comments. If the 
Department did not receive comments regarding a particular section, 
that section is not discussed in detail below, and the final rule 
adopts that section as proposed for the reasons set forth in the NPRM. 
The Department also has made nonsubstantive changes to the

[[Page 82666]]

regulatory text to correct grammatical and typographical errors, in 
order to improve the readability and conform the document 
stylistically, that are not discussed in detail below.

A. Technical Amendments and Global Edits

    In the NPRM, the Department proposed several technical amendments 
and global changes, as discussed in detail below. The Department did 
not receive substantive comments on these proposed changes, and it 
adopts them as proposed in the final rule.
    To conform with the proposed changes to the definition of Wagner-
Peyser Act Employment Service (ES) also known as Employment Service 
(ES) in Sec.  651.10, the Department is making technical changes to 
replace the phrases ``employment services,'' ``Wagner-Peyser Act 
services,'' and ``services provided under the Wagner-Peyser Act'' with 
``ES services.'' Changes also have been made to replace the phrase 
``employment office'' with ``ES office,'' and ``Wagner-Peyser Act 
participants'' with ``ES participants.'' These changes will simplify 
and standardize the use of terminology. The language is also intended 
to improve usage of plain language within the regulations. Technical 
changes to articles, specifically changing ``a'' to ``an'' where 
necessary, have been made as well when preceding ``ES office.'' These 
changes have been made in Sec.  651.10 within the definitions of 
applicant holding office, Employment Service (ES) office, field visits, 
outreach staff, placement, and reportable individual, in addition to 
the changes in the definition of Wagner-Peyser Act Employment Service 
(ES) also known as Employment Service (ES). Conforming changes have 
also been made to the subpart heading at part 652, subpart C, and 
within the regulatory text at Sec. Sec.  652.205, 652.207, 652.215, 
653.107, 653.108, 658.411, 658.502, 658.602, and 658.603.
    The Department is adopting several technical edits to refine 
gender-inclusive language within the regulatory text while maintaining 
plain language principles. Throughout parts 651, 653, and 658, the term 
``he/she'' was used to denote an individual of unknown gender. Using 
terms with a slash may not be in keeping with plain language principles 
and may also exclude people who are nonbinary. The Department has made 
three technical edits to replace ``he/she'' with more inclusive 
language employing plain language principles.
    First, where ``he/she'' refers to an individual in their 
professional capacity, the Department uses their job title instead of a 
pronoun. These edits largely affect regulations impacting the National 
Monitor Advocate (NMA) or the Regional Monitor Advocate (RMA). In these 
cases, ``he/she'' has been replaced with ``the NMA'' or ``the RMA'' as 
appropriate and ``his/her'' with the possessive pronoun ``their.'' 
These edits are made as proposed at Sec. Sec.  658.602 and 658.603.
    Second, where ``he/she'' refers to an employer that is not an 
individual person, the Department uses the pronoun ``it.'' Where the 
possessive pronouns ``his/her'' were used, the Department proposed 
using ``its.'' This is appropriate because employers are entities, not 
individuals, and the proper pronoun is ``it.'' This edit is made as 
proposed at Sec. Sec.  658.502 and 658.504.
    In all other cases where ``he/she'' was used, the Department uses 
the pronoun ``they'' in its capacity as a gender-inclusive third-person 
singular pronoun but conjugated with third-person plural verbs. Where 
the possessive pronouns ``his/her'' were used, the Department proposed 
using ``their.'' These changes are designed to remove binary gender 
language so that the regulatory text is gender inclusive. The 
Department makes these changes as proposed in Sec.  651.10 in the 
definition of seasonal farmworker. Edits are also made as proposed to 
Sec. Sec.  653.107, 653.108, 653.111, 653.501, 653.502, 658.400, 
658.410, 658.411, 658.421, 658.422, 658.602, 658.603, 658.702, 658.705, 
658.706, and 658.707.
    In addition, the Department replaces the words ``handle'' and 
``handled'' with ``process'' and ``processed,'' as appropriate, to 
clarify that actions by ES staff and Federal staff must follow the 
processing requirements listed throughout part 658, subparts E and H, 
which use the word ``process.'' The word ``handle'' does not have a 
specific meaning in the regulatory text and may be unclear to SWAs.
    In some instances, the Department also made conforming technical 
amendments to correct grammar in the regulations, as needed, because of 
these changes. In addition to such conforming technical amendments, the 
Department added and removed commas throughout the regulatory text to 
improve clarity and readability. These global changes and technical 
amendments described in this section are not explicitly identified 
later in the section-by-section discussion.
    Finally, the Department is correcting the citation for its 
rulemaking authority for parts 651 and 652.

B. Part 651--General Provisions Governing the Wagner-Peyser Act 
Employment Service

    Part 651 (Sec.  651.10) sets forth definitions for parts 652, 653, 
654, and 658. In the NPRM, the Department proposed to define several 
new terms in this section and to make revisions to a number of other 
terms that were already defined in this section. The Department 
received comments on some of the proposed additions and revisions. 
After carefully considering these comments, the Department has decided 
to adopt most of the additions and revisions as proposed, with 
exceptions, as discussed in detail below.
Apparent Violation
    The Department proposed to add a definition for apparent violation 
to clarify that the term means a suspected violation of employment-
related laws or ES regulations, as set forth in Sec.  658.419.
    Comment: A State government agency appreciated the Department's 
efforts to define apparent violation but felt that additional 
clarification was required to aid implementation. This commenter 
suggested that the Department clarify the proposed definition of 
apparent violation by adding the following language at the end: ``for 
which ES staff observes, has reason to believe, or is in receipt of 
information that a violation has occurred.''
    Response: The Department agrees that the proposed definition for 
this term should be clarified by specifying that ES staff process 
apparent violations. In reviewing the commenter's suggestion, the 
Department further identified that it would be beneficial to include in 
the definition that apparent violations relate to information received 
about suspected employer noncompliance, as Sec.  658.419 has 
historically described. Additionally, upon further review of the NPRM, 
the Department is further clarifying the definition of apparent 
violation to state explicitly that the definition does not include 
complaints as defined in Sec.  651.10. This change is meant to make the 
distinction between complaints and apparent violations clearer. The 
Department is also removing the parenthetical ``as set forth in Sec.  
658.419 of this chapter'' because it is unnecessary with the changes 
the Department is making in Sec.  658.419 to be more clearly consistent 
with this definition. Accordingly, the Department has decided to amend 
the definition of apparent violation adopted in this final rule to mean 
``a suspected violation of employment-related laws or employment 
service (ES) regulations by an employer, which an ES staff member

[[Page 82667]]

observes, has reason to believe, or regarding which an ES staff member 
receives information (other than a complaint as defined in this 
part).''
Applicant Holding Office
    The Department proposed to amend the definition of applicant 
holding office to replace ``a Wagner-Peyser Employment Service Office'' 
with ``an ES office,'' and did not receive any comments on this 
proposed change. This change is consistent with the changes proposed to 
the definition of Wagner-Peyser Employment Service (ES) also known as 
Employment Service (ES). The Department adopts the revision to 
``applicant holding office'' as proposed.
Bona Fide Occupational Qualification (BFOQ)
    As noted in the preceding section on technical amendments and 
global edits, the Department added commas throughout the regulatory 
text to improve clarity and readability, including in the first 
sentence of the definition of bona fide occupational qualification 
(BFOQ). The Department did not receive any comments on this proposed 
change. In this final rule, the Department adds a necessary cross-
reference to the EEOC's regulation regarding national origin found at 
29 CFR part 1606 and corrects the cross-reference to the EEOC's BFOQ 
regulation found at 29 CFR part 1627.
Career Services
    The Department proposed to amend the definition of career services 
to refer to WIOA by its acronym rather than its full title because the 
full title is previously spelled out at the beginning of this section. 
The Department did not receive any comments on this proposed change and 
adopts it as proposed.
Clearance Order
    The Department proposed to amend the definition of clearance order 
to add a citation to the Agricultural Recruitment System (ARS) 
regulations at part 653, subpart F. The purpose of this addition is to 
clearly identify the ARS regulations to which the term refers. The 
Department did not receive any comments on this proposed change and 
adopts it as proposed.
Complaint System Representative
    The Department proposed to amend the definition of Complaint System 
Representative to specify that the Complaint System Representative must 
be trained. The addition of the word ``trained'' makes the definition 
consistent with the requirement in Sec.  658.410(g) and (h) that 
complaints are processed by a trained Complaint System Representative. 
The Department also proposed to remove the words ``individual at the 
local or State level'' due to proposed changes to the definition of ES 
staff. The Department did not receive any comments on the changes 
proposed to the definition of complaint system representative. While 
the Department is not adopting the changes that it proposed to the 
definition of ES staff, the reference to an ``individual at the local 
and State level'' in the definition of complaint system representative 
is not necessary regardless of whether the Department revises the 
definition of ES staff. Accordingly, the Department adopts the proposed 
revisions to the definition of complaint system representative, 
including the removal of these words, without change.
Decertification
    The Department proposed to amend the definition of Decertification 
to specify that the Secretary to which this definition refers is the 
Secretary of Labor. The Department did not receive any comments on this 
proposed change and adopts it as proposed.
Employment and Training Administration
    The Department proposed to amend the definition of Employment and 
Training Administration (ETA) to remove the words ``of Labor'' after 
``Department'' because Department is previously defined in this section 
as ``the United States Department of Labor.'' The Department did not 
receive any comments on this proposed change and adopts it as proposed.
Employment Service (ES) Office and Employment Service (ES) Office 
Manager
    The Department proposed to amend the definition of Employment 
Service (ES) office to replace ``Wagner-Peyser Act'' with ``ES,'' to 
align with other proposed changes to the regulatory text. The 
Department further proposed to amend the definition of Employment 
Service (ES) Office Manager to replace the phrase ``all ES activities 
in a one-stop center'' with the phrase ``ES services provided in a one-
stop center,'' to align with other proposed changes to the regulatory 
text. In the same definition, the Department also proposed to replace 
``individual'' with ``ES staff person'' to clarify that the ES Office 
Manager must be ES staff, as defined in this section.
    Comment: Several commenters, including a one-stop center employee, 
supported the requirement in the definition of Employment Service (ES) 
office that it be colocated in a one-stop center, saying this is part 
of Michigan's current practice. However, the commenters expressed 
concern about the term Employment Service (ES) Office Manager, arguing 
that it is misleading and implies greater authority than may be 
appropriate for onsite one-stop center ES staff.
    Response: The Department acknowledges the comment but notes that 
there is no requirement for the ES Office Manager to be located onsite. 
ES Office Managers are responsible for all ES services provided in a 
one-stop center. It is possible for one ES Office Manager to manage 
more than one ES Office; however, each ES Office must have an assigned 
ES Office Manager. The Department adopts the change as proposed.
Employment Service (ES) Staff
    The Department proposed to amend the definition of Employment 
Service (ES) staff in two ways: first, by replacing the phrase 
``individuals, including but not limited to State employees and staff 
of a subrecipient,'' with ``State government personnel who are employed 
according to the merit system principles described in 5 CFR part 900, 
subpart F--Standards for a Merit System of Personnel Administration, 
and'' to conform with the imposition of the merit-staffing requirement 
proposed in Sec.  652.215; and, second, by deleting the phrase ``to 
carry out activities authorized under the Wagner-Peyser Act,'' because 
this language is unnecessary as parts 652, 653, and 658 describe the 
activities and services that ES staff may or must carry out. The 
proposal also added that ES staff includes a SWA official.
    Comment: Multiple commenters, including a trade association, a one-
stop center employee, and an advocacy organization, recommended the 
Department expand the definition of Employment Service (ES) staff to 
include local merit staff in addition to State merit staff. The trade 
association reasoned that a more expansive definition is needed in 
light of the nationwide employment crisis and to enable the hiring of 
qualified local personnel. A group of Colorado local government 
employees also in favor of expanding the definition described the 
braided services they provided to a job seeker who needed extra 
support, arguing that the individual likely would not have received the 
same opportunities from State merit staff. Some commenters and a one-
stop center employee asked the Department to explicitly state in the 
final rule that ES

[[Page 82668]]

staff should be a part of the local AJC, arguing that standalone ES 
offices undermine the WIOA one-stop concept and hinder access to 
comprehensive services for job seekers and employers.
    A State government agency requested guidance on which 
classifications of ES staff would need to be cross-trained, noting that 
the NPRM only defines ES staff as those who are funded, in whole or in 
part, by Wagner-Peyser Act funds. The commenter stated that in their 
State, some workers may meet this definition of ES staff but only 
perform administrative functions.
    Response: The Department has considered the comments recommending 
expanding the definition of ES staff to include local merit staff and 
requesting clarification regarding which staff are included in the 
definition. Because the Department is adopting the proposed State 
merit-staffing requirement with the limited exception that Colorado, 
Massachusetts, and Michigan may continue to use alternative staffing 
models, the Department is removing the reference to merit system 
principles from the definition of ES staff. The final rule defines ES 
staff to mean ``Individuals who are funded, in whole or in part, by 
Wagner-Peyser Act funds to carry out activities authorized under the 
Wagner-Peyser Act.'' The Department is not adopting the proposal that 
would have added that ES staff includes a SWA official because SWA 
officials may include individuals funded by programs other than Wagner-
Peyser. In response to the comment stating the final rule should 
require that ES staff be a part of the local AJC because stand-alone ES 
offices undermine the WIOA one-stop concept, the Department notes that 
the existing regulations at 20 CFR 652.202 and 678.315 state that 
stand-alone ES offices are not permitted, and States must colocate ES 
offices with one-stop centers. In response to the comment inquiring 
about cross-training, the Department notes that, while there are 
benefits to cross-training, the NPRM did not propose requiring States 
to cross-train employees nor does this final rule require cross-
training.
Field Checks
    The Department proposed several amendments to the definition of 
field checks. First, the Department proposed to replace the term ``job 
order'' with ``clearance order,'' which is more accurate because field 
checks must be conducted on clearance orders as defined in Sec.  
651.10. Second, the Department proposed to clarify that field checks 
may be conducted by non-ES State staff, in addition to ES or Federal 
staff, where the SWA has entered into an arrangement with a State or 
Federal enforcement agency (or agencies) for their enforcement agency 
staff to conduct field checks. Third, the Department proposed to remove 
the word ``random'' from the existing definition to clarify that the 
selection of the clearance orders on which the SWA will conduct field 
checks need not be random, though random field checks may still occur, 
and to clarify that field checks may be targeted, where necessary, to 
respond to known or suspected compliance issues.
    Comment: A State government agency supported the revised definition 
of field checks but requested that the Department clarify in the rule 
or guidance either the circumstances that warrant targeted field checks 
or the responsibility of States to define the circumstances in policy. 
Another State government agency stated that the proposal to amend the 
definition of field checks to allow non-ES State staff to conduct field 
checks would necessitate coordination, training, and reporting to 
ensure that non-ES staff perform field checks properly and timely. The 
agency recommended that the Department remove the language allowing 
non-ES staff to perform field checks. A farmworker advocacy 
organization also supported the proposal to remove the word ``random'' 
from the definition of field checks, which it said would help improve 
protections for farmworkers. The organization stated that it believed 
the Department should go further to expand the definition of field 
checks to include locations beyond where ES placements have been made, 
stating that the ES placement limitation significantly reduces the 
number of worksites eligible for these essential compliance checks and 
incentivizes employers to hire H-2A workers--whose employment does not 
currently create the possibility of a field check--instead of hiring 
U.S. workers through the ES.
    Response: Regarding the request for clarification on the 
circumstances that warrant targeted field checks, the Department 
clarifies that the circumstances must relate to the terms and 
conditions on the clearance order. Thus, where it is known or suspected 
that wages, hours, and working and housing conditions are not being 
provided as specified in the clearance order, a targeted field check 
may be warranted. The Department will issue guidance on this change.
    Regarding the recommendation that the Department remove the 
language allowing non-ES staff to perform field checks, the Department 
notes that this proposed revision to the definition of field checks is 
not a new requirement. Rather, it is intended to align the definition 
with the existing regulation at Sec.  653.503(e), which allows SWA 
officials to enter into formal or informal arrangements with 
appropriate State and Federal enforcement agencies where the 
enforcement agency staff may conduct field checks instead of and on 
behalf of the SWA, as described in Sec.  653.503(e). The Department, 
therefore, declines to adopt this recommendation, and maintains that 
non-ES staff may conduct field checks under certain circumstances.
    Regarding the recommendation that the Department expand field 
checks to locations beyond where ES placements have been made, the 
Department acknowledges the concerns raised by the farmworker advocacy 
organization regarding the limited instances in which a SWA may conduct 
field checks to evaluate employer compliance but disagrees that 
existing field check requirements incentivize employers to hire H-2A 
workers over U.S. workers. The Department agrees that compliance 
monitoring is essential, but notes that field checks are not the sole 
means by which such monitoring occurs, and employers are prohibited 
from rejecting able, willing, and qualified U.S. workers (referred to 
them through the ES or otherwise) in favor of H-2A workers. The 
Department further notes that field checks only pertain to placement of 
U.S. workers via the ARS. The Department's Wage and Hour Division (WHD) 
conducts investigations and evaluates agricultural employers' 
compliance with the terms and conditions of the H-2A program (including 
H-2A employers' compliance with the terms and conditions that they 
offer in clearance orders) (see 29 CFR part 501). To the extent the 
advocacy organization is recommending field checks for H-2A employment, 
the operative regulations are outside the scope of this rulemaking and 
the Department declines to adopt this recommendation. The Department 
adopts the changes to this definition as proposed in the NPRM.
Field Visits
    The Department proposed several amendments to the definition of 
field visits. First, the Department proposed to clarify that field 
visits are announced appearances by SMAs, RMAs, the NMA, or NMA team 
members, in addition to outreach staff, to clarify which Monitor 
Advocates may conduct field visits and that the appearances are 
announced (and not unannounced, as with the proposed definition of 
field checks). Second, the Department proposed to

[[Page 82669]]

replace the reference to ``employment services'' with ``ES services'' 
to conform with the use of the ``ES'' abbreviation throughout the 
regulatory text. Third, the Department proposed an amendment to specify 
that field visits include discussions on farmworker rights and 
protections, to help ensure that these issues are consistently 
addressed.
    Comment: A farmworker advocacy organization supported the proposal 
to amend the definition of field visits to include discussions on 
farmworker rights and protections. The organization agreed with the 
Department's observation that outreach staff and SMAs do not always 
discuss farmworker rights and protections during field visits as part 
of broader discussions on ES services. A State government agency 
requested that the Department clarify the role of monitor advocates 
with respect to field visits. The agency stated that the Department's 
intent to refocus monitor advocate responsibilities on monitoring 
appears to be contradicted by its expectation that monitor advocates 
conduct more field visits, which is not a monitoring activity. The 
commenter asked the Department to clarify that the monitor advocate's 
role in field visits is to monitor that ES staff conduct field visits 
in accordance with part 653.
    Response: The Department appreciates the advocacy organization's 
support for the inclusion of discussions of farmworker rights and 
protections in the definition of field visits. Regarding the State 
agency's request for clarification on monitor advocate roles in field 
visits, the Department notes that the proposed revisions do not require 
additional field visits, but instead clarify that the monitor advocates 
who may conduct field visits include SMAs, RMAs, and the NMA and NMA 
staff. The existing regulations provide that SMAs conduct field visits 
in accordance with Sec.  653.108(o) and (q), the NMA (and NMA staff) in 
accordance with Sec.  658.602(n), and RMAs in accordance with Sec.  
658.603(p). As part of their monitoring duties, the NMA (and NMA staff) 
and RMAs accompany selected outreach workers on field visits as part of 
their review and assessment responsibilities in Sec. Sec.  658.602 and 
658.603. For SMAs, the Department proposed in Sec.  653.108 to clarify 
that the purpose of a SMA field visit is to discuss the SWA's provision 
of ES services and obtain input on the adequacy of those services from 
MSFWs, crew leaders, and employers. The SMA is not responsible to 
provide direct employment services during field visits or other 
activities. Instead, the SMA's field visits are designed to gather 
information the SMA needs to evaluate how the SWA is currently serving 
MSFWs, which the SMA uses to assess SWA compliance and to advocate for 
improvements.
    After carefully reviewing the comments, the Department has decided 
to update the definition of field visits to cross reference the 
citations that describe activities Monitor Advocates and outreach staff 
perform during field visits. To further clarify the role of monitor 
advocates with respect to field visits, the Department has decided to 
remove the proposed reference to NMA team members and instead refer to 
NMA staff, as identified in Sec.  658.602(h).
    During consideration of the comments, the Department noticed that 
the proposed definition did not specify that field visits may occur at 
the gathering places of MSFWs, which is necessary to align the 
definition with the requirement in Sec.  653.107(b)(1) that outreach 
staff must explain certain information and services to MSFWs at their 
working, living, or gathering areas. To align the definition with Sec.  
653.107(b)(1), the Department is further revising the definition of 
field visits to include that field visits may occur at places where 
MSFWs gather, in addition to working and living locations.
Hearing Officer
    The Department proposed to amend the definition of Hearing Officer 
to remove the words ``of Labor'' because Sec.  651.10 previously 
defines ``Department'' as ``the United States Department of Labor.'' 
The Department did not receive any comments on this proposed change and 
adopts it as proposed.
Interstate Clearance Order
    The Department proposed to amend the definition of interstate 
clearance order to indicate that it is an agricultural ``clearance'' 
order for temporary employment instead of a ``job'' order. This change 
aligns the definitions of job order and clearance order. The Department 
did not receive any comments on this proposed change and adopts it as 
proposed.
Intrastate Clearance Order
    The Department proposed to amend the definition of intrastate 
clearance order in two ways: first, by indicating that it is an 
agricultural ``clearance'' order for temporary employment instead of a 
``job'' order, to align the definition with the definitions of job 
order and clearance order in this part; and, second, by clarifying that 
the term means an agricultural clearance order for temporary employment 
describing one or more hard-to-fill job openings that an ES office uses 
to request recruitment assistance from all other ES offices within the 
State, to help SWAs understand that an intrastate clearance order must 
be circulated to all ES offices within the State.
    Comment: A State government agency said that amending the 
definition of interstate clearance order to require an ES office to 
request recruitment assistance from all ES offices (not just 
significant MSFW one-stop centers) will necessitate changes to the 
review tool its monitor advocate office uses to conduct annual reviews 
(i.e., to reflect that all offices must conduct recruitment). Another 
State government agency asked the Department to clarify what 
recruitment assistance means in the definition of intrastate clearance 
order.
    Response: The Department acknowledges that the changes may require 
some SWAs to update their review tools and notes that intrastate 
recruitment, not interstate recruitment, involves recruitment 
assistance from all other ES offices within the State. However, the 
Department believes that the majority of SWAs will not need to update 
review tools or other processes because the revised definition is 
consistent with their current practices. The Department has found 
through monitoring that the majority of SWAs place intrastate clearance 
orders into their web-based labor exchange systems and make them 
available for recruitment throughout the entire State. Most SWAs do not 
direct recruitment efforts to specific ES offices because their labor 
exchange systems are not programmed to do so. Therefore, this change 
will not increase burden for most SWAs.
    The Department has considered the impact of updating the definition 
to specify that intrastate clearance orders request recruitment 
assistance from all other ES offices in the State and finds it to be 
beneficial. Specifically, requesting recruitment assistance from all 
other ES offices increases the likelihood that the employer will find 
the workers it needs. Because the definition applies to criteria and 
non-criteria clearance orders, the description also allows the employer 
and SWA to recruit as broadly as possible and assists ETA in assessing 
the need for interstate clearance requests, including requests 
connected to the H-2A visa program. The intended result is that 
intrastate clearance will be more likely to result in employment of 
U.S. workers.
    The Department adopts the definition as proposed and will provide 
guidance and technical assistance, as needed,

[[Page 82670]]

including how other ES offices provide recruitment assistance.
Migrant Farmworker and Seasonal Farmworker
    The Department proposed to amend the definition of migrant 
farmworker by removing the exclusion of full-time students who are 
traveling in organized groups, to make available to these individuals 
the benefits and protections of the Monitor Advocate System, including 
ES service requirements and safeguards built into the Complaint System. 
Relatedly, the Department proposed to remove the exclusion of non-
migrant full-time students from the definition of seasonal farmworker, 
to allow full-time students who work in seasonal farmwork to be 
considered seasonal farmworkers and to make the definition of seasonal 
farmworker consistent with the definition of migrant farmworker. The 
Department adopts these definitions as proposed.
    Comment: Referencing the Department's proposal to remove the 
exclusion of non-migrant full-time students from the definition of 
seasonal farmworker, thus making the definition of seasonal farmworker 
consistent with the definition of migrant farmworker, an anonymous 
commenter remarked that seasonal farmworkers (such as non-migrant full-
time students) are not the same as migrant farmworkers (who they said 
are usually noncitizens admitted to the United States for specific 
timeframes with green card status). The commenter also mentioned an ES 
office in Traverse City, Michigan, with a specific division for 
assisting migrant farmworkers and stated that hiring extra migrant 
farmworkers may not suffice for fresh produce processing of their 
State's agriculturally diverse crops.
    Response: The proposed changes maintain two separate definitions 
for seasonal farmworkers and migrant farmworkers and remove the 
exclusion of full-time students from both definitions to ensure MSFW 
students have access to the benefits and protections of the Monitor 
Advocate System.
Removal of Migrant Food Processing Worker
    The Department proposed to remove the definition of migrant food 
processing worker because migrant food processing worker status has not 
been a separately tracked part of the MSFW definition since the ES 
regulations were updated in the WIOA final rule promulgated in 2016. 
See 81 FR 56071 (Oct. 18, 2016). Current ETA reporting does not require 
States to document migrant food processing workers as a particular type 
of MSFW and this definition is unnecessary because the existing MSFW 
definitions are inclusive of individuals who perform work as migrant 
food processors. The Department did not receive any comments on its 
proposal to remove this defined term and adopts its removal as 
proposed.
Occupational Information Network (O*NET)
    The Department proposed to amend the definition of Occupational 
Information Network (O*NET) to remove the word ``system'' from the 
definition, as it is not needed to describe O*NET. The Department did 
not receive any comments on this proposed change. The Department adopts 
the change as proposed.
O*NET-SOC
    The Department proposed to amend the definition of O*NET-SOC to 
remove the words ``of Labor'' after ``Department'' because Department 
is previously defined in this section as ``the United States Department 
of Labor.'' The Department did not receive any comments. The Department 
adopts the change as proposed.
Outreach Staff
    The Department proposed to amend the definition of outreach staff 
to clarify that an SMA is not ``outreach staff'' for purposes of Sec.  
653.107. While an SMA may join outreach staff on field visits, an SMA 
cannot fulfill a SWA's responsibility under Sec.  653.107(a) to provide 
outreach staff. This aligns with a revision in Sec.  653.108(d) to 
specify that the SMA and their staff cannot assist with outreach 
responsibilities, which is further discussed in the section-by-section 
analysis for Sec.  653.108. The Department did not receive any comments 
on the clarification proposed to the definition, and it adopts the 
revision to this definition as proposed.
Participant and Reportable Individual
    To align with the proposed changes to replace references to 
``employment services,'' ``Wagner-Peyser Act services,'' and ``services 
provided under the Wagner-Peyser Act'' with ``ES services'' and ``ES,'' 
the Department proposed to amend the definition of participant by 
replacing the phrase ``Wagner-Peyser Act participants'' with ``ES 
participants'' and to amend the definition of reportable individual by 
replacing the phrase ``Wagner-Peyser Act services'' with ``ES 
services.'' The Department did not propose any other changes to these 
definitions. The Department received one comment related to the 
definitions for each of these terms, which is summarized and responded 
to below. After consideration of this comment, the Department adopts 
the revisions to both of these definitions as proposed.
    Comment: A State government agency suggested the Department should 
define reportable individual versus participant for States to 
accurately collect and report information on these groups.
    Response: The Department appreciates the comment requesting that 
the Department clarify who is considered reportable individuals or 
participants. The Department's existing regulations in part 651 provide 
definitions for reportable individual and participant at Sec.  651.10. 
This final rule adopts only minor revisions to each term to replace 
existing references to the ``Wagner-Peyser Act'' with ``ES.'' As noted 
in Sec.  651.10, participant means a reportable individual who has 
received services other than the services described in Sec.  
677.150(a)(3) of this chapter, after satisfying all applicable 
programmatic requirements for the provision of services, such as 
eligibility determination (see 20 CFR 677.150(a)). This definition 
notes that individuals who use only self-services or information-only 
services or activities are not considered participants. As outlined in 
Sec.  677.150(a)(4) of this chapter, programs must include participants 
in their performance calculations.
Placement
    The Department proposed to amend the definition of placement (along 
with other terms) to replace the phrase ``employment office'' with ``ES 
office.'' The Department did not propose any other changes to this 
definition. The Department did not receive any comments on this 
proposed definition and adopts it as proposed.
Respondent
    The Department proposed to revise the definition of respondent by 
removing the parenthetical language ``including a State agency 
official'' because the term ``State agency'' is assumed to include 
``State agency officials'' and is therefore unnecessary to clarify. The 
Department did not receive any comments on this proposed change and 
adopts it as proposed.
Significant MSFW One-Stop Centers and Significant MSFW States
    The Department proposed to revise the definition of significant 
MSFW one-stop centers in two ways: first, by removing the text stating 
these designations are made annually; and,

[[Page 82671]]

second, by adding to the criteria by which the Department designates 
significant MSFW one-stop centers, so that they will include ES offices 
where MSFWs account for 10 percent or more of reportable individuals in 
the ES annually. First, as explained in the NPRM, the Department 
proposed to remove the text stating that significant MSFW one-stop 
centers are designated annually, because in making the designation, the 
Department relies on multiple data sources that are published in 
intervals up to every 5 years. Based on the Department's analysis, the 
data do not change significantly on an annual basis, and therefore it 
is often unnecessary to change the designations. This change in the 
definition would allow the list of significant MSFW one-stop centers to 
remain the same if there is no compelling reason to make a change. Also 
as proposed, the designation of significant one-stop centers would 
include ES offices where MSFWs account for 10 percent or more of 
participants or reportable individuals who are served by that ES office 
annually, and any other ES offices that the Office of Workforce 
Investment (OWI) Administrator includes due to special circumstances 
such as an estimated large number of MSFWs in the service area. The 
Department proposed to add reportable individuals to the criteria it 
considers in making this designation so that the one-stop centers 
designated as significant MSFW one-stop centers also account for the 
number of MSFWs in the area who are likely to benefit from access to ES 
services.
    The Department similarly proposed to revise the definition of 
significant MSFW States in two ways: first, by removing the text 
stating that these designations will be made annually; and second, to 
change the basis on which this designation is made from the 20 States 
with the highest number of MSFW participants to the 20 States with the 
highest estimated total number of MSFWs. The Department proposed to 
change the basis on which it makes this designation so that it will 
reflect States with the highest total estimated MSFW activity--rather 
than the highest numbers of MSFW ES participants--so that the 
designation will better reflect the 20 States with the highest numbers 
of MSFWs who may ultimately seek assistance from the ES, rather than 
just those States with the highest numbers of MSFWs who have already 
sought such assistance.
    The Department received a few comments that address the revisions 
proposed to these definitions. A summary of these comments and the 
Department's response is below. After thoroughly considering the issues 
and questions that these commenters presented, the Department has 
decided to adopt the revisions as proposed, with a clarification to the 
definition of significant MSFW one-stop centers as described below.
    Comment: A couple of State government agencies expressed concern 
that the Department planned to designate significant MSFW one-stop 
centers and significant MSFW States based on a blend of data from the 
Quarterly Census of Employment and Wages (QCEW) and Census of 
Agriculture, because, as they explained, the QCEW and the Census of 
Agriculture use disparate definitions and methodologies. Both 
commenters recommended that the Department use only QCEW data, from 
which they assert the Department could derive annual variable 
employment using a time series decomposition model that disaggregates 
covered employment by industry in States, agriculture reporting areas, 
and counties.
    One of these State agencies noted that it did not object to the 
proposal to remove annual designations of significant MSFW one-stop 
centers and significant MSFW States, but sought confirmation that 
States would still be able to submit annual amendments to add or remove 
a designated office as warranted by data or due to ES-staffing 
challenges in specific offices, site closures, and/or challenges posted 
by the Americans with Disabilities Act. This State agency also asked 
whether the proposed change would affect the use of Special 
Circumstance MSFW one-stop centers, and expressed concern that the 
proposed revisions could increase the number of one-stop centers 
designated as significant MSFW one-stop centers, which would create a 
need for additional resources and State merit staff in offices so 
designated.
    A farmworker advocacy organization supported the Department's 
proposal to designate significant MSFW one-stop centers based on the 
percentage of reportable individuals (not just participants) who are 
MSFWs, reasoning that many farmworkers who do not participate in the ES 
rely on other SWA services and are affected by the SWA's outreach and 
monitoring activities.
    Response: The Department appreciates the commenters' recommendation 
to use QCEW data. The changes will not limit the Department's 
consideration to the Census of Agriculture; therefore, the Department 
may also consider QCEW data. The Department disagrees with the 
commenters that using QCEW and the Census of Agriculture data is 
problematic even though they use disparate definitions and 
methodologies. The Department often consults multiple data sources to 
develop planning estimates and will take differences in source 
methodologies while making determinations for significant MSFW one-stop 
centers.
    In response to the commenter's question regarding whether States 
may submit annual updates regarding significant MSFW one-stop center 
activity levels, the Department confirms that States may submit such 
information and the Department will consider the information to 
determine if an update is appropriate. As mentioned in the NPRM, if 
annual adjustments are warranted by the data, the Department will make 
adjustments. This change would allow the list of significant MSFW one-
stop centers to remain the same if there is no compelling reason to 
make a change.
    The Department notes that the revised methodology will apply to all 
significant MSFW one-stop center designations, including those 
significant MSFW one-stop centers that are designated due to special 
circumstances and may increase the number of significant MSFW one-stop 
centers in some States. An increase in the number of significant MSFW 
one-stop centers will not create a need for additional State merit 
staff in offices so designated. It would, however, require the SMA to 
monitor additional offices onsite.
    After further consideration, the Department identified a need to 
clarify that the administrator who determines which ES offices must be 
included as significant MSFW one-stop centers based on special 
circumstances is the OWI Administrator. Accordingly, the Department 
adopts the changes as proposed, except to add that the OWI 
Administrator makes the determinations.
Removed Definition of Significant Multilingual MSFW One-Stop Centers
    The Department proposed to delete the definition of significant 
multilingual MSFW one-stop centers because proposed changes to Sec.  
653.102 would remove specific requirements for offices that meet this 
definition. The Department proposed to remove specific requirements for 
significant multilingual MSFW one-stop centers in part 653, because all 
one-stop centers must comply with the comprehensive language access 
requirements in 29 CFR 38.9, which prohibit discrimination on the basis 
of national origin, including LEP, and establish that language access 
requirements apply to services that ES

[[Page 82672]]

recipients provide to all individuals with LEP at all one-stop centers 
and are broader than the existing requirements for significant 
multilingual MSFW one-stop centers.
    The Department received two comments that address its proposed 
removal of the definition of significant multilingual MSFW one-stop 
centers. Both comments and the Department's response are discussed 
below. After thoroughly considering these comments, the Department has 
decided to remove this definition as proposed.
    Comment: Agreeing with the Department's proposal to remove specific 
requirements for significant multilingual MSFW one-stop centers (e.g., 
removing the definition of significant multilingual MSFW one-stop 
centers) because all one-stop centers must comply with language access 
requirements, commenters including a one-stop center employee remarked 
that Michigan's one-stop centers have multilingual staff to provide 
their customers access to a broader set of services. In contrast, a 
State government agency expressed concern that the proposal would 
result in ES offices with no bilingual staff at present needing to hire 
additional staff who can assist participants with LEP.
    Response: The Department notes that all ES offices must meet the 
language access requirements in 29 CFR 38.9, regardless of how many 
significant multilingual MSFW one-stop centers exist in a State. 
Pursuant to 29 CFR 38.9, SWAs must make services available in all 
needed languages. SWAs may use bilingual staff to meet this 
requirement, but other alternatives are available, such as in-person 
interpretation or telephone interpretation services.
State Workforce Agency (SWA) Official
    The Department proposed to remove the definition of State Workforce 
Agency (SWA) official, because SWA officials would be considered ES 
staff based on the Department's proposed revisions to the definition of 
ES staff in this rulemaking.
    Comment: Two State government agencies and an anonymous commenter 
warned that confusion and inconsistency could result from the 
Department's proposal to remove the definition of State Workforce 
Agency (SWA) official but continue using the SWA naming convention 
elsewhere in the regulatory text. The commenters recommended the 
Department keep State Workforce Agency (SWA) official as a defined 
term, similar to how title I of WIOA defines chief elected official, 
while clarifying that a SWA official is also considered ES staff.
    Response: The Department appreciates the comments regarding the 
potential for confusion or inconsistency related to the use of SWA 
official. The Department agrees with these comments. Although the 
Department proposed to remove the definition of SWA official, the final 
rule maintains the definition of SWA official in existing Sec.  651.10, 
which means an individual employed by the SWA or any of its 
subdivisions.
Wagner-Peyser Act Employment Service (ES) Also Known as Employment 
Service (ES)
    The Department proposed to amend this definition to replace the 
phrase ``employment services'' with ``ES services.'' The Department 
also proposed to remove the words ``and are'' from the definition for 
greater clarity. The Department did not receive any comments on this 
proposed definition and adopts it as proposed.

C. Part 652--Establishment and Functioning of State Employment Service

1. Subpart A--Employment Service Operations
    Subpart A of part 652 includes an explanation of the scope and 
purpose of the ES; the rules governing allotments and grant agreements; 
authorized services; administrative provisions; and rules governing 
labor disputes. The changes to this subpart focus on administrative 
provisions governing nondiscrimination requirements. This final rule 
also includes a severability provision for part 652 in subpart A.
Section 652.8 Administrative Provisions
    The Department proposed to amend Sec.  652.8(j)(2) to correct the 
statutory reference regarding the BFOQ exception currently listed in 
the regulation as 42 U.S.C. 2000(e)-2(e) to 42 U.S.C. 2000e-2(e). 
However, there was a typographical error in the proposed regulatory 
text. The final rule reflects the correct statutory reference, 42 
U.S.C. 2000e-2(e). The final rule also adds a necessary cross-reference 
to the EEOC's regulation regarding religion found at 29 CFR part 1605.
    The Department proposed to amend Sec.  652.8(j)(3) to remove an 
outdated reference to affirmative action requests to make the 
Department's regulation consistent with U.S. Supreme Court 
jurisprudence on race-based affirmative action.\5\ The proposed 
revision clarifies that the States' obligation is to comply with 41 CFR 
60-300.84. The regulation at 41 CFR 60-300.84 requires ES offices to 
refer qualified protected veterans to fill employment openings required 
to be listed with ES offices by certain Federal contractors; give 
priority to qualified protected veterans in making such referrals; and, 
upon request, provide the Office of Federal Contract Compliance 
Programs with information as to whether certain Federal contractors are 
in compliance with the mandatory job listing requirements of the equal 
opportunity clause (41 CFR 60-300.5).
---------------------------------------------------------------------------

    \5\ See, e.g., Ricci v. DeStefano, 557 U.S. 557, 585 (2009); 
Adarand Constructors, Inc. v. Pena, 515 U.S. 200, 238 (1995); 
Richmond v. J.A. Croson Co., 488 U.S. 469, 507 (1989).
---------------------------------------------------------------------------

    Comment: A one-stop operator and an advocacy organization expressed 
concern that, in appearing to prioritize UI recipients over job seekers 
as a whole, the proposed rule may not strengthen nondiscrimination 
requirements but rather could be discriminatory toward certain classes 
of individuals, such as people on public assistance, immigrants and 
refugees, people experiencing homelessness, second-chance customers, 
people with disabilities, and other groups with historically lower 
labor market participation rates. Similarly, a private citizen stated 
that staffing flexibility has allowed Colorado to promote and deliver 
equitable access to the ES for marginalized and underserved populations 
(i.e., priority populations under WIOA) but the proposed rule 
emphasizes UI above other services. Several other commenters also 
stated that staffing flexibility led to more localized services that 
better met the needs of marginalized communities.
    A one-stop center employee and other commenters stated that 
Michigan satisfies the requirement to give priority to qualified 
protected veterans through a 24-hour hold on all job orders. The 
comments also discussed how Michigan meets its affirmative outreach 
obligation to ensure equal access to services and activities by 
coordinating with WIOA partners on outreach and accommodating 
individuals with LEP. The comments argued that the proposed changes 
would result in staffing cuts, reduced hours, and office closures that 
could threaten Michigan's proven record of adhering to 
nondiscrimination requirements and providing universal access to ES 
services. The commenters added that these impacts would be felt most by 
people in rural areas and individuals with LEP.
    Response: The changes to this section were made to correct a 
statutory reference and to remove an outdated reference to affirmative 
action requests

[[Page 82673]]

to ensure that the Department's regulations are consistent with U.S. 
Supreme Court jurisprudence on race-based affirmative action. The 
changes do not constitute a change in the Department's policies or 
treatment of individuals. Just as the previous longstanding State 
merit-staffing requirement, which was based in part on the close 
relationship between the ES and UI programs, did not violate the 
nondiscrimination obligations of the Department and States in 
administering the ES program, the reinstatement of the State merit-
staffing requirement in this final rule for similar reasons does not 
run afoul of the nondiscrimination obligations of the Department and 
States administering the ES program. In re-aligning ES and UI, the 
Department is not prioritizing individuals eligible for UI benefits 
over individuals in historically underserved or marginalized 
populations. The ES is a universal access program. In the Department's 
view, reinstating a State merit-staffing requirement not only supports 
the historical alignment between ES and UI, but it also helps to 
maintain universal access and helps to protect the integrity of the ES 
program. As articulated further in discussion of Sec.  652.215 of this 
preamble, a State merit-staffing requirement helps to ensure that ES 
services are delivered by nonpartisan personnel held to transparent, 
objective standards designed to assure high quality performance. In 
response to the NPRM, three States--Colorado, Massachusetts, and 
Michigan--provided initial justification and data to support use of 
their longstanding staffing model and provided information about 
significant service disruption that would result from having to upend 
their longstanding ES staffing model. However, the initial 
justifications and data presented do not provide clear evidence of 
causation. Without evidence that alternative staffing models directly 
cause higher employment outcomes, balanced against widespread success 
in delivering services while maintaining State merit staff for ES, and 
further balanced by the need for ES State merit staff to be available 
for surges in UI claims and appeals, the Department is generally 
adopting the proposed requirement that States use State merit staff to 
provide ES services. The three States with longstanding reliance 
interests are permitted to continue using the staffing model consistent 
with the model the Department previously authorized for that State. The 
Department will conduct an evaluation of the three States' provision of 
ES services, including review of services of other States that 
participate, as necessary, to determine whether such models are 
empirically supported and must participate in an evaluation to 
determine whether alternative staffing models are empirically 
supported. The commenters who indicated that Wagner-Peyser staffing 
flexibility allowed States to provide better services to marginalized 
communities did not include any data that demonstrates causal evidence 
to support this claim. Likewise, the Department has not identified such 
evidence to support it.
    The Department reminds SWAs that they have an affirmative outreach 
obligation under 29 CFR 38.40 that requires them to take appropriate 
steps to ensure they are providing equal access to services and 
activities authorized under the Wagner-Peyser Act, as well as any other 
WIOA title I-financially assisted programs and activities. As outlined 
in that regulation, these steps should involve reasonable efforts to 
include members of the various groups protected by the WIOA sec. 188 
regulations, including but not limited to persons of different sexes, 
various racial and ethnic/national origin groups, members of various 
religions, individuals with LEP, individuals with disabilities, and 
individuals in different age groups.
Section 652.10 Severability
    Given the numerous and varied changes the Department proposed and 
is adopting, the Department intends the provisions of this rule to be 
severable and is including a severability provision in parts 652, 653, 
and 658 in this final rule. That intent was reflected in the structure 
of and descriptions in the proposed rule. The inclusion of severability 
provisions in this final rule confirms the Department's belief that the 
severance of any affected provision will not impair the function of the 
regulation as a whole and that the Department would have proposed and 
implemented the remaining regulatory provisions even without any 
others. To the extent that a court holds any provision, or any portion 
of any provision, of part 652 invalid, the provision will be construed 
so as to continue to give the maximum effect to the provision permitted 
by law, unless such holding is one of total invalidity or 
unenforceability, in which event the provision will be severable from 
this part and will not affect the remainder thereof.
2. Subpart C--Employment Service Services in a One-Stop Delivery System 
Environment
    Subpart C of part 652 discusses State agency roles and 
responsibilities; rules governing ES offices; the relationship between 
the ES and the one-stop delivery system; required and allowable ES 
services; provision of services for UI claimants; and State planning. 
Among other changes, the changes to the regulations under subpart C are 
tailored to require all States to use State merit staff to provide ES 
services, except the three States using longstanding alternative 
staffing models previously authorized by the Department. As was true 
when the regulations were changed in 2020, none of the changes in this 
section will impact the personnel requirements of the Vocational 
Rehabilitation (VR) program, one of the six core programs in the 
workforce development system. Title I of the Rehabilitation Act of 1973 
(Rehabilitation Act), as amended by title IV of WIOA, which authorizes 
the VR program, has specific requirements governing the use of State VR 
agency personnel for performing certain critical functions of the VR 
program.
Section 652.204 Must funds authorized under the Wagner-Peyser Act 
Governor's Reserve flow through the one-stop delivery system?
    The Department proposed to simplify the section heading to remove 
reference to the Wagner-Peyser Act because reference to the Governor's 
Reserve is adequate. The Department also proposed amending this section 
to reference professional development and career advancement of ES 
staff instead of SWA officials. After further consideration, the 
Department is not finalizing the proposed change to the section heading 
in order to differentiate the Wagner Peyser Act Governor's Reserve from 
the WIOA Governor's Reserve. Instead, the Department is making a slight 
revision to the current section heading. The new section heading reads, 
``Must funds authorized through the Wagner-Peyser Act Governor's 
Reserve flow through the one-stop delivery system?'' In addition, 
because of the Department's change to the NPRM's proposed definition of 
``ES staff'' in this final rule, the Department retains the text of the 
existing regulation for this section.
Section 652.215 Can Wagner-Peyser Act-funded activities be provided 
through a variety of staffing models?
    The Department proposed to amend Sec.  652.215 to require all 
States to use

[[Page 82674]]

State merit staff to provide ES services and proposed giving States 18 
months to comply with this requirement. After further consideration, 
the Department adopts a rule requiring all States to use State merit 
staff to deliver ES services, except the three States using 
longstanding alternative staffing models previously authorized by the 
Department. States authorized to use alternative staffing models will 
be required to participate in evaluation(s) of their delivery of ES 
services to be conducted by the Department. While the Department plans 
on conducting a single evaluation, the rule requires these States' 
participation if evaluation activities span more than one study, 
including any data collection associated with those evaluation 
activities. The Department will conduct this evaluation of the three 
States' provision of ES services, including review of services of other 
States that participate, as necessary, to determine whether such models 
are empirically supported. All States have 24 months to comply with the 
staffing requirements in this section.
    The Department believes that a State merit-staffing requirement is 
a generally reliable method to ensure quality and consistency in ES 
services and supports the well-established connection between ES and UI 
services. Paragraph (a) of Sec.  652.215 provides that except as 
provided in paragraph (b) of Sec.  652.215, all States must deliver 
labor exchange services described in Sec.  652.3 using State merit-
staff employees employed according to the merit-system principles 
described in 5 CFR part 900, subpart F--Standards for a Merit System of 
Personnel Administration. This staffing requirement also applies to the 
provision of services and activities under parts 653 and 658.
    The Department also recognizes the longstanding reliance interests 
of three States that had been authorized to use alternative staffing 
models in the 1990s. These States provided initial justification and 
data to support use of their longstanding staffing model and provided 
information about significant service disruption that would result from 
having to upend their longstanding ES staffing model. These three 
States have built systems, developed partnerships, and established a 
service delivery model that could be reversed only at significant cost 
to the State and with significant harm to job seekers and employers. 
Accordingly, in paragraph (b) the Department permits only these three 
States authorized to use alternative staffing models prior to February 
5, 2020, the effective date of the 2020 Final Rule, to continue using 
the staffing model consistent with the model the Department previously 
authorized for that State. It is the use of a particular staffing model 
in each State that engendered each State's strong reliance interest. 
Therefore, paragraph (b) also provides that these States may use merit-
staffing flexibility only to the same extent that the Department 
authorized it prior to February 5, 2020. This means that if any of the 
States covered by paragraph (b) sought to use the 2020 Final Rule to 
expand flexibility beyond what was previously authorized in that State, 
that State must return to the staffing model in use as authorized by 
the Department prior to February 5, 2020.
    Paragraph (c) requires that the States permitted to use an 
alternative staffing model must participate in evaluations of their 
delivery of ES services to be conducted by the Department. The 
Department's goal will be to assess ES service delivery in several 
States. Requiring the three States authorized to use their longstanding 
alternative staffing models to participate in evaluation activities 
will enable the Department to determine whether alternative staffing 
models are empirically supported.
    In response to comments, paragraph (d) lengthens the proposed 
transition period, requiring all States to comply with the staffing 
requirements in Sec.  652.215 no later than 24 months after the 
effective date of this final rule. The Department recognizes that 
States will need time to address issues, such as obtaining any 
necessary State authorization, procurement, collective bargaining, 
hiring, and training.
    The following discussion further details the Department's decision.
Potential Impacts of the Rule on the Provision of ES
Benefits of Using State Merit Staff To Deliver ES Services
    Comment: Two State government agencies expressed support for the 
proposed merit-staffing requirement because it would promote Statewide 
uniformity and consistency of employment security services. In 
particular, one of these commenters stated the ability to have 
consistent hiring practices, standardization of staff onboarding and 
training, and continuous professional development training throughout 
the State merit staff's employment life cycle ensure the most 
consistent and best customer service possible across the State. 
Similarly, two anonymous commenters expressed concern about the lack of 
consistent ES services throughout Michigan, which one of these 
commenters said is a byproduct of local control. These commenters 
argued that a consistent service delivery model of providing ES 
services through State merit staff would benefit Michigan job seekers 
and provide greater transparency and accountability to Michigan 
residents.
    A State employee association commented that, in passing the Wagner-
Peyser Act, Congress envisioned a federally supported but State-
administered merit system, subject to consistent rules and oversight, 
to prevent favoritism and promote equality in the delivery of 
employment services.
    Response: The Department agrees that using State merit staff to 
deliver ES services helps to promote statewide stability and 
consistency in service delivery. The Department further agrees that 
using State merit staff helps ensure that employment services are 
delivered in an equitable manner and on a nonpartisan basis. As noted 
earlier in this preamble, in the IPA Congress found that the quality of 
public service could be improved by administering programs according to 
merit-based principles. Because the ES is a universal access program, 
it is critical that it be administered by nonpartisan personnel held to 
transparent, objective standards designed to assure high quality 
performance.
    The Department acknowledges the comments regarding ES service 
delivery in Michigan. As noted elsewhere in this preamble, Michigan is 
one of three States that the Department authorized to use an 
alternative staffing model beginning in the 1990s. Due to the State's 
strong reliance interest developed from longstanding use of a 
particular service delivery model and the potential service disruption 
that would ensue if the State is required to adopt a full State merit-
staffing model, the Department is permitting Michigan to continue using 
its longstanding alternative staffing model. The Department is 
requiring the State to participate in an evaluation of service delivery 
in the State to be conducted by the Department.
Potential Cost Increases of State Merit Staff That May Reduce the 
Availability of ES Staff
    Comment: Numerous commenters, including an association of State 
elected officials, Michigan, Colorado, and Delaware State government 
agencies, and Michigan and Colorado local governments, expressed 
concern that the proposed rule could make the provision of employment 
services less efficient in States that use flexible staffing models and 
may reduce access

[[Page 82675]]

to critical workforce resources for job seekers and employers because 
the proposal would reduce the number of available ES staff. In 
contrast, a private citizen argued that there is little evidence that 
the proposed rule would reduce access to workforce resources, reasoning 
that in Michigan, if there is a threat of service reduction it is 
because the State has used ES funding as a substitute for WIOA funding, 
for local staff, or for overhead costs for staff not fully dedicated to 
providing ES services.
    Many commenters, including Michigan and Colorado State elected 
officials, Michigan, Colorado, and Delaware State government agencies, 
and Michigan and Colorado local governments, argued that the rule would 
cause a significant reduction in ES staff in States that use flexible 
staffing models, as well as the closure of many one-stop employment 
centers, with the greatest losses occurring in rural areas.
    Response: The Department acknowledged in the NPRM that there would 
be costs to some States to transition to using State merit staff to 
deliver ES services, requested feedback on the transition costs, and 
requested feedback on the proposed 18-month transition period. The 
Department notes that information that is supported with evidence and 
data sources is more strongly considered than information that is 
unsubstantiated. The States of Delaware, Michigan, and Colorado 
provided new information in their comments on the NPRM that are 
relevant to the NPRM's regulatory impact analysis. These States 
detailed impacts on existing contracts and procurement, recruitment, 
training, staffing, collective bargaining, technology costs, 
infrastructure changes, funding, and the extent of service disruptions 
that would result from imposition of a State merit-staffing requirement 
because these States have utilized approved alternative staffing models 
for many years. Some commenters provided information based on a survey 
stating that there will be job losses and center closures as a result 
of the State merit-staffing requirement. A few additional States 
responded to indicate that they may be utilizing staffing flexibility, 
although the Department was previously not aware they intended to 
utilize the staffing flexibility provided by the 2020 Final Rule. Those 
States did not estimate transition impacts as requested by the 
Department in the NPRM.
    The Department has considered the comments opposing the 
reinstatement of the State merit-staffing requirement and found the 
comments from Colorado, Massachusetts, and Michigan the most compelling 
due to their longstanding reliance interests on using alternative 
staffing models. Based on these comments the Department has determined 
that States are required to use State merit staff to provide ES 
services, except Colorado, Massachusetts, and Michigan. The final rule 
is allowing these three States to use merit-staffing flexibility to the 
same extent previously allowed by the Department prior to February 5, 
2020, the effective date of the 2020 Final Rule. As discussed above, 
the Department is requiring these States to participate in an 
evaluation of ES service delivery staffing models. All States will have 
24 months to comply with the requirements in this final rule.
ES Service Delivery and Customer Impacts
    Comment: Many commenters described the services made available 
through Wagner-Peyser Act funding and expressed concern about a 
disruption or outright elimination of such services due to the proposed 
merit-staffing requirement, as described below.
    Many Michigan commenters, including private citizens and one-stop 
center staff, discussed the value of the supportive services they have 
received or provided through Michigan Works! offices, including 
assistance with important tasks for job seekers such as developing a 
resume, strengthening interviewing skills, and performing job searches; 
some of these commenters, including one-stop center employees, stated 
that local center staff help alert customers to the availability of 
such services. A one-stop center employee stated that local ES workers 
have the best understanding of community needs and are often the first 
point of contact to help customers navigate available programs.
    Many commenters, including Michigan and Massachusetts State 
government agencies, Michigan and Colorado local governments, and 
advocacy organizations, went on to more specifically describe one-stop 
employment centers' role in preparing job seekers for employment and 
connecting them with employers who want to hire them, including 
services such as facilitating training programs, hosting job fairs and 
career awareness events, organizing industry collaboratives, helping 
craft resumes, and providing job searching and interviewing tips. 
According to some of these commenters, including Michigan local 
governments, a key benefit of staffing flexibility is strong local 
strategic relationships with businesses, higher education, nonprofits, 
childcare, elementary and secondary education, adult education 
providers and other partners, which allows for more efficient customer 
service to connect job seekers to in-demand jobs and training 
opportunities.
    Furthermore, many commenters, including Michigan and Colorado State 
elected officials, Michigan and Colorado local governments, and 
advocacy organizations, claimed that the status quo staffing 
flexibility has helped States and localities achieve specific, positive 
outcomes in terms of newly employed individuals, employment rates, 
average worker earnings, numbers of employers served, total economic 
impact, increased tax revenue, and returns on investment.
    Response: The Department appreciates the concerns raised by 
commenters and agrees that the quality of ES services is important. The 
commenters highlighted the benefits of the services provided to 
participants but did not provide evidence that the staffing model is a 
causal factor in the quality of those services. Though the Department 
agrees that local relationships are important in business services, 
local areas in States across the country using State merit staff for ES 
manage to develop such relationships. Commenters did not provide any 
evidence that strong local relationships are only possible with 
alternative staffing models, or that using a non-State-merit staffing 
model is a causal factor in developing strong business relationships. 
Without such evidence, balanced against the benefits of State merit-
staffing described above, the Department will not extend the ability to 
use alternative staffing models to other States besides Colorado, 
Massachusetts, and Michigan. Therefore, the Department has determined 
that States are required to use State merit staff to provide ES 
services, except the three States that have long been allowed to use 
alternative staffing models.
    Comment: A State workforce development board said that data shows 
that former demonstration States using local merit and non-merit staff 
to deliver ES services have been successful and argued that all States 
should examine strategies to further service integration. Another State 
workforce development board and a professional association stated that 
it appreciated the approach ``created by Congress'' wherein the Federal 
government partners with State and local workforce program, providing 
performance goals and broad working parameters, but leaves States to 
manage their operations based on the diverse needs of businesses and 
workers in their

[[Page 82676]]

communities. These commenters urged the Department to permanently 
codify staffing flexibility.
    Response: As explained earlier in the preamble, the Act gives the 
Secretary discretion to require that States use a staffing model that 
will promote the goals of the ES program. For reasons articulated in 
the NPRM and this final rule, the Department has determined that that 
model is State merit-staffing. Three States using longstanding 
alternative staffing models presented arguments in support of retaining 
those models, but the information provided did not show a causal impact 
of the staffing model in these States and performance. Accordingly, the 
Department declines to extend staffing flexibility to all States. The 
Department reinstates a State merit-staffing requirement for ES 
services with the exception of the three States with longstanding 
reliance interests. These States are required to participate in 
evaluation of their delivery of ES services conducted by the 
Department, including review of services of other States that 
participate, as necessary, to determine whether such models are 
empirically supported.
    Comment: Some commenters, including one-stop operators, private 
citizens, and others, listed several potential impacts on customer 
service as reported by stakeholders concerned about the proposal, 
including closure of ES offices (particularly in rural areas), reduced 
hours of operation for offices, disruption of referrals, curtailed 
services to immigrants, veterans, and other vulnerable populations, 
fewer opportunities for career awareness events or job fairs, and 
reduced access to technology. Many commenters, including Michigan local 
governments, a Michigan State elected official, and Michigan one-stop 
operators, also warned that the rule would cause one-stop centers to 
reduce or eliminate their job seeker and employer workshops, career 
fairs, and career awareness events, as well as their efforts to 
facilitate job seekers' enrollment in and funding for schools and 
training programs. Some commenters, including Michigan one-stop 
operators, Michigan one-stop center staff, and an employer, warned that 
with the reduced staffing flexibility under the rule, customer service 
in employment services would decline, with reductions in virtual 
services, less personal services, and with services only provided by 
appointment to customers who meet specific criteria. Several 
commenters, including a one-stop center employee, private citizens, and 
a Michigan State government agency, asserted that Michigan Works! staff 
anticipate disruptions to the ``more than 3,600 services'' provided to 
industry-led collaboratives, 7,500 job fairs, and other services that 
have been successfully delivered over a 25-year period.
    Several commenters referred to the minimum services required by 
Sec.  652.3 noted in the NPRM (including facilitating the connection 
between job seekers and employers) and questioned how their State would 
continue to provide these essential services with just an estimated 25 
percent of their current staffing level. The commenter asked whether a 
certain service or customer sector would take priority in cases where 
staffing shortages impact service availability, and further questioned 
how robust services would be provided if ES staff are reassigned to UI. 
A few one-stop center employees and a local government remarked that 
the proposal would disrupt convenience or would lengthen ``turnaround 
time'' for service delivery to job seekers, an outcome that the 
commenters warned would adversely impact job seekers, employers, and 
the local community.
    A local workforce development board described how ES staff work 
with job seekers to determine their unique needs, increase their 
marketability in the labor market, or otherwise provide ``intensive job 
search assistance.'' The commenter said these comprehensive services 
would be disrupted, causing a gap in service provision, and adversely 
affecting job seekers. The commenter provided figures to demonstrate 
the economic value of participation in the WIOA's adult and youth 
programs and expressed concern that these economic impacts would be 
reduced or lost if existing ES staff are unable to support the 
comprehensive set of services they currently provide. A private citizen 
said ES customers need career services to build a sustainable work 
history.
    Several commenters asserted that one-stop organizations in its area 
take pride in providing quality customer service and argued that local 
control over Wagner-Peyser Act ES programs is critical to positive 
impacts associated with its workforce development programs, citing 
statistics about the numbers of individuals and businesses served, 
numbers of workshops and hiring events hosted, and economic figures 
demonstrating economic impact and an overall return on investment.
    A State government agency recommended that the Department maintain 
staffing flexibility to avoid service disruption during emergencies. An 
anonymous commenter expressed concern that changing a system that works 
well will place ``stress'' on their State government, which is dealing 
with challenges related to the pandemic and unemployment.
    Some commenters, including a Michigan State government agency and 
an employer, asserted that the proposal would result in the loss of 
many full-time employees and expressed concern about the ability of 
fewer State merit staff to handle the leftover caseload. The Michigan 
State agency asserted that this staffing shortfall would cause one-stop 
customers to experience increased delays, inefficiencies due to remote 
service delivery or multiple case managers, and challenges in 
scheduling appointments (potentially resulting in increased 
transportation or childcare costs).
    Response: The Department appreciates the concerns raised by the 
commenters. Commenters' concerns appear to generally stem from an 
assumption that the use of State merit staff for ES services would be 
more expensive and thus result in the closure of one-stop centers, 
reduction of one-stop hours, and programming cuts. While the commenters 
provided no evidence that the rule change would result in these 
reductions or closures, the Department understands that there may be 
costs and disruption associated with a transition to State merit staff, 
particularly for the three States that have longstanding reliance on 
being able to use alternative staffing models, as described above. 
Therefore, the Department will permit alternative staffing models in 
the three States with long-time reliance on such models.
Service to Specific Populations or Vulnerable Populations
    Comment: Many commenters, including a Colorado State government 
agency, Colorado local government agencies, and advocacy organizations, 
warned that the rule would cause reductions in ES services in States 
that use flexible staffing models. These commenters expressed concern 
that such reductions would be associated with services that are 
designed specifically to aid vulnerable populations, or those who 
otherwise have significant difficulty in finding employment, thus doing 
them particular harm. In this category of vulnerable populations, 
commenters included groups such as veterans, immigrants, refugees, 
youth, people living in rural areas, people with disabilities, formerly 
incarcerated people, and other vulnerable job seekers.
    Several commenters, including private citizens, advocacy 
organizations, a local government, and others, stated that local 
Michigan Works! offices serve

[[Page 82677]]

the most vulnerable populations in a given community, including 
veterans, low-income adults, dislocated workers, individuals with 
intellectual disabilities, older workers, youth, and immigrants and 
refugees, and expressed concern that the proposal would disrupt or 
eliminate services to the detriment of these vulnerable populations. A 
one-stop center employee similarly referred to these population groups 
and expressed concern that the proposal would delay service delivery 
for these groups and would adversely impact ``follow through'' and 
information sharing between States and agencies. Some commenters, 
including a Michigan State government agency, a Colorado local 
government agency, and many Michigan one-stop center staff, also 
described the specific needs of the people generally served by one-stop 
centers; in general, these are vulnerable and low-income populations, 
in need of significant support in the job seeking process, including 
transportation, clothing, food, childcare, technology assistance, 
substance abuse counselling, and medical care.
    An academic commenter described their organization's strong 
relationship with a local Michigan Works! office and expressed concern 
that the proposal would disrupt services to the most vulnerable 
communities in their area. The commenter said their organization 
benefits from employment and training services for immigrants and 
students and expressed particular concern about the potential 
elimination of the Teach Talent Thrive program that promotes lifelong 
learning and career readiness.
    An adult education provider stated that their organization partners 
with the local Michigan Works! office to provide career training and 
education services to adults and students, including coaching for 
career readiness, job searching, and aligning skills with a desired 
career pathway. The commenter also said the proposal would 
``compromise'' Governor Whitmer's Sixty by 30 plan that seeks to close 
socioeconomic gaps for vulnerable populations, including the 
economically vulnerable adults served by the commenter's organization.
    Some commenters, including an employer, an advocacy organization, 
and a private citizen, expressed concern that the proposal would 
disrupt services for veterans, including programs that support 
employment for veterans with employment barriers, services for active-
duty military members, and military spousal services.
    An advocacy organization expressed concern that ``impactful'' 
programs such as the Clean Slate program (which provides supportive 
services for formerly incarcerated individuals or individuals with 
criminal records) and the Going Pro Talent Fund (which provides skills-
based certificate training) would be adversely affected by the 
proposal. A local workforce development board stated that local ES 
staff partner with programs like the Disability Program Navigator to 
enhance local capacity to provide services for people with 
disabilities, including helping such individuals navigate available 
services. A private citizen described how receiving supportive services 
from their local Michigan Works! service center has benefited their 
family member with intellectual disabilities and remarked that such 
services are difficult to find.
    A private citizen concerned about a disruption of critical services 
to vulnerable populations remarked that Michigan Works! has proven it 
is ``best in class'' as an ES provider, citing figures from 2018 and 
2019 that showed Michigan was among the 10 States with the lowest costs 
of career services per participant served.
    Response: The Department appreciates the concerns raised by 
commenters and agrees that the quality of ES services is important, 
particularly for vulnerable populations. The ES is a universal access 
program. The Department prioritizes the needs of vulnerable populations 
in this rulemaking and believes that changes in this rulemaking further 
the goal of universal access. Requiring States to use State merit staff 
to provide ES services will better protect vulnerable individuals 
because State merit staff are employees of the State who are subject to 
merit system principles and are thus directly accountable to the State 
and administer the ES with greater transparency and accountability than 
other staffing models.
    The staffing requirements in part 652 apply to the delivery of 
services and activities under parts 653 and 658. Using State merit 
staff for these services is appropriate because these staff positions 
perform worker protection functions for MSFWs, who are particularly 
vulnerable to employment-related abuses. These staff require 
centralized training and management from the State to ensure they are 
equipped to assess and respond to farmworker needs, including 
responding to complaints and apparent violations in the field, which 
may include highly sensitive subject matter like human trafficking.
    As stated above, the Department also recognizes the longstanding 
reliance interests of three States--Colorado, Massachusetts, and 
Michigan--and based on comments received about the negative impacts 
that requiring these States to change their ES service delivery models 
would have on service delivery, the final rule is allowing these three 
States to use the staffing models they have been allowed to use since 
the 1990s. Adjusting to avoid negative impacts to these three States' 
service delivery caused by the transition costs involved in changing 
decades-long practice is aligned with the Department's prioritization 
of the service delivery needs of vulnerable populations.
Business Services and Partnerships
    Comment: In addition to comments focused on the rule's detrimental 
effects on job seekers, many commenters, including Michigan local 
governments, a Michigan State elected official, and Michigan one-stop 
operators, also expressed concern that the rule would have a 
significant negative effect on businesses and employers, primarily by 
reducing recruiting services to businesses seeking help in filling 
vacancies, as well as reduced job retention efforts. Numerous 
commenters, including an association of State elected officials, 
Michigan, Colorado, Massachusetts, and Delaware State government 
agencies, and Michigan and Colorado local governments, argued that the 
one-stop employment centers, operated by local merit staff, deliver 
high-quality, cost-effective services to job seekers, and that existing 
staffing flexibility enables local centers to create strategic 
partnerships with businesses, schools, and nonprofits, all of which 
help better serve job seekers and businesses. Some commenters, 
including Michigan local governments, a Michigan State elected 
official, Michigan one-stop operators, and others, also warned that the 
rule would force one-stop centers to cut their industry-led 
collaboratives. Some commenters from Massachusetts, including a State 
government agency, local workforce development boards, and a local 
government employee, argued that implementing the rule would undermine 
business commitments and partnerships with ES services in States that 
use flexible staffing models because of the appearance of political 
instability and unnecessary bureaucratic change.
    Several commenters, including employers, one-stop center employees, 
and a local workforce development board, described how ES services 
benefit businesses, such as through job fairs, retention services, 
online job postings, and other programs that connect job seekers and 
employers. The

[[Page 82678]]

commenters expressed concern that the proposal would disrupt such 
services. Some commenters, including a private citizen and an employer, 
remarked that many businesses are struggling to find employees and 
credited local services that use Wagner-Peyser Act funding with 
providing critical assistance connecting employers and employees. 
Several commenters stated that Michigan Works! has provided ``more than 
141,000 services to businesses'' and cited responses from program 
stakeholders who believed these services would be reduced or eliminated 
if reinstating merit-staffing impacted uses of Wagner-Peyser Act 
funding. A private citizen remarked that Michigan Works! services in 
their area assist employers with upskilling and retention of employees. 
A Colorado State government official asserted that the use of local 
merit staff for Wagner-Peyser Act programs has allowed Colorado to 
fully implement the ``primary vision'' of WIOA, effectively emphasize 
employer engagement, encourage work-based learning, and maximize 
support for local businesses based on local community and competitive 
needs.
    Some commenters, including a Colorado local workforce development 
board, an employer, and a one-stop center employee, specifically 
claimed that one-stop centers have been particularly helpful in 
connecting employers with skilled employees in the manufacturing 
sector, as well as facilitating training; thus, the implementation of 
this rule would do particular harm to the struggling manufacturing 
sector in the States that use flexible staffing models.
    Several commenters, including a Colorado State government, local 
governments, employers, and private citizens, asserted that the 
proposal would fracture relationships forged at the local level, 
harming both job seekers and employers. A Colorado local government and 
a local workforce development board said strong relationships between 
ES staff and local employers has resulted in a Subsidized Employment 
program that connects employers and entry level workers and expressed 
concern that this program and other comprehensive wrap around services 
would be lost due to the State merit-staffing requirement. An anonymous 
commenter remarked that local residents consider the local one-stop 
center to be a ``neutral third party'' for businesses and job seekers, 
and expressed concern that this would be disrupted due to the merit-
staffing requirement.
    A local workforce development board stated that their State's 
current one-stop delivery model works well for businesses by connecting 
them with job seekers as well as training resources. Some commenters 
asserted that as a result of the proposal, employers will lose access 
to support for posting job orders and connecting with job seekers.
    A one-stop center employee argued that serving business requires 
staff ``out in the field'' and remarked that one-stop workers must seek 
out businesses, not the other way around. A trade association similarly 
remarked that the proposal would make it harder for businesses to 
engage with the workforce system and could result in the cancellation 
of contracts or other transition costs.
    A private citizen remarked that their local Michigan Works! office 
has effectively helped businesses attract and develop their workforces, 
including assisting businesses in securing grants to train and invest 
in current employees and add new staff. Similarly praising Michigan 
Works! employees' support for local businesses, another private citizen 
expressed concern that the proposed merit-staffing requirement would 
negatively impact local communities at a time when labor concerns 
hinder businesses across the State.
    Some commenters, including State and local workforce development 
boards from Colorado, a trade association, a commenter from academia, 
and an employer, discussed the value of working with local ES staff due 
to their expertise in the local economy and knowledge of competitive 
factors in a given area, arguing that the ability to provide ES 
services using local merit staff maximizes the level of support 
provided to local businesses. A local government expressed concern that 
the proposal would disrupt established relationships between local 
staff and employers and economic development organizations at the 
community level.
    Some commenters, including an advocacy organization, a trade 
association, a Colorado local government, and private citizens, 
discussed the value of local knowledge in serving the needs of local 
businesses and job seekers, with some discussing the varied needs of 
businesses and job seekers in urban and rural areas. A Colorado local 
government and a Colorado one-stop operator similarly argued that 
employers benefit from working with staff who have a regional 
perspective on what businesses need. A Colorado local workforce 
development board similarly discussed the value of local control of ES 
services and the knowledge of local and regional economic conditions, 
including whether the economy is prosperous, whether employers are 
facing labor shortages or scarcity, and whether unemployment rates are 
high or low. The commenter said removing local control would result in 
slower services and a less nuanced and dynamic response to citizen and 
business needs.
    An advocacy organization described the value of local industry-led 
initiatives in serving employers' unique regional needs and expressed 
concern about such initiatives' continued success if ES staff are 
reduced or reassigned. A Colorado local workforce development board 
described sectoral partnerships developed by local staff working in the 
communities they serve, including partnerships in the healthcare, 
information technology (IT), construction, and transportation sectors. 
A different Colorado local workforce development board expressed 
concern that the proposal would ``dismantle'' successful regional 
industry sector work that has developed over the past decade. A private 
citizen and an anonymous commenter described services provided to 
businesses made possible by local staff's relationships with those 
businesses and expressed concern that the proposal would result in the 
loss of ``local control.''
    A Colorado employer and a few private citizens argued that county 
merit staff have developed expertise on the local economy and community 
needs, asserting that State or Federal employees are less capable of 
developing successful local connections with local businesses.
    Several commenters, including trade associations, private citizens, 
a one-stop center employee, an advocacy organization, and Colorado 
local workforce development boards, argued that local workforce staff 
have the necessary local and regional understanding to establish 
effective partnerships with local partners and organizations. Several 
commenters, including a Michigan State elected official, a Michigan 
local elected official, Michigan local workforce development boards, 
one-stop operators, and Michigan local governments, similarly remarked 
that the ability to develop strategic partnerships with local 
nonprofits, businesses, educational institutions, and other 
organizations is a key benefit of ES staffing flexibility because these 
relationships facilitate connections between students, job seekers, 
training providers, and local employers.
    A private citizen remarked that staff in their local Michigan 
Works! office had a knowledge of local business needs

[[Page 82679]]

and hiring trends that was critical in accessing the right services for 
the commenter to remain competitive in the local job market.
    Response: The commenters highlighted the benefits of the services 
provided to businesses, and the Department agrees that business 
services and partnerships with businesses are important. However, the 
commenters did not explain why the ES staffing model is a causal factor 
in the quality of those business services and partnerships. Many other 
States use State merit staff to successfully provide services to 
businesses and job seekers. The Department recognizes the longstanding 
reliance interests of Colorado, Massachusetts, and Michigan, and will 
therefore allow these States to utilize the longstanding alternative 
staffing models the Department previously allowed them to use. These 
States may exercise merit-staffing flexibility to the same extent 
previously authorized by the Department for that State prior to 
February 5, 2020, the effective date of the 2020 Final Rule. The 
Department also is requiring these three States to participate in 
evaluations of their ES service delivery model to be conducted by the 
Department.
Access--Transportation and Virtual Services
    Comment: Some commenters, including an anonymous commenter, a one-
stop center employee, a local workforce development board, and a 
private citizen, stated that their local service office has offered 
assistance in using technologies or online services that are vital to 
employment and expressed concern about losing access to such support.
    Some commenters, concerned about the disruption or closure of 
Michigan Works! offices in their area, including a local workforce 
development board and a one-stop center employee, worried that 
customers would need to travel longer distances to access needed 
services, with many stating that rising gas prices and other 
complications (such as the sparse availability of public transportation 
in certain areas) will make transportation particularly challenging for 
many one-stop center customers.
    Response: The COVID-19 pandemic highlighted the need for States to 
have staff to serve as surge capacity for times of high demand for UI 
claims. The Department agrees that in-person services are valuable, 
even as technology makes virtual services easier to develop and 
deliver. States across the country, the vast majority of which use 
State merit staff, have successfully used a combination of 
comprehensive and affiliate AJCs, access points, mobile AJCs, and 
online and virtual services to a reach geographically distant job 
seekers and those without reliable transportation. Data do not show a 
relationship between staffing models and the number of AJCs or access 
points per capita in the State. The Department also recognizes the 
longstanding reliance interest that Colorado, Massachusetts, and 
Michigan have in using alternative staffing models authorized by the 
Department. The Department is permitting these States to continue using 
the longstanding staffing models the Department allowed them to use in 
the 1990s. These States may use merit-staffing flexibility to the 
extent permitted by the Department in that State prior to February 5, 
2020, the effective date of the 2020 Final Rule. All other States, 
including those that began using the staffing flexibility provided by 
the 2020 Final Rule, are required to use State merit staff to provide 
ES services. The Department will further examine various staffing 
models and methods of delivering labor exchange services, including 
evaluation activities for which the Department will require the 
participation of the three alternative staffing model States. All other 
States will have 24 months to comply with the requirement to use State 
merit staff to provide ES services. No additional States are permitted 
to pursue adoption of an alternative staffing model during the 
transition period; the final rule is effective 60 days after 
publication in the Federal Register. The 24-month transition period for 
complying with the State merit-staffing requirement is intended only 
for those few States that began using staffing flexibility in response 
to the 2020 Final Rule and now must transition back to using State 
merit staff.
Training and Other Considerations for Employees Delivering Services
    Comment: A think tank remarked that many State agencies face 
multiple challenges, including staffing shortages, funding shortfalls, 
and backlogs, and warned that the proposal could exacerbate these 
issues because contract staffing or other staffing flexibilities offer 
workable solutions. A local government expressed concern about forcing 
programs to re-structure existing staffing models, stating that the 
proposed rule could result in laid off staff, damage to staff morale, 
and a reduction of ``vital employment services'' like labor exchange 
services, career workshops, and services related to community 
engagement and service navigation.
    Some commenters, including a one-stop center employee and a private 
citizen, warned that hiring or training new staff could lead to 
discrimination or bias against existing staff or entry-level staff. A 
private citizen remarked that local agencies may have different 
retirement or healthcare benefits for staff based on agreements with 
local or country governments, and expressed concern that changing 
staffing arrangements could disrupt pension or healthcare benefits for 
some workers. A one-stop operator acknowledged that ensuring employees 
receive fair wages and benefits was a motivation for the NPRM and 
remarked that the retirement and medical benefits available for public 
employees in its county are among the top plans nationwide.
    An anonymous commenter argued that it would not make sense to train 
new individuals to replace the current staff in Workforce Centers, who 
have already developed relationships with customers.
    A private citizen remarked that Colorado's current staffing model 
creates a greater level of oversight because county merit-staff 
employees are accountable to both the State and county government. A 
State government referred to the Department's rationale about State 
merit staff's accountability and asserted that county merit employees 
are already sufficiently accountable to their local county government. 
An advocacy organization stated that currently employee performance is 
assessed and measured using customer service metrics and they expressed 
concern that the proposal would alter and complicate performance 
assessments.
    Response: The Department recognizes that there will be transition 
costs to some States, which was included in the NPRM's regulatory 
impact analysis. New information regarding transition costs and impacts 
was provided in comments to the NPRM from States utilizing alternative 
staffing models. The Department considered these comments in developing 
the final rule but, for the reasons discussed throughout, the 
Department has decided to require that States use State merit staff to 
provide ES services, with limited exception. The Department is allowing 
the three States with longstanding reliance interests--Colorado, 
Massachusetts, and Michigan--to continue to utilize their longstanding 
alternative staffing models for ES services and is requiring their 
participation in an evaluation to be conducted by the Department.

[[Page 82680]]

Transition Period
    Comment: In addition to reduced future employment services, some 
commenters, including an association of State elected officials, a 
Colorado State government agency, Colorado local government agencies, 
and others, claimed that there will be significant transition costs and 
logistical challenges for States to transition to a model by which 
employment services are only provided by State merit staff.
    During this transition period and for some time after, a Colorado 
State elected official and State government agency warned that 
compliance and performance standard failures will likely become more 
common.
    While most commenters wrote about the effects the rule would have 
if implemented, some commenters, including a Colorado State elected 
official, a Colorado local government agency, and a one-stop center 
employee, argued that the proposed merit-staffing requirement has 
already had a chilling effect, with former demonstration State one-stop 
centers and localities unable to approve budgets, not knowing what 
future grant levels will be, and with one-stop center staff already 
seeking employment elsewhere in anticipation that their positions will 
be terminated soon anyway.
    A State government agency discussed the challenging logistics of 
implementing a State merit-staffing model within 18 months, 
anticipating additional staffing needs as well as a challenging 
timeline for State legislature approval of additional funding for 
additional staff. The commenter requested a 3-year implementation 
timeframe to make requests for additional staff and funding during the 
State legislature's budget cycle.
    Conversely, several unions who supported the proposal agreed with 
the proposed 18-month transition timeline and recommended that the 
Department provide assistance and support to any States using 
alternative or flexible staffing models, reasoning that such assistance 
would help prevent disruptions to Wagner-Peyser Act services. One union 
suggested that the Department ``require sufficient staffing to monitor 
and support'' the transition in States using flexible staffing models.
    State and local workforce development boards, a Colorado State 
government agency, and a Colorado local government requested a 36- to 
40-month transition timeline (depending on if and when the rule is 
finalized) allowing for full compliance by December 31, 2025. The 
commenters cited the State legislative process and funding needs to 
both maintain quality services and hire and cross-train new staff as 
factors that necessitate a longer transition period.
    A Colorado State government agency and State and local workforce 
development boards said State legislation would be needed to allow 
Colorado to come into compliance with the Federal rule and anticipated 
that current staff may leave their posts as soon as the rule is 
finalized (which, the commenters asserted, would require time and 
funding to find and train their State merit-staff replacements). The 
commenters also stated that the funding and effort required to hire and 
train new State merit staff would require funding from the PY 2024 
Wagner-Peyser Act allocation as the PY 2023 amount likely would not be 
sufficient.
    A Colorado one-stop operator argued that the transition timeline is 
``irrelevant'' because the proposal will cause impacts immediately. The 
commenter argued that the proposal has already created concerns among 
local employees about their job security and, thus, announcement of a 
finalized nationwide merit-staffing requirement would result in 
immediate departure of ES staff, concluding that Wagner-Peyser Act 
services will ``cease immediately'' if the proposal becomes final.
    A Michigan State government agency requested an extension of the 
implementation period from 18 months to 3 years, arguing that 
modifications to State departments' structure, State budget processes, 
and public sector recruitment, hiring, and training functions will take 
time. The commenter anticipated that 90 new staff members would need to 
be hired and trained and remarked that this would require the State 
legislature to approve a staffing structure modification (adding that 
their State legislature is ``extremely resistant'' to adding new full-
time employees to State departmental budgets). The commenter said the 
longer implementation period would be necessary to ensure there are no 
disruptions to service delivery and reorient the local workforce 
development structure. If the Department finalizes the merit-staffing 
requirement as proposed, this commenter also requested a 3-year 
reprieve from Wagner-Peyser Act and WIOA title I performance reporting 
and suggested that a new performance baseline would need to be 
negotiated and established.
    Opposing the proposed merit-staffing requirement, several 
commenters, including a one-stop center employee, argued that 18 months 
was insufficient to ``revamp'' an ES delivery system that has been 
constructed over the past 25 years and requested that, if the proposal 
is finalized, more than 18 months be provided for transition and 
transition should align with a new program year. These commenters 
described the ``painful'' impacts of Michigan's 1998 transition from 
State merit staff to local merit staff, including lack of coordination 
in program delivery and diminished customer service.
    A Massachusetts State government agency opposed to the proposal 
requested a ``significantly longer timeline'' to assess, plan for, and 
implement the merit-staffing requirement, asserting this would require 
the conversion of more than 40 local Wagner-Peyser Act staff into State 
merit staff. The State government listed difficulties associated with 
an anticipated ``major infrastructure change,'' including facilitating 
staff turnover and hiring new staff, negotiating with unions, approval 
of ``spending controls,'' and considerations of lease or other 
contractual agreements. The commenter also mentioned that the 
forthcoming WIOA reauthorization potentially complicates the overall 
timeline. Ultimately, the commenter requested that the implementation 
period should last until at least January 2025.
    Describing the proposal as a major disruption to Colorado's 
workforce system, the commenter discussed how the staffing transition 
would impact program offices in Colorado, including ``mass layoffs'' of 
145 county staff (and associated negative impacts on morale), fewer 
full time Wagner-Peyser Act staff resulting in scaled back services for 
vulnerable populations, lost productivity, customer service 
disruptions, increased errors by ``unseasoned staff,'' and potential 
lawsuits or other complications due to union representation of State 
staff.
    Several commenters remarked that, based on average turnover rates, 
Michigan's local offices may have 18 open ES positions at any given 
time. A Colorado State government agency asserted that the proposal 
would make it difficult to hire new outreach staff. Additionally, a 
Delaware State government agency further warned that the process to 
replace Wagner-Peyser Act contractors and local staff with State merit 
staff will be procedurally challenging and time consuming, with no 
guarantee that the staff requests will be approved by the relevant 
State government bodies. A local workforce development board remarked 
that its local service center could not move forward with planning 
programming and strategies for the forthcoming

[[Page 82681]]

program year (which begins on July 1st of this year) because they are 
unclear as to the financial implications of the proposal. Similarly, a 
Colorado State government agency expressed concern about changing 
regulations during ``the current 2020-2023 demonstration period'' 
because neither former demonstration States nor the Department would 
have enough time to provide evaluative data on the benefits and 
challenges with the flexible staffing model approach.
    Response: The Department proposed an 18-month transition period for 
States to comply with the requirement to use State merit staff to 
provide ES services and estimated transition costs in its regulatory 
impact analysis. In the proposed rule the Department specifically 
requested information regarding States' transition costs and the 
proposed 18-month transition period should this requirement be 
implemented for all States. The Department received comments regarding 
the length of the transition period, with some commenters suggesting a 
2-year transition period, while others suggested a longer or 
unspecified period of time. The three States with longstanding reliance 
interests requested a 3- to 4-year transition period. As noted 
throughout this preamble, based on information provided by these three 
States in response to the NPRM, the Department is allowing these States 
to continue to use the alternative staffing models consistent with the 
models previously approved by the Department in these States. The 
Department is requiring these three States to participate in 
evaluations of their ES service delivery models. The Department 
recognizes that there are certain transition costs associated with 
shifting back to the use of State merit-staffing, which may include 
State legislation, budget restructuring, and hiring, and these 
processes, particularly those that require State legislative action, 
may take longer than 18 months. Therefore, the Department is requiring 
all other States, including States that began using alternative 
staffing models following the 2020 Final Rule, to comply with the 
requirement to use State merit staff for ES services within 24 months 
of the effective date of this final rule. This includes the requirement 
to use State merit staff to conduct outreach and provide other services 
to MSFWs under parts 653 and 658.
Relationship Between Employment Services and Unemployment Insurance
Consequences of Having the Same Staff Manage ES and UI in States That 
Are Currently Operating Flexible Staffing Models
    Comment: Many commenters, including a Michigan State elected 
official, a Massachusetts State government agency, and Colorado local 
governments, articulated that local merit staff at one-stop centers in 
former demonstration States already provide significant resources, 
guidance, and other support to UI claimants, many of whom face 
technological and transportation barriers in making successful 
unemployment claims, and claimed this role was particularly important 
during the UI demand surge caused by the COVID-19 pandemic.
    Some commenters, including one-stop center staff and a private 
citizen, warned that assigning ES staff to UI adjudications during UI 
surges would unnecessarily burden ES staff and cause the quality of 
employment services in the States that use flexible staffing models to 
degrade even further during UI surges.
    An advocacy organization argued that the relatively small number of 
new State merit staff this rule would create in States that use 
flexible staffing models would not make the States significantly more 
prepared to handle UI surges. Similarly, a Colorado State elected 
official and a Colorado local workforce development board argued that 
States that already require Wagner-Peyser Act ES services to be 
provided by State merit staff did not perform any better in processing 
UI claims during the UI surge caused by the COVID-19 pandemic than the 
former demonstration States.
    A one-stop center employee similarly argued that the rule could 
actually decrease the number of staff available to assist with UI 
claims during a UI surge in States that use flexible staffing models; 
this commenter argued that because one-stop center staff in former 
demonstration States are already assisting with the UI claims process, 
by causing an overall reduction in ES staff, such States would lose 
this surge capacity.
    Some commenters, including one-stop center employees, trade 
associations, and a private citizen, expressed concern about skill 
misalignment and warned that the proposal would require retraining 
workers who provide employment services to perform tasks related to 
adjudicating UI claims, functions the commenters argued require 
different skill sets and workstyles. A one-stop center employee 
expressed concern about ES staff taking on the duties of UI staff and 
argued that ES staff will not be familiar with practices critical to 
the management of UI benefits (such as timely administration of the 
``work test.'') A private citizen remarked that Michigan's local ES 
offices have been successful in providing a wide range of services to 
both job seekers and businesses seeking employees while, in their view, 
the merit-staffed State UI program has been ``a debacle.''
    A Colorado State government agency expressed concern about the 
effort and funding required to onboard or cross-train staff and 
remarked that new hires may not be available to provide services 
throughout their first year due to the time needed to complete required 
trainings for both UI and Wagner-Peyser Act programs.
    Response: The Department proposed to require that States use State 
merit staff to provide ES services, which aligns the provision of ES 
services with the requirement that States administer certain UI 
activities with State merit staff. The Department notes that the NPRM 
did not propose requirements on States to train or use their ES staff 
for UI activities. Neither is the Department requiring that States 
cross-train ES staff for UI activities in this final rule. However, the 
ability for States to cross-train would generally better equip States 
to be able to use ES staff for certain UI activities that require State 
merit staff in times of high need. While the Department encourages 
States to plan for increases in UI demand including through cross-
training, a State can develop cross-training that it wishes to 
implement at its own pace. The Department recognizes the role that 
other staff in an AJC may play in connecting job seekers with UI 
services, but also notes that the ES has specific duties to assist UI 
claimants to become reemployed. Providing information and meaningful 
assistance in filing a claim for unemployment compensation is an 
allowable cost under the Wagner-Peyser Act. The Department also 
recognizes the longstanding reliance interests of Colorado, 
Massachusetts, and Michigan, in utilizing alternative staffing models 
and that a requirement to use State merit staff may impact these States 
differently than other States. Therefore, the Department is allowing 
these three States to continue to use the longstanding alternative 
staffing models previously approved by the Department in these States. 
The Department is requiring these three States to participate in 
evaluations of ES service delivery and alternative staffing models.

[[Page 82682]]

Support Ability of State Merit Staff To Provide Surge UI Claims 
Processing Capacity
    Comment: Many commenters, including unions, advocacy organizations, 
think tanks, and a State government agency, expressed support for the 
proposed ES merit-staffing requirement because of State merit staff's 
ability to play roles in administering UI programs and connecting 
jobless workers to UI benefits. Specifically, some of these commenters 
remarked that, because only State merit staff can legally adjudicate UI 
claims, requiring ES staff to be hired on a merit basis would permit 
States to rely on them to process and adjudicate UI claims. Some 
unions, advocacy organizations, think tanks, and a State employee 
association commented that reinstating the merit-staffing requirement 
in all States and realigning ES services with the UI program will 
ensure that workers can continue to receive unbiased, high-quality 
employment services and effective, qualified help in claiming UI 
benefits during economic crises ``without the threat of partisan 
political coercion hanging over them.''
    Several unions, a State government agency, and a think tank agreed 
with the Department's assessment that any value gained by allowing the 
ES to be staffed at the local level is outweighed by the benefits of 
aligning ES staffing with UI administration and adjudication, which 
would allow ES staff to provide surge capacity for UI during times of 
high need. As framed by one union, cross-training State merit ES staff 
enhances the resiliency of UI service delivery. Citing the pandemic and 
natural disaster emergencies (e.g., Hurricane Sandy) as the best 
examples of the need for cross-training State merit ES staff to assist 
UI claimants in periods of high demand, many commenters, including 
unions, advocacy organizations, and think tanks, argued that, because 
the frequency of such extreme events is likely to increase, alignment 
of ES and UI staff is even more important. Several of these commenters 
reported that during the pandemic, Great Recession, and recent natural 
disasters, States have relied on State merit ES staff to support UI 
work, which helped to address historic UI claims surges.
    According to unions, advocacy organizations, think tanks, and a 
State employee association, the U.S. experience with temporary 
privatization of UI administration permitted by Congress during the 
pandemic reinforces the importance of reinstating ES merit-staffing. 
These commenters asserted that the temporary exemption from the 
requirement that UI adjudicators be merit-staffed resulted in many 
States contracting with private companies that hired low paid, poorly 
trained non-State-merit staff to administer traditional and new 
temporary UI programs. Citing a May 2022 working paper, these 
commenters said that this use of non-State-merit staff led to high 
turnover among contracted staff; corruption in the hiring of staff and 
in job and training referrals and placements; and poor service and long 
payment delays for claimants. A State employee association and a union 
added that incomplete and deficient work by outsourced staff increased 
the workload for State merit-staff UI adjudicators, who were forced to 
correct vendor staff errors.
    Further, unions, an advocacy organization, a think tank, and a 
State employee association discussed a State audit of Michigan's UI 
experience during the pandemic, which they asserted found that 
insufficient worker onboarding and offboarding practices (e.g., only 
one-fifth of workers completed required training before starting their 
duties) resulted in a total of $3.8 million in UI fraud committed by 
vendor staff; purchase order delays; conflicts and ethics violations; 
and unsafe computer sanitization practices. A State employee 
association and an advocacy organization added that the Michigan audit 
also found that nearly half of the sampled vendor staff still had 
access to the State's automated UI system long after they no longer 
worked for the contractor, which the commenter said created unnecessary 
risk to the data and systems. Citing the Michigan audit report, an 
advocacy organization said that contractors also failed to comply with 
criminal history background checks for their workers.
    Also asserting that Michigan UI claimants in particular suffered 
during the pandemic, an advocacy organization commented that hundreds 
of claimants reported to legal advocates that they received little to 
no help from the frontline staff who were hired to handle the surge of 
claims during the pandemic. Asserting that non-merit UI workers hired 
during the pandemic did not receive adequate training, unions and a 
State employee association agreed with the Department's statement in 
the NPRM that providing adequate training for UI adjudicators takes 
several months to a year. A think tank commented that State UI offices 
increasingly are using contractors for identity verification, which is 
delaying benefits and creating backlogs for unemployed workers, which 
is impacting individuals of color and their communities.
    An advocacy organization and a private citizen commented that 
cross-training ES merit staff would alleviate a lot of the pressure on 
UI merit staff during crises. Citing a lag of increased UI 
administrative funding at the start of economic downturns, another 
advocacy organization argued that cross-training State merit ES staff 
allows ES staff to fill this gap before the Department is able to 
distribute additional funds to respond to increased administrative 
needs.
    A think tank commented that it has heard from a wide range of legal 
aid and UI advocates that State UI systems are overwhelmed and fighting 
cyber fraud due to staffing shortages. Citing a 2020 news article about 
a Michigan UI agency employee committing fraud, an advocacy 
organization argued that cross-training ES State merit staff to provide 
UI services during surges--rather than relying on contractors or new 
hires--could limit the risk of fraud and ensure the program is run with 
high integrity and efficiency.
    Some commenters, including unions, advocacy organizations, and 
think tanks, remarked that merit-based State ES employees provide 
professional, unbiased ES services to job seekers and employers and 
help UI claimants navigate the job market and comply with work search 
requirements to initiate and remain eligible for UI benefits. 
Specifically, an advocacy organization commented that ES staff are 
already familiar with the local worker populations and understand the 
conditions on the ground. Because ES staff administer the work test to 
ensure that UI claimants are able to work and are available for and 
actively seeking work, which is a federally required condition of State 
UI eligibility, a State employee association asserted that this 
gatekeeper function makes the role of ES staff ``inherently 
governmental.'' Citing increased mandatory UI work test duties imposed 
over time, a private citizen argued that additional State merit ES 
staff should be physically available in one-stop centers to assist the 
UI component in a variety of expanded work test functions.
    An advocacy organization argued that, to support a unified delivery 
model in which job seekers can apply for UI benefits through the same 
agency providing reemployment services, ES and UI programs should work 
together to ensure that services are provided by conflict-free, public 
service professionals, so that workers receiving UI benefits can find 
suitable replacement jobs efficiently. Similarly, a private citizen 
commented that required

[[Page 82683]]

merit-staffing for ES services may promote better coordination between 
UI staff and ES staff, which is much needed. Commenting that the ES 
program performs important labor exchange functions that connect 
employers with qualified workers and help employees gain reemployment 
more rapidly, a private citizen argued that the ES must be closely 
involved with UI. A think tank argued that, as new technology will be 
deployed over the next few years to address UI modernization, it is 
critical that State level staff are career employees with decent pay 
and benefits, which ``will also help ensure a more equitable UI system 
for all workers and address the racial inequities.''
    Asserting that allowing non-State employees in some States to 
operate ES and UI services was not a wise policy practice, a private 
citizen reasoned that deficient or hard-to-manipulate computer-based 
registration, job finding and placement services, and claims processing 
often result in frustration, leaving some jobless to abandon government 
assistance, which erodes overall trust in government services. This 
commenter concluded that the best way to reestablish the trust of job 
seekers and UI claimants in the delivery of public services is to 
improve the national standards of quality and professionalism in 
staffing of State workforce agencies by hiring superior individuals 
under merit standards.
    Also expressing concern about non-State-merit ES staff causing 
frustration for UI claimants, an advocacy organization argued that 
cross-training ES State merit staff, and allowing them limited access 
to UI claims information, could go a long way towards rebuilding these 
relationships, and would provide claimants with the in-person access to 
information that they want. Specifically, this commenter said that most 
of its clients have limited access to technology and struggle to 
navigate the UI technology system on their phones, and one-stop center 
staff cannot help claimants with filing claims or navigating the online 
portal. Therefore, the commenter remarked that cross-training ES staff 
and allowing them to provide minimal UI support could help alleviate 
claimant frustrations, provide better access to UI, and prevent many 
mistakes that claimants make when filing that later lead to improper 
payments. Finally, this commenter argued that, because the majority of 
its clients who seek help at State one-stop centers are from 
underserved populations, allowing ES State merit staff to provide basic 
information about UI claim status and assist with navigating the online 
systems would ensure greater equity in access to benefits.
    A union, a State employee association, an advocacy organization, 
and a private citizen argued that the history of the ES and UI programs 
supports the NPRM's reliance on the ES-UI relationship and the 
appropriateness of aligning these programs via the State merit-staffing 
requirement. Specifically, a union and a State employee association 
commented that these programs originated as intertwined prongs of the 
New Deal response to mass unemployment and Congress subsequently 
integrated the funding structure of ES and UI, tasked ES with 
administering the UI work test, and encouraged the colocation of ES and 
UI staff to support unified service delivery, all of which also bind 
these programs together and support alignment.
    In particular, because the UI program was created in the Social 
Security Act (SSA) less than 2 years after passage of the Wagner-Peyser 
Act, a private citizen stated that Congress developed the UI program 
with full knowledge of the existing ES public labor exchanges. The 
commenter described the origins of the UI statutory merit-staffing 
requirement and asserted that this legislative history provides support 
for the Department's linkage of UI and ES. In summary, according to 
this commenter, the UI merit-staffing requirement was not in the 
original SSA of 1935, even though the President's Committee that 
designed the programs recommended that the selection of administrative 
personnel for the program be on a merit basis. In 1938, the commenter 
said, based on an initial UI program review by the Social Security 
Board, a recommendation was made to require merit-staffing in the UI 
program for all States, which was implemented by Congress in 1939, 
while leaving early Federal administrative interpretations requiring 
merit-staffing for the ES program in place. Therefore, this commenter 
concluded that the linked historical background of ES and UI 
demonstrates that the absence of an explicit merit-staffing requirement 
in the Wagner-Peyser Act does not demonstrate that merit-staffing is 
beyond the Secretary's authority, and the record of consistent use of 
merit-staffing in both ES and UI programs supports the adoption of the 
proposed merit-staffing requirement.
    Asserting that the founders of the unemployment security system 
felt strongly that ES and UI services should be administered by State 
merit-staffed employees, a private citizen commented that, without 
State merit-staff ES employees, the public character of the one-stop 
center is ceded to private control, contrary to the intent of the 
Wagner-Peyser Act. This commenter urged the Department to strengthen 
its argument for uniform required State merit-staffing for ES services 
by indicating that it is based on longstanding Department policy, 
research findings, and relevant recent experience.
    A union argued that aligning the staffing requirements of the ES 
and UI programs would further facilitate their integration and promote 
their joint aim of alleviating the deleterious effects of unemployment 
and foster reemployment.
    Response: The Department proposed to require that all States use 
State merit staff to provide ES services due in part to the critical 
need for alignment between the ES and UI programs. The Department 
appreciates the comments supporting this alignment. It is vital that 
the ES be administered so that services are delivered effectively and 
equitably to UI beneficiaries and other ES customers. The Department's 
proposal and justification was supported by these commenters, including 
that States would be better equipped to handle surges in UI claims with 
cross-trained ES staff. As the Department noted in the NPRM, 
emergencies such as natural disasters are occurring with increased 
frequency such that a need for surge capacity and cross-trained staff 
is becoming increasingly necessary. The Department further noted that 
historical data from 1971 through 2021 indicate regular and periodic 
increases in the number of UI initial claims and first payments, for 
which having ES staff who are already cross-trained or able to be 
quickly cross-trained to assist UI claimants would be beneficial. 
Requiring States to use State merit staff also helps to support 
universal access to ES services and helps to ensure that services are 
delivered by qualified, non-partisan personnel who are directly 
accountable to the State. Such professionals would be required to meet 
objective professional qualifications, be trained to assure high-
quality performance, and maintain certain standards of performance. 
They would also be prohibited from using their official authority for 
purposes of political interference, and States would be required to 
assure that they are treated fairly and protected against partisan 
political coercion.
    The Department further agrees that UI and ES are two mutually 
reinforcing elements of the Federal government's commitment to workers 
and that the legislative history of the two programs

[[Page 82684]]

strengthens the Department's authority to require State merit ES staff. 
The alignment of these two programs remains a core goal of the 
Department, with the RESEA program's emphasis on connecting UI 
claimants to Wagner-Peyser and WIOA services being the latest step 
toward further integration.
Undue Prioritization of UI Services
    Comment: Some commenters, including a Colorado State government 
agency, a one-stop operator, private citizens, and an anonymous 
commenter, critiqued the proposal over what they perceived as an undue 
prioritization of UI services over ES and argued that in doing so, the 
Department would be restricting vulnerable populations' access to 
needed employment assistance programs because many individuals who 
would benefit from ES are not eligible for UI. Several commenters, 
including a Colorado local government employee and an anonymous 
commenter, argued that the proposal presented ``discrimination and 
civil rights issues'' in shifting focus from ES to UI services because 
the latter does not provide a comprehensive set of services to enable 
job seekers to find and secure a job. Several commenters, including a 
Colorado State government agency and a trade association, similarly 
discussed inequity and civil rights concerns associated with the 
proposal ``prioritizing the delivery of UI services'' over ES, arguing 
that this places increased importance on customers eligible for UI and 
diminishes the availability of services for vulnerable populations 
(such as communities of color, people with disabilities, people 
experiencing homelessness, and self-employed or gig workers) who need 
employment assistance but may be ineligible for UI.
    A trade association remarked that shifting ES staff to UI services 
would promote benefit payments over assisting customers with employment 
and would cause the community to perceive AJCs as ``the unemployment 
office'' rather than a site to receive employment services.
    A one-stop center argued that prioritizing UI services over ES 
would be harmful to employers. A private citizen stated that the 
staffing status quo in Colorado enables an equitable delivery of UI and 
ES services and cited data from 2021 about the numbers of people who 
accessed such services in their area in asserting that 9,000 people 
would receive ``subpar'' ES due to the proposal's undue prioritization 
of UI.
    A State government discussed challenges associated with a rapidly 
changing labor market and encouraged the Department to keep flexible 
staffing models in place, arguing that States need flexibility to 
effectively deliver UI and reemployment services, in part due to the 
decrease in Federal Wagner-Peyser Act funding ``over the past 
decades.'' The commenter said reemployment services require a wide 
range of ``tools, sites, and strategies'' and argued that staffing 
flexibility helps some States deliver such services effectively. A 
group of local government employees remarked that many of the 
individuals served in their local area are not eligible for UI benefits 
but need access to ES services. The commenter said such individuals 
feel comfortable coming into a local office and expressed concern about 
a disruption of the equitable and ``seamless'' delivery of services to 
marginalized populations, citing an anecdotal example.
    Many commenters asserted that it would be counterproductive to 
require States to use State merit staff to provide ES services and 
cross-train these employees to process UI claims.
    Several commenters, including a Colorado State agency, a trade 
association, and an advocacy organization, argued that shifting ES 
staff to perform UI services would repurpose staff to perform duties 
outside their scope of work, therefore hampering staff ability to 
perform their main function. These commenters reasoned that ES staff 
are hired for job coaching, customer support, and relationship building 
while UI staff focus on short-term problem solving, further stating 
that the misalignment of these skill sets will create more 
accessibility problems for all.
    Many commenters, including State agencies and an advocacy 
organization, expressed concern that the proposed rule does not 
consider the need for surging ES services during UI surges, further 
questioning who will provide ES services when ES staff are re-assigned 
to UI adjudication and claim processing. Some commenters, including an 
association of State elected officials, a one-stop operator, and 
others, agreed that the lack of staff performing ES services during UI 
surges will lead to slower service overall. Relatedly, a few 
commenters, including a one-stop center employee, a think tank, and an 
anonymous commenter, argued that it is unrealistic to have ES staff 
turn away from their job duties to handle UI claims as they already 
have full workloads that can be difficult to keep up with. Several 
commenters questioned whether ES staff would be relocated to UI offices 
for training and for the provision of UI services during surges.
    Some commenters, including a Colorado State government agency and a 
trade association, argued that the pandemic created a rare economic 
crisis, and that requiring nationwide State merit-staffing for ES 
services is not the most efficient way to fix the UI surge issues 
brought about by these extraordinary circumstances. Many other 
commenters, including a Colorado State workforce development board and 
a Colorado employer, expressed similar sentiments, agreeing that the 
pandemic is a temporary outlier event, and that implementing these 
changes will be less effective in supporting job seekers and UI 
claimants at all other times. A local workforce development board 
stated there was no compelling need nor sufficient rationale to require 
State merit staff and asserted the proposal would ``void'' the ability 
to innovate in its State.
    A Colorado State agency, a Colorado workforce development board, 
and a private citizen stated that the proposed rule would negatively 
impact the quality of services to businesses. These commenters reasoned 
that current local ES staff have experience serving businesses and 
knowledge of the local economy, while any State merit staff that 
replace them will not have these advantages or incentive to support 
employers across multiple programs. The commenters further stated that 
businesses will suffer during economic hardships because ES staff will 
be diverted to focus on UI claims.
    Two State government agencies recommended that the Department 
provide more guidance to States about cross-training ES staff with UI 
services to prepare for the next UI surge. These commenters expressed 
concern that this responsibility will fall on the States without 
direction from the agency on how to meet the Department's objective.
    A State workforce development board and others expressed concern 
that the proposed rule would have a disproportionate impact on rural 
areas, as many States report centralized ES staff in urban areas. The 
commenters anticipated the required change in staffing would bring 
about an overall reduction in services, especially during UI surges.
    Framing the proposed merit-staffing requirement as prioritizing UI 
benefits recipients over all other populations, a one-stop operator 
commented that, because data shows UI recipients do not represent 
underserved populations, requiring nationwide merit-staffing for ES 
services would supersede community and business needs to provide backup 
for UI programs in times of need.

[[Page 82685]]

    A few associations of workforce boards, a State workforce 
development board, and a professional association stated that by 
mandating the use of State merit staff for ES services, the proposed 
rule would significantly limit the types of technology and tools 
available to States in times of surging UI demand.
    Also arguing that a uniform merit-staffing requirement would harm, 
rather than assist, Colorado's workforce, a private citizen suggested 
that the Department instead change the requirement that UI claims must 
be processed by State merit staff. A think tank similarly argued that 
the Department should support legislative efforts to create permanent 
staffing flexibilities in both the ES and UI programs.
    Many commenters from Michigan, Colorado, and Massachusetts 
discussed how the local resource centers in their State were able to 
pivot to UI surge support amid the pandemic to demonstrate the high 
efficiency of their current systems. For example, several commenters 
from Colorado, including a local government, a local workforce 
development board, a trade association, and others, described how their 
local staff successfully responded to the spike in phone calls related 
to UI issues by creating a virtual call center that exclusively 
answered UI questions, proving that they are able to handle these 
services at a local level, particularly when unemployment agencies are 
overwhelmed. Several commenters from Michigan, including one-stop 
operators, one-stop center staff, and private citizens, stated that 
local workforce development offices across the State were able to 
leverage hundreds of staff to assist the unemployment agency in 
responding to the UI claims they could not keep up with during the 
pandemic, further requesting that Michigan be allowed to continue 
utilizing non-State-merit staff to provide ES services. A few 
commenters from Massachusetts, including a State government agency, a 
local workforce development board, and a local elected official, stated 
that the one-stop center staff in their State are trained on the 
fundamental knowledge of unemployment, along with more in-depth 
training for designated staff, all of which allows them to assist 
customers with questions about their UI claims. These commenters 
further discussed how their ES staff seamlessly transitioned to 
assisting UI claimants during the pandemic without any disruption of 
services.
    Expressing concern that the proposed rule would result in reduced 
services at local offices, some private citizens and an employer 
expressed appreciation for ES staff helping them with job search and UI 
claims process issues during periods of unemployment. Similarly, an 
employer commented that they do not know what they would do without 
Michigan Works! because they assist them and their employees with UI 
benefits in their off season. Michigan one-stop center staff also said 
that they help unemployed customers to navigate the UI system, with 
some asserting that many UI claimants have challenges using a computer 
and eliminating local services could escalate customer frustrations.
    Response: The Department appreciates the concerns raised by 
commenters, and agrees with the comments describing the importance of 
assistance with UI, the ability to access that support, and the close 
relationship between ES and UI. Similarly, in most of the States across 
the country, ES State merit staff operate in AJCs and provide 
assistance with job search, applying for UI benefits, and pivot during 
surges. The Department proposed to require that States use State merit 
staff to provide ES services due to the need for critical alignment 
between the ES and UI programs and to help ensure that services are 
delivered by qualified, non-partisan professionals accountable to the 
State. While the Department believes it is vital for ES and UI to be 
aligned, this final rule does not impose requirements on States to 
cross-train or utilize ES staff for UI services. Many States already 
cross-train and utilize ES staff for UI activities, and States with 
prior issues within their UI program may benefit from having cross-
trained ES staff available when there are surges in demand for UI 
claims. Aligning these programs should not negatively impact or 
prioritize one program over the other. Rather, aligning the two 
programs serves to increase consistency of service, as well as 
capacity, for each. Further, a State merit-staffing requirement helps 
to promote consistent training and accountability throughout the State 
from one locality to another. The Department will provide technical 
assistance to States that are interested in more closely aligning the 
respective programs.
    The Department additionally recognizes the reliance interests of 
Colorado, Massachusetts, and Michigan, all of which were permitted by 
the Department to use alternative staffing models beginning in the 
1990s. Accordingly, this rule requires all States to use State merit 
staff to deliver ES services, except for these three States using 
longstanding alternative staffing models previously authorized by the 
Department. These three States are permitted to continue using their 
longstanding staffing models and must participate in any evaluation of 
their delivery of ES services conducted by the Department.
    The Department recognizes that there will be certain transition 
costs to some States, which was included in the NPRM's regulatory 
impact analysis. All States have 24 months to comply with the staffing 
requirements.
Alignment With Other Programs
    Comment: Several commenters, including a one-stop center employee 
and an advocacy organization, expressed concern that the proposal would 
disrupt the ``integrated service delivery model'' in their area and 
would result in a siloed service delivery model to the detriment of 
program beneficiaries.
    Several commenters, including Michigan local governments, a 
Michigan local elected official, State and local workforce development 
boards, and a private citizen, encouraged alignment and integration 
among programs including the Wagner-Peyser Act ES program, WIOA, the 
Supplemental Nutrition Assistance Program (SNAP), Temporary Assistance 
for Needy Families (TANF), and Trade Adjustment Assistance (TAA) and 
expressed concern that the proposal would disrupt a ``streamlined'' 
service delivery model. A trade association remarked that Wagner-Peyser 
Act funding allows Michigan Works! to leverage funds from other State, 
Federal, and non-governmental programs to improve services for 
individuals and businesses.
    Many commenters, including Michigan and Colorado State elected 
officials, Michigan and Delaware State government agencies, and 
Michigan and Colorado local governments, argued that the rule would 
eliminate States' ability to integrate the provision of Wagner-Peyser 
Act-funded services with other workforce development and social support 
services, such as WIOA and TANF, which would reduce efficiencies and 
increase administrative costs in States that use flexible staffing 
models. A one-stop operator requested that the Department reconsider 
the proposal, arguing that the current flexibility afforded to States 
has resulted in a more ``responsive'' workforce development system.
    Some commenters, including a training provider, a commenter from 
academia, and a one-stop center employee, warned that the rule would 
jeopardize former demonstration States' other grant funding agreements 
with the Department. Several commenters asserted that the proposal 
would ``de-

[[Page 82686]]

couple'' services, funding, and practices that have been integrated as 
a result of their State's demonstration status. The commenters 
described the rule as ``outdated, inefficient, unnecessary, and overly 
burdensome.''
    Many commenters, including Michigan and Massachusetts State 
government agencies, advocacy organizations, and trade associations, 
argued that one significant benefit of the status quo flexibility in 
staffing and use of funds in States operating flexible staffing models 
is the ability of local ES staff to braid funds and integrate the 
provision of Wagner-Peyser Act-funded services with other local 
workforce development programs and social services, including WIOA and 
TANF, which makes the services more efficient and reduces 
administrative costs. An employer commented that flexible ES staffing 
models like the Michigan Works! system are able to provide the most 
cost-efficient results because they can leverage Federal, State, and 
local resources; costs to operate job centers are shared with all 
partners and programs; and because, at the local level, many 
organizations provide ``in kind'' contributions of administrative 
support, which reduces overall program costs.
    Several commenters provided performance data from the Department's 
website that demonstrates the success of Michigan's performance against 
the national average and argued that the integrated workforce 
development system in their State is ``transformational'' for both 
employers and job seekers. Other commenters, including a trade 
association, one-stop center staff, and private citizens, made similar 
arguments that Michigan and Colorado are outpacing the national median 
on performance metrics and has a low cost per participant. Also 
asserting that Michigan has been a top performer in nearly every ES-
relevant metric, a private citizen questioned the need for the rule and 
the proposal's ``streamlining or improving services'' assertion, 
commenting that replacing 220 local workforce staff with 80 to 90 State 
merit staff will hurt rural communities.
    Several commenters stated that, in Michigan, alignment with local 
workforce systems is critical in connecting job seekers with a range of 
programs that support their ability to remain employed and minimize the 
need for UI benefits.
    An anonymous commenter said the integrated model in their area 
allows offices to leverage resources, which in turn promotes higher 
quality of services. A private citizen remarked that current staffing 
model in Colorado has encouraged innovation and has led to the creation 
of an integrated model of program administration, oversight, and 
delivery. Several commenters, including a one-stop center employee, 
faulted the proposal for favoring ``alignment of ES and UI staffing'' 
over the efficiencies associated with flexible staffing arrangements 
and expressed concern that the proposal would result in the closure of 
AJCs (ES offices) and reduced services for employers.
    Some commenters, including a one-stop center employee, described 
their experiences working for or with local service centers and 
expressed concern about offering Wagner-Peyser Act and WIOA services in 
different offices or sites and the disruption of access to a more all-
encompassing set of services. Some commenters, including a State 
Workforce Development Board, a trade association, and private citizens, 
remarked that the proposal could disrupt the WIOA one-stop service 
delivery model because Employment Service (ES) and WIOA staff would not 
be housed together. These commenters and others, including an employer 
and a one-stop center employee, said this divided or siloed environment 
was contrary to the ``vision and intent'' of WIOA.
    A State employee association that supported the proposal argued 
that ``restoring'' State merit-staffing requirements would be 
beneficial for other programs unrelated to the UI system, such as the 
employment infrastructure for veterans and the delivery of TAA services 
for workers impacted by trade. The commenter referred to removal of the 
merit-staffing requirement for delivering TAA services in the ``Trade 
Adjustment Assistance for Workers'' final rule, 85 FR 51896 (Aug. 21, 
2020), and urged the Department to also repeal that rule to ensure 
State merit-staffing is the ``standard'' in States that may have used 
staffing flexibility for TAA. A Colorado State government agency 
similarly remarked that TAA services, which are staffed by county merit 
staff in Colorado, would be adversely impacted by the proposal, 
remarking that in 2021, TAA ``provided approximately $956,761 to local 
areas'' to assist with staffing 15 full-time employees.
    Conversely, a State workforce development board argued that WIOA's 
title programs, and other programs under TANF and SNAP, are aligned to 
work together in meeting diverse customers' needs and encouraged the 
Department to maintain staffing flexibility for the Wagner-Peyser Act 
ES program, RESEA, TAA, and other programs that benefit from alignment 
with local workforce systems. A local workforce development board 
stated that Colorado's ability to employ a flexible staffing model has 
improved integration between WIOA and Wagner-Peyser Act ES services and 
led to several positive outcomes, including successful employment of 
customers, services rendered to many unique employers, significant 
numbers of workshops and hiring events, and a strong overall return on 
investment. A State government and other commenters similarly remarked 
that the local merit-staffing model used in Colorado allows for 
``seamless'' service integration and braiding of funding across 
federally funded programs.
    A State Workforce Development Board argued that the Department's 
approach in the proposal undermines the ``key principle'' of State and 
local flexibility for WIOA services and the Federal workforce system 
more broadly. The commenter said the proposal would disrupt 
efficiencies, discourage innovation, and undermine ``balance'' among 
the Federal, State, and local partnerships that deliver WIOA and ES 
services.
    Response: The Department proposed to require that all States use 
State merit staff to provide ES services due to the critical need for 
alignment between the ES and UI programs. Aligning these programs 
should not negatively impact or prioritize one program over the other. 
It simply allows the State, in times of high need to be able to use ES 
staff for certain UI activities should the State choose to do so. The 
Department is not imposing additional requirements on the State for how 
it uses the ES staff, but having cross-trained staff would better equip 
the States to be able to shift resources in certain situations. The ES 
and UI are already closely linked as they are both required partners 
under WIOA, the UI program makes referrals to the ES for reemployment 
services, and the ES program administers the work test for UI. WIOA 
also requires the colocation of the ES with WIOA programs (20 CFR 
652.202, 678.315) so the concerns regarding certain individuals no 
longer having access to services is not supported by the information 
provided. WIOA emphasizes integrated and streamlined service delivery. 
The nature of ES services is such that ES staff provide basic and 
individualized career services and make referrals to other programs, no 
matter the staffing model used. The Department further believes the 
keys to program success are the intensity of the integration of WIOA 
and Wagner-Peyser services. Other States that use State merit staff 
have been able

[[Page 82687]]

to innovate and implement the vision of WIOA. Several States have made 
progress cross-training ES staff and UI staff. Additionally, States 
have trained all AJC partners including ES staff to perform common 
intake and make seamless referrals using a ``no wrong door'' approach 
to case management irrespective of the Wagner-Peyser ES staffing model. 
Three States using longstanding alternative staffing models presented 
arguments in support of retaining those models, but the information 
provided did not show a causal impact of the staffing model in these 
States and performance. Accordingly, the Department declines to extend 
staffing flexibility to all States. The Department reinstates a State 
merit-staffing requirement for ES services with the exception of the 
three States with longstanding reliance interests. These States are 
required to participate in evaluation of their delivery of ES services 
conducted by the Department, including review of services of other 
States that participate, as necessary, to determine whether such models 
are empirically supported.
Other Objections From States With Longstanding Reliance Interests
    Comment: Many commenters, including a Michigan State elected 
official, Colorado local governments, and an advocacy organization, 
expressed opposition to the rule on the grounds that it would reduce 
both State and local control over the provision of ES services in the 
States that use flexible staffing models, and that in many cases this 
will make the services less personal and less responsive to local 
needs.
    One anonymous commenter argued that as contractors and local 
government employees, ES staff in States that use flexible staffing 
models are currently insulated from State partisan politics; this 
commenter reasoned that by transitioning ES staff to being entirely 
State employees, they will be more subject to fluctuating partisan 
demands.
    Some commenters, including a Colorado State elected official, a 
commenter from academia, and a Colorado local workforce development 
board, warned that implementation of the proposed rule could trigger 
lawsuits from affected counties and unions in States that use flexible 
staffing models.
    Response: The Department received new information in comments on 
the NPRM from States with longstanding reliance interests and 
determined that these States may continue to utilize their longstanding 
alternative staffing models.
Reliance Interests of Other States
    Comment: An association of State elected officials and a State 
government agency stated that Missouri had been approved by the 
Department as recently as summer 2021 to begin using non-State-merit 
staff to provide Wagner-Peyser Act ES services, and that the State had 
submitted its WIOA State Plan and that the State's local workforce 
development boards have already budgeted and planned for Wagner-Peyser 
Act funding based on this recent approval. As such, the commenters 
asserted that rescinding the State's staffing flexibility would create 
an unnecessary burden.
    A State government agency commented that existing ES rules and the 
Coronavirus Aid, Relief, and Economic Security Act (CARES Act) allowed 
for a degree of staffing flexibility during the COVID-19 pandemic, 
which enabled quicker and more cost-effective services for client needs 
during the extraordinary economic circumstances of the pandemic.
    A State government agency similarly stated that the current 
staffing flexibility under the status quo allows for the more efficient 
provision of ES services; the commenter asserted that rescinding this 
flexibility will cause services to become less efficient.
    Response: While the Department recognizes that any shift in 
staffing requires transition, the transition for the three States with 
decades of reliance would experience higher transition costs in 
contracts, supervision adjustments, bargaining agreements, and IT 
systems than those that have used alternative staffing for 2 years. As 
demonstrated in the comments received, these three States have built 
systems, developed partnerships, and established a service delivery 
model that could be reversed only at significant cost to the State and 
with significant harm to job seekers and employers. The expansion of 
alternative staffing models to additional States occurred without 
study, before the landscape-altering impact of the pandemic on the UI 
and workforce system. The Department will evaluate ES services and 
their staffing models before taking additional actions regarding the 
use of alternative staffing for other States. Recognizing that some 
States adopted a different staffing model under the 2020 Final Rule, as 
discussed above, the Department is further providing 24 months of 
transition time for any State that needs to adjust its staffing model 
to adhere to the regulations.
Recommendations To Continue Demonstration State Status
    Comment: Based on their objections to the proposal, including an 
anticipated reduction in the quality and availability of ES in States 
that would have to make major staffing changes to comply with the State 
merit-staffing requirement, numerous commenters, including Colorado and 
Michigan State elected officials, a Michigan State government agency, 
and Colorado and Michigan local governments, urged the Department to 
allow the former demonstration States to retain their current status 
and the flexibility to provide ES services with local merit staff or to 
otherwise entirely abandon the proposed rule change.
    Another State government agency echoed this recommendation, 
suggesting that the Department grant continuing exemptions to the 
proposed rule to the former demonstration States, but not to any other 
States.
    Alternatively, a think tank suggested that, at a minimum, the 
former demonstration States should be allowed to maintain their current 
status until the end of the established performance period, and that 
results from these States should be evaluated when considering if their 
staffing flexibility model should be extended.
    Several commenters, including one-stop operators, State and local 
workforce development boards, a trade association, a Colorado local 
government, and a Colorado State elected official, requested that the 
Department permit their State to continue utilizing flexible staffing 
models to deliver for Wagner-Peyser Act-funded ES services. A Michigan 
one-stop operator and one-stop center employee argued that staffing 
flexibility allows programs to provide ES services to customers, 
including businesses and vulnerable populations such as youth, 
refugees, and veterans, in the most efficient and effective manner 
possible.
    A Colorado State elected official asserted the loss of its ability 
to provide ES services using a flexible staffing model would cause 
costly disruptions to businesses and citizens. The commenter remarked 
that its workforce development staffing model had bipartisan support in 
the State Congress and that statewide stakeholders remain committed to 
this ``nimble and agile'' workforce service delivery model. The 
commenter further asserted that national organizations like the 
National Association of State Workforce Agencies, the National 
Association of Workforce Boards, and the National Association of 
Counties support the

[[Page 82688]]

State's request to continue operating this model.
    A Massachusetts local workforce development board did not challenge 
the Department's ability to roll back the 2020 Final Rule providing 
widespread staffing flexibility but opposed using the proposal to void 
``waivers'' previously granted to the former demonstration States.
    A Michigan training provider asserted the proposal would jeopardize 
successful programs in States providing ES services using a flexible 
staffing model, such as Michigan, if they are not ``exempted'' from the 
State merit-staffing requirement. The commenter provided attachments 
that, in their view, provide evidence that the workforce development 
structure employed in the former demonstration States should instead be 
the national standard.
    A think tank suggested that the Department ``grandfather'' the 
flexible staffing models for the former demonstration States because 
they have been operating successfully for more than two decades, and 
further suggested that the Department extend waivers for similar 
staffing flexibility to other States.
    Response: For reasons explained throughout this section, the 
Department is allowing Colorado, Massachusetts, and Michigan to use the 
same longstanding alternative staffing models that the Department has 
allowed them to use since the 1990s. The Department is requiring these 
three States to participate in in an evaluation to be conducted by the 
Department. All other States are required to use State merit staff to 
provide ES services.
Other Arguments Against Requiring State Merit Staff
    Comment: A think tank argued that flexibility was more beneficial 
for States than ``rigid rules'' and described how certain restrictions 
hamper State workforce programs. The commenter cited the National 
Association of Medicaid Directors' 2022 request for flexibility to hire 
non-merit staff for processing Medicaid and SNAP renewals to ``handle 
increased workloads from the fallout of COVID-19'' as an example of the 
personnel challenges facing workforce and welfare agencies. Citing WIOA 
provisions concerning the one-stop delivery system, the commenter said 
that the issue of flexibility in workforce programs ``extends beyond 
staffing models.'' The commenter stated that current law places 
``handcuffs'' on SWAs, hampering how they can spend WIOA funds. For 
example, the commenter stated that under WIOA, ``states' ability to 
design pay-for-performance contracts based on job placement is limited 
to non-federal funds and youth workforce services'' and that WIOA 
restricts States' ability to use Federal funds related to work 
requirements in welfare to solely Employment and Training programs 
(arguing that WIOA funds should be able to be used to administer more 
meaningful work requirements like the able-bodied adult-without-
dependent work requirements for SNAP). The commenter concluded that the 
ES should be designed to move as many individuals as possible into 
self-sufficiency by increasing their marketability in the labor market 
and argued that staffing flexibility allows States to design ES 
programs that accomplish these goals.
    A one-stop operator in Texas remarked that while State merit-staff 
employees are performing well, ``funding limitations have hampered the 
ability to provide salary increases for many years.'' The commenter 
stated that ``[w]hile employees are able to receive one-time, merit-
based pay, being in a merit-based system has, in fact, negatively 
impacted retention and attraction of employees, which are key elements 
in maintaining a quality staff.'' A one-stop center employee stated 
that the proposal would cause Michigan to be non-compliant with a State 
``One-Stop Operator statute.'' A Michigan one-stop center employee 
asked how the proposed merit-staffing requirement will save the State 
money, time, or resources.
    A local government stated that the proposal would create an 
unnecessary layer of bureaucracy and would disrupt an integrated 
service model that meets the local community's needs. A one-stop 
operator argued that the proposal would result in too few employees to 
service job seekers and employers through Wagner-Peyser Act programs in 
their State and expressed confusion as to how ``a few organizations'' 
in its State could express support for the proposal. The commenter 
suspected that the proposal is meant to favor employers that provide 
for union representation of employees and faulted a local union for 
ceasing representation for a group of employees last year.
    Some commenters, including a private citizen, a one-stop center 
employee, a trade association, and an advocacy organization, remarked 
that the former demonstration States successfully developed locally 
based staffing models that work across budgetary and programmatic silos 
to create a more integrated system providing higher quality services. A 
professional association said Colorado's use of a flexible staffing 
model to provide ES services has proven effective because staffing 
flexibility allows local areas to react more quickly to local market 
conditions. An employer remarked that delivering ES at the local level 
produces optimally cost-efficient and effective results, and a Colorado 
local government similarly argued that the proposal would lead to 
inefficiencies and would disrupt a streamlined service delivery model. 
An anonymous commenter similarly argued that separating local merit 
WIOA staff and ES State merit staff would jeopardize the effectiveness 
of the one-stop delivery model.
    A Colorado local government asserted that increasing State control 
over local ES offices would lose county workers' regional understanding 
of local needs around ES, arguing that county input is essential to 
avoid the ``disconnect'' that occurs in larger bureaucracies because 
counties have unique needs and characteristics. A Michigan private 
citizen remarked that State agencies, including the State UI agency, 
come across as ``bureaucratic and impersonal'' and argued that State 
agency leaders may not listen to local concerns due to their limited 
local knowledge. Another Michigan private citizen preferred to continue 
dealing with local ES staff and expressed concern about 
``centralizing'' ES in their State's capitol. A State government agency 
argued that ES staffing flexibility allows local workforce development 
boards to staff offices appropriately based on the needs of individual 
communities. The commenter said some communities would not need a 
``full accompaniment'' of local and State merit staff and also 
expressed concern about clients needing to engage with either local or 
State staff based on the type of service they need, reasoning that such 
an approach could make clients feel as though they are being ``ferried 
around'' rather than establishing a relationship with a single point of 
contact.
    A Colorado one-stop operator remarked that providing ES services at 
the local level allows for better integration of Federal, State, and 
local programs and rejected the Department's assertion that local 
government employees are treated less fairly or are more susceptible to 
political influence, arguing that this argument was ``na[iuml]ve'' and 
unsupported by evidence. A Colorado State government agency similarly 
remarked that the Department's argument that ES services provided by 
State merit staff would be ``quantitatively or qualitatively better''

[[Page 82689]]

than services delivered by county merit staff was not supported by 
evidence and asserted that county merit staff are hired using objective 
and transparent standards. The commenter stated that local merit staff 
are accountable to their local county government to best position such 
staff to provide services in their communities. A think tank agreed and 
disputed the Department's argument that the adherence of non-State 
entities to State policies is unobservable, reasoning that contracts 
contain performance goals and metrics, and sometimes include financial 
penalties for underperformance. The commenter also asserted that these 
standards do not exist for ``merit'' staff.
    Some commenters, including anonymous commenters and a Colorado 
local government, remarked that the proposal would transfer duties from 
local workers to a smaller group of State staff; the commenters 
asserted this would result in considerable and challenging workloads 
and diminished services for participants. A private citizen who 
preferred local staffing for ES suggested that a possible compromise 
could be to increase funding and add a State merit-staff employee to 
each local office who would serve as a liaison for State programs and 
services.
    Several commenters stated that Colorado's current staffing model 
allows for effective partnerships with community-based organizations 
because local staff have developed strong relationships with such 
organizations. The commenters expressed concern that the proposal would 
disrupt or reduce services for community-based organizations. A private 
citizen remarked that State merit staff would find it more difficult to 
establish partnerships and navigate local resource networks, arguing 
that local staff successfully participate in such networks through 
community engagement.
    Expressing opposition to the proposed merit-staffing requirement, a 
private citizen and a few one-stop center staff quoted the proposed 
Sec.  652.215(a) language (``The Secretary requires that the labor 
exchange services described in Sec.  652.3 be provided by ES staff, as 
defined in part 651 of this chapter.''), arguing that this change would 
have a detrimental impact on the provision of ES services.
    A Michigan one-stop center employee listed the minimum services 
required by Sec.  652.3, including connecting job seekers with 
employment opportunities and assisting employers with filling jobs, and 
questioned how States would provide these ``robust'' services if they 
face a major staffing reduction.
    Response: The Department maintains that using State merit staff 
helps to provide for high-quality, consistent, and politically neutral 
ES services. State merit staff are held accountable for their work 
through State-managed performance management plans and must meet 
certain service benchmarks and milestones.
    With respect to comments about local partnerships, the Department 
notes that the vast majority of ES services nationwide are provided by 
State merit staff who are able to establish working relationships with 
community-based organizations. Additionally, the Department notes that 
State WIOA funds can be used for an extremely broad set of activities, 
including career and training services for individuals receiving public 
benefits like SNAP. In multiple States with ES State merit staff, local 
service delivery in AJCs provides services to a range of job seekers, 
including those receiving public benefits.
    Three States using longstanding alternative staffing models, 
including local merit staff, presented arguments in support of 
retaining those models, but the information provided did not show a 
causal impact of the staffing model in these States and performance. 
The Department acknowledges the strong reliance interests of these 
three States--Colorado, Massachusetts, and Michigan--that the 
Department has allowed to use alternative staffing models to administer 
ES services since the 1990s. The Department recognizes the adverse 
impacts a complete State merit-staffing requirement would have on these 
three States relative to other States that began using alternative 
staffing models following the 2020 Final Rule. Therefore, the 
Department is allowing Colorado, Massachusetts, and Michigan to 
continue using their longstanding alternative staffing models while 
requiring their participation in an evaluation to be conducted by the 
Department to determine whether alternative staffing models are 
empirically supported.
    The Department acknowledges comments regarding funding limitations 
in the context of merit-staffing models. The Department has detailed 
the cost burden associated with this final rule in Section VI. Wagner-
Peyser ES grant funding is provided annually to deliver employment 
services. For reasons stated throughout this preamble, the Department 
has determined that reinstating the requirement to provide ES services 
using State merit staff will help to allow the States to provide 
quality and consistent ES services in an accountable and transparent 
manner as the Department undertakes an evaluation to determine whether 
alternative staffing models are empirically supported.
    The comments regarding WIOA pay-for-performance and work 
requirements are out of scope and not addressed by this final rule.

D. Part 653--Services of the Wagner-Peyser Act Employment Service 
System

    Part 653 sets forth services of the Wagner-Peyser Act ES system 
related to MSFWs. Subpart B provides the principal regulations of the 
ES concerning the provision of services to MSFWs consistent with the 
requirement that all services of the workforce development system be 
available to all job seekers in an equitable fashion. This includes 
ensuring MSFWs have access to these services in a way that meets their 
unique needs. MSFWs must receive services on a basis that is 
qualitatively equivalent and quantitatively proportionate to services 
provided to non-MSFWs. The regulations in this subpart establish 
special services to ensure MSFWs receive the full range of career 
services, as defined in WIOA sec. 134(c)(2), 29 U.S.C. 3174(c)(2), and 
contain requirements that SWAs establish a system to monitor their own 
compliance with ES regulations governing services to MSFWs. Subpart F 
sets forth regulations governing the ARS. It provides requirements for 
SWA acceptance of intrastate and interstate job clearance orders that 
seek U.S. workers to perform farmwork on a temporary, less than year-
round basis.
    The Department proposed to revise various sections of the 
regulatory text in both subparts and received comments about some of 
its proposed revisions. In the discussion that follows, the Department 
responds to these comments, grouping them by the provision that they 
address and the order in which that provision appears within this part.
1. Subpart B--Services for Migrant and Seasonal Farmworkers (MSFWs)
    Subpart B provides the principal regulations of the ES concerning 
the provision of services to MSFWs. The Department proposed a number of 
revisions to the regulatory text in this subpart to clarify and enhance 
the outreach that SWAs provide to MSFWs and to strengthen the 
monitoring that SMAs conduct pursuant to this part. The Department 
received a number of comments that generally supported the proposed 
revisions and its efforts to

[[Page 82690]]

strengthen the services that SWAs provide to MSFWs. Although the 
feedback was primarily positive, several State and local agencies felt 
the revised provisions were too prescriptive and urged the Department 
to adopt a more flexible approach. The Department values and 
appreciates the participation and input from these commenters and the 
perspectives they have to offer. In the section-by-section discussion 
below, the Department summarizes and responds to comments that address 
the revisions it proposed to a particular section in this subpart. 
After careful consideration of these comments, the Department generally 
adopts the revisions it proposed to the regulatory text without change, 
with exceptions as discussed below.
Section 653.100 Purpose and Scope of Subpart
    The Department proposed to amend Sec.  653.100(a) to clarify that 
the provision of services for MSFWs must be consistent with the 
requirement that all services of the workforce development system be 
available to all job seekers in an equitable and nondiscriminatory 
fashion. The existing regulation states only that such services must be 
made available in an equitable fashion. The Department proposed, and 
this final rule adopts, an amendment to Sec.  653.100 to state such 
services must be made available in both an equitable and 
nondiscriminatory fashion. The addition of the phrase ``and 
nondiscriminatory'' is intended to clarify that SWAs must not 
discriminate against farmworkers either because they are farmworkers or 
because of any characteristics protected under the nondiscrimination 
and equal opportunity provisions of WIOA, which are contained in 
section 188 of WIOA, 29 U.S.C. 3248, and the implementing regulations 
at 29 CFR part 38. The requirements of section 188 of WIOA apply to ES 
services because the ES is a required one-stop partner, and the 
requirements of section 188 of WIOA apply to one-stop partners pursuant 
to 29 CFR 38.2. The Department did not receive any comments on the 
proposed addition of this language and adopts the revision as proposed.
Section 653.101 Provision of Services to Migrant and Seasonal 
Farmworkers
    The Department proposed to amend Sec.  653.101 by revising the 
first sentence to clarify that the SWA is the primary recipient of 
Wagner-Peyser Act funds and, therefore, is the entity responsible for 
ensuring that ES staff offer MSFWs the full range of career and 
supportive services. As the Department explained in the NPRM, it is 
ultimately incumbent upon the SWA, as the Wagner-Peyser Act grantee, to 
ensure ES staff at one-stop centers are offering and providing ES 
services to MSFWs in an appropriate manner. The Department also 
proposed to replace the requirement for one-stop centers to consider 
and be sensitive to the preferences, needs, and skills of individual 
MSFWs and the availability of job and training opportunities with a 
requirement that SWAs ensure ES staff at one-stop centers tailor the 
provision of ES services to MSFWs in a way that accounts for their 
preferences, needs, skills, and the availability of job and training 
opportunities. The Department proposed this revision to ensure MSFWs 
are able to participate in the ES and, similar to the revision in the 
first sentence, to clarify that the SWA is responsible for ensuring 
compliance with this requirement. The Department received a few 
comments on the proposed revisions in this section. As discussed below, 
the Department has not made any changes to the regulatory text in 
response to these comments and adopts the revisions as proposed.
    Comment: The Department received numerous comments from individuals 
and entities in Michigan explaining that under Michigan's current 
service delivery model, local ES staff provide MSFWs the full range of 
career and supportive services, benefits and protections, and job and 
training referral services that they provide to non-MSFWs. Some of 
these commenters noted that under Michigan's current model, the SWA 
ensures Wagner-Peyser funded staff provide the full range of career 
services to MSFWs by providing staff training and conducting one-stop 
center reviews to ensure compliance. These commenters asserted that 
while Michigan has historically made ES services available to all job 
seekers (including MSFWs) in an equitable and nondiscriminatory 
fashion, the proposed rule would have a chilling effect on their access 
to services by making fewer offices and staff available to help them. 
Similarly, a local government agency in Colorado, which opposed the 
proposed State merit-staffing requirement, discussed its use of local 
staff to provide MSFWs with equitable ES services that it stated are 
innovative, personal, and available in multiple languages, and to offer 
their State's highest level of outreach to MSFWs.
    Response: As discussed in section III above, the Department has 
decided not to apply the proposed State merit-staffing requirement to 
several States, including Michigan and Colorado, that have developed 
strong reliance interests in providing ES services through longstanding 
alternative staffing models. Because this final rule will permit 
Michigan and Colorado to continue to provide ES services in accordance 
with each State's longstanding alternative staffing model, it should 
not result in the ``chilling effect'' that commenters from Michigan 
feared or impact the services that local staff in Colorado are 
currently providing to MSFWs.
    Moreover, the Department notes that SWAs, as required one-stop 
partners, must ensure individual customers are served based on 
individual needs, including MSFWs. See 20 CFR 678.425(b). The final 
rule would, consistent with this requirement, clarify that SWAs are 
responsible for ensuring that ES staff at one-stop centers tailor 
services to meet the particular needs of MSFWs. While some States may 
already meet this requirement, as asserted in the comments described 
above, others may not. The revision makes it clear that Wagner-Peyser 
Act funded staff must serve MSFWs based on their individual needs. In 
addition, this revision will complement the MSFW-specific staffing 
requirements in Sec. Sec.  653.107(a)(3) and 653.111.
    It is particularly important to consider the particular needs of 
MSFWs, because MSFW job seekers may face multiple barriers to 
employment for which individualized career services are warranted. In 
implementing this requirement, SWAs must take care to ensure MSFWs are 
offered appropriate services based on their particular workforce 
interests (e.g., referral to jobs they may want or need to meet their 
employment-related goals and not only positions involving farmwork).
Section 653.102 Job Information
    The Department proposed several revisions to the text of existing 
Sec.  653.102. First, the Department proposed to revise the third 
sentence of Sec.  653.102 to clarify that the SWA is the entity 
responsible for ensuring that ES staff assist MSFWs to access job order 
information, for the same rationale as similar changes the Department 
is making to Sec.  653.101, as described above. Second, the Department 
proposed to remove the word ``adequate'' as a modifier to the phrase 
``assistance to MSFWs,'' in order to remove any perceived subjectivity 
and clarify that a SWA meets its obligation to assist MSFWs by 
complying with the requirements in parts 653 and 658. Finally, the 
Department proposed to remove the final sentence of Sec.  653.102, 
which stated that in designated significant MSFW multilingual offices, 
assistance with accessing job order

[[Page 82691]]

information must be provided to MSFWs in their native language whenever 
requested or necessary. As the Department explained in the NPRM, this 
would align language access requirements in the ES regulations with 
those required by WIOA sec. 188 and its implementing regulations at 29 
CFR part 38, because language access requirements apply to individuals 
with LEP regardless of through which office they seek ES services. The 
Department received one comment on this provision. For the reasons 
discussed below, the Department has not made any changes to the 
proposed regulatory text and adopts it as proposed.
    Comment: The Department received a comment from a farmworker 
advocacy organization that generally supported the Department's 
proposal to clarify language access requirements throughout part 653, 
but with some reservations. As relevant here, this commenter opposed 
the Department's proposal to remove the requirement for MSFW 
multilingual offices to provide MSFWs access to job order information 
in their native language whenever requested or necessary. The commenter 
suggested that the Department take additional steps to ensure 
individuals with LEP are able to access and engage with ES services and 
asserted that SWAs should ensure clearance orders are translated to 
Spanish and other major languages in the area so that all workers are 
aware of their rights and able to access and review clearance orders in 
their native language. According to these organizations, such a 
requirement would align with the practices of certain SWAs that already 
translate or require submission of translated clearance orders and help 
to fulfill the Department's language access obligations under Executive 
Order (E.O.) 13166, in addition to bolstering compliance with the 
existing regulatory requirement at 20 CFR 655.122(q) that all H-2A 
workers and workers in corresponding employment receive a copy of the 
work contract ``in a language understood by the worker.'' Finally, they 
noted that English-only clearance orders have presented particular 
barriers for U.S. farmworkers in Puerto Rico, where some local SWA 
officials have limited English ability and, without translations, are 
unable to refer workers to available positions elsewhere in the United 
States.
    Response: The Department acknowledges the comment that suggested 
the regulation should specify that clearance orders should be 
translated into Spanish and other major languages in the area. However, 
the Department reiterates that 29 CFR 38.9 spells out the applicable 
language access requirements more comprehensively, including the 
obligations to translate vital information (as defined at 29 CFR 
28.4(ttt)) that appears in written materials into languages spoken by a 
significant number or portion of the population eligible to be served, 
or likely to be encountered, and to make the translations readily 
available in hard copy or electronically. The regulation at 29 CFR 38.9 
also imposes an obligation to take reasonable steps to ensure 
meaningful access to each individual with LEP served or encountered, 
including providing oral interpretation or written translation of 
materials, in the appropriate non-English languages, so that 
individuals with LEP are effectively informed about and able to 
participate in the program or activity. Furthermore, once ES staff 
becomes aware of the non-English preferred language of an individual 
with LEP, the ES staff must convey vital information to that individual 
in their preferred language.
    The Department adopts the language as proposed in the NPRM and will 
provide guidance and technical assistance as needed.
Section 653.103 Process for Migrant and Seasonal Farmworkers To 
Participate in Workforce Development
    The Department proposed to make several revisions to Sec.  653.103. 
First, the Department proposed to revise the requirement in paragraph 
(a) for one-stop centers to determine whether participants, as defined 
at Sec.  651.10, are MSFWs. As revised, this section would replace 
``one-stop center'' with ``ES office,'' and it would require ES offices 
to also determine whether reportable individuals, as defined at Sec.  
651.10, are MSFWs.
    Second, in Sec.  653.103(b), the Department proposed to replace the 
existing provision requiring all SWAs to ensure that MSFWs who are 
English-language learners receive, free of charge, the language 
assistance necessary to afford them meaningful access to the programs, 
services, and information offered by the one-stop centers with a new 
provision clarifying that all SWAs are required to comply with the 
language access and assistance requirements at 29 CFR 38.9 with regard 
to all individuals with LEP, including MSFWs who are LEP individuals, 
as defined at 29 CFR 38.4(hh). This compliance includes ensuring ES 
staff comply with these language access and assistance requirements. In 
the NPRM, the Department explained that this would align the language 
access requirements for MSFWs with language access requirements for all 
individuals with LEP pursuant to 29 CFR 38.9, and it would help to 
ensure all individuals with LEP, including MSFWs, are provided 
meaningful access to ES services.
    Lastly, the Department proposed to remove the specific requirement 
in Sec.  653.103(c) for one-stop centers to provide MSFWs a list of 
available career and supportive services ``in their native language.'' 
This, too, would align with the proposed revisions to replace the 
various specific language access requirements in this part with 
reference to the comprehensive requirements applicable to all 
individuals with LEP in 29 CFR 38.9.
    The Department received comments concerning each of these proposed 
revisions. For the reasons discussed below, the Department has not made 
any changes to the proposed regulatory text and adopts it as proposed.
    Comment: The Department received several comments from individuals 
and entities in Michigan that reported Michigan's ES offices are 
prepared to implement the new requirement to determine whether 
reportable individuals are MSFWs. Another State agency opposed the 
proposed requirement for States to determine whether reportable 
individuals are MSFWs, as defined at Sec.  651.10. The State agency 
disputed the value of collecting this information, asserting it had 
previously collected information from reportable individuals to 
determine whether they were MSFWs and found it was inaccurate, because 
it was based on self-service registrations that were not reviewed by 
staff for accuracy unless the self-registrant sought participant-level 
services. This State agency estimated that, if the proposed requirement 
is adopted, it would cost $30,000 to $50,000 to update its IT systems 
to track the MSFW-status of reportable individuals, and it asked the 
Department to provide additional funding to cover these costs.
    Response: The Department appreciates the commenter's concern 
regarding the accuracy of self-reported data. While the Department 
acknowledges that there may be errors in classification determinations 
based on self-reported information that are made without assistance 
from staff in the one-stop center, it believes this risk could largely 
be addressed if SWAs carefully tailor the questions that they pose to 
self-registrants so that the answers self-registrants provide are more 
likely to elicit accurate classification determinations. The Department 
expects that some States may need to revise their current

[[Page 82692]]

information collection (IC) practices and/or make changes to existing 
IT systems to collect this information from reportable individuals. 
These costs are allowable under a State's Wagner-Peyser ES grant, and 
the Department has accounted for them in the regulatory impact and IC 
analyses provided in sections VI.A and VI.C, respectively, below. The 
Department does not take lightly the changes that States must make to 
processes and systems to collect information about participants or 
reportable individuals, but believes that the value of collecting this 
data outweighs the estimated burden that SWAs may incur to collect it. 
Collecting data about participant and reportable individual 
characteristics, particularly related to populations that have been 
historically underserved, is an important tool for measuring progress 
in providing equal opportunity. In this case, collecting MSFW status 
will help the ES to identify all MSFWs who engage in the ES and the 
degree of their engagement. To ensure data on the MSFW status of 
reportable individuals is accurate and used appropriately, Sec.  
653.109(e) will require SWAs to periodically verify data collected 
under this section, take necessary steps to ensure its validity, and 
submit the data for verification to the Department, as directed by the 
Department.
    Comment: The Department received comments from numerous entities 
and individuals in Michigan that asserted the costs their State incurs 
to comply with language access and assistance requirements would 
increase if the final rule requires Michigan to change its longstanding 
staffing model to comply with a State merit-staffing requirement, 
because if the Department were to adopt this requirement, one-stop 
centers in Michigan could no longer rely on multilingual local staff 
across an array of workforce programs to provide ES services.
    Response: As discussed in section V.C.2 above, this final rule will 
allow several States, including Michigan, to continue to provide ES 
services in accordance with their longstanding alternative staffing 
arrangements. Because this change resolves the circumstances about 
which the commenters were concerned, this final rule should not impact 
Michigan's cost of compliance with language access requirements for the 
reasons that these commenters feared.
    Comment: A farmworker advocacy organization largely supported the 
Department's proposed revisions to align the language access 
requirements in part 653 with the requirements in 29 CFR 38.9 that 
apply to all individuals with LEP, but with some reservations. This 
commenter expressed concern that removing the phrase ``in their native 
language'' from Sec.  653.103(c) could create confusion about a SWA's 
language access obligations and recommended retaining this language in 
the regulation for clarity, rather than simply relying on the new 
provision in Sec.  653.103(b), which clarifies that SWAs must comply 
with the language access requirements in 29 CFR 38.9.
    Response: The Department recognizes that language access is crucial 
for individuals with LEP and is revising Sec.  653.103 to clarify that 
SWAs must comply with the language access requirements in 29 CFR 38.9 
when providing Wagner-Peyser ES services to MSFWs. The Department 
disagrees with the commenter's assertion that it is necessary to retain 
a specific requirement in this section for one-stop centers to provide 
MSFWs a list of available career and supportive services ``in their 
native language.'' As explained above, 29 CFR 38.9 spells out the 
language access requirements that apply comprehensively, including the 
obligations to translate vital information in written materials and to 
convey vital information to individuals with LEP in their preferred 
languages once the one-stop center becomes aware of the individuals' 
non-English preferred languages.
    The Department therefore adopts the changes to this section as 
proposed and will provide guidance and technical assistance as needed.
Section 653.107 Outreach Responsibilities and Agricultural Outreach 
Plan
    Section 653.107 governs the outreach that SWAs must conduct to 
ensure that MSFWs receive ES services that are qualitatively equivalent 
and quantitatively proportionate to the services that the SWA offers 
and provides to other job seekers. The migrant and seasonal nature of 
the farmwork that MSFWs perform presents numerous challenges to the 
effective provision of services to this subpopulation. Accordingly, the 
Department has historically required SWAs to conduct outreach to MSFWs 
to ensure that the services they receive are qualitatively equivalent 
and quantitatively proportionate to the services offered to other job 
seekers. The Department proposed revisions to the regulatory text 
throughout Sec.  653.107 to further prescribe the outreach that SWAs 
must conduct under this section. These revisions and the comments the 
Department received about them, as well as the Department's responses, 
are discussed below in accordance with the paragraph in which they 
appear in the regulatory text.
Section 653.107(a)
    The Department proposed to strengthen SWA outreach by making a 
number of revisions to the regulatory text in Sec.  653.107(a). Among 
other things, the proposed revisions emphasize the year-round nature of 
outreach work; specify that full-time outreach staff may not be 
assigned to duties other than the outreach responsibilities described 
in Sec.  653.107(b); provide a standard by which to determine whether a 
SWA employs an adequate number of outreach staff; and place additional 
emphasis on the background and training that outreach staff must have 
in order to successfully perform their duties. A detailed description 
of the revisions proposed in each subordinate paragraph follows.
    First, the Department proposed to amend Sec.  653.107(a)(1) in 
several ways to emphasize that outreach work must be performed only by 
outreach staff and that outreach staff in all States must conduct 
outreach year-round. Specifically, the Department proposed to replace 
the first sentence of paragraph (a)(1) in the existing regulation--
which required each SWA to provide an adequate number of outreach staff 
to conduct MSFW outreach in their service areas--with a requirement for 
each SWA to ensure that outreach staff conduct the outreach 
responsibilities described in paragraph (b) of this section on an 
ongoing basis. The Department proposed this change to clarify that 
outreach staff in all States must be employed year-round and perform 
the outreach activities described in Sec.  653.107(b) on an ongoing 
basis. The Department did not propose to remove the requirement for a 
SWA to provide an adequate number of outreach staff, but rather, 
proposed to relocate this requirement to paragraph (a)(4), and to 
revise this requirement so that it specifies a means to measure whether 
a SWA employs an adequate number of outreach staff (discussed further 
below with the proposed changes to paragraph (a)(4)). The Department 
further proposed to prohibit a SWA from relying on the outreach 
activities conducted by NFJP grant recipients (i.e., recipients of 
grants awarded under WIOA title I sec. 167) to substitute for the 
outreach responsibilities that outreach staff must conduct under this 
section. In particular, the Department proposed to revise the second 
sentence of paragraph (a)(1)--which required SMAs and outreach staff to 
coordinate their outreach efforts with WIOA title I

[[Page 82693]]

sec. 167 grantees--to instead require that SMAs and outreach staff 
coordinate their activities with WIOA title I sec. 167 grantees. The 
Department additionally proposed to include a new sentence at the end 
of this paragraph to make clear that a SWA cannot rely on the 
activities of NFJP grantees as a substitute for SWA outreach 
responsibilities. Taken together, these revisions would require a SWA 
to coordinate their outreach activities with the activities of NFJP 
grantees in their State (i.e., SWAs and NFJP grantees would have to 
work together to strengthen their respective services) but prohibit the 
SWA from relying on activities of NFJP grantees as a substitute for the 
outreach responsibilities that outreach staff must conduct under this 
section.
    Second, the Department proposed to revise Sec.  653.107(a)(2)(ii) 
so that SWAs in all States will be required to conduct thorough 
outreach efforts with extensive follow-up activities. In particular, 
the Department proposed to amend the existing regulation--which 
required SWAs in supply States to conduct thorough outreach efforts 
with extensive follow-up--to instead require that SWAs in all States 
conduct thorough outreach efforts with extensive follow-up, and to add 
language specifying that extensive follow-up consists of the activities 
identified in paragraph (b)(5) of this section.
    Third, the Department proposed revisions to Sec.  653.107(a)(3) to 
operationalize the proposed merit State merit-staffing requirement for 
outreach staff and strengthen the process by which SWAs hire and assign 
outreach staff. In particular, the Department proposed to amend the 
language and structure of this paragraph to make clear that the SWA is 
responsible for directly hiring outreach staff and to specify the 
actions that a SWA must take when hiring or assigning outreach staff. 
The proposed revisions would require a SWA to not only ``seek'' 
qualified candidates with certain characteristics when hiring or 
assigning outreach staff, but to also ``place a strong emphasis on 
hiring and assigning'' such candidates. To increase the likelihood that 
SWAs will employ candidates who meet the required criteria, the 
Department further proposed to add a new paragraph at Sec.  
653.107(a)(3)(ii) that would require a SWA to inform farmworker 
organizations and other organizations with expertise concerning MSFWs 
of outreach staff job openings and encourage such organizations to 
refer qualified applicants to apply for the opening.
    Fourth and finally, the Department proposed to make several changes 
in Sec.  653.107(a)(4) that would bolster outreach staffing 
requirements. In particular, the Department proposed to move the first 
sentence in paragraph (a)(1) of the existing regulation--which required 
each SWA to provide an adequate number of outreach staff--to the 
beginning of paragraph (a)(4) and to amend this sentence so that it 
would require each SWA to employ (as opposed to provide) an adequate 
number of outreach staff to conduct MSFW outreach in each area of the 
State to contact a majority of MSFWs in all of the SWA's service areas 
annually. The revisions to this sentence would make clear each SWA must 
employ outreach staff to perform the outreach required by this section 
and provide a measurable means of determining whether the number of 
outreach staff a SWA employs is adequate. They would also ensure that 
each SWA conducts outreach in all areas of the State, and not only 
certain service areas (e.g., only those service areas with significant 
MSFW one-stop centers). In addition, the Department proposed to add a 
sentence in paragraph (a)(4) that specifies full-time outreach staff 
must devote 100 percent of their time to the outreach responsibilities 
described in Sec.  653.107(b). Finally, the Department proposed adding 
another sentence to require that SWA outreach staffing levels align 
with and be supported by the estimated number of MSFWs in the State and 
the MSFW activity in the State, as demonstrated in the State's 
Agricultural Outreach Plan (AOP).
    The Department received numerous comments about the changes it 
proposed, as discussed in detail below. After careful consideration of 
these comments, the Department largely adopts the proposed regulatory 
text with minor revisions.
    First, this final rule modifies the proposed revisions to Sec.  
653.107(a)(1) to replace the phrase ``SWA Administrators'' with the 
phrase ``State Administrators'' in the second sentence of that 
paragraph. The Department is making this change because Sec.  651.10 
defines the term State Administrator for purposes of the Wagner-Peyser 
regulations and does not define the term SWA Administrator.
    Second, this final rule modifies the proposed revisions to Sec.  
653.107(a)(3) and (4) to account for changes to the proposed State 
merit-staffing requirement adopted in this final rule. Specifically, as 
adopted in this final rule, Sec.  652.215 will generally require States 
to deliver the services and activities under this part using State 
merit-staff employees, but Sec.  652.215(b) will allow the three States 
authorized to use alternative staffing models prior to February 5, 
2020, to use an alternative staffing model to the extent the Department 
authorized that State to use an alternative staffing model prior to 
February 5, 2020. To account for the fact that in these three States, 
the SWA may not be the entity directly hiring outreach staff, the 
Department modified the proposed regulatory text for Sec.  
653.107(a)(3). The Department is adopting text in this paragraph that 
clearly requires a SWA to ensure that outreach staff are sought and 
hired or assigned in the manner that this regulation requires. The 
Department made similar revisions to the proposed regulatory text for 
Sec.  653.107(a)(4). Instead of stating that the SWA must employ an 
adequate number of outreach staff, as proposed, this final rule 
requires a SWA to ensure an adequate number of outreach staff are 
employed in accordance with the requirements in this paragraph.
    Notably, these revisions are intended to accommodate only those 
rare instances in which a State may use an alternative staffing model 
under Sec.  652.215(b). Because the State merit-staffing requirement 
adopted in Sec.  652.215(a) applies to the services and activities 
performed by outreach staff under Sec.  653.107, this final rule 
requires SWAs to directly hire or assign State merit staff to outreach 
staff positions in all but a very limited number of situations.
    Third, as explained in further detail below, the Department is 
modifying the proposed regulatory text for Sec.  653.107(a)(4) to 
clarify the manner in which SWAs must determine whether the number of 
outreach staff employed in their State is adequate. As adopted in this 
final rule, Sec.  653.107(a)(4) requires each SWA to ensure that there 
are an adequate number of outreach staff employed in the State to 
conduct MSFW outreach in each service area of the State and to contact 
a majority of MSFWs in the State annually.
General Comments
    Many commenters expressed general support for the Department's 
proposal. For example, a farmworker advocacy organization stated the 
proposed changes would ensure that SWAs once again provide adequate 
outreach services to MSFWs. Another farmworker advocacy organization 
noted MSFW outreach would be improved by underscoring that outreach is 
a full-time job that deserves priority and which should not be combined 
with other functions. A number of other

[[Page 82694]]

commenters, including several unions, likewise supported the proposed 
rule's focus on improving outreach to MSFWs. The Department also 
received comments from several State government agencies that expressed 
about the impact of the proposed revisions and urged the Department to 
adopt a more flexible approach. The Department values the input and 
perspectives that commenters shared and has thoroughly considered their 
concerns and recommendations. A summary of the specific issues and 
concerns raised, and the Department's response, follows.
NFJP Activities
    Comment: A farmworker advocacy organization supported the 
Department's approach to improve outreach by strengthening staffing 
requirements, including the proposal to amend Sec.  653.107(a)(1) to 
specify that NFJP grantee activities do not fulfill the SWA's outreach 
obligations under Sec.  653.107. This commenter asserted that the 
proposed revisions represented an important improvement, and noted its 
staff had witnessed failed outreach and ineffective services provided 
by part-time and contract staff in many of the States where the 
organization serves farmworkers. Another commenter, a State government 
agency, reported that it has procedures in place to collaborate with 
its NFJP partner to conduct joint outreach. However, it was not clear 
whether the joint outreach this commenter referenced would be conducted 
alongside outreach staff employed by the SWA, as required by this final 
rule, or in lieu of outreach conducted by ES staff. In addition to 
joint outreach with the NFJP, the commenter said its staff make other 
contacts.
    Response: The Department appreciates the views that commenters 
shared about this proposal. The Department agrees that MSFW outreach 
will be more effective if it is performed by outreach staff who are not 
expected to perform other functions. This is partly achieved by 
ensuring there is dedicated outreach staff to perform the outreach 
activities required by Sec.  653.107 and informing SWAs that they may 
not rely on outreach activities of NFJP grantees to substitute for the 
outreach that these regulations require. It was not clear whether the 
State government agency that reported it has procedures in place to 
conduct joint outreach with its NFJP partner has been conducting this 
joint outreach in a manner that would comply with this final rule. 
Under this final rule, Sec.  653.107(a)(1) will require a SWA to 
coordinate outreach with the activities of NFJP grantees, and it will 
permit a SWA to conduct joint outreach with NFJP grantees. But it will 
not permit a SWA to rely on the activities of an NFJP grantee to 
satisfy the MSFW outreach requirements set forth in Sec.  653.107. The 
Department has decided to adopt this rule because a SWA's 
responsibility to conduct outreach to MSFWs under Sec.  653.107 differs 
in purpose and scope from the recruitment activities of NFJP grantees. 
The activities of NFJP grantees differ from the responsibilities of 
outreach staff under this section, because Sec.  653.107(b) requires 
outreach staff to perform a number of specific tasks, such as provide 
MSFWs certain information (e.g., a basic summary of farmworker rights, 
information about services available at the local one-stop center, the 
ES and Employment-Related Law Complaint System, and organizations that 
serve MSFWs in the area) and offer to directly provide access to 
certain ES services onsite. Accordingly, the final rule adopts the 
revisions to Sec.  653.501(a)(1) as proposed.
Hiring and Assignment of Outreach Staff
    Comment: A Delaware State government agency discussed its use of a 
contractor to provide outreach to MSFWs, arguing that this approach 
enabled it to significantly increase its outreach to MSFWs. Stating 
that privatizing the role allowed it to offer competitive pay, attract 
qualified candidates, and fill the job quickly, the commenter asked the 
Department for an exemption from the merit-staffing requirement for 
this outreach position so that a contractor can continue to hold it.
    Response: The Department appreciates this commenter's feedback 
regarding outreach staffing. However, the Department addressed the 
benefits of State merit staff, including using State merit staff for 
MSFW outreach, in earlier sections of this preamble, specifically 
stating that the Department is adopting the proposed State merit-
staffing requirement as a generally reliable method to ensure quality 
and consistency in ES delivery. Aside from allowing the three States to 
use their alternative staffing models in place as of February 5, 2020, 
the Department is not permitting further exceptions to the merit-
staffing requirement discussed above.
    Comment: The Department received several comments related to its 
proposal to revise the requirements governing the hiring or assignment 
of outreach staff in Sec.  653.107(a)(3). A farmworker advocacy 
organization supported the Department's proposal to strengthen the 
hiring process for outreach staff, particularly the proposed 
requirement for SWAs to inform farmworker organizations in their States 
about job openings, noting such a requirement would help SWAs identify 
candidates who possess cultural competence and develop broad networks 
within farmworker communities.
    Several commenters from Colorado, including a Colorado State 
government agency, a State workforce development board, and a trade 
association, expressed concern that if the Department adopted the 
proposed rule, it would require Colorado to employ new outreach staff 
and cross-train them to perform UI services. These commenters argued 
that it would be more difficult to backfill outreach positions 
currently held by county merit staff, as the proposed rule would 
require, if the Department also adopted revisions that raised the 
qualifications for hiring or assigning ES staff to outreach staff 
positions. As discussed below, this concern appeared to be based on 
these commenters' mistaken understanding that the proposed revisions 
would raise the qualifications for outreach staff positions.
    Another State government agency opposed the proposed changes to the 
outreach staffing requirements in Sec.  653.107(a)(3) based on a 
similar misunderstanding that the proposed revisions would increase the 
qualifications required of MSFW outreach staff. This State agency 
maintained that there was no need to expand current requirements, which 
it asserted allow the State to meet the needs of the program while 
maintaining flexibility in a tight labor market. According to this 
State agency, it is increasingly difficult to find applicants who are 
from MSFW backgrounds or who have substantial work experience in 
farmworker activities in a tight labor market, and many individuals 
already employed in outreach, compliance, and monitoring positions 
outside of MSFW or farmwork possess the necessary skillset and 
transferable skills.
    A different State government agency agreed with the Department that 
SWAs should employ outreach staff who meet relevant criteria, but it 
noted the difficulty that its program managers at significant MSFW one-
stop centers have faced when trying to hire qualified outreach staff 
who meet all requirements, which it said has resulted in program 
managers hiring outreach staff who are bilingual but do not necessarily 
have experience working with farmworkers.

[[Page 82695]]

    Response: The Department appreciates the feedback it received from 
these commenters. As discussed in section V.C.2 above, this final rule 
will permit three States, including Colorado, to provide ES services in 
accordance with their longstanding alternative staffing arrangements. 
This revision to the proposed State merit-staffing requirement should 
resolve any concerns raised by commenters from Colorado regarding the 
impact that such a requirement would have on their State's ability to 
serve MSFWs. As relevant here, this final rule will not require 
Colorado to replace its county merit staff with State merit staff. 
Moreover, neither the proposed rule nor this rule require any State to 
cross-train ES staff to provide UI services.
    Several commenters mistakenly believed that the proposed revisions 
would increase the qualifications of the individuals who SWAs must seek 
when hiring or assigning outreach staff. The Department did not propose 
to change the type of characteristics that SWAs must seek among 
qualified candidates when hiring or assigning outreach staff. The 
existing regulation at Sec.  653.107(a)(3) already requires SWAs to 
seek qualified candidates who speak the language of a significant 
proportion of the MSFW population in the State and who are from MSFW 
backgrounds or who have substantial work experience in farmworker 
activities. Rather, the Department proposed to require SWAs not only 
seek individuals with these characteristics, but also place a strong 
emphasis on hiring and assigning such individuals. The Department has 
long required SWAs to seek out individuals who possess similar 
characteristics when hiring or assigning ES staff to outreach duties. 
Nevertheless, the Department has observed that SWAs commonly assign 
existing staff to fill outreach staff vacancies, without seeking 
qualified candidates who speak the language of a significant proportion 
of the State MSFW population and who are from MSFW backgrounds or have 
substantial work experience in farmworker activities. The Department is 
concerned that assigning individuals who do not possess these 
characteristics to outreach staff positions may contribute to low MSFW 
engagement in the ES program. Individuals who do not meet these 
characteristics may not have the language skills or experience 
necessary to effectively explain services to MSFWs or to successfully 
tailor those services to meet the particular needs of MSFWs. It is 
important for outreach staff to be able to effectively communicate with 
the MSFWs whom they serve, particularly because outreach staff often 
interact with MSFWs with LEP in remote places, such as rural working 
and living locations, where interpretation services and aids may not be 
as widely available. If outreach staff speak the same language as the 
majority of MSFWs in the State and come from an MSFW background or have 
substantial work experience in farmworker activities, then they are 
more likely to be able to effectively communicate with the MSFWs whom 
they encounter. In sum, the Department has determined SWAs must make a 
greater effort to employ outreach workers with the characteristics 
required by Sec.  653.107(a)(3), because such individuals are more 
likely to have the knowledge and skills to help them effectively 
communicate and engage with MSFWs. In the Department's view, the 
benefit of identifying qualified candidates with these characteristics 
outweighs the burden it places on SWAs to comply with the requirement.
    In order to receive applicants from farmworker organizations and 
other organizations with expertise concerning MSFWs, SWAs must make the 
job opening available to external candidates. SWAs may recruit 
internally for outreach staff job openings but they must also recruit 
externally. SWAs may hire or assign qualified candidates from their 
internal or external recruitment efforts, provided that they put a 
strong emphasis on hiring or assigning candidates who meet the 
characteristics described at Sec.  653.107(a)(3)(i). If a SWA ensures 
hiring officials properly inform appropriate organizations and recruit 
externally for outreach staff positions, but these recruitment efforts 
do not produce qualified candidates who meet the required criteria, 
then hiring officials may assign existing staff to perform outreach 
staff responsibilities. In such cases, hiring officials must still put 
a strong emphasis on assigning candidates who meet at least some of the 
characteristics described at Sec.  653.107(a)(3)(i). To demonstrate a 
strong emphasis on hiring or assigning candidates who meet these 
characteristics, job postings should describe the desired 
characteristics. This proposed change will also allow the Department to 
assess whether a SWA has policies and procedures in place to ensure 
hiring officials place an appropriate emphasis on seeking and hiring or 
assigning qualified candidates who meet the characteristics described 
at Sec.  653.107(a)(3)(i). In cases where a SWA has more than one 
qualified applicant, the Department would expect hiring officials to 
select the applicant who meets the required criteria over the one who 
does not.
    The Department appreciates that some SWAs may face difficulties in 
identifying qualified candidates who meet these characteristics and 
understands it may not always be possible to identify such candidates 
when hiring or assigning ES staff to outreach staff positions. 
Accordingly, this final rule will require SWAs to ensure hiring 
officials seek and put a strong emphasis on identifying qualified 
candidates with these characteristics. If hiring officials are not able 
to find qualified candidates who possess these characteristics, the SWA 
may proceed to hire or assign the most qualified candidate.
Appropriate Outreach Staffing Levels and Duties
    Comment: The Department received comments both in support and 
opposition to its proposal to revise Sec.  653.107(a)(1) and (4) to 
clarify and strengthen requirements governing the outreach staff whom 
SWAs employ to fulfill the requirements set forth in Sec.  653.107. For 
example, a union organization supported the Department's proposed 
changes to ensure SWAs employ an adequate number of outreach staff 
sufficient to reach a majority of MSFWs in all States. A farmworker 
advocacy organization similarly remarked that the proposed changes 
would improve MSFW outreach by underscoring that outreach is a full-
time job that deserves priority and should not be combined with other 
functions. This commenter thought the proposed changes would help 
ensure that outreach staff are available and qualified to provide the 
outreach and follow-up services required by the regulations. A State 
employee association supported the proposed rule's focus on outreach 
services to MSFWs. Similarly, a State government agency agreed with the 
proposed requirement for outreach staff in significant MSFW States to 
devote all of their time to outreach rather than merely including 
outreach among other responsibilities, noting it would further clarify 
the role and expectations of outreach staff. However, this State agency 
sought further clarification about how it should determine whether it 
employs an ``adequate'' number of outreach staff and inquired whether 
this determination would involve using a DOL-provided formula to 
accurately assess the need and determine what is considered a majority 
of the population.
    Several other State government agencies opposed the proposed 
revisions and urged the Department to

[[Page 82696]]

consider alternative approaches that allow for more flexibility. For 
example, one State government agency expressed concern that the 
proposed requirement for a SWA to employ a sufficient number of 
outreach staff to conduct MSFW outreach ``in each area of the State'' 
would increase the Department's expectations for MSFW outreach 
staffing. Because this State agency did not think the effect of this 
proposed revision was clear, it asked the Department to clarify what 
the addition of ``in each area of the State'' would require and how it 
would impact the State's current practice for employing outreach staff. 
In particular, the State agency was concerned that the proposed 
requirement to employ an adequate number of outreach staff to conduct 
MSFW outreach ``in each area of the State'' might require each 
workforce development area or one-stop (depending how ``each area'' is 
defined) to devote more resources to MSFW outreach based on unknown 
parameters set by the Department. The State agency noted that it 
currently employed full-time, year-round outreach staff who serve three 
of its 12 workforce development areas, and that those workforce 
development areas covered around 90 percent of the State's agricultural 
employment population. The State agency expressed concern that the 
proposed revisions might require it to employ additional dedicated MSFW 
outreach staff to serve the nine other workforce development areas (or 
the other 30 non-significant MSFW one-stops), even though those areas 
and one-stop centers collectively served only around 10 percent of the 
State's MSFW population. The State agency noted that if the Department 
were to adopt such a requirement, it would decrease the State's 
capacity to conduct outreach to other key populations (e.g., different 
groups statutorily identified as having barriers to employment) and to 
otherwise serve customers that directly access ES services via one-
stops or virtually. The commenter requested that the Department allow 
States to meet regulatory goals through operational flexibility rather 
than rigid staffing requirements. Citing annual reports from the SMA to 
the Department showing frequent turnover among outreach staff, the 
commenter said a flexible approach was important to avoid gaps in 
outreach services when attrition occurs.
    Another State agency explained that it employed several part-time 
outreach specialists throughout the State, and asserted that, as a non-
significant MSFW State, there would not be enough outreach work for 
this staff to perform during peak season if their duties are limited to 
performing only those activities identified in Sec.  653.107(b). 
According to this State agency, limiting the job duties that outreach 
staff can undertake during peak season is neither practical nor cost-
effective given the number of MSFWs in the State. The State agency 
explained this limitation would pose several problems for the State's 
ES staff and the services they are able to provide. Specifically, the 
State agency noted that Sec.  653.107(b) does not include duties like 
providing services in one-stop centers, attending meetings, and 
contributing to the one-stop ES services team. This was problematic, 
according to the State agency, because outreach staff are tasked with 
encouraging MSFWs to obtain services at one-stop centers, and in order 
to effectively serve MSFWs in the field or at one-stop centers, 
outreach staff must be able to devote some time to serving non-MSFWs, 
so that they stay up to date on the latest services, best practices, 
employers, and hiring events in their area.
    A different State government agency asserted that the proposed 
requirement for year-round, part-time outreach staff in non-significant 
MSFW States is untenable because Wagner-Peyser Act funding is not 
designated for this function and its current staffing level has proven 
sufficient. Specifically, the commenter reported that its MSFW outreach 
staff collaborate with the State's NFJP partner on joint outreach, 
distribute pamphlets and speak to workers during housing inspections, 
and reach MSFWs at outreach clinic events hosted by a State public 
university.
    Another State government agency objected to the proposed revision 
that would require outreach staff in significant MSFW States to spend 
100 percent of their time on the outreach responsibilities listed in 
Sec.  653.107(b), arguing that it would restrict staffing flexibility 
by prohibiting the assignment of additional duties and limit its 
staff's ability to assist MSFWs and their families who are seeking 
assistance in a one-stop center.
    Response: The Department appreciates the feedback it received from 
State government agencies regarding the revisions it proposed to the 
outreach staffing requirements in Sec.  653.107(a). The Department 
proposed these revisions to strengthen the requirements governing 
outreach staffing levels to ensure that outreach staff are dedicating 
sufficient time to performing the duties set forth at Sec.  653.107(b) 
for outreach staff. As noted above, the Department has carefully 
considered the concerns these commenters raised and will adopt the 
proposed revisions to Sec.  653.107(a) with minor revisions.
    Some of the requirements about which commenters expressed concern 
are not new proposals. For example, the existing regulation at Sec.  
653.107(a)(4) already required significant MSFW States (i.e., the 20 
States with the highest estimated year-round MSFW activity) to provide 
full-time, year-round outreach staff to conduct outreach duties. It 
also required the remainder of States to provide at least part-time 
outreach staff on a year-round basis and full-time outreach staff 
during periods of the highest MSFW activity.
    At the same time, the Department recognizes that some of the 
revisions to this section introduce new requirements, and that 
compliance with these requirements will require some SWAs to change the 
manner in which they have been conducting MSFW outreach or employing 
outreach staff. For example, if a SWA currently employs outreach staff 
only in those areas where significant MSFW one-stop centers are 
located, it will need to ensure that those outreach staff are also able 
to conduct outreach in all areas of the State (not just those service 
areas in which the significant MSFW one-stop centers are located) and 
make enough contacts to reach the majority of MSFWs in the State 
annually. If a SWA's existing outreach staff cannot adequately meet 
these requirements, then the SWA will need to ensure additional 
outreach staff are hired or assigned to meet these requirements.
    While compliance with these requirements will require some SWAs to 
change the manner in which they currently conduct MSFW outreach, the 
Department does not anticipate that implementing these changes will 
impose a heavy burden. States will continue to retain some flexibility 
in determining how to structure their MSFW outreach in a manner that 
meets regulatory requirements. For example, a SWA may assign outreach 
staff to cover more than one service area, provided that the number of 
outreach staff in the State is adequate to conduct outreach in every 
service area in the State and to contact at least a majority of MSFWs 
in the State overall on an annual basis.
    It is important that SWAs conduct MSFW outreach in all service 
areas in the State to ensure MSFWs throughout the State are able to 
access ES and receive information on farmworker rights from outreach 
staff. While there may be fewer MSFWs in certain areas, it is important 
to ensure MSFWs in all

[[Page 82697]]

areas have access to ES on an equitable basis. Additionally, when SWAs 
do not conduct outreach in particular areas of the State, MSFWs in 
those areas may not be aware of their employment-related rights and the 
availability of the ES and Employment-Related Law Complaint System. 
These conditions could make MSFWs in those areas more susceptible to 
employment-related abuses, including wage theft, exploitation, and 
trafficking.
    As noted above, the Department acknowledges that the changes 
adopted in this final rule will require some States to change the 
manner in which they have been employing or assigning outreach staff. 
The Department has determined any burden this will impose is outweighed 
by the benefits likely to result from adopting these changes, because 
compliance with the updated requirements will better ensure that SWAs 
serve MSFWs in a manner that is qualitatively equivalent and 
quantitatively proportionate to other job seekers. The Department is 
concerned that the number of outreach staff in some States is not 
adequate to provide ES services in accordance with this standard, and 
that outreach staff are too often assigned other duties that detract 
from their ability to focus full time on the outreach responsibilities 
set forth in Sec.  653.107(b).
    SWAs contacted only approximately 21 percent of MSFWs in PY 2018 
and approximately 19 percent of MSFWs in PY 2020.\6\ The Department 
believes this level of outreach is not adequate. As described in the 
NMA Annual Report for PY 2020, the NMA has received information from 
farmworker organizations that most farmworkers have never experienced 
outreach contacts from SWAs.\7\ This information aligns with the data 
described above, which shows SWAs are not contacting the majority of 
MSFWs. Farmworkers and advocates report that farmworkers are often not 
aware of their employment-related rights, that they fear retaliation 
for reporting violations, and that they experience violations of 
employment-related law and ES regulations. Farmworker advocates also 
report that farmworkers and advocates do not trust that SWAs will 
provide help. Section 653.107 requires ES staff to educate farmworkers 
about their rights, to be alert to observe working conditions, and to 
document and process apparent violations and complaints observed during 
outreach. Through the changes adopted in this final rule, the 
Department is seeking to increase the outreach provided by SWAs to 
reach a larger percentage of MSFWs, improve the presence and 
credibility of SWAs in the farmworker community, and increase the 
number and percentage of MSFWs who are aware of the ES services, 
rights, and protections available to them.
---------------------------------------------------------------------------

    \6\ See NMA Concern 1 in the PY 2020 NMA Annual Report on 
Service to MSFWs, available on the Department's website at https://www.dol.gov/agencies/eta/agriculture/monitor-advocate-system/performance.
    \7\ NMA Annual Report for PY 2020, available at: https://www.dol.gov/agencies/eta/agriculture/monitor-advocate-system/performance.
---------------------------------------------------------------------------

    In the Department's view, the benefit of having an adequate number 
of outreach staff to contact a majority of MSFWs in the State annually 
outweighs the burden it places on SWAs to comply with the requirement. 
Compliance with this requirement will help to ensure outreach staff in 
significant MSFW States are able to focus their full attention on 
performing the outreach activities specified in Sec.  653.107(b) on a 
year-round basis, and that outreach staff in the remaining States are 
able to focus on these outreach activities full time during peak 
seasons. This is important because outreach is an essential service 
delivery component to effectively serve vulnerable populations and 
individuals who live in rural communities like MSFWs. MSFWs often 
experience transportation challenges, work long hours, and are afraid 
to seek services for numerous factors and they may not be able to go 
into an AJC in person. It is therefore imperative that SWAs have an 
adequate number of outreach staff to bridge this service gap and 
improve accessibility for MSFWs. Outreach staff who devote full time to 
their outreach responsibilities are better positioned to provide direct 
services to MSFWs and help connect them to other services. The 
Department measures the provision of services to MSFWs through its 
equity ratio indicators and minimum service level indicators. Data 
suggests that increased outreach staffing would help to improve the 
provision of ES services in many States. Specifically, while national-
level data for PY 2020 and prior years reflects that SWAs are 
cumulatively meeting equity ratio indicators, State-level data shows 
that many SWAs are not meeting several measures.\8\
---------------------------------------------------------------------------

    \8\ See NMA Concern 1 in the PY 2020 NMA Annual Report on 
Service to MSFWs, available on the Department's website at https://www.dol.gov/agencies/eta/agriculture/monitor-advocate-system/performance.
---------------------------------------------------------------------------

    Accordingly, the revisions adopted in this final rule make clear 
that full-time outreach staff must focus 100 percent of their time on 
the outreach responsibilities set forth in Sec.  653.107(b). Under this 
final rule, full-time outreach staff may not provide services to MSFWs 
who enter or otherwise contact the one-stop for ES services, or provide 
any other services, including services related to the ARS in subpart F 
of this part, such as field checks or housing inspections. MSFWs who 
make contact with the one-stop outside of the outreach process must 
instead be assisted by other available ES staff. The role of outreach 
staff is to locate and contact MSFWs who are not being reached by the 
normal intake activities conducted by the ES offices. Consistent with 
Sec.  653.107(b)(5), if an MSFW enters the ES office as a result of a 
prior outreach contact, the MSFW may be assisted by the outreach staff, 
provided that the services fall under the description of follow-up 
contacts necessary and appropriate to provide the assistance specified 
in Sec.  653.107(b)(1) through (4). If outreach staff are not 
available, other ES staff must assist the MSFW.
    The Department acknowledges there is less need for outreach in 
States with lower populations of MSFWs. Accordingly, Sec.  
653.107(a)(4) requires only those States with the highest estimated 
year-round MSFW activity to employ full-time, year-round outreach 
staff. The remainder of States need only employ full-time outreach 
during periods of the highest MSFW activity and may employ part-time 
outreach staff the remainder of the year. Under this final rule, SWAs 
will continue to provide an assessment of need that is particular to 
their State's service area(s) in the AOP, including information about 
when peak season in their State occurs and an estimate of the number of 
MSFWs in the State during peak season. The final rule will require all 
SWAs to use this data to determine the number of outreach staff that 
are adequate to conduct MSFW outreach in each service area of the State 
and to contact a majority of the MSFWs in the State annually.
    The Department disagrees with the commenters that allege it is 
untenable for States with lower populations of MSFWs to employ outreach 
staff who may perform only those duties described at Sec.  653.107(b) 
during peak season. The outreach responsibilities described in 
paragraph (b) include time-consuming services like preparation of 
applications for ES services, making referrals to employment, providing 
assistance with filing complaints, referrals to supportive services, 
assistance in making appointments and arranging transportation to and 
from local one-stop centers or other appropriate agencies, and follow-
up activities necessary to provide the

[[Page 82698]]

assistance described in Sec.  653.107(b)(1) through (4). Outreach staff 
may, therefore, devote time to providing the direct services identified 
in Sec.  653.107(b)(4) to the MSFWs they contact through outreach and 
may work to ensure the MSFWs they enroll as participants receive 
services the Department measures through its equity ratio indicators 
and minimum service level indicators. This work is particularly 
important because, while national-level data for PY 2020 and prior 
years reflects that SWAs are cumulatively meeting equity ratio 
indicators, State-level data shows that many SWAs are not meeting 
several measures.\9\ The condition appears to exist because data from a 
few larger States that are compliant with these measures compensates 
for many other States that are not meeting the measures, including 
States that are not significant MSFW States. These low-performing 
States often do not have full-time or any outreach staff in peak 
season, and the Department is concerned that the lack of staffing 
negatively impacts the ability of MSFWs in these States to receive 
equitable access to the ES. Accordingly, the Department continues to 
believe it is necessary for SWAs in all States to employ outreach staff 
on a year-round basis, and that outreach staff in non-significant MSFW 
States must devote full-time to outreach work during the periods of 
highest MSFW activity in the State.
---------------------------------------------------------------------------

    \9\ See NMA Concern 1 in the PY 2020 NMA Annual Report on 
Service to MSFWs, available on the Department's website at https://www.dol.gov/agencies/eta/agriculture/monitor-advocate-system/performance.
---------------------------------------------------------------------------

    The Department disagrees with the commenter that asserted outreach 
staff must serve non-MSFWs and perform other duties within a one-stop 
center in order to learn how to effectively serve MSFWs. In the 
Department's view, the training that outreach staff receive pursuant to 
Sec.  653.107(b)(7), which includes training on one-stop center 
procedures and on the services, benefits, and protections afforded 
MSFWs by the ES, should sufficiently prepare them to successfully serve 
MSFWs. Outreach staff may also attend staff meetings and trainings that 
relate to improving the quality of their outreach and which do not 
detract from their ability to meet outreach requirements described in 
this section. Such trainings might include information on one-stop 
partners, supportive services, and other information or resources 
available to MSFWs, which may also be available to non-MSFWs. Serving 
other job seekers is not necessary to obtain the skills or knowledge 
necessary to effectively conduct outreach to MSFWs.
    In response to the commenter that sought clarification about how a 
SWA should determine if it employs an ``adequate'' number of outreach 
staff, the Department notes that, per the revision to Sec.  
653.107(a)(4) adopted in this final rule, the number of outreach staff 
in a State is ``adequate'' if the outreach staff in the State are able 
to (1) conduct MSFW outreach in each service area of the State and (2) 
contact a majority of MSFWs in the State annually. Section 
653.107(a)(4) additionally specifies that outreach staffing levels must 
align with and be supported by the estimated number of farmworkers in 
the State and the farmworker activity in the State, as demonstrated by 
the SWA in the State's AOP.
    In response to the commenter seeking clarification about the areas 
where States must conduct outreach, the Department is modifying the 
revision it proposed to make in Sec.  653.107(a)(4) so that it 
explicitly specifies that each SWA must ensure there is an adequate 
number of outreach staff in the State to conduct MSFW outreach in each 
service area of the State and to contact a majority of MSFWs in all of 
the State annually. The final rule will require SWAs to conduct 
outreach in all of the State's service areas so that MSFWs in all 
service areas are able to access the full range of ES. The SWA's 
service areas consist of each local area where the SWA provides labor 
exchange services under the Wagner-Peyser Act, as described in the 
Memorandum of Understanding (MOU) that is explained in 20 CFR 678.500. 
This requirement does not mean that outreach staff must be placed in 
each local area, only that the State must ensure that there is an 
adequate number of outreach staff in the State to meet the requirements 
of this section.
    The Department acknowledges the concern raised by some commenters 
that the revisions to Sec.  653.107(a)(3) will make it more difficult 
to hire and retain outreach staff, which could impede a SWA's ability 
to hire an adequate number of outreach staff. However, the Department 
does not anticipate that compliance with Sec.  653.107(a)(3) will pose 
the obstacle that these commenters fear. While the revised regulation 
will require a SWA to ensure hiring officials seek and put a strong 
emphasis on hiring and assigning qualified candidates who meet the 
characteristics described in Sec.  653.107(a)(3) (i.e., qualified 
candidates who speak the language of a significant proportion of the 
State MSFW population and who are from MSFW backgrounds or who have 
substantial work experience in farmworker activities), if a State seeks 
but does not find qualified candidates who meet the characteristics 
described in Sec.  653.107(a)(3), the State must still employ an 
adequate number of outreach staff by hiring or assigning the most 
qualified among available candidates.
    For these reasons, the Department adopts the proposed changes, with 
the revisions to Sec.  653.107(a)(3) and (4) described above, and will 
provide technical assistance and guidance to help SWAs meet the 
requirements, as appropriate.
Section 653.107(b)
    Paragraph (b) of Sec.  653.107 describes outreach staff 
responsibilities. The Department proposed to make several revisions to 
this section.
    In particular, the Department proposed to amend the introductory 
sentence of paragraph (b) to specify that outreach staff 
responsibilities include the activities identified in paragraphs (b)(1) 
through (11) of this section. This revision would reinforce the 
Department's proposal to add a sentence in Sec.  653.107(a)(4) to 
specify that full-time outreach means each individual outreach staff 
person must spend 100 percent of their time performing the outreach 
responsibilities described in Sec.  653.107(b). Because this revision 
would remove the colon in the existing regulatory text, the Department 
proposed to make a conforming amendment to the beginning of the 
sentence in paragraph (b)(1) so that it begins by stating ``outreach 
staff must'' instead of ``explaining.''
    The Department additionally proposed to make several revisions to 
Sec.  653.107(b)(7) to update the topics about which outreach staff 
must receive training. In particular, the Department proposed to 
replace the reference to outreach staff being trained in ``local 
office'' procedures with a requirement to train outreach staff in 
``one-stop center'' procedures, which would align with the revised 
definition of ES office that the Department proposed at Sec.  651.10. 
The Department additionally proposed to require training on sexual 
coercion, assault, and human trafficking, in addition to the existing 
requirement to provide outreach staff training on sexual harassment 
(training on the former topics is suggested but not mandatory in the 
existing regulations). The Department also proposed to replace the 
existing requirement for SWAs to train outreach staff in the procedure 
for informal resolution of complaints with a requirement for

[[Page 82699]]

SWAs to train outreach staff on the Complaint System procedures at part 
658, subpart E, and to require that outreach staff be aware of the 
local, State, regional, and national enforcement agencies that would be 
appropriate to receive referrals.
    Finally, the Department proposed several non-substantive revisions 
in paragraph (b) to replace ``outreach workers'' with ``outreach 
staff'' and ``employment services'' with ``ES services.''
    The Department received several comments concerning the revisions 
it proposed to paragraph (b), which it describes and responds to below. 
Comments regarding the proposal to limit full-time outreach workers to 
the outreach responsibilities set forth in this paragraph are discussed 
above in connection with the proposed revision to Sec.  653.107(a)(4).
    For the reasons discussed below, the Department has not made any 
changes to the revisions it proposed to this paragraph and adopts the 
revisions to Sec.  653.107(b) as proposed. In addition, although the 
Department did not propose to revise Sec.  653.107(b)(6) in the NPRM, 
as discussed in the comment responses for Sec.  658.419, the Department 
received comments requesting additional clarification to the proposed 
definition of apparent violation, which resulted in further revisions 
to that definition. As a result, the Department has identified that it 
is necessary to revise Sec.  653.107(b)(6) to remove the reference to 
suspected violations and to clarify the procedure outreach staff must 
follow to document and refer apparent violations. Therefore, through 
this final rule, the Department revises Sec.  653.107(b)(6) to state 
that outreach staff must be alert to observe the working and living 
conditions of MSFWs and if an outreach staff member observes or 
receives information about apparent violations, the outreach staff 
member must document and refer the information to the appropriate ES 
Office Manager (as described in Sec.  658.419 of this chapter).
    Comment: A farmworker advocacy organization commended the 
Department's proposals that emphasize outreach work is a full-time job 
that deserves priority and should not be combined with other functions. 
This commenter went on to suggest that the Department add an additional 
role to outreach responsibilities: collect data to be used for 
prevailing wage surveys. In particular, this commenter recommended that 
the Department allow SWAs to leverage outreach staff to collect wage 
data while conducting outreach work. The commenter asserted that doing 
so would help the Department fulfill its duty to determine the 
prevailing wages for agricultural work and better protect farmworker 
wages by increasing the frequency of surveys, including worker input in 
the determination, and addressing instances of insufficient employer 
data.
    Response: The Department declines to adopt the commenter's 
suggestion to add an additional role to outreach responsibilities for 
outreach staff to collect data to be used for prevailing wage surveys. 
The Department believes that outreach staff must focus their efforts on 
providing services to MSFWs. Prevailing wage surveys would cause 
outreach staff to devote time away from providing services to MSFWs.
    Comment: The Department received several comments concerning its 
proposal to revise the training requirements in Sec.  653.107(b)(7). A 
farmworker advocacy organization endorsed the proposal to amend this 
paragraph to require that outreach staff receive training on additional 
topics (i.e., protecting MSFWs against sexual coercion, assault, and 
human trafficking, as well Complaint System procedures). To support the 
requirement, this commenter cited news coverage and research findings 
about human trafficking and asserted that, in order for the ES 
Complaint System to be effective, outreach workers will first need to 
make farmworkers aware of its existence.
    A State government agency similarly agreed that outreach staff 
should receive training on protecting MSFWs against sexual coercion, 
assault, and human trafficking, but it urged the Department to provide 
appropriate training rather than requiring States to find or develop 
appropriate trainings locally. This commenter felt the Department (not 
SWAs) should bear responsibility for providing this training, because 
the Department identified these topics as issues that are particularly 
relevant to H-2A workers, and the Department is tasked with 
administering the H-2A visa program. The commenter further reasoned 
that if the Department provides training on these topics, it could 
target the unique challenges facing outreach staff and provide States 
an opportunity to share lessons learned and best practices.
    Other commenters raised more general questions about when and by 
whom the training required by Sec.  653.107(b)(7) is to be provided. 
These commenters questioned what training MSFW outreach staff housed at 
one-stop centers would need regarding one-stop center procedures and 
how the training requirement could be met when the proposed rule 
emphasizes that MSFW outreach staff should be in the field during peak 
growing season to ensure MSFWs are protected while they work. In 
contrast, a State government agency asserted that outreach staff must 
be able to dedicate time to providing services to non-MSFWs so they can 
remain up to date on the latest services, best practices, employers, 
hiring events, etc. in their area.
    Response: The Department continues to believe that it is critical 
for outreach staff to receive training on protecting MSFWs against 
sexual coercion, assault, and human trafficking, as well as training in 
Complaint System procedures. In response to comments asking who will 
provide this training (as well as training on the other topics set 
forth in Sec.  653.107(b)(7)), the Department notes that the existing 
regulation tasks the State Administrator with the responsibility to 
develop the training required by this regulation, pursuant to uniform 
guidelines developed by ETA. The Department did not propose any 
revisions to this requirement in Sec.  653.107(b)(7). The Department 
continues to believe the State Administrator is in the best position to 
develop these trainings, because conditions, resources, and relevant 
service providers are State-specific. While the Department often 
provides guidance on protecting MSFWs from employment-related abuses 
and the Department's overall regulations for the Complaint System, each 
State is best positioned to train their outreach staff on the specific 
resources and procedures in their State. Specifically, the State 
Administrator can ensure staff receive training on the specific 
conditions affecting MSFWs in the State and the SWA's own procedures, 
including Complaint System procedures. For example, each State has 
different State-level enforcement agencies about which staff should be 
informed to make appropriate referrals. Additionally, many States have 
anti-trafficking taskforces that are specific to the State or to local 
areas. RMAs are available to provide technical assistance regarding 
these resources, including sharing contact information for potential 
training partners.
    In response to questions from commenters asking why outreach staff 
need to be trained on one-stop center procedures and when outreach 
staff would be available to receive such training if they are working 
in the field, the Department notes that Sec.  653.107(b) requires 
outreach staff to spend a majority-- but not all-- of their time in the 
field. Outreach staff may use the time when they are not in the field 
to

[[Page 82700]]

attend training, provide follow-up services, or engage in any of the 
other activities described in Sec.  653.107(b). Because outreach staff 
are tasked with providing ES services to the MSFWs they contact through 
their outreach work--either directly in the field or subsequently in a 
one-stop center--they must be trained on how to provide those services 
in both the field and at the one-stop center. The Department disagrees 
that outreach staff must also serve non-MSFWs at the local one-stop in 
order to effectively serve MSFWs and receive this training. Outreach 
staff do not need to provide other services in the one-stop to receive 
this training and provide competent services to MSFWs.
Section 653.107(d)
    Paragraph (d) of Sec.  653.107 requires a SWA to develop an 
Agricultural Outreach Plan (AOP) to include in the Unified or Combined 
State Plan that its State submits pursuant to sec. 102 or 103 of WIOA. 
The Department proposed to amend this paragraph to make several changes 
to the content that SWAs must include in their AOP.
    First, the Department proposed to revise Sec.  653.107(d)(2)(ii) to 
require the AOP to explain the materials, tools, and resources that the 
SWA will use for outreach.
    Second, the Department proposed to revise Sec.  653.107(d)(2)(iii) 
so that it would require a SWA to describe their proposed activities to 
contact MSFWs who are not being reached by the normal intake activities 
conducted by the one-stop centers and to include within this 
description: (1) the number of full-time and part-time outreach staff 
in the State; and (2) an explanation demonstrating that there is a 
sufficient number of outreach staff to contact a majority of MSFWs in 
all the State's service areas annually. The Department proposed this 
change to align the information that SWAs provide in the AOP with the 
proposed requirement in Sec.  653.107(a)(4) for a SWA to employ an 
adequate number of outreach staff to conduct MSFW outreach in each area 
of the State to contact a majority of the MSFWs in all of the SWA's 
service areas annually. As noted below, the Department has modified the 
proposed regulatory text for this provision to conform with the 
revisions that it made to the regulatory text in Sec.  653.107(a)(4).
    Third, the Department proposed to revise Sec.  653.107(d)(2)(v) to 
replace the requirement for a SWA in a State with significant MSFW one-
stop centers to provide an assurance that it is complying with the 
requirements in Sec.  653.111 to instead require that SWAs in such 
States provide a description of how they how they intend to comply with 
the staffing requirements for MSFW one-stop centers in accordance with 
Sec.  653.111.
    Fourth, the Department proposed to amend Sec.  653.107(d)(4) to 
clarify that the AOP must be submitted in accordance with paragraph 
(d)(1) of this section instead of paragraph (d), as currently written. 
Paragraph (d)(1) is the accurate reference that explains the SWA's 
responsibility to develop the AOP as a part of the Unified or Combined 
State Plan.
    Finally, the Department proposed two revisions at Sec.  
653.107(d)(5). First, the Department proposed a technical edit to 
change the reference from Sec.  653.108(s) to Sec.  653.108(u) due to 
restructuring paragraphs at Sec.  653.108. Second, the Department 
proposed to replace ``its goals'' with ``the objectives.'' Referring to 
``the objectives'' is more accurate because the Department does not ask 
SWAs to provide specific goals in the AOP, rather SWAs identify various 
objectives.
    The Department largely adopts the proposed changes with only minor 
revisions. Specifically, the Department modified the regulatory text it 
proposed for Sec.  653.107(d)(2)(iii) to clarify the information that 
this provision requires States to include in the AOP and to align with 
the revisions that this final rule adopts at Sec.  653.107(a)(4). The 
Department adopts all other proposed revisions to Sec.  653.107(d) 
without change.
    Comment: A farmworker advocacy group supported the Department's 
proposed changes to the content that SWAs must include in an 
Agricultural Outreach Plan, noting the revisions would require 
considerably greater detail about how the SWA intended to reach 
farmworkers who do not normally visit the SWA's one-stop centers.
    Response: The Department appreciates the views that this commenter 
shared. As this commenter noted, the revisions adopted in this rule 
will require SWAs to provide more detail in their AOPs about the 
outreach they plan to conduct. They will also require SWAs to provide 
more detail about how they plan to comply with the staffing 
requirements for significant one-stop centers in Sec.  653.111. This 
level of detail is essential to aid SMAs, RMAs, and the NMA in 
assessing whether SWAs have the appropriate staffing structure to meet 
the unique needs of farmworkers.
Section 653.108 State Workforce Agency and State Monitor Advocate 
Responsibilities
    Section 653.108 governs the monitoring obligations of the SWA and 
the SMA. The NPRM proposed numerous revisions to this section intended 
to strengthen the role of the SMA and enhance the monitoring activities 
that SMAs perform. The Department received a number of comments 
addressing these proposals. After careful consideration of the comments 
received, the Department has decided to adopt the revisions as 
originally proposed, except as noted in the discussions below. 
Paragraphs (k), (p), (r), (s), and (t) in this section are redesignated 
paragraphs because of revisions made elsewhere in this section. The 
Department did not propose any other changes to these paragraphs, and 
they are not discussed below.
Section 653.108(a) State Workforce Agency Responsibilities for Service 
Delivery to Migrant and Seasonal Farmworkers
    Paragraph (a) of Sec.  653.108 establishes the SWA's responsibility 
to monitor the SWA's own compliance with ES regulations in serving 
MSFWs. The Department proposed to revise this paragraph to explicitly 
prohibit the State Administrator or ES staff from retaliating against 
an SMA for performing the monitoring activities required by this 
section.
    Comment: A State government agency and a farmworker advocacy 
organization commended the Department for proposing to explicitly 
prohibit the SWA from retaliating against SMAs and their staff for 
monitoring activities or for raising concerns about noncompliance with 
ES regulations.
    Response: The Department appreciates the commenters' feedback 
supporting the proposed change prohibiting retaliation. The Department 
adopts this change as proposed for the reasons set forth in the NPRM.
Section 653.108(b) State Monitor Advocate Requirement and 
Qualifications
    Paragraph (b) of Sec.  653.108 requires SWAs to appoint an SMA who 
must be a SWA official to monitor SWA compliance with ES regulations in 
serving MSFWs and sets forth qualifications for the SMA position. The 
Department proposed to revise this paragraph to remove the requirement 
that the SMA be a SWA official because the Department proposed to 
remove the definition of SWA official in Sec.  651.10.

[[Page 82701]]

However, as described in the comment responses for Sec.  651.10, the 
final rule will maintain the current definition of SWA official in 
existing Sec.  651.10, and therefore, the Department will also maintain 
the requirement that the SMA be a SWA official in this paragraph.
    The Department also proposed to revise Sec.  658.108 to require 
that SWAs not only seek but also put a strong emphasis on hiring 
qualified candidates for the SMA position who meet one or more of the 
criteria listed in paragraphs (b)(1) through (3). The Department adopts 
the change as proposed.
    Comment: A farmworker advocacy organization supported proposed 
changes to ensure that States prioritize hiring SMAs with experience in 
the farmworker community, inform farmworker organizations about 
vacancies in the SMA position, and encourage these organizations to 
refer qualified applicants. However, the commenter warned that States 
do not always honor their obligation to work with farmworker 
organizations when hiring for the SMA position. The commenter expressed 
hope that the proposed rule's renewed emphasis on the importance of 
hiring SMAs with relevant experience and connections would alleviate 
this problem going forward.
    A State government agency disagreed with the proposal to establish 
additional hiring requirements for the SMA role, arguing that putting 
``a strong emphasis on hiring'' qualified candidates who meet the 
criteria is not needed because SWAs already must ``seek'' such 
candidates. The commenter added that it uses detailed job descriptions, 
screening evaluations, and interviewing benchmarks to hire strong 
candidates.
    Response: The Department acknowledges that some SWAs already have 
practices in place to hire strong candidates for the SMA position, but 
some do not. The changes in this paragraph are intended to better 
ensure that SWAs not only seek qualified candidates by complying with 
the requirements to contact certain organizations about job openings, 
but also hire qualified candidates. The Department acknowledges that 
SWAs may not always be able to attract candidates who meet 100 percent 
of the criteria outlined in the regulations and therefore mandating 
that SWAs hire candidates meeting all of the criteria is not 
practicable. Instead, the Department determined that requiring that 
SWAs seek and place a strong emphasis on hiring SMAs meeting the 
criteria in the regulations gives SWAs the flexibility needed to fill 
SMA positions and also better ensures that SWAs hire qualified 
individuals to perform the critical duties of the SMA position.
    The proposed change to put a strong emphasis on hiring qualified 
candidates is important to increase the likelihood that all SWAs will 
hire SMAs who meet one or more of the criteria, and not simply seek 
such individuals. This proposed change will allow the Department to 
assess whether a SWA has policies and procedures in place to ensure it 
hires qualified candidates. In cases where a SWA has more than one 
applicant, the Department would expect SWAs to hire the applicant with 
the listed qualifications, over those that did not meet the 
qualifications. The Department adopts the change as proposed to better 
ensure SWAs hire qualified candidates for the SMA position.
Section 653.108(c) State Monitor Advocate Status
    Paragraph (c) of Sec.  653.108(c) establishes the status of the SMA 
within the SWA. The Department proposed several revisions to this 
paragraph to strengthen the status of the SMA, as many SMAs have 
reported difficulty in their ability to fully carry out their duties 
due to insufficient status within the SWA. Specifically, the Department 
proposed at Sec.  653.108(c) to create new paragraphs (c)(1) through 
(3). First, proposed paragraph (c)(1) required that the SMA be a 
senior-level ES staff employee. Second, proposed paragraph (c)(2) 
required the SMA to report directly to the State Administrator or their 
designee such as a director or other appropriately titled official in 
the State Administrator's office who has the authority to act on behalf 
of the State Administrator. Third, proposed paragraph (c)(3) required 
that the SMA have the knowledge, skills, and abilities necessary to 
fulfill the responsibilities as described in this subpart. The 
Department adopts the changes as proposed.
    Comment: Several State government agencies, both those in support 
of and opposed to the requirements in this paragraph, noted that the 
requirements will require restructuring or reclassifying the SMA 
position.
    A farmworker advocacy organization agreed with the proposed 
requirement that SMAs must be senior-level officials within the SWA. A 
private citizen also supported requiring the SMA to be a senior-level 
ES staff employee who reports to the State Administrator, remarking 
that the SMA currently does not have sufficient status within the SWA 
and reports to a lower level supervisor without decision-making 
authority, which they said causes delays or denials of requests by the 
SMA and even the disregarding of corrective actions. Similarly, some 
State government agencies and anonymous commenters agreed with proposed 
changes that would enable SMAs to conduct their role more effectively, 
such as strengthening their status and giving them more autonomy, but 
asked the Department to provide SWAs with more guidance on the revised 
role (e.g., better define ``senior-level'' and ``their designee''). One 
of the anonymous commenters recommended the Department communicate the 
changes in the SMA's status directly to SWAs, such as through a 
webinar, rather than having them learn it from their SMAs. The other 
anonymous commenter also urged the Department to ensure that when the 
State Administrator uses a designee, the SMA still has direct, personal 
access to the State Administrator and the designee is knowledgeable and 
experienced in the ES and Monitor Advocate System to better assist the 
SMA and make decisions on behalf of the SWA.
    A State government agency remarked that not allowing the State 
Administrator's designee to be the individual who has direct program 
oversight of the ES is practical because it ensures compliance 
standards are met without biases. However, the commenter asked the 
Department to clarify how it defines ``direct program oversight,'' to 
ensure that the SMA is reporting to the correct administrator.
    A State government agency opposed the proposed requirement that the 
SMA be a senior-level position reporting directly to the State 
Administrator, arguing that its approved part-time SMA ensures SWA 
adherence to all requirements, has access to the State Administrator 
through the chain of command, and would not have any greater efficacy 
in oversight at a different level. Another State government agency 
similarly opposed a requirement for the SMA to be positioned at the 
senior staff level and expressed its preference to retain flexibility 
on where the SMA is placed within the agency, arguing it has 
demonstrated that its SMA can effectively perform their role from their 
current placement within the agency. This State agency additionally 
asserted that changing the SMA's current placement within the agency 
would likely require reclassification of the position and necessitate a 
strategic recruitment process to identify a candidate with the 
requisite skills and experience at a senior level. Noting these 
processes require time, this State agency asked the Department to 
enlarge

[[Page 82702]]

the proposed deadline to comply with this requirement if the Department 
decided to adopt it, and provide States 2 years from the effective date 
of any final rule to come into compliance with the requirement. Another 
State government agency commented that the proposed change would 
require reorganization of the State's MSFW program office in order to 
elevate the SMA position to report directly to the State Administrator 
and to comply with other changes proposed in paragraph (d). This agency 
stated the proposed changes could adversely impact the level of funding 
that the agency provides to local ES offices to support MSFW 
activities.
    Some commenters remarked that the proposed changes appear to be a 
duplicative effort by aligning the status of the SMA and the E.O. 
Officer. In contrast, a State government agency said there are direct 
correlations between the SMA and the E.O. Officer and reasoned that 
improved alignment and partnership of the two positions would better 
address the statewide need.
    Referencing the Department's statement that the proposed change 
would require the SMA to be ``not only a State employee, but a State 
merit-staff employee,'' a State government agency asked the Department 
to clarify or define the terms ``State employee'' and ``State merit-
system employee.''
    Response: While many commenters, including some SWAs, SMAs, and 
advocacy organizations, supported a requirement to enhance the status 
of the SMA, the Department recognizes that some SWAs did not. The 
Department believes these changes are critical to ensure that SMAs can 
more effectively carry out their duties; having ``direct access'' to 
the State Administrator ``as needed'' as previously required was not 
enough. The Department recognizes that SWAs will need a reasonable 
amount of time to implement these changes. The Department requested 
comment on the appropriate length of time to come into compliance. 
States requested a range of 2 years to 3 years. The Department is 
providing 24 months from the effective date of this final rule for SWAs 
to implement these changes. This is the same amount of time SWAs will 
have to comply with the State merit-staffing requirements in this final 
rule. Having one transition period enables SWAs to take the necessary 
steps to implement all of the changes required under this final rule at 
one time. These steps include, among others, obtaining any required 
State authorization, addressing collective bargaining issues and 
contracts, and conducting recruiting and training. During the 
transition period, the Department will provide technical assistance and 
guidance to help SWAs comply with the new requirements. The Department 
has detailed the cost burden associated with this final rule in section 
VI. Wagner-Peyser Employment Service grant funding is provided annually 
to deliver employment services, and such grant funding is available to 
cover the cost of implementing this final rule.
    The Department noted in the NPRM that many SMAs have reported 
difficulty in their ability to carry out their duties due to 
insufficient status within the SWA. The proposed changes strengthen the 
status of SMA. SMAs are charged with ensuring compliance with ES 
regulations put in place to ensure that MSFWs have meaningful access to 
services and equal opportunities. To enhance the SMA's ability to 
effectively carry out their role, SMAs need to hold a senior-level 
position that will grant them more direct access to top management. A 
senior-level position is one having a title and resources commensurate 
with the level of responsibility for a senior official who reports 
directly to the State Administrator or the State Administrator's 
designee having the authority to make decisions on behalf of the State 
Administrator.
    Allowing the State Administrator to select a designee to whom the 
SMA reports gives States flexibility in how to implement this 
requirement. If a State Administrator chooses to have the SMA report 
directly to a designee, the designee must be a position within the 
State Administrator's office with authority to act on behalf of the 
State Administrator. However, the designee may not be the individual 
with direct oversight of the ES, such as the ES director. This 
restriction is necessary to avoid challenges that may result from 
having the SMA monitor compliance with decisions made by their direct 
supervisor or for which their direct supervisor may be responsible.
    The Department notes that Sec.  653.108(e) provides States with the 
ability to have part-time SMAs with prior approval from the Regional 
Administrator (RA). The Department believes the requirements under 
paragraph (c) are compatible with the part-time SMA staffing provision 
in paragraph (e).
    The NPRM referenced the E.O. Officer simply as a comparable 
position to an SMA, having a similar level of responsibility and 
complexity, that is required to be a senior-level position within a 
State. The Department did not propose, nor do these final regulations 
require, any changes to the SMA position that either duplicate the work 
of the E.O. Officer or require the SMA to have the exact same position 
or level as the E.O. Officer. SMAs are responsible for monitoring SWA 
and ES office compliance with ES regulations in serving MSFWs. The 
change in this final rule requires the SMA to report to the State 
Administrator (or designee). E.O. Officers perform a different function 
in the State.
    The Department notes that ``State employee'' means an individual 
employed by the State. ``State merit staff'' means State government 
personnel who are employed according to the merit system principles 
described in 5 CFR part 900, subpart F (Standards for a Merit System of 
Personnel Administration). Requiring the SMA to be State merit staff, 
not just a State employee, conforms with the merit-staffing requirement 
in Sec.  652.215.
    The Department adopts the changes as proposed to ensure SMAs have 
the status and authority to monitor SWA compliance with ES regulations.
Section 653.108(d) State Monitor Advocate Staff Responsibilities
    Paragraph (d) of Sec.  653.108 describes requirements for staff and 
other resources to support the SMA in carrying out monitoring 
functions. The Department proposed to revise Sec.  653.108(d) to 
require that the SMA have sufficient authority, staff, resources, and 
access to top management to monitor compliance with the ES regulations. 
In addition, the Department proposed to prohibit SMA staff from 
performing outreach responsibilities, ARS processing, and complaint 
processing to conform with proposed changes to the SMA's role in these 
activities.
    Comment: A farmworker advocacy organization remarked that the 
proposed revisions ensure SMAs have the authority, tools, and resources 
they need to monitor SWA compliance with ES regulations. A few State 
government agencies noted the proposed requirements in paragraphs (c) 
and (d) together could require restructuring their SMA office (e.g., 
creating a senior-level staff position and hiring additional analyst 
staff) and relocating it for direct access to the State Administrator 
or their designee. One of those State government agencies requested a 
transition period of 3 years to comply with the requirements. A 
different State government agency supported the proposed requirement, 
saying it would amplify the SMA's monitoring capabilities and allow the 
SMA to maintain program standards. However, referencing the 
Department's statement that ES staff assigned to help the SMA

[[Page 82703]]

carry out its duties may not be assigned conflicting roles, the 
commenter asked the Department to clarify the functions and 
responsibilities that ES staff would be assigned under the SMA, which 
it said would provide it guidance to determine if any conflict exists.
    A State government agency requested that the Department require 
coordination between the SMA and SWA officials responsible for 
monitoring to help ensure efficient and non-duplicative efforts given 
the requirement that the SWA also conduct monitoring.
    A farmworker advocacy organization agreed with the proposed 
requirement that SMAs must not serve jointly as outreach staff, 
reasoning that prohibiting the SMA from serving part-time in an 
outreach role would eliminate conflict of interest concerns that arise 
from the SMA's responsibility for monitoring outreach efforts. Citing 
an article about an investigation of human trafficking by an SMA's 
relative, the commenter urged the Department to go further to address 
other significant conflicts of interest that can arise with SMAs, such 
as by adopting conflict of interest standards for SMAs to ensure that 
they are not involved in approving clearance orders or handling 
complaints related to family members or close associates.
    Response: The Department recognizes that SWAs will need a 
reasonable amount of time to implement these changes. The Department 
will provide 24 months from the effective date of this final rule for 
SWAs to implement these changes. This is the same amount of time SWAs 
will have to comply with the State merit-staffing requirements in this 
final rule. Having one transition period enables SWAs to take the 
necessary steps to implement all of the changes required under this 
final rule at one time. These steps include, among others, obtaining 
any required State authorization, addressing collective bargaining 
issues and contracts, and conducting recruiting and training. During 
the transition period, the Department will provide technical assistance 
and guidance to help SWAs comply with the new requirements.
    In the NPRM, the Department proposed changes to prohibit the SMA's 
staff from being assigned conflicting roles to perform any outreach 
responsibilities, ARS processing, or complaint processing. The 
Department proposed regulatory text to prohibit SMA staff from 
performing work that conflicts with the ``monitoring'' duties of the 
SMA. The final regulatory text does not include the word ``monitoring'' 
before duties to make clear that SMA staff must not perform any work 
that conflicts with any of the SMA's duties, not just the SMA's 
monitoring duties. The Department notes the recommendation to go 
further to address other significant conflicts of interest that can 
arise with SMAs, such as by adopting conflict of interest standards for 
SMAs in this final rule. The Department is adding in paragraph (e) 
regulatory text to explicitly prohibit the SMA from performing any work 
that conflicts with any of the SMA's duties in Sec.  653.108. The 
Department will further address conflicts of interest and internal 
controls in technical assistance and guidance.
Section 653.108(e) State Monitor Advocate Full-Time Staffing 
Requirement and Prohibited Duties
    Paragraph (e) of Sec.  653.108 is a new paragraph that was 
proposed, specifying that no State may dedicate less than full-time 
staffing for the SMA position unless the RA, with input from the RMA, 
provides written approval. The Department is also making one change in 
this section that was not proposed in the NPRM to explicitly state that 
the SMA must not perform work that conflicts with any of the SMA's 
duties, such as outreach, ARS processing, and complaint processing.
    Comment: Citing reports of issues such as discrimination arising 
when SMAs split their time between monitoring activities and other 
duties, a farmworker advocacy organization agreed with the proposed 
requirement that SMAs must serve in the role full-time.
    Response: The Department acknowledges the commenter's support for a 
full-time SMA staffing requirement. The Department sought to strengthen 
the regulation permitting part-time SMA staffing (previously described 
in Sec.  653.108(d)) by (1) including the RMA in the RA's process for 
determining whether a State has demonstrated that the SMA function can 
be effectively performed with part-time staffing; and (2) requiring 
express written approval by the RA. After consideration of comments 
regarding SMA conflicts, the Department is also revising this paragraph 
to explicitly state that the SMA must not perform any work that 
conflicts with any of the SMA's duties described in Sec.  653.108. This 
change was not proposed in the NPRM, but the Department did propose and 
has adopted in the definition of ``outreach staff'' in Sec.  651.10, 
regulatory text explaining that SMAs are not considered outreach staff. 
In part 658, the Department proposed and adopted regulatory text 
prohibiting the SMA from participating in the complaint process. And in 
paragraph (d) of this section, the Department proposed an explicit 
prohibition on the SMA's staff from performing any work that conflicts 
with the SMA's duties, such as outreach, ARS processing, and complaint 
processing. It follows that the SMA must not perform work that 
conflicts with the SMA's duties either. Therefore, the Department is 
expressly prohibiting the SMA from performing any work that conflicts 
with the SMA's duties described in this section.
Section 653.108(f) State Monitor Advocate Training
    Redesignated paragraph (f) of Sec.  653.108 sets forth required 
trainings for SMAs and SMA staff to maintain competency. The Department 
proposed to remove the requirement that SMAs attend a training by the 
RMA within the first 3 months of the SMA's tenure. Instead, the 
Department proposed to require all SMAs and their staff to attend 
trainings offered by the RMA, the NMA, and their team, as well as those 
trainings necessary to maintain competency and enhance the SMA's 
understanding of the unique needs of farmworkers. This includes 
trainings offered by an enumerated list of Federal agencies as well as 
trainings offering farmworker-related information.
    Comment: Numerous commenters, including several labor unions, a 
couple of think tanks, and an advocacy organization, commended the 
Department for its commitment to improving the effectiveness of SMAs 
and ensuring that their staff receive the training necessary to provide 
MSFWs adequate services. A farmworker advocacy organization agreed it 
is important that SWA staff receive proper training on key tasks like 
assessing agricultural jobs and connecting workers with necessary 
services.
    Response: The Department appreciates the comments provided in these 
areas supporting the proposed changes. After further consideration, the 
Department identified a need to clarify which staff may require SMAs to 
attend training. The Department has decided to remove the proposed 
reference to NMA team members and instead refer to NMA staff, as 
identified in Sec.  658.602(h). The Department adopts the proposed 
revisions, with the exception of updating the reference to NMA staff, 
for the reasons outlined in the NPRM.

[[Page 82704]]

Section 653.108(h) State Monitor Advocate Review of State Workforce 
Agencies and Employment Service Offices
    Paragraph (h) of Sec.  653.108 outlines elements of the SMA's 
review of SWA and ES office service delivery to MSFWs. These 
requirements were previously described in Sec.  653.108(g). The 
Department proposed in Sec.  653.108(h)(1)) to specify important 
elements of the ongoing review that the SMA must conduct under this 
paragraph. In particular, new proposed paragraphs (h)(1)(i) through 
(iii) would require the SMA to conduct an ongoing review of the 
delivery of services and protections afforded by the ES regulations to 
MSFWs by the SWA and ES offices, including: (i) monitoring compliance 
with Sec.  653.111; (ii) monitoring the ES services that the SWA and 
one-stop centers provide to MSFWs to assess whether they are 
qualitatively equivalent and quantitatively proportionate to the 
services the SWA and one-stop centers provide to non-MSFWs; and (iii) 
reviewing the appropriateness of informal resolution of complaints and 
apparent violations as documented in the complaint logs. The Department 
proposed in Sec.  653.108(h)(3) and to clarify that SMAs must conduct 
onsite reviews of one-stop centers regardless of whether the one-stop 
center is designated as a significant MSFW one-stop center. Proposed 
Sec.  653.108(h)(6) maintained an existing requirement for SMAs to 
review outreach workers' daily logs and other reports, including those 
showing or reflecting the workers' activities, but proposed that this 
review be done on a ``regular'' rather than a ``random'' basis. The 
Department adopts the changes as proposed.
    Comment: Some commenters disagreed with the proposed requirement 
that SMAs must conduct onsite reviews of one-stop centers regardless of 
whether the one-stop center is designated as a significant MSFW one-
stop center, arguing that this is an overreach, that it is duplicative 
of existing monitoring reviews, and that monitoring of one-stop centers 
can be accomplished without dismantling the current Michigan model. 
Quoting the Secretary describing the Industry-Recognized Apprenticeship 
Program as ``a disconnected, duplicative program that does nothing but 
create confusion,'' the commenters asserted the same could be said of 
the proposed requirement, which they warned would slow customer service 
response time, increase all workforce system costs, and reduce 
flexibility in meeting the needs of local communities. In contrast, a 
farmworker advocacy organization supported the proposed requirement but 
cautioned that SMAs will need adequate resources to effectively 
implement this change. A few State government agencies also stated that 
the proposed revision will require an increase in staffing resources.
    A State government agency opposed the proposed requirement that 
SMAs must monitor whether the ES services provided to MSFWs are 
qualitatively equivalent and quantitatively proportionate to the 
services provided to non-MSFWs. The commenter argued that State 
performance indicators already serve this purpose and are gathered to 
determine whether services are quantitatively proportionate. The 
commenter stated that States would need additional guidance from the 
Department on how the SMA should determine whether services are 
qualitatively equivalent to ensure all States follow the same standards 
for such monitoring.
    Referencing the Department's proposed clarification that SMAs must 
review outreach workers' daily logs and other reports, including those 
showing or reflecting the workers' activities, on a ``regular'' rather 
than ``random'' basis, a State government agency agreed with the 
proposal, which they said could help identify potential errors or 
irregular reporting in daily outreach logs and monthly manager reports 
as well as prevent significant MSFW one-stop offices from receiving a 
finding during annual reviews.
    Response: The Department adopts the changes as proposed.
    The monitoring requirements in redesignated paragraphs (h)(1)(i) 
and (iii) are derived from requirements that previously existed at 
Sec.  653.108(g)(1). The minor revisions to these requirements are 
intended only to clarify existing requirements. Specifically, paragraph 
(h)(1)(i) requires an SMA's ongoing review to include monitoring 
compliance with Sec.  653.111 to highlight the importance of staffing 
significant MSFW one-stop centers appropriately to meet the unique 
needs of farmworkers. This change is necessary to help ensure 
significant MSFW States meet the minimum service level indicators, some 
of which measure qualitative outcomes like median earnings in 
unsubsidized employment and individuals placed in long-term non-
agricultural jobs.
    All States are required to meet equity indicators that address 
provision of ES services, including individuals referred to a job, 
receiving job development, and referred to supportive or career 
development. To meet the equity performance standards, the percentage 
of services provided to MSFWs must be equal to or greater than the 
percentage of services offered to non-MSFWs. Significant MSFW States 
must also meet minimum levels of service, which must include, at a 
minimum, individuals placed in a job, individuals placed long-term (150 
days or more) in a non-agricultural job, a review of significant MSFW 
ES offices, field checks conducted, outreach contacts per quarter, and 
processing of complaints.
    As mentioned in the PY 2020 NMA Annual Report, data SWAs submit 
through Form ETA-5148 show that the majority of SWAs are not meeting 
several equity ratio indicators.\10\ The data shows that most SWAs are 
providing MSFWs with equitable access to basic career services but are 
not providing MSFWs equitable access to higher-level staff assisted 
services. This condition is particularly concerning because it may 
impact the ability of MSFWs to access training and employment 
opportunities necessary to attain and maintain gainful and secure 
employment. Additionally, between PY 2015 and PY 2019, equity levels 
trended down in four equity ratio indicators (referred to jobs, 
received staff assisted services, referred to support service, and job 
development contact).\11\ Most notably, there was a 7-percentage-point 
decrease in States that referred MSFWs to jobs on a quantitatively 
proportionate basis in PY 2019 compared to PY 2015. The COVID-19 
pandemic likely had some impact on the outcomes in PY 2019 but because 
equity trended down for the last 5 years preceding the pandemic, the 
pandemic cannot be the only cause.
---------------------------------------------------------------------------

    \10\ NMA Annual Report for PY 2020, available at: https://www.dol.gov/agencies/eta/agriculture/monitor-advocate-system/performance.
    \11\ NMA Annual Report for PY 2019, available at: https://www.dol.gov/agencies/eta/agriculture/monitor-advocate-system/performance.
---------------------------------------------------------------------------

    SWA performance reports also show that significant MSFW States 
performed considerably below required levels for five of the seven 
Minimum Service Level Indicators in PY 2019 and PY 2020.\12\ Between PY 
2015 and PY 2019, performance decreased in six of the seven indicators. 
While minimum service level indicators improved in PY 2020, all 
Significant MSFW States still did not meet each indicator. The most 
significant decrease in PY 2019 was in reviews of Significant MSFW ES 
Offices. The Department is particularly concerned that the majority of

[[Page 82705]]

Significant MSFW States and all States have not been meeting the 
indicator for reviews of Significant MSFW Offices. If properly 
completed, SMA onsite reviews should identify the same downward trends 
that the Department identified and should result in corrective action 
plans to resolve findings of noncompliance. The low rates of 
Significant MSFW Office reviews completed, therefore, may directly 
relate to the low rates of compliance with equity ratio indicators and 
minimum service levels. In Sec.  653.108(h)(1)(ii), the Department 
clarifies that SMAs are required to monitor whether the ES services 
provided to MSFWs are qualitatively equivalent and quantitatively 
proportionate to the services provided to non-MSFWs.
---------------------------------------------------------------------------

    \12\ See performance data available at https://www.dol.gov/agencies/eta/agriculture/monitor-advocate-system/performance.
---------------------------------------------------------------------------

    Additionally, as described at Sec.  653.108(h)(3)(ii), the SMA must 
ensure that the onsite review format, developed by ETA, is used as a 
guideline for onsite reviews. The Department's Core Monitoring Guide 
provides the Department's onsite review format and includes guidance on 
how the SMA may monitor the quality of the program and services.\13\ 
The existing regulations explain that in addition to ensuring all 
significant MSFW one-stop centers are reviewed at least once per year 
by a SWA official, the SMA must ensure ES offices in which significant 
problems are revealed by required reports, management information, the 
Complaint System, or other means are reviewed as soon as possible. The 
existing regulations therefore prescribe that SMAs must review one-stop 
centers that are not designated as significant MSFW one-stop centers, 
as appropriate. Revised Sec.  653.108(h)(3) is important to strengthen 
the SMA's monitoring requirements because it will clearly state that 
the SMA must participate in onsite reviews of one-stop centers on a 
regular basis (regardless of whether or not they are designated 
significant MSFW one-stop centers).
---------------------------------------------------------------------------

    \13\ United States Department of Labor, Employment and Training 
Administration Core Monitoring Guide (Aug. 2018), available at: 
https://www.dol.gov/sites/dolgov/files/ETA/grants/pdfs/2%20CMG%20CoreMonitoringGuide_FINAL_20180816(R).pdf.
---------------------------------------------------------------------------

    To specifically address the comment that opposed the proposed 
requirement that SMAs must monitor whether the ES services provided to 
MSFWs are qualitatively equivalent and quantitatively proportionate to 
the services provided to non-MSFWs and that State performance 
indicators already serve the purpose of monitoring ES services, the 
Department believes the SMA's monitoring is necessary in addition to 
the monitoring that the Department conducts. The SMA's ongoing and 
onsite reviews are necessary to ensure compliance issues are resolved 
in a more timely manner than the quarterly basis on which States report 
Equity Ratio Indicators and Minimum Service Level Indicators to ETA. 
This more timely review helps ensure MSFWs receive equitable services 
when the MSFWs are still available to benefit from the services before 
they may become unavailable due to the transient nature of their work.
    The Department agrees with the comment that requiring the SMA to 
review outreach logs on a regular basis could help identify potential 
errors or irregular reporting in daily outreach logs and monthly 
manager reports as well as prevent significant MSFW one-stop offices 
from receiving a finding during annual reviews.
    The Department adopts the changes as proposed and will provide 
technical assistance and guidance to help SWAs comply with the 
requirements.
Section 653.108(i) SMA Participation in Federal Reviews
    In redesignated paragraph (i), the Department proposed to add ``as 
requested by the Regional or National Monitor Advocate,'' after ``The 
SMA must participate in Federal reviews conducted pursuant to part 658, 
subpart G, of this chapter.'' The Department did not receive any 
comments on this change and adopts the change as proposed for the 
reasons set forth in the NPRM.
Section 653.108(j) State Monitor Advocate Role in Complaint System
    Paragraph (j) of Sec.  653.108 outlines the role of the SMA in the 
Complaint System. The SMA's role in the Complaint System was previously 
described in Sec.  653.108(i). In paragraph (j), the Department 
proposed to require that the SMA perform solely a monitoring role in 
the Complaint System, consistent with changes made in part 658 of this 
final rule. The changes removed the ability of the State Administrator 
to assign the SMA responsibility as the Complaint Service 
Representative and the requirement that the SMA participate in the 
Complaint System as described under part 658. The Department made 
parallel revisions in Sec.  658.410(h). Some commenters, including a 
farmworker advocacy organization and a State government agency, opposed 
the change. In part, these commenters stated that the SMA should still 
have a participant role in the Complaint System due to the SMA's 
expertise with MSFWs. Some State government agencies supported the 
change, stating the change will help ensure that the SMA is objective 
and not biased. For full discussion of the prohibition on the SMA's 
acting as the Complaint System Representative and participation in the 
Complaint System, see the discussion for Sec.  658.410(h). The 
Department adopts the change in paragraph (j) as proposed to more 
clearly delineate the SMA's role in monitoring the Complaint System and 
to avoid conflicts of interest in the SMA role by ensuring separation 
of duties between SMAs and other ES staff roles.
Sections 653.108(l), 653.108(m), and 653.108(n) State Monitor Advocate 
Liaison Requirements
    Paragraphs (l), (m), and (n) of Sec.  653.108 establish SMA liaison 
requirements. Proposed paragraph (l) sets forth requirements that 
previously existed at Sec.  653.108(k) requiring the SMA to liaise with 
WIOA section 167 NFJP grantees and other organizations serving 
farmworkers, employers, and employer organizations in the State. In 
Sec.  653.108(m), the Department proposed to require that the SMA 
establish an ongoing liaison with the State-level E.O. Officer. In 
Sec.  653.108(n), the Department proposed a conforming revision to the 
cross-references so that the representatives with whom the SMA must 
meet reflect the organizations described in paragraph (l) and the 
State-level E.O. Officer referenced in paragraph (m).
    Comment: A farmworker advocacy organization supported the proposed 
requirements that SMAs regularly engage with representatives of NFJP 
grantees, the State Equal Employment Officer, and other organizations 
serving farmworkers, employers, and employer organizations in the 
State. The commenter recommended that this engagement should include 
working with unions, worker organizations, legal service providers, and 
farmworker attorneys in the State because these are often some of the 
first groups to hear complaints from workers. A State government agency 
agreed with the new requirement that the SMA must establish an ongoing 
liaison with the State-level E.O. Officer, reasoning that it would 
present States with the opportunity to enhance collaboration between 
SMAs and E.O. Officers.
    Response: The Department appreciates the comments in support of the 
proposed revisions. The Department will continue to address in guidance 
or technical assistance which organizations are important for SMA 
liaison for purposes of paragraph (l). The Department adopts the 
changes as

[[Page 82706]]

proposed, for the reasons set forth in the NPRM.
Section 653.108(o) State Monitor Advocate Field Visits
    Paragraph (o) of Sec.  653.108 describes requirements for field 
visits conducted by the SMA. These requirements were previously 
described in Sec.  653.108(m). The Department proposed that during 
field visits, the SMA must discuss the SWA's provision of ES services 
and obtain input on the adequacy of those services from MSFWs, crew 
leaders, and employers, rather than providing direct employment 
services and access to other employment-related programs. The 
Department adopts the proposed change.
    Comment: A State government agency requested the Department clarify 
that SMAs do not conduct field visits, which it said have a specific 
purpose in regulation, but rather monitor the adequacy of information 
and services provided to MSFWs by ES staff during field visits. The 
commenter argued that this clarity is important because treating SMA 
activity as a field visit is imprecise and detracts from its monitoring 
purpose.
    Another State government agency opposed the proposal that during 
field visits SMA must discuss the SWA's provision of ES services and 
obtain input on the adequacy of those services from MSFWs, crew 
leaders, and employers, asserting that this would not be a useful way 
to gauge how well the State is providing ES services to MSFWs because 
few MSFWs reach out for services and even fewer receive them. The 
commenter suggested that this purpose would be better served by asking 
MSFWs, crew leaders, and employers if they learned about ES services, 
worker rights, employment rights, and employer/contractor 
responsibilities and if they were able to reach out and felt 
comfortable reaching out to outreach workers or visiting an ES office 
to seek assistance.
    Response: Consistent with the definition of field visits, SMAs do 
conduct field visits, but they differ from field visits conducted by 
outreach staff. During SMA field visits, SMAs do not conduct the 
outreach activities outlined in Sec.  653.107. Instead, as this 
paragraph requires and consistent with the SMA's monitoring role, SMAs 
must discuss the SWA's provision of ES services and employment-related 
activities with MSFWs, crew leaders, and employers. SMAs are still 
expected to discuss farmworker protection and rights when conducting 
field visits.
    The Department agrees that it is relevant and permissible for SMAs 
to ask MSFWs, crew leaders, and employers if they learned about ES 
services, worker rights, employment rights, and employer/contractor 
responsibilities and if they were able to reach out and felt 
comfortable reaching out to outreach workers or visiting an ES office 
to seek assistance during the SMA's field visits. Asking these 
questions is one way the SMA may discuss the SWA's provision of ES 
services and obtain input on the adequacy of those services from MSFWs, 
crew leaders, and employers. The commenter's statement that few MSFWs 
reach out for services and even fewer receive them demonstrates that 
SWAs may not be conducting adequate outreach or making services 
available to MSFWs, taking into consideration their particular needs. 
For this reason, it is particularly important that SMAs conduct field 
visits to identify adequacy of services and to receive input on how to 
improve services, which informs the SMA's monitoring, reporting, and 
technical assistance. The Department adopts these changes as proposed, 
to clarify the role of the SMA and the purpose of field visits.
Section 653.108(u) State Monitor Advocate Annual Summary
    Paragraph (u) of Sec.  653.108 outlines requirements for the SMA to 
prepare an Annual Summary describing how the State provided ES services 
to MSFWs within the State based on statistical data, reviews, and other 
activities. These requirements were previously described in Sec.  
653.108(s). Subordinate paragraphs (u)(1) through (11) identify the 
various required components of the Annual Summary. In Sec.  
653.108(u)(5), the Department proposed to specify that when the SMA 
summarizes the outreach efforts undertaken by all significant and non-
significant MSFW ES offices in the State, the SMA must include the 
results of those efforts and analyze whether the outreach levels and 
results were adequate. Aside from a technical edit, the Department 
adopts the proposed change for the reasons discussed below. The 
Department did not receive substantive comments on other revisions 
proposed in paragraph (u) and adopts those changes for the reasons set 
forth in the NPRM.
    Comment: A Colorado State government agency and other commenters 
expressed concern about the proposed rule's inclusion of non-
significant MSFW offices in the requirement that an SMA submit an 
Annual Summary report to the Department describing its provision of 
services to MSFWs. Explaining that Colorado's few significant MSFW 
offices are so designated based on the presence of hand labor crops in 
their geographic area rather than having a high proportion of MSFWs 
served, the commenters asserted that the proposed requirement implies 
the need to divert ES staff from assisting job seekers, UI claimants, 
and businesses to focusing on MSFW outreach in offices with very small 
numbers of MSFWs.
    A State government agency disagreed with the proposed requirement 
that when the SMA summarizes the outreach efforts undertaken by all 
significant and nonsignificant MSFW ES offices in the State, the SMA 
must include the results of those efforts and analyze whether the 
outreach levels and results were adequate. The commenter's objections 
were that outreach activities already have required reporting and--
unless the Department clearly defines in the regulations what States 
must do to meet adequate outreach levels and results outside of the 
performance measure--SMAs would have to make their own subjective 
determinations about what is adequate.
    Response: Regarding the concerns about the proposed rule's 
inclusion of non-significant MSFW offices in the SMA's Annual Summary 
report requirement, the Department acknowledges that there may be less 
MSFW activity in service areas for ES offices that are not designated 
as significant MSFW one-stop centers. The Department notes that the SMA 
was already required to include information about outreach levels in 
both significant and non-significant MSFW ES offices. It is not the 
Department's intent to encourage nor does the Department require that 
non-significant MSFW offices unnecessarily divert local office 
resources to MSFW outreach where there is no need to do so. However, 
the SMA is required to review the SWA's overall provision of services 
to MSFWs throughout the entire State. Doing so allows the SMA to 
evaluate if the SWA is in compliance with regulatory requirements. 
Further, existing regulations explain that in addition to ensuring that 
all significant MSFW one-stop centers are reviewed at least once per 
year by a SWA official, the SMA must ensure ES offices in which 
significant problems are revealed by required reports, management 
information, the Complaint System, or other means are reviewed as soon 
as possible. Therefore, it is relevant for the SMA to include 
information about all offices in their Annual Summary.
    Additionally, regarding the concern that the SMA must include in 
their Annual Summary the results of outreach efforts in the State and 
analyze whether

[[Page 82707]]

the outreach levels and results were adequate, the Department believes 
this is relevant and necessary. As explained in the NPRM, the 
Department believes this analysis will help the Department understand 
whether the SMA believes that the SWA has allocated sufficient outreach 
staff and resources to complete the outreach duties identified at Sec.  
653.107, including whether outreach staff are able to reach the 
majority of MSFWs in the State. The SMA's analysis and opinion on 
outreach throughout the entire State is central to the SMA's monitoring 
and reporting functions. Specifically, the Annual Summary described in 
Sec.  653.108(u) must be prepared by the SMA and is intended to include 
the SMA's independent assessment of the quantity and quality of ES 
services provided to MSFWs. The SMA's assessments must be based on 
quantitative standards, including minimum service level indicators and 
equity ratio indicators, as well as information the SMA gathers through 
their monitoring, field visits, and liaison with employers, MSFWs, and 
farmworker organizations, which inform the SMA's opinions regarding the 
quality of services.
    The SMA's analysis of the SWA's outreach is distinct from the 
required reporting of the minimum service level indicators that 
significant MSFW States must meet. The minimum service level indicator 
regarding number of outreach contacts per quarter measures the quantity 
of MSFW outreach contacts significant MSFW States make per quarter. 
This indicator is relevant to significant MSFW States to ensure 
significant MSFW States conduct minimum levels of outreach year-round 
because those States must have full-time outreach staff year-round. 
This indicator does not apply to the remainder of the States because 
States that are not designated as significant MSFW States may have 
part-time outreach staff in non-peak season. In all States, outreach 
staff must contact the majority of MSFWs in the State on an annual 
basis.
    Under this final rule, SWAs will continue to provide an assessment 
of need that is particular to their State's service area(s) in the AOP, 
including information about when peak season in their State occurs and 
an estimate of the number of MSFWs in the State during peak season. The 
final rule will require all SWAs to use this data to determine the 
number of outreach staff that are adequate to conduct MSFW outreach in 
each area of the State and to contact a majority of the MSFWs in the 
State annually.
    MSFWs constitute a critical population of workers with unique needs 
and challenges who are vulnerable to exploitation, abuse, and 
mistreatment. Therefore, the Department wants all States to allocate 
the necessary resources to reach the majority of MSFWs in the State. 
The SMA's analysis of the SWA's outreach levels and results in the 
State will better enable the Department to analyze whether additional 
State (or Federal) resources may be necessary.
    After further review, the Department identified a need to update 
Sec.  653.108(u)(5) to use the term significant MSFW one-stop center, 
instead of significant MSFW ES office. This change is necessary to 
align the requirement with the defined term in Sec.  651.10. Aside from 
this technical edit, the Department adopts the changes to Sec.  
653.108(u) as proposed and will provide technical assistance and 
guidance to help SWAs comply with the requirements.
Section 653.109 Data Collection and Performance Accountability Measures
    Section 653.109 sets forth MSFW-specific data collection 
requirements and performance accountability measures. The Department 
proposed to amend this section to make two notable changes. First, the 
Department proposed to add a new data collection requirement at Sec.  
653.109(b)(10), which would require SWAs to collect the number of 
reportable individuals and participants who are MSFWs. This would align 
the data collection requirements in this section with the new 
requirement in Sec.  653.103(a) for ES offices to determine whether 
reportable individuals are MSFWs, as defined at Sec.  651.10 of this 
chapter. The Department received one comment from a State government 
agency on this proposal, which is summarized and addressed in the 
discussion of Sec.  653.103 above. For the reasons explained there, the 
Department has determined the benefits of collecting this information 
outweigh the costs, and it adopts the proposed data collection 
requirement in Sec.  653.109(b)(10) as proposed.
    Second, the Department proposed to amend Sec.  653.109(h), which 
sets forth the minimum levels of service that significant MSFW States 
must meet, by replacing the requirement for a significant MSFW State to 
measure the number of outreach contacts per ``week'' with a requirement 
that such States measure the number of outreach contacts per 
``quarter.'' The Department proposed this change to align with the 
other quarterly data submissions that SWAs provide to the Department.
    A State government agency submitted a comment opposing the 
Department's proposal to change the frequency with which outreach 
contacts are measured. As discussed below, the Department considered 
these concerns and determined that they do not necessitate any changes 
to the proposed regulatory text. Accordingly, the Department adopts 
this revision as proposed.
    Comment: Commenters from a State government agency opposed changing 
the requirement for significant MSFW States to measure the number of 
outreach contacts from per week to per quarter, reasoning that the 
change could lead outreach staff to limit outreach contacts to the end 
of the quarter instead of making outreach contacts throughout the 
quarter. As an alternative, the commenter recommended the requirement 
could be changed to once per month to allow some flexibility for 
outreach staff to meet the requirement even during non-peak seasons.
    Response: The Department acknowledges the State agency's concern 
that the reduction in reporting frequency could lead outreach staff to 
limit outreach contacts to short periods at the end of the quarter, 
instead of conducting outreach consistently throughout the quarter. 
However, the Department does not anticipate that such an outcome is 
likely to occur, because this final rule retains the requirement for 
outreach staff to spend a majority of their time in the field, and it 
will additionally require a State to employ an adequate number of 
outreach staff to contact a majority of MSFWs in the State annually. It 
would therefore be difficult for a significant MSFW State to 
effectively comply with other regulatory requirements governing 
outreach if the outreach staff in the State limit the outreach they 
conduct to only a short period at the end of the quarter. Moreover, 
this change will impact only the frequency with which significant MSFW 
States must report outreach contacts to the Department. If a SWA or ES 
office is concerned that outreach staff are not making outreach 
contacts consistently throughout a quarter, then that SWA or ES office 
may independently require its outreach staff to report the number of 
outreach contacts they make on a more frequent basis or to comply with 
other interim goals that would allow it to monitor the performance of 
its outreach staff throughout the quarter. Ineffective or noncompliant 
outreach may be addressed through monitoring and corrective actions by 
the SWA, ES offices, and SMA.
    The Department notes that there will not be a change in the 
frequency of reporting outreach contacts to the

[[Page 82708]]

Department. SWAs report performance data to ETA on a quarterly basis 
through Form ETA-5148. The revision will align the measure with the 
existing quarterly reporting timelines for SWA grantees. Additionally, 
as mentioned in the NPRM, SMAs have provided feedback to the Department 
that measuring contacts per week is difficult and not an effective 
measurement of outreach, and they believe it would be a better measure 
to report contacts per quarter.
    After further review, the Department identified a need to update 
Sec.  653.109(h) to use the term significant MSFW one-stop centers, 
instead of significant MSFW ES office. This change is necessary to 
align the requirement with the defined term in Sec.  651.10. The 
Department adopts the changes to Sec.  653.109 as proposed, with the 
additional reference to significant MSFW one-stop centers, for the 
reasons described above.
Section 653.110 Disclosure of Data
    The Department proposed to revise Sec.  653.110(b) by removing the 
word ``the'' before ``ETA.'' No comments were received on this proposed 
revision, and the Department finalizes this technical edit as proposed.
Section 653.111 State Workforce Agency Staffing Requirements for 
Significant MSFW One-Stop Centers
    Section 653.111 sets forth staffing requirements for significant 
MSFW one-stop centers. The Department proposed to revise paragraph 
(a)--which currently requires SWAs to implement and maintain a program 
for staffing significant MSFW one-stop centers by providing ES staff in 
a manner facilitating the delivery of employment services tailored to 
the special needs of MSFWs, including by seeking ES staff that meet the 
criteria in Sec.  653.107(a)(3)--and divide it into two sentences. The 
first sentence would provide that a SWA must staff significant MSFW 
one-stop centers in a manner that facilitates the delivery of ES 
services tailored to the unique needs of MSFWs. The second sentence 
would clarify that such staffing includes recruiting qualified 
candidates who meet the criteria for outreach worker positions in Sec.  
653.107(a)(3).
    The Department received a comment concerning the proposed revisions 
to this section. Revisions to the merit-staffing requirement adopted in 
this final rule necessitate revisions to the hiring requirements in 
this section, as described below.
    Comment: A State government agency expressed its opposition to the 
proposed revisions to this section and the accompanying revision to 
Sec.  653.107(a)(3), noting it did not support any increase in 
requirements for hiring ES staff.
    Response: The Department anticipates that the revisions to this 
section, much like the revisions proposed and adopted in Sec.  
653.107(a)(3), will help SWAs recruit staff who are better equipped to 
assist MSFWs in significant MSFW one-stop centers. The Department is 
revising the text proposed in this section to conform with changes made 
to the merit-staffing requirement in Sec.  652.215 of this chapter. 
Under this final rule, a SWA must ensure hiring officials seek and put 
a strong emphasis on hiring ES staff for significant one-stop centers 
who meet the enumerated criteria. As explained above in the section-by-
section discussion for Sec.  653.107(a), a SWA will retain some 
discretion in developing their State's plan to meet this requirement, 
and if hiring officials are unable to identify qualified candidates who 
meet the required characteristics, then the SWA may proceed to hire or 
assign the most qualified candidate(s). It is particularly important 
for ES staff in significant MSFW one-stop centers to possess these 
characteristics, because such staff are more likely to have the skills 
and experience necessary to facilitate the delivery of ES services 
tailored to the special needs of MSFWs, and significant MSFW one-stop 
centers, by definition, serve greater numbers of MSFWs than other one-
stop centers. The need for SWAs to ensure hiring officials recruit ES 
staff who are qualified to serve this unique population is therefore 
greater in significant MSFW one-stop centers than it is in one-stop 
centers who serve fewer MSFWs. The Department recognizes that 
compliance with the recruitment requirements adopted in this rule may 
require some SWAs to change their current practices. In adopting these 
requirements, the Department has taken this into consideration and 
determined that these requirements strike the right balance, because 
they increase the likelihood that SWAs will hire staff with appropriate 
skills to adequately serve MSFWs, while providing flexibility if SWAs 
are not able to find qualified candidates who meet the enumerated 
criteria.
2. Subpart F--Agricultural Recruitment System for U.S. Workers (ARS)
    Subpart F sets forth the regulations governing the ARS, including 
the requirements that employers must follow when submitting clearance 
orders for temporary or seasonal farmwork, and the requirements that 
SWAs must follow in processing the orders. In subpart F, the Department 
proposed new requirements for processing clearance orders, initiating 
discontinuation of services, and conducting field checks. Additionally, 
the Department proposed several technical, clarifying, and minor edits 
throughout Sec.  653.501. As described more fully below, with the 
exception of proposed Sec.  653.501(b) and (c), and the addition of a 
new severability provision at Sec.  653.504, the Department finalizes 
subpart F as proposed.
Section 653.501 Requirements for Processing Clearance Orders
    Section 653.501 describes the requirements that SWAs and ES staff 
must follow when processing clearance orders for the ARS. In this 
section, the Department proposed a new requirement that SWAs consult 
the Department's Office of Foreign Labor Certification (OFLC) and WHD 
debarment lists before placing job orders into clearance, and initiate 
discontinuation of ES services if an employer is so debarred. The 
Department also proposed several technical, clarifying, and conforming 
amendments. The Department's responses to public comments received on 
Sec.  653.501 are set forth below. If a proposed amendment is not 
addressed in the discussion below, the public comments did not address 
that specific amendment and no changes have been made to the proposed 
regulatory text. The Department declines to adopt Sec.  653.501(b) and 
(c), and adopts the remaining provisions in Sec.  653.501 as proposed.
    Regarding proposed Sec.  653.501(b) and (c), the Department 
proposed to add a fourth paragraph to Sec.  653.501(b), at Sec.  
653.501(b)(4), which would require ES staff to consult the Department's 
OFLC and WHD debarment lists before placing a job order into intrastate 
or interstate clearance and initiate discontinuation of ES services if 
the employer is debarred or disqualified from participating in one or 
all of the Department's foreign labor certification programs. 
Additionally, the Department proposed minor edits to Sec.  
653.501(c)(3) to clarify that paragraph (c) sets forth a list of the 
assurances that an employer must make before the SWA may place a job 
order into intrastate or interstate clearance.
    The Department appreciates the views and recommendations of 
commenters that supported and opposed the proposed changes to Sec.  
653.501(b). The Department notes that on September 15, 2023, the 
Department published the ``Improving Protections for Workers in 
Temporary Agricultural Employment in the United States'' NPRM (the

[[Page 82709]]

``Farmworker NPRM'') in the Federal Register. (88 FR 63750). In the 
Farmworker NPRM, the Department proposed changes to paragraphs 
653.501(b) and (c), which intersect with changes that were proposed in 
the NPRM for this rule (87 FR 23700). As discussed in the Farmworker 
NPRM, where the proposed changes in the Farmworker NPRM intersect or 
conflict with the proposed changes in this rule, the Department will 
utilize the Farmworker NPRM as the operative rulemaking proceeding to 
provide notice and opportunity to comment. The Department sees this as 
the most transparent approach to address this overlap, and the best way 
to minimize confusion within the regulated community while ensuring the 
public has a full opportunity to receive notice and provide comments on 
the proposed changes. Accordingly, as any changes to Sec.  653.501(b) 
and (c) will be made through the Farmworker NPRM, the Department 
declines to finalize Sec.  653.501(b) and (c) as proposed.
    Comment: The Department notes that a State government agency 
recommended that, in Sec.  653.501(b)(2), the Department remove the 
requirement to suppress employer information in clearance orders. The 
commenter stated that doing so would provide the same transparency to 
interested workers as that presently afforded when viewing the same 
clearance orders on the Department's SeasonalJobs.gov site and would 
remove a barrier for MSFWs that is not faced by non-agricultural job 
seekers viewing job order information. The commenter said this change 
would not only align its agricultural recruitment process with that of 
DOL but also benefit domestic agricultural workers through ready, 
unfettered access to the same H-2A employer information in the State 
Agricultural Reporting System as is available through SeasonalJobs.gov.
    Response: As the Department did not propose changes to Sec.  
653.501(b)(2), the State government agency's recommendation is outside 
the scope of this rulemaking and the Department declines to adopt it.
Section 653.503 Field Checks
    Section 653.503 describes the requirements that SWAs and ES staff 
must follow when conducting field checks. In this section, the 
Department proposed to revise Sec.  653.503(a) to add 
``transportation'' to the list of conditions that SWAs must assess and 
document when performing a field check. The Department also proposed to 
remove the word ``random'' from the existing requirement in Sec.  
653.503(a) that SWAs ``must conduct random, unannounced field checks'' 
on clearance orders, to clarify that the selection of the clearance 
orders on which the SWA will conduct field checks does not need to be 
random, and may respond to known or suspected compliance issues. The 
Department adopts Sec.  653.503 as proposed.
    Comment: Regarding transportation, a State government agency 
opposed the proposal to add transportation to the list of conditions 
that SWAs must assess and document when performing a field check. The 
agency stated that ES staff are not experts on vehicle-related 
technical matters and should not be expected to have this level of 
responsibility. The agency asked the Department to clarify whether ES 
staff would be expected to check on the type of transportation provided 
by the employer or to assess the safety and maintenance of the 
transportation used. If the latter, the agency recommended that WHD 
provide appropriate training to assess transportation during field 
checks.
    Response: The Department appreciates the concern and recommendation 
raised. In the NPRM, the Department proposed to add ``transportation'' 
to the list of conditions that SWAs must assess and document when 
performing a field check to ``increase health and safety of MSFWs by 
adding an additional safeguard against dangerous transportation tied to 
their employment.'' The Department clarifies that by adding the term 
``transportation,'' it means the specific transportation terms 
described at Sec.  653.501. The Department is not requiring ES staff to 
assess the safety or maintenance of transportation used. However, as 
with any employment-related law, if while conducting a field check, ES 
staff observe or receive information, or otherwise have reason to 
believe that an employer is violating an employment-related law--such 
as the transportation safety standards enforced by WHD--ES staff must 
document and process this information in accordance with Sec.  
653.503(d).
    Comment: Regarding the proposal to remove the word ``random'' from 
the existing requirement that SWAs ``must conduct random, unannounced 
field checks,'' many commenters, including State government agencies, 
advocacy organizations, think tanks, and several labor unions supported 
the revision, uniformly stating that it ensures that MSFW working and 
housing conditions meet basic standards. A State government agency 
supported the proposed change but requested that the Department clarify 
in the rule or guidance either the circumstances that warrant targeted 
field checks or the responsibility of States to define the 
circumstances in policy.
    Response: The Department appreciates the commenters' support for 
this proposed change. As noted in the NPRM, the Department believes 
that removal of the word ``random'' will improve MSFW protections by 
allowing SWAs and ES staff to conduct field checks where there are 
known or suspected compliance issues. Regarding the request for 
clarification on the circumstances that warrant targeted field checks, 
the Department clarifies that the circumstances must relate to the 
terms and conditions on the clearance order. Thus, where it is known or 
suspected that wages, hours, and working and housing conditions are not 
being provided as specified in the clearance order, a targeted field 
check may be warranted. The Department will issue guidance on this 
proposed change.
Section 653.504 Severability
    Given the numerous and varied changes the Department proposed and 
is adopting, the Department intends this rule to be severable and is 
including a severability provision in parts 652, 653, and 658 in this 
final rule. That intent was reflected in the structure of and 
descriptions in the proposed rule. The inclusion of severability 
provisions in this final rule confirms the Department's belief that the 
severance of any affected provision will not impair the function of the 
regulation as a whole and that the Department would have proposed and 
implemented the remaining regulatory provisions even without any 
others. To the extent that a court holds any provision, or any portion 
of any provision, of part 653 invalid, the provision will be construed 
so as to continue to give the maximum effect to the provision permitted 
by law, unless such holding is one of total invalidity or 
unenforceability, in which event the provision will be severable from 
this part and will not affect the remainder thereof.

E. Part 658--Administrative Provisions Governing the Wagner-Peyser Act 
Employment Service

    Part 658 sets forth systems and procedures for complaints, 
monitoring for compliance assessment, enforcement, and sanctions for 
violations of the ES regulations and employment-related laws, including 
discontinuation of services to employers and decertification of SWAs. 
The Department proposed several revisions to part 658, including 
removing the requirement that SMAs serve as

[[Page 82710]]

Complaint System Representatives or have any direct role in the 
Complaint System process, and clarifying the procedures for processing 
complaints alleging discrimination or reprisal for protected activity. 
Additionally, the Department proposed revisions throughout part 658 to 
conform with existing and proposed language in parts 651 and 653, make 
non-substantive technical edits, remove redundancies, and clarify terms 
and requirements. The Department's responses to public comments 
received on part 658 are set forth below. The Department did not 
receive comments on Sec. Sec.  658.419, 658.420, and 658.422 in 
subparts E, G, and H. The Department is finalizing subparts E, G, and H 
as proposed.
    Of note, the Department proposed several revisions to the 
discontinuation of services provisions in subpart F (Sec. Sec.  658.500 
through 658.504). The Department proposed to amend the bases for 
discontinuation to include an employer's debarment or disqualification 
from participating in one of the Department's foreign labor 
certification programs; to amend the notification procedures to 
require, where applicable, that SWAs specify the time-period of an 
employer's debarment or disqualification; and to correct cross-
referencing errors in the regulatory text. The Department received 
comments supporting the proposed changes, but on September 15, 2023, 
the Department issued an NPRM regarding improved protections for 
workers in temporary agricultural employment (the ``Farmworker NPRM''). 
88 FR 63750. In the Farmworker NPRM, the Department proposed further 
changes to the discontinuation of services provisions, which intersect 
and, in some instances, conflict with changes that were proposed in the 
NPRM for this rule (87 FR 23700). As discussed in the Farmworker NPRM, 
where the proposed changes in the Farmworker NPRM intersect or conflict 
with the proposed changes in this rule, the Department will utilize the 
Farmworker NPRM as the operative rulemaking proceeding to provide 
notice and opportunity to comment. The Department sees this as the most 
transparent approach to address this overlap, and the best way to 
minimize confusion within the regulated community while ensuring the 
public has a full opportunity to receive notice and provide comments on 
the proposed changes. Accordingly, as any changes to the 
discontinuation of services provisions will be made through the 
Farmworker NPRM, the Department declines to finalize subpart F as 
proposed.
1. Subpart E--Employment Service and Employment-Related Law Complaint 
System (Complaint System)
    Subpart E covers the purpose and scope of the Complaint System, and 
the requirements for processing complaints at the local, State, and 
Federal levels. The Department's responses to public comments received 
on subpart E are set forth below. If a proposed amendment to subpart E 
is not addressed in the discussion below, the public comments did not 
address that specific amendment and no changes have been made to the 
proposed regulatory text. With the exception of a new severability 
clause, the Department adopts subpart E as proposed.
    Comment: Several one-stop center representatives stated they 
support utilization of a complaint system but questioned who will take 
incoming complaints when ES staff have been reassigned to UI claims.
    A farmworker advocacy organization discussed the need for major 
procedural reforms to the Complaint System, beyond the modifications 
set forth in the proposed rule, if it is to be an effective tool for 
farmworkers to vindicate their rights. The organization asserted that 
the proposed subpart E ignores fundamental flaws at the heart of the 
Complaint System. Regarding complaints filed against employers, the 
organization stated that the Complaint System is often just a slower, 
more cumbersome means to reach another agency, like WHD or EEOC, and 
that farmworkers generally are better served by filing their complaints 
directly with those agencies. Regarding complaints filed against SWAs, 
the organization stated that the ES complaint process is a ``byzantine 
maze'' that can take years to navigate and may involve multiple levels 
of adjudication. Citing Sec.  658.421(g) and examples of recent cases, 
the organization stated that the current process eventually reaches the 
Office of Administrative Law Judges (OALJ), but only after typically at 
least 2 years of litigation in which a complainant often does not 
understand the process or their rights, before State-level officials 
without expertise in the ES system or farmworker issues, and with 
little chance of systemic relief. The organization recommended that the 
Department allow workers direct appeal from the SWA to the OALJ, which 
it said would be analogous to how employers appeal foreign labor 
certification decisions at Sec.  655.171. The organization stated that 
the Department should treat employers and workers the same, and that 
just as growers are allowed to appeal decisions under the labor 
certification regulations directly from the OFLC to the OALJ, the 
Department should allow workers to appeal ES complaints directly from 
the SWA to the OALJ.
    Response: The Department clarifies that while it proposed to 
require States to use merit staff, in part so that States may leverage 
ES staff for UI, SWAs must still ensure there are adequate Complaint 
System Representatives to process complaints at all times. The 
Department further clarifies that complainants are not required to 
bring employment-related law complaints through the Complaint System; 
they may file employment-related law complaints directly with the 
appropriate enforcement agencies. Nevertheless, SWAs and the Department 
have an interest in tracking employment-related law complaints as SWAs 
are required to accept, informally resolve (where appropriate), and 
refer incoming employment-related law complaints to appropriate 
enforcement agencies. Additionally, SWAs and the Department have an 
interest in quickly and efficiently resolving ES-related complaints. 
The proposed revisions are designed to strengthen training, monitoring, 
and internal controls so that the Complaint System can more effectively 
and quickly resolve ES-related complaints at the local level, and 
quickly resolve violations to the benefit of complainants.
    The Department agrees with ensuring an efficient Complaint System 
but disagrees with the recommendation to allow workers to appeal ES 
complaints directly from SWAs to the OALJ. The Department notes that 
the OALJ only resolves Federal administrative disputes before 
Departmental agencies (e.g., ETA, OFLC), and does not resolve disputes 
before State agencies (e.g., SWAs). Consequently, the Complaint System 
only allows for appeal to the OALJ following a formal determination 
from an RA and does not contemplate direct appeal of a SWA decision to 
the OALJ. The Department, therefore, declines to adopt this 
recommendation.
Section 658.410 Establishment of Local and State Complaint Systems
    Section 658.410 describes procedures that SWAs and ES Offices must 
follow in establishing and maintaining local and State complaint 
systems. In this section, the Department proposed to remove the 
requirement in Sec.  658.410(h) that the SMA be the Complaint System 
Representative designated to handle MSFW complaints and replace it with 
a provision prohibiting the State Administrator from assigning the SMA 
responsibility for doing so. Relatedly,

[[Page 82711]]

the Department proposed to revise Sec.  658.410(m) to replace ``SMA'' 
with ``Complaint System Representative,'' thereby removing the SMA from 
responsibility for conducting monthly follow-up on MSFW complaints.
    The Department also proposed several technical, clarifying, and 
conforming amendments. For example, in Sec.  658.410(g), the Department 
proposed to remove the word ``local,'' which comes before ``ES office'' 
in the existing regulatory text, because ``ES Office'' is a defined 
term and removal of the word ``local'' clarifies that the regulatory 
text is not referring to a different type of ES Office. For that 
change, the NPRM preamble clearly explained that the Department was 
proposing to remove ``local,'' but the proposed regulatory text 
inadvertently retained the word. The Department adopts the text of 
Sec.  658.410(g) as described in the NPRM preamble. Aside from that 
change, the Department adopts the regulatory text of Sec.  658.410 as 
proposed.
    Comment: Regarding the proposed amendments to Sec.  658.410(h), to 
prohibit the SMA from being assigned to be the Complaint System 
Representative, a State government agency supported the changes, 
stating that they would allow the SMA to maintain a neutral stance and 
create balance within the ES program and could enhance the Complaint 
System and improve program monitoring and compliance. Similarly, an 
anonymous commenter described the removal of the SMA from the Complaint 
Specialist role as a ``smart call'' that leaves less opportunities for 
``unwanted liabilities.'' In contrast, another State government agency 
said that removing the SMA from involvement in direct complaint system 
activities removes the staff member with the greatest expertise in 
understanding the complexities of the MSFW population and available 
resources from the complaint-taking process. Regarding the proposed 
amendment to Sec.  658.410(m), the same agency stated that requiring 
the Complaint System Representative, and not the SMA, to follow up 
monthly on the processing of MSFW complaints would decentralize the ES 
Complaint System follow-up process; require additional time, effort, 
and coordination with enforcement agencies; and could entail challenges 
in enforcement agencies responding to ES staff requests.
    Regarding the proposed amendment to Sec.  658.410(g), two one-stop 
center employees opposed the proposed revision but did not state any 
specific concern with the proposed removal of the word ``local'' from 
the regulatory text. The employees stated generally that their local 
Complaint System representatives receive annual training from the SMA 
regarding the Complaint System. A farmworker advocacy organization 
supported the proposed amendments to Sec.  658.410, in part. The 
organization stated that while it generally supports having the SMA 
oversee the Complaint System (rather than serve as the initial 
complaint recipient), ES complaints (versus complaints involving 
employment- or discrimination-related laws) still should go to the SMA 
first. The organization stated that ES complaints allege the type of 
``within-agency'' problems that SMAs are charged with correcting, and 
are the only avenue for worker communications with SMAs that guarantee 
a written response. The organization further stated that Complaint 
System Representatives may lack the authority, information access, or 
confidence in their position to sufficiently address complaints 
alleging legal violations by their supervisors. The organization 
acknowledged that leaving SMAs in charge of responses to ES complaints 
limits their ability to meaningfully oversee the Complaint System, but 
stated that the benefits of doing so overshadow this concern; and that 
such concern is mitigated by the fact that ES complaints are relatively 
rare.
    Response: Regarding the concern that removing SMAs from direct 
involvement in the Complaint System removes the staff member with the 
greatest MSFW expertise and resources from the complaint-taking 
process, the Department notes that the existing regulations require 
that all Complaint System representatives--SMAs or otherwise--be 
trained on handling MSFW complaints. Accordingly, the Department 
believes that the existing regulations provide for sufficient expertise 
among non-SMA representatives to process MSFW complaints. Additionally, 
the Department notes that a SMA's expertise is not lost by removing the 
SMA from direct involvement in the Complaint System. Monitoring 
activities allow for SMAs to share and apply their expertise throughout 
the entire Complaint System, rather than on a complaint-by-complaint 
basis. One such example is mentioned in the comments: two one-stop 
center employees stated that their Complaint Service Representatives 
receive annual training by the SMA on the Complaint System. Removing 
the SMA from direct involvement in the System will, the Department 
believes, allow SMAs to focus their expertise on monitoring activities 
that impact the Complaint System and MSFWs much more broadly.
    Regarding the concern that removing the SMA from conducting monthly 
follow-up on MSFW complaints would decentralize the Complaint System 
follow-up process, the Department notes that existing regulations 
already require SWAs to have trained Complaint System Representatives 
at each ES office and that, in practice, many SWAs already have 
trained, non-SMA Complaint System Representatives. Regarding the 
concern that removing the SMA would require additional time, effort, 
coordination, and communication challenges with enforcement agencies, 
the Department respectfully disagrees. The Department believes that the 
Complaint System Representatives are best positioned to follow up on 
the complaints they process--both with the enforcement agencies to 
which they have made referrals and with the complainant with whom they 
have already communicated directly. Additionally, the Department 
believes there are distinct benefits in having staff other than the SMA 
trained in processing MSFW-related complaints, most notably the 
increased staff capacity to process MSFW-related complaints quickly and 
efficiently.
    Regarding the recommendation that incoming ES complaints should 
still go to the SMA first, the Department notes that the SMA's primary 
role in the Complaint System is to monitor and report on its 
compliance, advocate for improvements to the system, and liaise among 
partners to support effective functioning of the system. The proposed 
amendments are meant to ensure separation of duties between SMAs and 
other ES staff roles. The Department believes that it cannot ensure 
full separation of duties by requiring SMAs to maintain direct 
responsibility for handling ES complaints. The Department understands 
the concern that non-SMA Complaint System Representatives may lack 
confidence to sufficiently address complaints alleging ``within-
agency'' violations of the ES regulations, such as violations by their 
supervisors, but notes that such issues may be addressed through 
training, including training by the SMA. SMAs will remain available to 
advise Complaint System Representatives and to report any patterns of 
unaddressed complaints directly to SWA leadership. Therefore, the 
Department believes that the benefits of ensuring full separation of 
duties for SMAs outweigh the concerns raised. The Department declines 
to adopt this recommendation.

[[Page 82712]]

Section 658.411 Action on Complaints
    Section 658.411 describes the actions that SWAs and ES Offices must 
take in receiving and processing complaints filed in the Complaint 
System. The Department proposed several changes to this section, 
including broadening the scope of contact methods complainants may 
provide when filing complaints to include ``any other helpful means''; 
removing language requiring SMAs to taking direct actions--such as 
making determinations and referrals--on complaints; broadening Sec.  
658.411(c) to apply to all complaints alleging discrimination and 
reprisal; and requiring SWAs and ES offices to refer discrimination and 
reprisal complaints to their State-level E.O. Officer. The Department 
also proposed several technical, clarifying, and conforming amendments. 
For the reasons discussed in the NPRM and below, the Department adopts 
Sec.  658.411 as proposed.
    Comment: A State government agency commended the Department for 
broadening the scope of contact methods complainants may provide when 
filing complaints to include social media and other applications. 
Another State government agency agreed with removing the SMA from 
taking direct actions on complaints, stating that SMAs need not play a 
prominent role in the Complaint System given the many entities already 
involved in capturing and responding to complaints, and noting that 
SMAs provide great value--as part of their monitoring duties--in 
reviewing complaints to ensure they are logged and addressed 
appropriately. A farmworker advocacy organization recommended that the 
Department further amend Sec.  658.411 to require that, upon receipt of 
complaints, SWAs and ES offices immediately advise complainants of 
their option to work with an attorney to resolve their claims and 
provide complainants contact information for legal services.
    The Department received several comments specific to Sec.  
658.411(c). A State government agency stated that it agreed with the 
intent to simplify the process for handling discrimination- and 
reprisal-related complaints under Sec.  658.411(c) but that the 
revisions, as proposed, do not clarify the complaint process. A 
farmworker advocacy organization supported the increased role of State-
level E.O. Officers in addressing complaints related to discrimination 
and retaliation, but expressed concern that State-level E.O. Officers 
may lack knowledge of certain farmworker-related laws, such as the 
Migrant and Seasonal Agricultural Worker Protection Act (MSPA) and the 
H-2A regulations. The organization recommended that the regulations 
require State-level E.O. Officers to receive training in all of these 
relevant areas.
    Three commenters opposed the proposed changes to Sec.  658.411(c). 
Two one-stop center employees stated that the section needs more 
clarification on the actions for complaints received from different 
sectors, such as MSFW complaints, Wagner-Peyser funded service 
complaints, and universal public complaints regarding work situations 
that are not serviced by the public workforce system. Additionally, a 
State government agency stated that referring all discrimination- and 
reprisal-related complaints to the State-level E.O. Officer adds 
another level of delay to the complaint referral process, which may 
bottleneck the complaint process and slow down an investigation and is 
contrary to the Department's efforts to eliminate delay elsewhere in 
the complaint process (i.e., by removing the SMA from the process). 
Rather than refer the complaints only to State-level E.O. Officers, the 
agency recommended that ES staff include the State-level E.O. Officer 
when referring complaints to the EEOC and other relevant agencies. 
Additionally, the agency recommended removing the language that 
requires ES staff to know the types of nondiscrimination law 
complaints. The agency also described confusion within the one-stop 
system regarding tracking and handling MSFW, Title I, and Title III 
one-stop operation complaints, and requested that the Department 
provide technical assistance on this topic.
    Response: Regarding the recommendation that SWAs and ES offices 
advise complainants of their option to work with an attorney to resolve 
to resolve their claims, the Department notes that existing regulations 
at Sec.  658.400 already provide that a complainant may designate an 
individual to act as their representative before the Complaint System, 
and ETA Form 8429 (``Complaint/Apparent Violation Form'') notifies 
complainants of this option. Additionally, for complaints alleging 
violations of employment-related laws, existing regulations at Sec.  
658.411 already provide that complaint representatives must refer non-
MSFW complaints involving employment-related laws, as well as MSFW 
complaints involving employment-related laws that are not informally 
resolved, to appropriate organizations, including legal aid or other 
consumer advocate organizations, as appropriate, for assistance. 
Regarding the related recommendation that SWAs and ES offices provide 
complainants contact information for legal services, the Department 
declines to adopt this recommendation as a requirement. The Department 
notes that SWAs must already provide information on organizations 
servicing MSFWs as part of their outreach responsibilities at Sec.  
653.107. Such organizations may include, for example, grantees of the 
Legal Services Corporation, a non-profit corporation established by 
Congress that provides grants to local organizations to provide legal 
services for agricultural workers and others who would be otherwise 
unable to afford adequate legal counsel. As to the Complaint System 
specifically, the Department does not wish to create the appearance of 
SWAs endorsing any legal services organization over others by requiring 
that SWAs affirmatively provide contact information for certain legal 
services organizations in the complaint process, but it does not 
prohibit SWAs from providing such contact information at their 
discretion.
    The Department believes that the existing regulations sufficiently 
notify complainants of their options regarding legal representation. 
The Department is concerned that adding further requirements for SWAs 
could mislead complainants to think that legal representation is 
required to file a complaint with the SWA and would not comport with 
the SWA's role as neutral processor in the Complaint System. 
Accordingly, the Department declines to adopt these recommendations.
    Regarding the concern that State-level E.O. Officers may lack the 
training needed to recognize retaliation under farmworker-related laws, 
such as MSPA and the H-2A regulations, and the related recommendation 
that State-level E.O. Officers receive training in this regard, the 
Department notes that the Wagner-Peyser regulations do not govern 
requirements for State-level E.O. Officers; these requirements, 
including the requirement that E.O. Officers and their staff be 
afforded the opportunity to receive necessary and appropriate training, 
are found at 29 CFR 38.28 through 38.33. As the operative regulations 
for the recommended training are outside the scope of this rulemaking, 
the Department declines to adopt this recommendation.
    Regarding the concern that referring all discrimination- and 
reprisal-related complaints to the State-level E.O. Officer adds 
another level of delay to the complaint referral process, and the 
related recommendation that the Department instead require ES staff 
include the State-level E.O. Officer when referring complaints to the 
EEOC and other relevant agencies, the

[[Page 82713]]

Department declines to adopt this recommendation. The Department 
believes that its proposed changes simplify, streamline, and prevent 
delays by the Complaint System in the referral process by allowing 
complaint representatives to promptly refer discrimination and 
reprisal-related complaints to the State-Level E.O. Officer, who is 
best equipped and positioned to direct such complaints to appropriate 
enforcement agencies. Because the State-level E.O. Officer is 
responsible for State Program-wide coordination of compliance with the 
equal opportunity and nondiscrimination requirements in WIOA, it is 
appropriate for the State-level E.O. Officer to receive all 
discrimination-related complaints. Additionally, the proposed changes 
simplify the referral process so that referrals may occur more quickly 
and reliably to one identified State-level E.O. Officer, instead of 
requiring complaint representatives to identify one of several referral 
options. The State-level E.O. Officer is best suited to determine which 
nondiscrimination laws are at issue. The proposed changes therefore 
improve the effectiveness and accuracy of discrimination complaint 
processing to the benefit of complainants.
    Regarding several commenters' general concern that the proposed 
changes to Sec.  658.411(c) do not clarify the complaint process as it 
relates to discrimination and reprisal-related complaints, and that 
additional clarification is needed on processing complaints received 
from different sectors (e.g., MSFW complaints, Wagner-Peyser funded 
service complaints, and complaints not serviced by the public workforce 
system), the Department notes that the proposed changes purposefully 
simplify the process so that complaint representatives must immediately 
refer all discrimination-related complaints to the State-level E.O. 
Officer. As previously mentioned, the State-level E.O. Officer is best 
suited to make determinations on applicable nondiscrimination laws. The 
SWA complaint representative will not need to make determinations 
regarding the type of alleged discrimination and applicable laws.
    Regarding the comment that reported confusion within the one-stop 
system regarding tracking and handling MSFW, Title I, and Title III 
one-stop operation complaints, and requested the Department provide 
technical assistance on this topic, the Department plans to provide 
further technical assistance. The Department notes that the existing 
regulations at Sec.  658.400(b) state that complaints alleging 
violations under WIOA title I programs are not covered by this subpart 
and must be referred to the appropriate administering agency which 
would follow the procedures set forth in the respective regulations. 
Section 683.600 describes local area, State, and direct recipient 
grievance procedures under WIOA title I.
    Regarding the recommendation to remove language requiring ES staff 
to know the types of nondiscrimination laws at issue, the Department 
believes that the proposed changes are in line with this 
recommendation, as sending all discrimination complaints to the State-
level E.O. Officer recognizes that State-Level E.O. Officers--and not 
complaint representatives--are best positioned to determine the 
applicable nondiscrimination laws and the agency to which complaints 
should be referred. Additionally, the proposed changes provide examples 
of the types of discrimination complaints that SWA staff may receive 
(e.g., EEOC and DOL Civil Rights Center (CRC) complaints, and 
complaints under the Immigration and Nationality Act), but do not 
require SWA staff to know all nondiscrimination laws that may be at 
issue.
    The Department appreciates commenters' concerns and 
recommendations. The Department believes that the proposed changes 
provide a straightforward, streamlined process for handling 
discrimination and reprisal-related complaints and--by utilizing the 
State-level E.O. Officer--ensure that such complaints are promptly and 
properly referred to the appropriate enforcement agency.
Section 658.419 Apparent Violations
    The Department proposed several clarifying revisions to Sec.  
658.419(a). First, the Department proposed to update Sec.  658.419(a) 
to replace the words ``a SWA, an ES office employee, or outreach 
staff'' with ``an ES staff member'' to conform with proposed revisions 
to ES staff at Sec.  651.10. It is not necessary to specifically refer 
to ``outreach staff'' in this section, because the definition of 
outreach staff means ES staff with the responsibilities described in 
Sec.  653.107(b). This change will make Sec.  658.419 more clear 
because the regulatory text will use the term ES staff uniformly.
    The Department also proposed changing the second reference to a 
``suspected violation'' in Sec.  658.419(a) to ``apparent violation'' 
for clarity. In addition, the Department proposed adding a sentence to 
Sec.  658.419(a) to clarify that the apparent violation must be 
documented in the Complaint System log as described at Sec.  658.410.
    Finally, the Department proposed to add a sentence at the end of 
Sec.  658.419(a) to clarify that when an apparent violation involves 
alleged violations of nondiscrimination laws, it must be processed 
according to the procedures described in Sec.  658.411(c)--that is, it 
must be logged and immediately referred to the State-level E.O. 
Officer.
    The Department did not receive any comments on this section. 
However, the Department is making additional changes to Sec.  658.419 
to be consistent with the definition of apparent violation that this 
final rule adopts in Sec.  651.10, which refers to suspected violations 
that an ES staff member observes, has reason to believe, or which the 
staff member is in receipt of information regarding. The final rule 
also revises the existing regulatory text ``except as provided at Sec.  
653.503 of this chapter (field checks) or Sec.  658.411 (complaints)'' 
to state more clearly ``except as part of a field check under provided 
at Sec.  653.503 of this chapter.'' This phrasing is meant to more 
clearly state that the apparent violations processed as directed by 
Sec.  658.419 are those that an ES staff observes, has reason to 
believe, or about which they receive information other than through 
field checks. The definition of apparent violations adopted by this 
final rule makes clear that the term does not include complaints.
    Furthermore, the final rule retains the language proposed in the 
NPRM at Sec.  658.419 that clarifies the ES Office Manager must 
document apparent violations in the Complaint System log as described 
at Sec.  658.410, with the slight revision that the ES Office Manager 
must ensure that they are documented in the log. Finally, the final 
rule adopts the proposed text that apparent violations of 
nondiscrimination laws must be processed according to the procedures 
described in Sec.  658.411(c), but for clarity moves this text into a 
separate paragraph (d) added at the end of Sec.  658.419.
Section 658.420 Responsibilities of the Employment and Training 
Administration Regional Office
    The Department proposed several revisions to Sec.  658.420. First, 
the Department proposed to revise Sec.  658.420(b)(1) to provide that 
if an ETA regional office receives a complaint alleging violations of 
nondiscrimination laws, then the complaint must be logged and 
immediately referred to the appropriate State-level E.O. Officer(s). 
This revision simplifies the process for referring nondiscrimination 
complaints

[[Page 82714]]

and provides clear instruction to ETA regional staff and task State-
level E.O. Officers, who have appropriate expertise in determining how 
nondiscrimination complaints should be handled and by whom.
    Second, the Department proposed removing existing Sec.  
658.420(b)(2), which addresses complaints alleging discrimination on 
the basis of genetic information, because such complaints would fall 
under the simplified procedures set forth in proposed Sec.  
658.420(b)(1). Third, the Department proposed making several revisions 
to conform with this deletion--namely, to move the text in existing 
Sec.  658.420(c) to Sec.  658.420(b) and remove all references to 
paragraph (b)(2) in this section.
    Finally, the Department proposed revising Sec.  658.420(c) to 
clarify that when an ETA regional office receives an employment-related 
law complaint under this subsection, it should process the complaint in 
accordance with Sec.  658.422. The existing regulation incorrectly 
references Sec.  658.411, which provides complaint processing 
procedures for ES offices and SWAs (and not ETA regional offices).
    The Department did not receive comments on this section and 
finalizes these revisions as proposed.
Section 658.422 Processing of Employment-Related Law Complaints by the 
Regional Administrator
    The Department proposed several revisions to Sec.  658.422. First, 
the Department proposed to revise paragraph (a) to clarify that this 
section applies to all ``employment-related law'' complaints submitted 
directly to the RA or their representative. Second, the Department 
proposed adding a sentence to the end of paragraphs (b) and (c) to 
conform with the proposed revisions to Sec.  658.420(b)(1). In 
particular, proposed paragraphs (b) and (c) each include an additional 
sentence to specify that when a complaint described in the paragraph 
alleges a violation of nondiscrimination laws or reprisal for protected 
activity, then it must be referred to the appropriate State-level E.O. 
Officer in accordance with Sec.  658.420(b)(1). The Department did not 
receive comments on this section and finalizes these revisions as 
proposed.
Section 658.427 Severability
    Given the numerous and varied changes the Department proposed and 
is adopting, the Department intends this rule to be severable and is 
including a severability provision in parts 652, 653, and 658 in this 
final rule. That intent was reflected in the structure of and 
descriptions in the proposed rule. The inclusion of severability 
provisions in this final rule confirms the Department's belief that the 
severance of any affected provision will not impair the function of the 
regulation as a whole and that the Department would have proposed and 
implemented the remaining regulatory provisions even without any 
others. To the extent that a court holds any provision, or any portion 
of any provision, of part 658 invalid, the provision will be construed 
so as to continue to give the maximum effect to the provision permitted 
by law, unless such holding is one of total invalidity or 
unenforceability, in which event the provision or subprovision will be 
severable from this part and will not affect the remainder thereof.
2. Subpart G--Review and Assessment of State Workforce Agency 
Compliance With Employment Service Regulations
Section 658.602 Employment and Training Administration National Office 
Responsibility
    The Department proposed amending Sec.  658.602(g) to refer to Sec.  
653.108(a) instead of Sec.  653.108(b). This is necessary to correct 
the inaccurate citation to Sec.  653.108(b). The Department proposed 
amending the introductory text of Sec.  658.602(n) to replace the 
phrase ``in the course of'' with the word ``during''. Additionally, the 
Department proposed amending Sec.  658.602(n)(1) to replace the phrase 
``outreach workers'' with ``outreach staff'' because outreach staff is 
a defined term in Sec.  651.10. The Department also proposed amending 
Sec.  658.602(n)(2) to remove the word ``random'' from the requirement 
for the NMA to participate in field check(s) of migrant camps or work 
site(s) where MSFWs have been placed. The proposed revision would 
clarify that the selection of migrant camps or work sites for which the 
NMA will participate in field checks does not need to be random, and 
may be targeted, where necessary, to respond to known or suspected 
compliance issues, thereby improving MSFW worker protection. Finally, 
the Department proposed amending Sec.  658.602(o) to remove ``(8)'' 
from the reference to paragraph (f)(8) as a technical edit. Paragraph 
(f) of Sec.  658.602 does not have a subordinate paragraph (f)(8). The 
Department did not receive any comments on this section and is 
finalizing these revisions as proposed.
Section 658.603 Employment and Training Administration Regional Office 
Responsibility
    The Department proposed amending Sec.  658.603(d)(7) to replace 
uses of ``job order'' with ``clearance order.'' The Department also 
proposed removing the word ``random'' from the requirement for the RA 
to conduct field checks. Finally, the Department proposed adding the 
word ``and'' before ``working and housing conditions'' to make clear 
that this is a single term that follows wages and hours in the list of 
items that must be specified on a clearance order.
    Paragraph (i) of Sec.  658.603 addresses RMA training. The 
Department proposed amending Sec.  658.603(i) to remove the requirement 
that the RMA participate in training sessions approved by the National 
Office within the first 3 months of their tenure and replacing it with 
a requirement that would require the RMA to participate in training 
sessions offered by the National Office and additional training 
sessions necessary to maintain competency and enhance their 
understanding of issues farmworkers face (including trainings offered 
by Occupational Safety and Health Administration (OSHA), WHD, EEOC, 
CRC, and other organizations offering farmworker-related information). 
The Department also proposed amending Sec.  658.603(p)(1) to replace 
``workers'' with ``staff.'' Additionally, the Department proposed 
amending Sec.  658.603(p)(2) to remove the word ``random'' so that the 
RMA understands that clearance orders selected for a field check do not 
need to be selected at random. The Department did not receive any 
comments on this section and is finalizing these revisions as proposed.
3. Subpart H--Federal Application of Remedial Action to State Workforce 
Agencies
Section 658.702 Assessment and Evaluation of Program Performance Data
    The Department proposed amending Sec.  658.702(f)(2) to add 
references to the ``RMA'' in two places to clarify that the RA must 
notify both the RMA and the NMA when findings and noncompliance involve 
services to MSFWs or the Complaint System. Additionally, this proposed 
change would require the Final Notification to be sent to the RMA, as 
well as the NMA. These changes are necessary for the RMA to be aware of 
all ES issues involving MSFWs and the Complaint System, which the RMA 
is responsible to monitor in their assigned region. The Department did 
not receive comments on this section and finalizes these revisions as 
proposed.
Section 658.704 Remedial Actions
    The Department proposed amending Sec.  658.704(f)(2) to require 
that copies of

[[Page 82715]]

the RA's notification to the SWA of decertification proceedings must be 
sent to the RMA and the NMA. The Department also proposed amending 
Sec.  658.707(a), which addresses the circumstances in which a SWA may 
request a hearing, to specify that any SWA that has received a Notice 
of Remedial Action under Sec.  658.707(a) of this subpart may also 
request a hearing, and that the SWA may do so by filing a written 
request with the RA within 20 business days of the SWA's receipt of the 
notice. Finally, the Department proposed adding a reference to the RA 
in Sec.  658.707(b), because Sec.  658.704(c) directs the SWA to send 
its written request to the RA. The Department did not receive any 
comments on this section and adopts these revisions as proposed.

VI. Rulemaking Analyses and Notices

A. Executive Orders 12866 (Regulatory Planning and Review), 13563 
(Improving Regulation and Regulatory Review), and 14094 (Modernizing 
Regulatory Review) and Subtitle E of the Small Business Regulatory 
Enforcement Fairness Act of 1996

    Under E.O. 12866, OMB's Office of Information and Regulatory 
Affairs (OIRA) determines whether a regulatory action is significant 
and, therefore, subject to the requirements of the E.O. and review by 
OMB. See 58 FR 51735 (Oct. 4, 1993). Section 1(b) of E.O. 14094 amends 
sec. 3(f) of E.O. 12866 to define a ``significant regulatory action'' 
as an action that is likely to result in a rule that may: (1) have an 
annual effect on the economy of $200 million or more (adjusted every 3 
years by the Administrator of OIRA for changes in gross domestic 
product) or adversely affect in a material way the economy, a sector of 
the economy, productivity, competition, jobs, the environment, public 
health or safety, or State, local, territorial, or tribal governments 
or communities; (2) create a serious inconsistency or otherwise 
interferes with an action taken or planned by another agency; (3) 
materially alter the budgetary impact of entitlements, grants, user 
fees, or loan programs, or the rights and obligations of recipients 
thereof; or (4) raise legal or policy issues for which centralized 
review would meaningfully further the President's priorities or the 
principles set forth in the E.O. See 88 FR 21879 (Apr. 11, 2023). OIRA 
has determined that this final rule is a significant regulatory action, 
although not a significant regulatory action under sec. 3(f)(1) of E.O. 
12866. Accordingly, OMB has reviewed this final rule.
    E.O. 13563 directs agencies to propose or adopt a regulation only 
upon a reasoned determination that its benefits justify its costs; the 
regulation is tailored to impose the least burden on society, 
consistent with achieving the regulatory objectives; and, in choosing 
among alternative regulatory approaches, the agency has selected those 
approaches that maximize net benefits. E.O. 13563 recognizes that some 
benefits are difficult to quantify and provides that, where appropriate 
and permitted by law, agencies may consider and discuss qualitatively 
values that are difficult or impossible to quantify, including equity, 
human dignity, fairness, and distributive impacts.
    The Department anticipates that the final rule will result in 
costs, transfer payments, and benefits for State governments and 
agricultural employers. The costs of the final rule will include rule 
familiarization and additional information collection for State 
governments, as well as transition costs such as recruitment, training, 
and technology expenses for the three States (i.e., Delaware, Indiana, 
and Missouri) that currently use the staffing flexibility provided in 
the 2020 Final Rule and will need to transition to State merit staff 
for the provision of all Wagner-Peyser Act labor exchange services.
    The transfer payments will include the changes in wages, fringe 
benefits, and overhead costs for the staff providing ES services in the 
three States that currently use the staffing flexibility provided in 
the 2020 Final Rule: Delaware, Indiana, and Missouri.
    The benefits of the merit-staffing provisions in the final rule 
will include the ability for States to shift staff resources during 
future surges in UI claims when time-limited legislative flexibilities 
in the delivery of UI services are not available. The Department is 
also amending the regulations that govern labor exchange services 
provided to MSFWs, the Monitor Advocate System, and the Complaint 
System. These amendments will remove redundancies, clarify 
requirements, and improve equity and inclusion for MSFWs in the ES 
system.
    Pursuant to Subtitle E of the Small Business Regulatory Enforcement 
Fairness Act of 1996, also known as the Congressional Review Act (5 
U.S.C. 801 et seq.), OIRA has designated this rule as not a ``major 
rule,'' as defined by 5 U.S.C. 804(2).
1. Public Comments
a. Public Comments on Rule Familiarization Costs
    In the NPRM, the Department anticipated that it would take a Human 
Resources Manager an average of 1 hour to review the rule and that the 
total one-time rule familiarization cost for all 57 jurisdictions (the 
50 States, the District of Columbia, Puerto Rico, American Samoa, the 
Commonwealth of the Northern Mariana Islands, Guam, the Republic of 
Palau, and the U.S. Virgin Islands) would be $4,439 (2020$).
    Comment: A State government agency commented that rule 
familiarization estimate in the NPRM is too low because, in addition to 
a Human Resources Manager, other staff members would need to review the 
changes as well.
    Response: The Department agrees that additional State staff may 
review the rule and that their fully loaded wage rates may be higher or 
lower than $82.13 per hour (2022$).\14\ The 1-hour time estimate and 
the $82.13 hourly wage estimate are intended to be averages across all 
57 jurisdictions. In some States, the combined time for all reviewers 
to read the rule may be more than 1 hour, while in other States, the 
combined time may be less than 1 hour. Similarly, the average fully 
loaded wage rate of the employees who familiarize themselves with the 
rule may be higher than $82.13 per hour in some States and lower than 
$82.13 per hour in other States. In the absence of supporting data from 
the commenter, the Department maintained its 1-hour time estimate and 
the $82.13 fully loaded wage rate in the final rule.
---------------------------------------------------------------------------

    \14\ In the NPRM, this fully loaded hourly wage estimate was 
$77.88 in 2020 dollars.
---------------------------------------------------------------------------

b. Public Comments on Transition Costs
    The Department had insufficient data to provide estimates in the 
NPRM of the potential one-time transition costs (e.g., recruitment, 
training, technology expenses) States might incur, so the Department 
sought additional input regarding potential transition costs.
    Comment: Several commenters argued that the NPRM does not fully 
anticipate costs for State governments. A number of commenters, 
including multiple form letter campaigns, a Colorado State elected 
official, a Colorado State government agency, and a local government, 
wrote that the proposed merit-staffing requirement would cost millions 
of dollars for States. A Colorado State government agency estimated 
that the proposed rule would result in over $7 million in transition

[[Page 82716]]

costs for Colorado and provided a specific breakdown of these costs. A 
couple of State government agencies wrote that the proposed rule does 
not take into account the costs related to cross-training ES staff for 
the UI program. A Colorado local government wrote that under the 
proposed rule, half of PY 2023 funds would need to be utilized to 
transition and hire new State level staff. A Michigan advocacy 
organization wrote that local ES program support allows for efficient 
``braided'' funding and, in contrast, the proposed rule would create 
siloed services that would increase overall labor costs for States.
    Some commenters also argued that the proposed rule would result in 
a number of job losses for local staff in ES programs. In particular, 
several commenters, including a Colorado local government, a one-stop 
operator, and a trade association, stated that the proposed rule would 
result in job losses for local staff and provided data on expected 
employment reductions to support their claim. Similarly, Massachusetts 
and Colorado State government agencies commented that the proposed rule 
would result in job losses, given that State merit staff are more 
costly than local staff. A trade association wrote that their local 
workforce development board would not be able to move forward with 
programming for the upcoming year due to anticipated job losses as a 
result of the proposed rule. A Colorado State government agency and 
other commenters wrote that, in their region, TAA case managers are 
provided by local staff, and under the proposed rule these staff 
members would need to be rehired and trained.
    An association of workforce boards wrote that the proposed rule 
would result in job centers closing and programs ending in States that 
operate their ES program using flexible staffing models, which would 
disproportionately impact rural areas as well as those facing barriers 
to employment. Some commenters stated that the proposed rule would 
result in service disruptions that would result in States incurring 
costs due to negative customer experiences, which would erode trust in 
the public workforce system. A State government agency wrote that the 
proposed rule would impose resource costs on States, while the national 
PY 2022 ES grant funding saw a non-adjusted increase of just 0.6 
percent and the State saw a non-adjusted decline of 1.6 percent in its 
PY 2022 ES grants.
    Response: The Department appreciates commenters' feedback on 
potential transition costs. After careful consideration of the comments 
received during the public comment period and reassessment of the NPRM, 
the Department is permitting the three States with longstanding 
reliance interests on using alternative staffing models, Colorado, 
Massachusetts, and Michigan, to continue using their alternative 
staffing models. The Department acknowledges that three other States 
(i.e., Delaware, Indiana, and Missouri) currently using the staffing 
flexibility granted under the 2020 Final Rule will incur transition 
costs. Without pertinent data, the Department is unable to estimate the 
potential transition costs in this final rule. Recognizing that these 
States will need time to adjust their staffing models, the Department 
is providing 24 months of transition time for all States to comply with 
this final rule.
c. Public Comments on Transfer Payments
    In the NPRM, the Department anticipated that four States (i.e., 
Colorado, Delaware, Massachusetts, and Michigan) would need to 
transition to State merit staff for the provision of all labor exchange 
services. The Department estimated that Delaware, Massachusetts, and 
Michigan would have a combined total of $10.1 million (2020$) in 
annualized transfer payments over the 10-year analysis period.
    Comment: Some commenters from Michigan wrote that they believe 
transfer payments estimated in the NPRM are too low. Specifically, they 
stated that the estimate of 192 full-time equivalents (FTEs) non-State-
merit staff providing ES services is too low because Michigan's Wagner-
Peyser Act-funded staffing is 400, equating to 220 FTEs. These 
commenters also asked where the funding for transfer payments would 
come from and, if there is not additional funding available, how the 
Department would close the gap.
    Response: Because the Department is allowing Colorado, 
Massachusetts, and Michigan to administer ES services using their 
longstanding alternative staffing model, the Department has not sought 
updated data from Michigan to estimate the transfer payments associated 
with this final rule.
d. Public Comments on Regulatory Alternatives
    In the NPRM, the Department analyzed two regulatory alternatives. 
Under the first alternative, the Department would return to the pre-
2020 Wagner-Peyser Act regulations, reinstituting the State merit-
staffing requirement for all States except for three States: Colorado, 
Massachusetts, and Michigan. Under the second alternative, the 
Department would require all States to come into compliance with the 
merit-staffing requirement within 30 or 60 days of issuance of the 
final rule rather than within 18 months from the effective date of the 
final rule.
    Comment: Several Michigan, Colorado, and Massachusetts commenters, 
including State and local workforce development boards, one-stop center 
staff, private citizens, State and local governments, and a Colorado 
State elected official, urged the Department to adopt Alternative 1 as 
discussed in the NPRM, which would allow Colorado, Michigan, and 
Massachusetts to continue operating Wagner-Peyser Act programs with 
flexible staffing models. The commenters reasoned that this would allow 
their State to continue to operate what they described as innovative, 
streamlined, responsive, and effective ES programs. A Massachusetts 
local workforce development board and a Massachusetts local elected 
official argued that Alternative 1 was the best way to avoid service 
interruptions for job seekers and businesses.
    To support their request for the Department to select Alternative 
1, a Colorado private citizen provided figures from their local one-
stop center to demonstrate the ``local return on investment'' and 
economic impact of Wagner-Peyser Act funding, including the estimation 
that every $1 of Wagner-Peyser Act funds received translates to $44.80 
in value for the community.
    Some commenters, including one-stop center employees, a Colorado 
local workforce development board, and a Colorado State government 
agency, critiqued the Department's mention of alignment with WIOA, and 
preference for alignment between ES and UI, when presenting Alternative 
1 in the NPRM. A one-stop center employee asserted that Alternative 1 
prioritizes UI administration over ES services despite WIOA identifying 
priority populations for ES service delivery. A Colorado local 
workforce development board argued that there was no justification for 
the Department's claim and provided evidence from its local programs, 
which it said demonstrates the benefits of alignment between Wagner-
Peyser Act ES and WIOA title I services. The commenter said the 
proposal would result in decreased functionality of ES and argued that 
this adverse outcome outweighs the benefits of staffing UI during 
relatively shorter periods of surge claims.

[[Page 82717]]

    A Colorado State workforce development board stated that 
prioritizing alignment of ES and UI so that States can provide surge 
capacity was not sufficient justification for the Department to discard 
Alternative 1 because States using flexible staffing models can provide 
surge capacity for UI administration. The commenter said Colorado's 
handling of the UI surge during the pandemic affirms county merit 
staff's ability to assist during UI surges. A Massachusetts local 
workforce development board reacted similarly to the NPRM's discussion 
of Alternative 1 and program alignment priorities, arguing that one-
stop center staff in Massachusetts performed ably to support the UI 
surge during the pandemic. The commenter said the flexible staffing 
arrangements in Massachusetts proved useful during the pandemic, as 
well as during other unemployment surges throughout history, and 
expressed concern about losing the ability to ``manage the next crisis 
locally.''
    A Colorado State government agency said the Department's discussion 
of Alternative 1 presented a false choice and argued that no studies 
exist over the past 14 years that prove the State merit-staffing model 
works better than ES staffed by county merit staff. A Colorado local 
workforce development board similarly stated that the Department 
``dismissed'' Alternative 1 with very little justification and asserted 
that the Department has not provided recent studies or data to support 
the notion that flexible ES staffing model States perform worse than 
States that use only State merit staff to provide ES services. A 
Colorado one-stop center employee requested the Department adopt 
Alternative 1 and further investigate how ES staff can support UI 
services.
    Also urging the Department to adopt Alternative 1, a Massachusetts 
local workforce development board discussed equity concerns with the 
proposal's prioritization of UI services for the recently unemployed 
over the needs of the longer-term unemployed and low-income workers who 
may need ES services. The commenter discussed historical inequities and 
current demographic makeups of these two groups and argued that the UI 
population is ``significantly less diverse'' than the rest of the job 
seeking population around Boston.
    A Colorado State workforce development board, a Colorado State 
government agency, and other commenters urged the Department to adopt 
Alternative 1 because it would allow for the collection of evaluative 
evidence, prevent transfer payments and system disruptions, and 
maintain the ability of States with existing State merit ES staff to 
cross-train such workers to assist with UI surges. An anonymous 
commenter expressed concern about ``eliminating Alternative 1'' because 
ending staffing flexibility will result in ``bifurcated'' supervision 
for Wagner-Peyser Act workers and inconsistent service delivery. Also 
urging the Department to adopt Alternative 1, a Colorado one-stop 
operator commented that, if the Department decides against adopting 
Alternative 1, Congress should enshrine ES staffing flexibility into 
Federal law.
    A Michigan State government agency suggested that, in the absence 
of additional analysis, the Department should implement the final rule 
without making a distinction between State and local merit staff, a 
less disruptive alternative that would allow Michigan to continue to 
offer ES services at current levels with qualified merit staff. The 
commenter argued that the Intergovernmental Personnel Act does not make 
a distinction between State and local merit staff, asserting that 
Michigan local merit staff are recruited, selected, advanced, and 
compensated in a manner consistent with State merit staff. This 
commenter opposed the proposal, alleging that it would result in fewer 
staff, less responsive customer service, and fewer ES locations across 
Michigan. The commenter requested that the Department conduct a 
specific, comprehensive, and independent analysis using up-to-date 
employment program, performance, and economic indicators to justify any 
changes to longstanding, successful delivery models like the one used 
in Michigan. The commenter said it had identified several of the 
proposal's anticipated adverse impacts during the current comment 
period and stated that the Department would ``confirm and expand'' upon 
these findings if it conducted an analysis.
    A State government agency and a Massachusetts local workforce 
development board supported an ongoing exemption from the State merit-
staffing requirement for the original demonstration States (Colorado, 
Massachusetts, and Michigan) but suggested that no additional States 
should receive such an exemption.
    Response: After careful consideration of the comments received 
during the public comment period and reassessment of the NPRM, the 
Department has decided to permit three States with strong reliance 
interests--Colorado, Massachusetts, and Michigan--to continue using 
their approved longstanding staffing model to deliver ES services. In 
the 1990s, as part of a demonstration, the Department permitted 
Colorado and Michigan to use a combination of local and State merit-
staffing and permitted Massachusetts to use non-merit staff in four of 
sixteen local areas for ES service delivery. During the comment period, 
these three States provided information about the service disruption 
that would result from having to upend their longstanding service 
delivery models. However, the initial justifications and data presented 
do not provide clear evidence of causation. Without evidence that 
alternative staffing models directly cause higher employment outcomes, 
balanced against widespread success in delivering services while 
maintaining State merit staff for ES, and further balanced by the need 
for ES State merit staff to be available for surges in UI claims and 
appeals, the Department is generally adopting the proposed requirement 
that States use State merit staff to provide ES services. The 
Department has determined that reinstating the requirement to provide 
ES services using State merit staff will help to allow the States to 
provide quality and consistent ES services in an accountable and 
transparent manner as we undertake an evaluation to determine whether 
alternative staffing models are empirically supported. All other States 
will have 24 months to comply with the rule's requirement to use State 
merit staff to provide ES services.
2. Costs
    The Department anticipates that the rule will result in costs 
related to rule familiarization, staff transition, and information 
collection.
a. Rule Familiarization Costs
    Regulatory familiarization costs represent direct costs to States 
associated with reviewing the new regulation. The Department's analysis 
\15\ anticipates that the changes introduced by the rule will be 
reviewed by Human Resources Managers (SOC code 11-3121) employed by 
SWAs. The Department anticipates that it will take a Human Resources 
Manager an average of 1 hour to review the rule.
---------------------------------------------------------------------------

    \15\ This analysis uses codes from the Standard Occupational 
Classification (SOC) system and the North American Industry 
Classification System (NAICS).
---------------------------------------------------------------------------

    The U.S. Bureau of Labor Statistics (BLS) Occupational Employment 
and Wage Statistics data show that the median hourly wage of State 
government Human Resources Managers

[[Page 82718]]

is $45.88.\16\ The Department used a 62-percent benefits rate \17\ and 
a 17-percent overhead rate,\18\ so the fully loaded hourly wage is 
$82.13 [= $45.88 + ($45.88 x 62%) + ($45.88 x 17%)]. Therefore, the 
one-time rule familiarization cost for all 57 jurisdictions (the 50 
States, the District of Columbia, Puerto Rico, American Samoa, the 
Commonwealth of the Northern Mariana Islands, Guam, the Republic of 
Palau, and the U.S. Virgin Islands) is estimated to be $4,681 (= $82.13 
x 1 hour x 57 jurisdictions).
---------------------------------------------------------------------------

    \16\ BLS, ``Occupational Employment and Wage Statistics, 
National Industry-Specific Occupational Employment and Wage 
Estimates, NAICS 999200,'' SOC Code 11-3121, May 2022, https://www.bls.gov/oes/current/naics4_999200.htm (last visited May 16, 
2023).
    \17\ BLS, ``National Compensation Survey, Employer Costs for 
Employee Compensation,'' https://www.bls.gov/ncs/data.htm (last 
visited May 16, 2023). For State and local government workers, wages 
and salaries averaged $34.88 per hour worked in 2022, while benefit 
costs averaged $21.51, which is a benefits rate of 62 percent.
    \18\ Cody Rice, U.S. Environmental Protection Agency, ``Wage 
Rates for Economic Analyses of the Toxics Release Inventory 
Program,'' June 10, 2002, https://www.regulations.gov/document/EPA-HQ-OPPT-2014-0650-0005 (last visited May 16, 2023).
---------------------------------------------------------------------------

b. Transition Costs
    Three States would potentially incur one-time costs associated with 
this rule's merit-staffing requirement. Delaware currently has some 
non-State-merit staff who provide labor exchange services, as explained 
in the NPRM. Additionally, based on comments received and their State 
plans, Indiana and Missouri also have non-State-merit staff providing 
ES services. These three States may incur transition expenses, such as 
recruitment, training, or technology costs, as well as costs related to 
the State budgeting process. Moreover, job seekers and employers in 
these States may experience nonquantifiable transition costs associated 
with service interruptions during the time period in which the States 
are making staff changes to comply with the provisions of this rule.
    In its comments on the NPRM, Delaware stated that ``the proposed 
rule change will take away funding for 13 total contractual staff.'' 
The Delaware Department of Labor explained that its Division of 
Employment and Training has 8 FTE Wagner-Peyser contractual staff 
funded at 100 percent, and 5 contractual FTEs partially charged to 
Wagner-Peyser who are assigned to provide ES services. The State 
anticipates that the decrease in staffing would have a negative impact 
on the quality and delivery of ES services, and that it would cause an 
added workload on merit staff, potentially adversely affecting staff 
morale. Delaware explained the steps it would need to take to obtain 
additional State FTEs, estimating that the process would take at least 
24 months and that there is no certainty that the positions would be 
approved by Delaware's Joint Finance Committee, its Governor, and OMB.
    In its PY 2022 State plan, Indiana indicated that it would evaluate 
potential changes to its staffing models over the next several years in 
light of the flexibility provided in the 2020 Final Rule. In its 
comments on the NPRM, the Indiana Department of Workforce Development 
stated that one of the primary ways Indiana was able to respond to 
changing conditions during the COVID-19 pandemic was with the staffing 
flexibility provided in the 2020 Final Rule and the temporarily 
staffing flexibility provided by the CARES Act. Indiana explained that 
the staffing flexibility allowed it ``to retain temporary, 
intermittent, and contractor staff to augment existing State and local 
staff to better and more quickly scale up services to respond to client 
needs.'' Indiana expressed opposition to the proposed State merit-
staffing requirement, asserting that it would result in significant 
inefficiencies because Indiana's AJCs would need to be staffed with a 
full accompaniment of both local workforce development board staff and 
State ES staff, a level that would be unnecessary in some AJCs ``as the 
populations simply do not require this many staff members for the 
possible client base.''
    In its PY 2022 State plan, Missouri stated that Wagner-Peyser Act 
labor exchange services are ``provided solely by non-merit State 
employees.'' Missouri explained that, in 2018, the State legislature 
amended the State personnel law to remove merit status for all 
employees except those who are required to be merit by ``federal law or 
regulations for grant-in-aid programs.'' All employees in Missouri are 
at-will except when required by Federal law. Following the Department's 
publication of the 2020 Final Rule, Missouri's Office of Workforce 
Development removed the merit status of employees funded under the 
Wagner-Peyser Act to comply with State law. According to Missouri's 
State plan, the change from merit status to at-will status became 
effective on July 1, 2021. In its comments on the NPRM, Missouri's 
Office of Workforce Development expressed opposition to the merit-
staffing requirement and urged the Department to preserve the 
longstanding staffing flexibility afforded to Colorado, Michigan, and 
Massachusetts and to grandfather in Missouri. Missouri asserted that 
``the back-and-forth decision to allow and then disallow Wagner-Peyser 
Act flexibility would cause unnecessary disruptions for service 
delivery.'' Missouri also claimed that the merit status requirement 
would place an unnecessary burden on local workforce development boards 
that ``have planned for, budgeted for, and implemented'' ES services.
    In the NPRM, the Department sought additional input about 
transition costs, but did not receive pertinent data for use in the 
final rule. The comments from Delaware, Indiana, and Missouri did not 
include estimates of their potential transition costs. Therefore, the 
Department is unable to quantify the transition costs that those three 
States will incur but does not anticipate that the transition costs 
will be large enough for this rule to be deemed a significant 
regulatory action under sec. 3(f)(1) of E.O. 12866.
c. Information Collection Costs
    Information collection costs represent direct costs to States 
associated with the information collection requests (ICRs) under this 
rule. Five ICRs are herein discussed.
    The first ICR pertains to the requirement that SWA Wagner-Peyser 
programs document Participant Individual Record Layout (PIRL) data 
element 413 for all reportable individuals. The Department anticipates 
that this provision will entail three costs: (1) computer programming, 
(2) additional time for ES staff to help individuals register for 
services, and (3) additional time for SMAs to check the accuracy of the 
MSFW coding. SWAs will need to reprogram their ES registration systems 
to ask MSFW status (PIRL 413) questions earlier in the registration 
process. The Department anticipates that reprogramming will cost an 
average of $4,000 per jurisdiction,\19\ so the total one-time cost for 
reprogramming is estimated at $228,000 (= $4,000 x 57 jurisdictions). 
For the additional annual burden on ES staff, the Department 
anticipates that it will take an ES staff member an average of 2 
minutes per reportable individual to ask the additional MSFW questions 
and record the answers. To estimate this cost, the Department used the 
median hourly wage of $27.05 for educational, guidance, and career 
counselors and advisors (SOC code 21-1012) employed by State 
governments (NAICS 999200).\20\ The Department used a 62-

[[Page 82719]]

percent benefits rate and a 17-percent overhead rate, so the fully 
loaded hourly wage is $48.42 [= $27.05 + ($27.05 x 62%) + ($27.05 x 
17%)]. Assuming ES staff assist in registering half of the 9.4 million 
reportable individuals (based on the average for Program Years 2018-
2021), the annual cost is estimated at $7,609,895 (= 9,429,858 
reportable individuals x 50% x 2 minutes x $48.42 per hour). For the 
annual burden on SMAs, the Department anticipates that it will take an 
SMA 1 hour per quarter to check the accuracy of the MSFW coding. To 
estimate this cost, the Department used the median hourly wage of 
$38.48 for social and community service managers (SOC code 11-9151) 
employed by State governments (NAICS 999200).\21\ The Department used a 
62-percent benefits rate and a 17-percent overhead rate, so the fully 
loaded hourly wage is $68.88 [= $38.48 + ($38.48 x 62%) + ($38.48 x 
17%)]. Therefore, the annual cost is estimated at $15,705 (= 57 SMAs x 
4 hours per year x $68.88 per hour).
---------------------------------------------------------------------------

    \19\ Anecdotal evidence from States indicates a range of $2,000 
to $6,000 to add one yes/no question to an existing data collection.
    \20\ BLS, ``Occupational Employment and Wage Statistics, 
National Industry-Specific Occupational Employment and Wage 
Estimates, NAICS 999200, SOC 21-1012.'' https://www.bls.gov/oes/current/naics4_999200.htm.
    \21\ BLS, ``Occupational Employment and Wage Statistics, 
National Industry-Specific Occupational Employment and Wage 
Estimates, NAICS 999200, SOC 11-9151.'' https://www.bls.gov/oes/current/naics4_999200.htm.
---------------------------------------------------------------------------

    The second ICR pertains to the requirement that SWA applicant-
holding offices provide workers referred on clearance orders with a 
checklist summarizing wages, working conditions, and other material 
specifications in the clearance order. The Department anticipates that 
it will take an ES staff member an average of 35 minutes to read the 
clearance order, create a checklist, and provide the checklist to 
applicants. To estimate this cost, the Department used a fully loaded 
hourly wage of $48.42 for educational, guidance, and career counselors 
and advisors (SOC code 21-1012) employed by State governments (NAICS 
999200). Assuming 14,580 clearance orders per year (based on the number 
of clearance orders reported by SWAs in Program Year 2019), the annual 
cost is estimated at $411,812 (= 14,580 clearance orders x 35 minutes x 
$48.42 per hour).
    The third ICR pertains to the changes associated with the Migrant 
and Seasonal Farmworker Monitoring Report and Complaint/Apparent 
Violation Form. The Department anticipates that this provision will 
entail two costs: (1) time for ES Managers to update a central 
complaint log, and (2) additional time for SMAs to complete the Annual 
Summary due to content changes. For the annual burden on ES Managers, 
the Department anticipates that it will take an ES Manager 8 hours per 
year to update the central complaint log. To estimate this cost, the 
Department used a fully loaded median hourly wage of $68.88 for social 
and community service managers (SOC code 11-9151) employed by State 
governments (NAICS 999200). Assuming that there are approximately 2,400 
ES Managers (based on the approximate number of one-stop centers), the 
annual cost is estimated at $1,322,496 (= 2,400 ES Managers x 8 hours 
per year x $68.88 per hour). For the annual burden on SMAs, the 
Department anticipates that it will take an SMA an additional 3 hours 
per year to complete the Annual Summary due to content changes. To 
estimate this cost, the Department used a fully loaded median hourly 
wage of $68.88 for social and community service managers (SOC code 11-
9151) employed by State governments (NAICS 999200). Therefore, the 
annual cost is estimated at $11,778 (= 57 SMAs x 3 hours per year x 
$68.88 per hour).
    The fourth ICR pertains to this rule's merit-staffing requirement. 
The Department will require States to describe in their Unified or 
Combined State Plans how the State will staff labor exchange services 
under the Wagner-Peyser Act using State merit staff. The Department 
does not anticipate additional costs related to this requirement given 
that States must already describe in their Unified or Combined State 
Plans how ES labor exchange services will be delivered.
    The fifth ICR pertains to the forthcoming evaluation of three 
States: Colorado, Massachusetts, and Michigan. The Department will 
develop an evaluation to examine various staffing models and methods of 
delivering labor exchange services, to determine whether such models 
are empirically supported. The pertinent estimates will be included in 
a future ICR.
    In total for the first three ICRs described above, the rule is 
expected to have first-year IC costs of $9.6 million (2022$). Over the 
10-year analysis period, the annualized costs are estimated at $9.4 
million at a discount rate of 7 percent (2022$).
3. Transfer Payments
    According to OMB Circular A-4, transfer payments are monetary 
payments from one group to another that do not affect the total 
resources available to society. The transfer payments for this rule are 
the transfer payments associated with employee wages, fringe benefits, 
and overhead costs.
    This final rule permits three States--Colorado, Massachusetts, and 
Michigan--to use their longstanding alternative staffing model to 
deliver ES services. The requirement to use State merit staff applies 
to the other 54 States and jurisdictions; therefore, the three States 
(i.e., Delaware, Indiana, and Missouri) that implemented the staffing 
flexibility provided by the 2020 Final Rule will need to adjust their 
staffing arrangements and may incur additional wage costs. For purposes 
of E.O. 12866, these additional wage costs are categorized as transfer 
payments from States to employees.
    The Delaware Department of Labor stated in its comments on the NPRM 
that ``the proposed rule change will take away funding for 13 total 
contractual staff.'' Delaware did not provide position titles or salary 
information in its comments. Therefore, the Department is unable to 
estimate the transfer payments for Delaware due to a lack of data.
    In their comments on the NPRM, the Indiana Department of Workforce 
Development and the Missouri Office of Workforce Development expressed 
opposition to the proposal but did not provide information about the 
number, position titles, or annual salaries of the non-State-merit 
staff dedicated to delivering ES services. Therefore, the Department is 
unable to estimate the transfer payments for Indiana and Missouri due 
to a lack of data.
    The Department does not anticipate that the transfer payments for 
Delaware, Indiana, and Missouri will be large enough for this rule to 
be deemed a significant regulatory action under sec. 3(f)(1) of E.O. 
12866.
4. Nonquantifiable Benefits
    The Department is requiring that States use only State merit staff 
to deliver ES labor exchange services, with exceptions for three 
States. The COVID-19 pandemic placed an enormous burden on State UI 
programs due to the significant increase in UI claims from the massive 
number of unemployed workers. The number of continued claims rose from 
fewer than 2 million before the pandemic to more than 20 million in the 
week ended May 9, 2020. It became evident to the Department that, 
during a crisis that displaces a large number of workers in a short 
time, it could become imperative for States to shift staff resources 
from ES services to support urgent UI services. Being able to do so, 
however, requires that ES labor exchange services be provided only by 
State merit staff because certain UI services are required to be 
delivered solely by State merit staff pursuant to

[[Page 82720]]

sec. 303(a)(1) of the SSA. Requiring labor exchange services to be 
provided by State merit staff will help ensure that States have the 
flexibility to shift staff resources during future surges in UI claims 
where time-limited legislative flexibilities to UI services are not 
available. Further, this ensures that UI services will be performed by 
qualified staff who are familiar with the requirements of the program 
during such future occurrences, ensuring the program's integrity.
    The benefits of requiring States to use only State merit staff to 
deliver ES labor exchange services are not entirely quantifiable. Yet, 
in addition to States benefiting from the availability of State merit 
staff to assist with a surge in UI claims, benefits also accrue to 
individuals accessing labor exchange services delivered by State merit 
personnel. State merit-staffed employees are accountable only to their 
State government, are hired through objective, transparent standards, 
and must deliver services to all customers of the ES system according 
to established standards. In exercising its discretion under sec. 3(a) 
of the Wagner-Peyser Act to establish minimum levels of efficiency and 
promote the uniform administration of labor exchange services by 
requiring the use of State merit staff to deliver labor exchange 
services, the Department has determined that alignment of ES and UI 
staffing is needed to ensure that quality services are delivered by 
States effectively and equitably to UI beneficiaries and other ES 
customers.
    The Department is also amending the regulations governing ES labor 
exchange services provided to MSFWs, the Monitor Advocate System, and 
the Complaint System. These amendments remove redundancies, clarify 
requirements, and enhance equity and inclusion for farmworkers in the 
ES system. The requirement that States use State merit staff to provide 
services to MSFWs benefits MSFWs, who are particularly vulnerable to 
employment-related abuses. Outreach and SMA staff receive centralized 
training and management from the State to ensure they are equipped to 
assess and respond to farmworker needs, including responding to 
complaints and apparent violations in the field, which may include 
highly sensitive subject matter like human trafficking.
5. Summary
    Exhibit 1 shows the annualized rule familiarization and IC costs at 
discount rates of 3 percent and 7 percent. The rule is expected to have 
first-year rule familiarization costs of $4,681 and first-year IC costs 
of $9.6 million (2022$). Over the 10-year analysis period, the 
annualized rule familiarization costs are estimated at $623 at a 
discount rate of 7 percent and the annualized IC costs are estimated at 
$9.4 million at a discount rate of 7 percent (2022$).
[GRAPHIC] [TIFF OMITTED] TR24NO23.037

    Due to data limitations, the Department is unable to quantify the 
transition costs or transfer payments that are likely to be incurred by 
Delaware, Indiana, and Missouri as they transition the delivery of all 
ES services to State merit staff. The Department does not anticipate 
that the transition costs or transfer payments will be large enough for 
this rule to be deemed a significant regulatory action under sec. 
3(f)(1) of E.O. 12866.
6. Regulatory Alternatives
    OMB Circular A-4 directs agencies to analyze alternatives if such 
alternatives best satisfy the philosophy and principles of E.O. 12866. 
Accordingly, the Department considered the following regulatory 
alternatives.
a. Alternative 1
    Under this alternative, the Department would require all States and 
jurisdictions to use State merit staff to provide ES services, 
including Colorado, Massachusetts, and Michigan. In other words, under 
this alternative, the Department would adopt the proposal described in 
the NPRM. After careful consideration, the Department is not pursuing 
this alternative. The Department recognizes the strong reliance 
interests of Colorado, Massachusetts, and Michigan and is therefore 
permitting these three States to continue using their approved 
longstanding staffing model to deliver ES services. These three States 
must participate in evaluations of ES service delivery to be conducted 
by the Department.
b. Alternative 2
    Under this alternative, the Department would require States to come 
into compliance with the requirement to use State merit staff within 30 
or 60 days of issuance of the final rule. The Department is not 
pursuing this alternative because it could result in interruption to ES 
labor exchange services in the three States not already operating in 
compliance with

[[Page 82721]]

the rule: Delaware, Indiana, and Missouri. The Department recognizes 
that this rule may be a substantial change for those three States, and 
they may need time to make adjustments to personnel, contractual 
arrangements, and service provision. Under this alternative, with only 
30 or 60 days to rapidly shift existing staff or hire new staff, 
Delaware, Indiana, and Missouri may find themselves in violation of 
contracts for services negotiated after the 2020 Final Rule. 
Accordingly, the Department is providing 24 months from the effective 
date of the final rule for States to comply with the State merit-
staffing requirement rather than stipulating that the States comply 
immediately.

B. Regulatory Flexibility Act, Small Business Regulatory Enforcement 
Fairness Act of 1996, and Executive Order 13272 (Proper Consideration 
of Small Entities in Agency Rulemaking)

    The Regulatory Flexibility Act (RFA), 5 U.S.C. chapter 6, requires 
the Department to evaluate the economic impact of this rule on small 
entities. The RFA defines small entities to include small businesses, 
small organizations, including not-for-profit organizations, and small 
governmental jurisdictions. The Department must determine whether the 
rule will impose a significant economic impact on a substantial number 
of such small entities. The Department concludes that this rule does 
not regulate any small entities directly, so any regulatory effect on 
small entities will be indirect. Accordingly, the Department has 
determined this rule will not have a significant economic impact on a 
substantial number of small entities within the meaning of the RFA.

C. Paperwork Reduction Act of 1995

    The purposes of the Paperwork Reduction Act of 1995 (PRA), 44 
U.S.C. 3501 et seq., include minimizing the paperwork burden on 
affected entities. The PRA requires certain actions before an agency 
can adopt or revise a collection of information, including publishing 
for public comment a summary of the collection of information and a 
brief description of the need for and proposed use of the information.
    As part of its continuing effort to reduce paperwork and respondent 
burden, the Department conducts a preclearance consultation program to 
provide the public and Federal agencies with an opportunity to comment 
on proposed and continuing collections of information in accordance 
with the PRA. See 44 U.S.C. 3506(c)(2)(A). This activity helps to 
ensure that the public understands the Department's collection 
instructions, respondents can provide the requested data in the desired 
format, reporting burden (time and financial resources) is minimized, 
collection instruments are clearly understood, and the Department can 
properly assess the impact of collection requirements on respondents.
    A Federal agency may not conduct or sponsor a collection of 
information unless it is approved by OMB under the PRA and it displays 
a currently valid OMB control number. The public is also not required 
to respond to a collection of information unless it displays a 
currently valid OMB control number. In addition, notwithstanding any 
other provisions of law, no person will be subject to penalty for 
failing to comply with a collection of information if the collection of 
information does not display a currently valid OMB control number (44 
U.S.C. 3512).
    In accordance with the PRA, the Department has submitted four ICRs 
to OMB in concert with the publishing of this final rule.
    The ICRs in this final rule are summarized as follows.
    Agency: DOL-ETA.
    Title of Collection: DOL-Only Performance Accountability, 
Information, and Reporting System for Reportable Individuals.
    Type of Review: New Collection.
    OMB Control Number: 1205-0NEW.
    Description: The Department is requesting a new OMB control number 
for this collection. The request for a new control number is for 
administrative reasons only. The changes to Sec. Sec.  653.103(a) and 
653.109(a)(10) in this rulemaking described subsequently will 
eventually be included in OMB Control Number 1205-0521. The Department 
is anticipating that a few different upcoming rulemakings will impact 
the ICs contained in OMB Control Number 1205-0521. Once all outstanding 
actions are final and complete, the Department intends to submit a 
nonmaterial change request to transfer the burden from the new ICR to 
the existing OMB control number for the DOL-Only Performance 
Accountability, Information, and Reporting System (1205-0521) and 
proceed to discontinue the use of the new control number.
    This final rule adds a requirement that SWA Wagner-Peyser programs 
must document PIRL data element 413 for reportable individuals. The 
DOL-only PIRL ETA 9172 already requires Wagner-Peyser programs to 
document data element 413 for participants. This change will help ES 
staff identify all individuals who engage in ES services who are MSFWs 
and the degree of their engagement, so that SWAs, SMAs, and the 
Department may better assess whether all Wagner-Peyser services are 
provided to MSFWs on an equitable basis. Collecting data about 
participant and reportable individual characteristics, particularly 
related to populations that have been historically underserved, is an 
important tool for measuring progress in providing equal opportunity. 
The final rule also makes changes to the definitions of migrant 
farmworker and seasonal farmworker. The Department plans to submit a 
new ICR that will update ETA 9172 to indicate that Wagner-Peyser 
programs must document and keep records of PIRL data element 413 for 
reportable individuals and align the definitions of migrant farmworker 
and seasonal farmworker with revisions at Sec.  651.10.
    Affected Public: State Governments.
    Obligation to Respond: Required to Obtain or Retain Benefits.
    Estimated Total Annual Respondents: 22,687,331.
    Estimated Total Annual Responses: 46,167,618.
    Estimated Total Annual Burden Hours: 10,629,971.
    Estimated Costs to Respondents or Recordkeepers: $9,719,287.
    Regulations Sections: Sec. Sec.  653.103(a), 653.109(a)(10).
    The preceding IC was the subject of a public comment, which the 
Department summarizes and responds to as follows.
    Comment: A private citizen sought to call attention to what they 
described as ``an apparent typographical error'' in the NPRM's PRA 
section on the DOL-Only Performance Accountability, Information, and 
Reporting System for Reportable Individuals IC. The commenter stated 
that the estimated total annual burden hours of 10,610,629,971 stood 
out as an erroneous figure because it is beyond the current government-
wide cumulative paperwork burden (citing OMB's figure of 
10,521,540,269.2 hours), and because the supporting statement for the 
IC in question listed the total annual burden hours at 10,629,971 hours 
(citing Table 8). The commenter said it appears that the Department 
mistakenly added an extra ``610'' to that figure.
    A State agency commented that, if the proposed requirement is 
adopted, it would cost $30,000 to $50,000 to update its IT systems to 
track the MSFW-status of reportable individuals, and it asked the 
Department to provide additional funding to cover these costs.
    Response: The Department acknowledges that estimated total annual 
burden hours for this collection

[[Page 82722]]

is 10,629,971, not 10,610,629,971. The Department notes that it only 
received one comment indicating that the cost to update IT systems 
could be higher than the Department's estimate of $4,000 per 
jurisdiction. The Department's estimate is based on anecdotal evidence 
from other States, which indicated the change could cost a one-time 
expense of $2,000 to $6,000. The Department notes that some States may 
have higher costs, while other States may have lower costs. The change 
to this collection does not establish a new data element. Instead, it 
only requires States to make the existing data element 413, which is 
already required for participants, applicable to reportable 
individuals. The Department expects the burden to be minimal and will 
finalize the collection as proposed.
    Agency: DOL-ETA.
    Title of Collection: Clearance Order Checklists.
    Type of Review: New Collection.
    OMB Control Number: 1205-0NEW.
    Description: In the NPRM, the Department proposed to add a new IC 
to address the requirements at 20 CFR 653.501(d)(6), which requires 
SWAs to provide farmworkers with ``checklists showing wage payment 
schedules, working conditions, and other material specifications of the 
clearance order,'' and 20 CFR 653.501(d)(10), which requires SWA 
applicant-holding offices to provide workers referred on clearance 
orders with a checklist summarizing wages, working conditions, and 
other material specifications in the clearance order. The Department 
proposed to include a new Agricultural Clearance Order Form, ETA Form 
790B, and to withdraw OMB Control Number 1205-0134, which at the time 
of the NPRM was an expired ICR for which a submission requesting 
reinstatement was pending at OMB. Since the publication of the NPRM, 
OMB approved OMB Control Number 1205-0134, and therefore there is no 
need to withdraw OMB Control Number 1205-0134 or to create a new OMB 
Control Number for Form ETA-790B. For this reason, the Department 
declines to finalize the new collection for Form ETA-790B; however, the 
Department will finalize the collection for the checklist requirements 
and will revise the title of the new collection to be Clearance Order 
Checklists. The Department has also revised the burden estimates to 
only include information for the checklist requirements.
    Affected Public: State Governments, Private Sector: Business or 
other for-profits, not-for-profit institutions, and farms.
    Obligation to Respond: Required to Obtain or Retain Benefits.
    Estimated Total Annual Respondents: 24,030.
    Estimated Total Annual Responses: 24,030.
    Estimated Total Annual Burden Hours: 13,937.
    Estimated Total Annual Other Burden Costs: $0.
    Regulations Sections: Sec.  653.501(d)(6) and (10).
    Agency: DOL-ETA.
    Title of Collection: Migrant and Seasonal Farmworker Monitoring 
Report and Complaint/Apparent Violation Form.
    Type of Review: Revision.
    OMB Control Number: 1205-0039.
    Description: The final rule requires four areas to be changed in 
this ICR. First, there are several changes to the required content of 
the SMA's Annual Summary, described at Sec.  653.108, including a 
summary of how the SMA is working with the State-level E.O. Officer, an 
assurance that the SMA is a senior-level official who reports directly 
to the State Administrator or their designee, an evaluation of SMA 
staffing levels, a summary and analysis of outreach efforts, and other 
minor edits to language used to describe content in the summary. To 
implement these changes, the Department also is revising the ETA Form 
5148 to include the content. Second, the Department is making two non-
substantive corrections to the ETA Form 5148: (1) adding transportation 
to the types of apparent violations reported in part 1, section E, item 
3; and (2) revising part 3, items 2 and 3 so that the field check 
requirements conform to the existing regulation at Sec.  653.501. The 
Department is adding transportation to the types of apparent violations 
because the types of apparent violations listed on the form are 
intended to exactly mirror the types of complaints reported in section 
D, item 2. Transportation was inadvertently omitted from the prior ICR 
revision. Third, the Department is adding a new IC to conform with the 
change to Sec.  653.107(b)(8), which requires that ES Office Managers 
maintain MSFW outreach logs on file for at least 3 years, to comply 
with 2 CFR 200.334. Fourth, the Department is adding an IC to this ICR 
to explain the recordkeeping requirements established at Sec.  
658.410(c) regarding maintaining a central complaint log. The 
Department is not establishing a required form, but rather describing 
the minimum contents that must be included in any complaint logs SWAs 
create. In addition, the Department is revising the ETA Form 5148 to 
conform with revisions to the minimum level of service indicators to 
request information regarding outreach contacts per quarter as opposed 
to per week as currently required under Sec.  653.109(h).
    Affected Public: State Governments.
    Obligation to Respond: Required to Obtain or Retain Benefits.
    Estimated Total Annual Respondents: 5,536.
    Estimated Total Annual Responses: 11,450.
    Estimated Total Annual Burden Hours: 29,440.
    Estimated Total Annual Other Burden Costs: $0.
    Regulations Sections: 2 CFR 200.334; 20 CFR 653.107(b)(8), 653.108, 
653.109(h), and 658.410(c).
    Agency: DOL-ETA.
    Title of Collection: Wagner-Peyser Employment Service Required 
Elements for the Unified or Combined State Plan.
    Type of Review: New Collection.
    OMB Control Number: 1205-0NEW.
    Description: The Department is requesting a new OMB control number 
for this collection. The request for a new control number is for 
administrative reasons only. The changes in this rulemaking described 
subsequently will eventually be included in OMB Control Number 1205-
0522 (expires Mar. 31, 2026). After this rule is published and before 
the expiration of OMB Control Number 1205-0522, the Department intends 
to submit a nonmaterial change request to transfer the burden from the 
new ICR to the existing OMB control number for the Required Elements 
for Submission of the Unified or Combined State Plan and Plan 
Modifications under the Workforce Innovation and Opportunity Act (1205-
0522) and proceed to discontinue the use of the new control number.
    The final rule requires all States to provide Wagner-Peyser Act ES 
services through State merit staff, except for three States that the 
Department is permitting to use their approved longstanding alternative 
staffing models. The Department is creating a new ICR to require 
Unified or Combined State Plans to describe how the State will staff 
labor exchange services under the Wagner-Peyser Act using State merit 
staff. Similarly, the Department is reinstituting the SWA's requirement 
to provide assurances that it will use State merit staff to deliver ES 
services. The final rule also provides several clarifications regarding 
outreach and significant MSFW one-stop center staffing, including 
changes to the content of the AOP. The changes will require revision to 
the AOP instructions. The AOP instructions in the final submission to 
OMB reflect one change from the NPRM related to outreach staffing 
levels that the Department is

[[Page 82723]]

making in Sec.  653.107(a)(4) and (d)(2) in this final rule.
    Affected Public: State Governments.
    Obligation to Respond: Required to Obtain or Retain Benefits.
    Estimated Total Annual Respondents: 57 (every 2 years).
    Estimated Total Annual Responses: 38 (every 2 years).
    Estimated Total Annual Burden Hours: 8,136 (every 2 years).
    Estimated Total Annual Other Burden Costs: $0 (every 2 years).
    Regulations Sections: Sec. Sec.  652.215; 653.107(a)(1), (a)(4), 
(b)(11), and (d)(2)(ii) through (v).
    Interested parties may obtain a copy free of charge of one or more 
of the ICRs submitted to OMB on the OIRA website at https://www.reginfo.gov/public/do/PRAMain. From that page, select Department of 
Labor from the ``Currently under Review'' dropdown menu, click the 
``Submit'' button, and find the applicable control number among the 
ICRs displayed.

D. Executive Order 13132 (Federalism)

    E.O. 13132 requires Federal agencies to ensure that the principles 
of Federalism animating our Constitution guide the executive 
departments and agencies in the formulation and implementation of 
policies, and to further the policies of the Unfunded Mandates Reform 
Act of 1995 (UMRA). Further, agencies must strictly adhere to 
constitutional principles. Agencies must closely examine the 
constitutional and statutory authority supporting any action that would 
limit the policymaking discretion of the States and they must carefully 
assess the necessity for any such action. To the extent practicable, 
State and local officials must be consulted before any such action is 
implemented. Section 3(b) of the E.O. further provides that Federal 
agencies must implement regulations that have a substantial direct 
effect only if statutory authority permits the regulation and it is of 
national significance. The Department has reviewed the final rule in 
light of these requirements and has concluded that it is properly 
premised on the statutory authority given to the Secretary to set 
standards under the Wagner-Peyser Act.
    Accordingly, the Department has reviewed this final rule and has 
concluded that the rulemaking has no substantial direct effects on 
States, the relationship between the National Government and the 
States, or the distribution of power and responsibilities among the 
various levels of government as described by E.O. 13132. Therefore, the 
Department has concluded that this final rule does not have a 
sufficient Federalism implication to require further agency action or 
analysis.

E. Unfunded Mandates Reform Act of 1995

    Title II of UMRA, Public Law 104-4, requires each Federal agency to 
prepare a written statement assessing the effects of any Federal 
mandate in a final agency rule that may result in an expenditure of 
$100 million or more (adjusted annually for inflation with the base 
year 1995) in any one year by State, local, and tribal governments, in 
the aggregate, or by the private sector. This final rule does not 
exceed the $100 million expenditure in any one year when adjusted for 
inflation. Therefore, the requirements of title II of UMRA do not 
apply, and the Department has not prepared a statement under UMRA.
    Comment: Some commenters, including a State workforce development 
board, a professional association, and an association of State elected 
officials, argued that the proposal would create an unfunded Federal 
mandate because States' costs would increase due to the loss of 
flexibility and the need to recruit State merit staff and cross-train 
workers to support UI adjudication. A professional association, an 
association of workforce boards, and a State workforce development 
board similarly argued that the proposal would create an unfunded 
Federal mandate because it would force States to make additional long-
term investments to employ State merit staff.
    Response: The regulation contains no unfunded mandates as defined 
in 2 U.S.C. 658. The Department has detailed the cost burden associated 
with this final rule in section VI. Wagner-Peyser Employment Service 
grant funding is provided annually to deliver employment services, and 
that funding will be used to cover the cost of implementing this rule. 
Under UMRA, a Federal mandate is any provision in a regulation that 
imposes an enforceable duty upon State, local, or tribal governments, 
or imposes a duty upon the private sector that is not voluntary. The 
Wagner-Peyser act, as amended by WIOA, authorizes ES activities. These 
program requirements are supported by Federal formula grant funds, and, 
accordingly, are not considered unfunded mandates.

F. Executive Order 13175 (Indian Tribal Governments)

    The Department has reviewed this final rule under the terms of E.O. 
13175 and DOL's Tribal Consultation Policy and has concluded that the 
changes to regulatory text would not have tribal implications. These 
changes do not have substantial direct effects on one or more Indian 
tribes, the relationship between the Federal government and Indian 
tribes, nor the distribution of power and responsibilities between the 
Federal government and Tribal Governments.

G. Plain Language

    E.O. 12866, E.O. 13563, and the Presidential Memorandum of June 1, 
1998 (Plain Language in Government Writing), direct executive 
departments and agencies to use plain language in all rulemaking 
documents published in the Federal Register. The goal is to make the 
government more responsive, accessible, and understandable in its 
communications with the public. Accordingly, the Department drafted 
this final rule in plain language.

List of Subjects

20 CFR Part 651

    Employment, Grant programs--labor.

20 CFR Part 652

    Employment, Grant programs--labor, Reporting and recordkeeping 
requirements.

20 CFR Part 653

    Agriculture, Employment, Equal employment opportunity, Grant 
programs--labor, Migrant labor, Reporting and recordkeeping 
requirements.

20 CFR Part 658

    Administrative practice and procedure, Employment, Grant programs--
labor, Reporting and recordkeeping requirements.

    For the reasons discussed in the preamble, the Department of Labor 
amends 20 CFR parts 651, 652, 653, and 658 as follows:

PART 651--GENERAL PROVISIONS GOVERNING THE WAGNER-PEYSER ACT 
EMPLOYMENT SERVICE

0
1. The authority citation for part 651 is revised to read as follows:

    Authority:  29 U.S.C. 49a and 49k; 38 U.S.C. 101, chapters 41 
and 42; Secs. 3, 189 and 503, Pub. L. 113-128, 128 Stat. 1425 (Jul. 
22, 2014).


0
2. Amend Sec.  651.10 by:
0
a. Revising the introductory text;
0
b. Adding in alphabetical order a definition for ``Apparent 
violation'';
0
c. Revising the definitions of ``Applicant holding office,'' ``Bona 
fide occupational qualification (BFOQ),'' ``Career services,'' 
``Clearance order,'' ``Complaint System Representative,''

[[Page 82724]]

``Decertification,'' ``Employment and Training Administration (ETA),'' 
``Employment Service (ES) office,'' ``Employment Service (ES) Office 
Manager,'' ``Employment Service (ES) staff,'' ``Field checks,'' ``Field 
visits,'' ``Hearing Officer,'' ``Interstate clearance order,'' 
``Intrastate clearance order,'' and ``Migrant farmworker'';
0
d. Removing the definition of ``Migrant food processing worker'';
0
e. Revising the definitions of ``Occupational Information Network 
(O*NET),'' ``O*NET-SOC,'' ``Outreach staff,'' ``Participant,'' 
``Placement,'' ``Reportable individual,'' ``Respondent,'' ``Seasonal 
farmworker,'' ``Significant MSFW one-stop centers,'' and ``Significant 
MSFW States'';
0
f. Removing the definitions of ``Significant multilingual MSFW one-stop 
centers'' and ``State Workforce Agency (SWA) official''; and
0
g. Revising the definition of ``Wagner-Peyser Act Employment Service 
(ES) also known as Employment Service (ES).''
    The addition and revisions read as follows:


Sec.  651.10  Definitions of terms used in this part and parts 652, 
653, 654, and 658 of this chapter.

    In addition to the definitions set forth in sec. 3 of the Workforce 
Innovation and Opportunity Act (WIOA), codified at 29 U.S.C. 3101 et 
seq., the following definitions apply to the regulations in parts 652, 
653, 654, and 658 of this chapter:
* * * * *
    Apparent violation means a suspected violation of employment-
related laws or employment service (ES) regulations by an employer, 
which an ES staff member observes, has reason to believe, or regarding 
which an ES staff member receives information (other than a complaint 
as defined in this part).
    Applicant holding office means an ES office that is in receipt of a 
clearance order and has access to U.S. workers who may be willing and 
available to perform farmwork on less than year-round basis.
* * * * *
    Bona fide occupational qualification (BFOQ) means that an 
employment decision or request based on age, sex, national origin, or 
religion is based on a finding that such characteristic is necessary to 
the individual's ability to perform the job in question. Since a BFOQ 
is an exception to the general prohibition against discrimination on 
the basis of age, sex, national origin, or religion, it must be 
interpreted narrowly in accordance with the Equal Employment 
Opportunity Commission regulations set forth at 29 CFR parts 1604, 
1605, 1606, and 1625.
    Career services means the services described in sec. 134(c)(2) of 
WIOA and Sec.  678.430 of this chapter.
    Clearance order means a job order that is processed through the 
clearance system under the Agricultural Recruitment System (ARS) at 
part 653, subpart F, of this chapter.
* * * * *
    Complaint System Representative means a trained ES staff individual 
who is responsible for processing complaints.
    Decertification means the rescission by the Secretary of Labor 
(Secretary) of the year-end certification made under sec. 7 of the 
Wagner-Peyser Act to the Secretary of the Treasury that the State 
agency may receive funds authorized by the Wagner-Peyser Act.
* * * * *
    Employment and Training Administration (ETA) means the component of 
the Department that administers Federal government job training and 
worker dislocation programs, Federal grants to States for public ES 
programs, and unemployment insurance benefits. These services are 
provided primarily through State and local workforce development 
systems.
* * * * *
    Employment Service (ES) office means a site that provides ES 
services as a one-stop partner program. A site must be colocated in a 
one-stop center consistent with the requirements of Sec. Sec.  678.305 
through 678.315 of this chapter.
    Employment Service (ES) Office Manager means the ES staff person in 
charge of ES services provided in a one-stop center.
* * * * *
    Employment Service (ES) staff means individuals who are funded, in 
whole or in part, by Wagner-Peyser Act funds to carry out activities 
authorized under the Wagner-Peyser Act.
* * * * *
    Field checks means unannounced appearances by ES staff and/or other 
State or Federal staff at agricultural worksites to which ES placements 
have been made through the intrastate or interstate clearance system to 
ensure that conditions are as stated on the clearance order and that 
the employer is not violating an employment-related law.
    Field visits means announced appearances by State Monitor 
Advocates, Regional Monitor Advocates, the National Monitor Advocate 
(or National Monitor Advocate staff), or outreach staff to the working, 
living, and gathering areas of migrant and seasonal farmworkers 
(MSFWs), to perform the duties described at Sec. Sec.  653.107(b) 
(outreach staff), 653.108(o) and (q) (State Monitor Advocates), 
658.602(n) (National Monitor Advocates and National Monitor Advocate 
staff), and 658.603(p) (Regional Monitor Advocates). Monitor Advocates 
or outreach staff must keep records of each such visit.
* * * * *
    Hearing Officer means a Department Administrative Law Judge, 
designated to preside at Department administrative hearings.
* * * * *
    Interstate clearance order means an agricultural clearance order 
for temporary employment (employment on a less than year-round basis) 
describing one or more hard-to-fill job openings, which an ES office 
uses to request recruitment assistance from other ES offices in a 
different State.
    Intrastate clearance order means an agricultural clearance order 
for temporary employment (employment on a less than year-round basis) 
describing one or more hard-to-fill job openings, which an ES office 
uses to request recruitment assistance from all other ES offices within 
the State.
* * * * *
    Migrant farmworker means a seasonal farmworker (as defined in this 
section) who travels to the job site so that the farmworker is not 
reasonably able to return to their permanent residence within the same 
day.
* * * * *
    Occupational Information Network (O*NET) means the online reference 
database which contains detailed descriptions of U.S. occupations, 
distinguishing characteristics, classification codes, and information 
on tasks, knowledge, skills, abilities, and work activities as well as 
information on interests, work styles, and work values.
* * * * *
    O*NET-SOC means the occupational codes and titles used in the O*NET 
system, based on and grounded in the Standard Occupational 
Classification (SOC), which are the titles and codes utilized by 
Federal statistical agencies to classify workers into occupational 
categories for the purpose of collecting, calculating, and 
disseminating data. The SOC system is issued by the Office of 
Management and Budget and the Department is authorized to develop 
additional detailed O*NET occupations within existing SOC categories. 
The Department uses O*NET-SOC titles and codes for the purposes of 
collecting descriptive occupational information and for State reporting 
of data on

[[Page 82725]]

training, credential attainment, and placement in employment by 
occupation.
* * * * *
    Outreach staff means ES staff with the responsibilities described 
in Sec.  653.107(b) of this chapter. State Monitor Advocates are not 
considered outreach staff.
    Participant means a reportable individual who has received services 
other than the services described in Sec.  677.150(a)(3) of this 
chapter, after satisfying all applicable programmatic requirements for 
the provision of services, such as eligibility determination. (See 
Sec.  677.150(a) of this chapter.)
    (1) The following individuals are not participants, subject to 
Sec.  677.150(a)(3)(ii) and (iii) of this chapter:
    (i) Individuals who only use the self-service system; and
    (ii) Individuals who receive information-only services or 
activities.
    (2) ES participants must be included in the program's performance 
calculations.
    Placement means the hiring by a public or private employer of an 
individual referred by the ES office for a job or an interview, 
provided that the ES office completed all the following steps:
    (1) Prepared a job order form prior to referral, except in the case 
of a job development contact on behalf of a specific participant;
    (2) Made prior arrangements with the employer for the referral of 
an individual or individuals;
    (3) Referred an individual who had not been specifically designated 
by the employer, except for referrals on agricultural job orders for a 
specific crew leader or worker;
    (4) Verified from a reliable source, preferably the employer, that 
the individual had entered on a job; and
    (5) Appropriately recorded the placement.
* * * * *
    Reportable individual means an individual who has taken action that 
demonstrates an intent to use ES services and who meets specific 
reporting criteria of the Wagner-Peyser Act (see Sec.  677.150(b) of 
this chapter), including:
    (1) Individuals who provide identifying information;
    (2) Individuals who only use the self-service system; or
    (3) Individuals who only receive information-only services or 
activities.
    Respondent means the individual or entity alleged to have committed 
the violation described in the complaint, such as the employer, service 
provider, or State agency.
    Seasonal farmworker means an individual who is employed, or was 
employed in the past 12 months, in farmwork (as defined in this 
section) of a seasonal or other temporary nature and is not required to 
be absent overnight from their permanent place of residence. Labor is 
performed on a seasonal basis where, ordinarily, the employment 
pertains to or is of the kind exclusively performed at certain seasons 
or periods of the year and which, from its nature, may not be 
continuous or carried on throughout the year. Workers who move from one 
seasonal activity to another, while employed in farmwork, are employed 
on a seasonal basis even though they may continue to be employed during 
a major portion of the year. Workers are employed on a temporary basis 
where they are employed for a limited time only or their performance is 
contemplated for a particular piece of work, usually of short duration. 
Generally, employment which is contemplated to continue indefinitely is 
not temporary.
* * * * *
    Significant MSFW one-stop centers are those designated by the 
Department and include those ES offices where MSFWs account for 10 
percent or more of annual participants or reportable individuals in ES 
and those local ES offices that the OWI Administrator determines must 
be included due to special circumstances such as an estimated large 
number of MSFWs in the service area. In no event may the number of 
significant MSFW one-stop centers be less than 100 centers on a 
nationwide basis.
    Significant MSFW States are those States designated by the 
Department and must include the 20 States with the highest estimated 
number of MSFWs.
* * * * *
    State Workforce Agency (SWA) official means an individual employed 
by the State Workforce Agency or any of its subdivisions.
* * * * *
    Wagner-Peyser Act Employment Service (ES) also known as Employment 
Service (ES) means the national system of public ES offices described 
under the Wagner-Peyser Act. ES services are delivered through a 
nationwide system of one-stop centers, managed by SWAs and the various 
local offices of the SWAs, and funded by the United States Department 
of Labor.
* * * * *

PART 652--ESTABLISHMENT AND FUNCTIONING OF STATE EMPLOYMENT SERVICE

0
3. The authority citation for part 652 is revised to read as follows:

    Authority:  29 U.S.C. chapter 4B; 38 U.S.C. chapters 41 and 42; 
Secs. 189 and 503, Public Law 113-128, 128 Stat. 1425 (Jul. 22, 
2014).


0
4. Amend Sec.  652.8 by revising paragraphs (h), introductory text of 
paragraph (j), and (j)(2) and (3) to read as follows:


Sec.  652.8  Administrative provisions.

* * * * *
    (h) Other violations. Violations or alleged violations of the 
Wagner-Peyser Act, regulations, or grant terms and conditions except 
those pertaining to audits or discrimination must be determined and 
processed in accordance with part 658, subpart H, of this chapter.
* * * * *
    (j) Nondiscrimination requirements. States must:
* * * * *
    (2) Assure that discriminatory job orders will not be accepted, 
except where the stated requirement is a bona fide occupational 
qualification (BFOQ). See generally 42 U.S.C. 2000e-2(e) and 29 CFR 
parts 1604, 1605, 1606, and 1625.
    (3) Assure that ES offices are in compliance with the veteran 
referral and job listing requirements at 41 CFR 60-300.84.
* * * * *

0
5. Add Sec.  652.10 to read as follows:


Sec.  652.10  Severability.

    Should a court hold any portion of any provision of this part to be 
invalid, the provision will be construed so as to continue to give the 
maximum effect to the provision permitted by law, unless such holding 
is one of total invalidity or unenforceability, in which event the 
provision or subprovision will be severable from this part and will not 
affect the remainder thereof.

0
6. Revise the heading to subpart C to read as follows:

Subpart C--Employment Service Services in a One-Stop Delivery 
System Environment

0
7. Amend Sec.  652.204 by revising the section heading to read as 
follows:


Sec.  652.204  Must funds authorized under the Wagner-Peyser Act 
Governor's Reserve flow through the one-stop delivery system?

* * * * *

0
8. Amend Sec.  652.205 by revising paragraph (b)(3) to read as follows:

[[Page 82726]]

Sec.  652.205  May funds authorized under the Wagner-Peyser Act be used 
to supplement funding for labor exchange programs authorized under 
separate legislation?

* * * * *
    (b) * * *
    (3) The activity provides services that are coordinated with ES 
services; and
* * * * *

0
9. Amend Sec.  652.207 by revising the section heading and paragraph 
(a) to read as follows:


Sec.  652.207  How does a State meet the requirement for universal 
access to Employment Service services?

    (a) A State has discretion in how it meets the requirement for 
universal access to ES services. In exercising this discretion, a State 
must meet the Wagner-Peyser Act's requirements.
* * * * *

0
10. Revise Sec.  652.215 to read as follows:


Sec.  652.215  What staffing models must be used to deliver services in 
the Employment Service?

    (a) Except as provided in paragraph (b) of this section, the 
Secretary requires that States deliver the labor exchange services 
described in Sec.  652.3 using State merit-staff employees employed 
according to the merit-system principles described in 5 CFR part 900, 
subpart F--Standards for a Merit System of Personnel Administration. 
This requirement also applies to the provision of services and 
activities under parts 653 and 658 of this chapter.
    (b) States authorized prior to February 5, 2020, to use a staffing 
model other than that described in paragraph (a) of this section to 
deliver ES services may use the staffing model consistent with the 
model previously authorized for the State. These States may use merit-
staffing flexibility only to the same extent that the Department had 
authorized it prior to February 5, 2020.
    (c) States using staffing models under paragraph (b) of this 
section are required to participate in evaluations of their delivery of 
ES services conducted by the Department.
    (d) All States must comply with the requirements in this section no 
later than January 22, 2026.

PART 653--SERVICES OF THE WAGNER-PEYSER ACT EMPLOYMENT SERVICE 
SYSTEM

0
11. The authority citation for part 653 continues to read as follows:

    Authority: Secs. 167, 189, 503, Public Law 113-128, 128 Stat. 
1425 (Jul. 22, 2014); 29 U.S.C. chapter 4B; 38 U.S.C. part III, 
chapters 41 and 42.

0
12. Amend Sec.  653.100 by revising paragraph (a) to read as follows:


Sec.  653.100  Purpose and scope of subpart.

    (a) This subpart sets forth the principal regulations of the 
Wagner-Peyser Act Employment Service (ES) concerning the provision of 
services for MSFWs consistent with the requirement that all services of 
the workforce development system be available to all job seekers in an 
equitable and nondiscriminatory fashion. This includes ensuring MSFWs 
have access to these services in a way that meets their unique needs. 
MSFWs must receive services on a basis which is qualitatively 
equivalent and quantitatively proportionate to services provided to 
non-MSFWs.
* * * * *

0
13. Revise Sec.  653.101 to read as follows:


Sec.  653.101  Provision of services to migrant and seasonal 
farmworkers.

    SWAs must ensure that ES staff at one-stop centers offer MSFWs the 
full range of career and supportive services, benefits and protections, 
and job and training referral services as are provided to non-MSFWs. 
SWAs must ensure ES staff at the one-stop centers tailor such ES 
services in a way that accounts for individual MSFW preferences, needs, 
skills, and the availability of job and training opportunities, so that 
MSFWs are reasonably able to participate in the ES.

0
14. Amend Sec.  653.102 by revising the third sentence and removing the 
fourth sentence to read as follows:


Sec.  653.102  Job information.

    * * * SWAs must ensure ES staff at one-stop centers provide 
assistance to MSFWs to access job order information easily and 
efficiently.

0
15. Amend Sec.  653.103 by revising paragraphs (a) through (c) to read 
as follows:


Sec.  653.103  Process for migrant and seasonal farmworkers to 
participate in workforce development activities.

    (a) Each ES office must determine whether participants and 
reportable individuals are MSFWs as defined at Sec.  651.10 of this 
chapter.
    (b) SWAs must comply with the language access and assistance 
requirements at 29 CFR 38.9 with regard to all individuals with limited 
English proficiency (LEP), including MSFWs who are limited English 
proficient individuals, as defined at 29 CFR 38.4(hh). This includes 
ensuring ES staff comply with these language access and assistance 
requirements.
    (c) One-stop centers must provide MSFWs a list of available career 
and supportive services.
* * * * *

0
16. Amend Sec.  653.107 by:
0
a. Revising the section heading and paragraphs (a)(1), (a)(2)(i) and 
(ii), and (3);
0
b. Revising paragraphs (a)(4), the first sentence of (a)(5), 
introductory text of paragraph (b), (b)(1), (b)(3), introductory text 
of (b)(4), (b)(4)(i) and (vi), (b)(6), (b)(7), the second sentence of 
(b)(8), and paragraphs (b)(11), (d)(2)(ii) through (v), and (d)(4) and 
(5).
    The revisions and additions read as follows:


Sec.  653.107  Outreach responsibilities and Agricultural Outreach 
Plan.

    (a) * * *
    (1) Each SWA must ensure outreach staff conduct outreach as 
described in paragraph (b) of this section on an ongoing basis. State 
Administrators must ensure State Monitor Advocates (SMAs) and outreach 
staff coordinate activities with WIOA title I sec. 167 grantees as well 
as with public and private community service agencies and MSFW groups. 
WIOA title I sec. 167 grantees' activities involving MSFWs does not 
substitute for SWA outreach responsibilities.
    (2) * * *
    (i) Communicate the full range of workforce development services to 
MSFWs; and
    (ii) Conduct thorough outreach efforts with extensive follow-up 
activities identified at paragraph (b)(5) of this section.
    (3) When hiring or assigning outreach staff, SWAs must ensure 
hiring officials:
    (i) Seek and put a strong emphasis on hiring and assigning 
qualified candidates who speak the language of a significant proportion 
of the State MSFW population; and
    (A) Who are from MSFW backgrounds; or
    (B) Who have substantial work experience in farmworker activities.
    (ii) Inform farmworker organizations and other organizations with 
expertise concerning MSFWs of job openings and encourage them to refer 
qualified applicants to apply.
    (4) Each SWA must ensure that there are an adequate number of 
outreach staff employed in the State to conduct MSFW outreach in each 
service area of the State and to contact a majority of MSFWs in the 
State annually. In the 20 States with the highest estimated year-round 
MSFW activity, as identified by the Department, there must be full-
time, year-round outreach staff to conduct outreach duties. Full-time 
means each

[[Page 82727]]

individual outreach staff person must spend 100 percent of their time 
on the outreach responsibilities described in paragraph (b) of this 
section. For the remainder of the States, there must be year-round 
part-time outreach staff, and during periods of the highest MSFW 
activity, there must be full-time outreach staff. These staffing levels 
must align with and be supported by information about the estimated 
number of farmworkers in the State and the farmworker activity in the 
State as demonstrated in the State's Agricultural Outreach Plan (AOP) 
pursuant to paragraph (d) of this section. All outreach staff must be 
multilingual, if warranted by the characteristics of the MSFW 
population in the State, and must spend a majority of their time in the 
field.
    (5) The SWA must publicize the availability of ES services through 
such means as newspaper and electronic media publicity. * * *
* * * * *
    (b) Outreach staff responsibilities. Outreach staff must locate and 
contact MSFWs who are not being reached by the normal intake activities 
conducted by the ES offices. Outreach staff responsibilities include 
the activities identified in paragraphs (b)(1) through (11) of this 
section.
    (1) Outreach staff must explain to MSFWs at their working, living, 
or gathering areas (including day-haul sites), by means of written and 
oral presentations either spontaneous or recorded, the following:
* * * * *
    (3) After making the presentation, outreach staff must urge the 
MSFWs to go to the local one-stop center to obtain the full range of 
employment and training services.
    (4) If an MSFW cannot or does not wish to visit the local one-stop 
center, outreach staff must offer to provide on-site the following:
    (i) Assistance in the preparation of applications for ES services;
* * * * *
    (vi) As needed, assistance in making appointments and arranging 
transportation for individual MSFW(s) or members of their family to and 
from local one-stop centers or other appropriate agencies.
* * * * *
    (6) Outreach staff must be alert to observe the working and living 
conditions of MSFWs and if an outreach staff member observes or 
receives information about apparent violations, the outreach staff 
member must document and refer the information to the appropriate ES 
Office Manager (as described in Sec.  658.419 of this chapter).
    (7) Outreach staff must be trained in one-stop center procedures 
and in the services, benefits, and protections afforded MSFWs by the 
ES, including training on protecting farmworkers against sexual 
harassment, sexual coercion, assault, and human trafficking. Such 
trainings are intended to help outreach staff identify when such issues 
may be occurring in the fields and how to document and refer the cases 
to the appropriate enforcement agencies. Outreach staff also must be 
trained in the Complaint System procedures at part 658, subpart E, of 
this chapter and be aware of the local, State, regional, and national 
enforcement agencies that would be appropriate to receive referrals. 
The program for such training must be formulated by the State 
Administrator, pursuant to uniform guidelines developed by ETA. The SMA 
must be given an opportunity to review and comment on the State's 
program.
    (8) * * * These records must include a daily log, a copy of which 
must be sent monthly to the ES Office Manager and maintained on file 
for at least 3 years. * * *
* * * * *
    (11) Outreach staff in significant MSFW one-stop centers must 
conduct especially vigorous outreach in their service areas. Outreach 
activities must align with and be supported by information provided in 
the State's AOP pursuant to paragraph (d) of this section.
* * * * *
    (d) * * *
    (2) * * *
    (ii) Explain the materials, tools, and resources the State will use 
for outreach;
    (iii) Describe the SWA's proposed outreach activities to contact 
MSFWs who are not being reached by the normal intake activities 
conducted by the one-stop centers. The description must identify the 
number of full-time and part-time outreach staff positions in the State 
and must demonstrate that there are sufficient outreach staff to 
conduct MSFW outreach in each service area of the State to contact a 
majority of MSFWs in the State annually;
    (iv) Describe the activities planned for providing the full range 
of ES services to the agricultural community, including both MSFWs and 
agricultural employers, through the one-stop centers; and
    (v) Include a description of how the SWA intends to provide ES 
staff in significant MSFW one-stop centers in accordance with Sec.  
653.111.
* * * * *
    (4) The AOP must be submitted in accordance with paragraph (d)(1) 
of this section and planning guidance issued by the Department.
    (5) The Annual Summaries required at Sec.  653.108(u) must update 
the Department on the SWA's progress toward meeting the objectives set 
forth in the AOP.

0
17. Revise Sec.  653.108 to read as follows:


Sec.  653.108  State Workforce Agency and State Monitor Advocate 
responsibilities.

    (a) State Administrators must ensure their SWAs monitor their own 
compliance with ES regulations in serving MSFWs on an ongoing basis. 
The State Administrator has overall responsibility for SWA self-
monitoring. The State Administrator and ES staff must not retaliate 
against staff, including the SMA, for self-monitoring or raising any 
issues or concerns regarding noncompliance with the ES regulations.
    (b) The State Administrator must appoint an SMA who must be a SWA 
official. The State Administrator must inform farmworker organizations 
and other organizations with expertise concerning MSFWs of the opening 
and encourage them to refer qualified applicants to apply. Among 
qualified candidates, the SWAs must seek and put a strong emphasis on 
hiring persons:
    (1) Who are from MSFW backgrounds; or
    (2) Who speak the language of a significant proportion of the State 
MSFW population; or
    (3) Who have substantial work experience in farmworker activities.
    (c) The SMA must be an individual who:
    (1) Is a senior-level ES staff employee;
    (2) Reports directly to the State Administrator or State 
Administrator's designee, such as a director or other appropriately 
titled official in the State Administrator's office, who has the 
authority to act on behalf of the State Administrator, except that if a 
designee is selected, they must not be the individual who has direct 
program oversight of the ES; and
    (3) Has the knowledge, skills, and abilities necessary to fulfill 
the responsibilities as described in this subpart.
    (d) The SMA must have sufficient authority, staff, resources, and 
access to top management to monitor compliance with the ES regulations. 
Staff assigned to the SMA are intended to help the SMA carry out the 
duties set forth in this section and must not perform work that 
conflicts with any of the SMA's duties, such as outreach 
responsibilities

[[Page 82728]]

required by Sec.  653.107, ARS processing under subpart F of this part, 
and complaint processing under subpart E of part 658. The number of ES 
staff positions assigned to the SMA must be determined by reference to 
the number of MSFWs in the State, (as measured at the time of the peak 
MSFW population), and the need for monitoring activity in the State.
    (e) The SMA must devote full-time staffing to the SMA functions 
described in this section. No State may dedicate less than full-time 
staffing for the SMA position, unless the Regional Administrator, with 
input from the Regional Monitor Advocate, provides written approval. 
Any State that proposes less than full-time dedication must demonstrate 
to the Regional Administrator and Regional Monitor Advocate that all 
SMA functions can be effectively performed with part-time staffing. The 
SMA must not perform work that conflicts with any of the SMA's duties, 
such as outreach responsibilities required by Sec.  653.107, ARS 
processing under subpart F of this part, and complaint processing under 
subpart E of part 658.
    (f) All SMAs and their staff must attend training session(s) 
offered by the Regional Monitor Advocate(s) and National Monitor 
Advocate and their staff and those necessary to maintain competency and 
enhance the SMA's understanding of the unique needs of farmworkers. 
Such trainings must include those identified by the SMA's Regional 
Monitor Advocate and may include those offered by the Occupational 
Safety and Health Administration, the Department's Wage and Hour 
Division, U.S. Equal Employment Opportunity Commission, the Immigrant 
and Employee Rights Section of the Department of Justice's Civil Rights 
Division, the Department's Civil Rights Center, and other organizations 
offering farmworker-related information.
    (g) The SMA must provide any relevant documentation requested from 
the SWA by the Regional Monitor Advocate or the National Monitor 
Advocate.
    (h) The SMA must:
    (1) Conduct an ongoing review of the delivery of services and 
protections afforded by the ES regulations to MSFWs by the SWA and ES 
offices. This includes:
    (i) Monitoring compliance with Sec.  653.111;
    (ii) Monitoring the ES services that the SWA and one-stop centers 
provide to MSFWs to assess whether they are qualitatively equivalent 
and quantitatively proportionate to the services that the SWA and one-
stop centers provide to non-MSFWs; and
    (iii) Reviewing the appropriateness of informal resolution of 
complaints and apparent violations as documented in the complaint logs.
    (2) Without delay, must advise the SWA and ES offices of problems, 
deficiencies, or improper practices in the delivery of services and 
protections afforded by these regulations and, if warranted, specify 
the corrective action(s) necessary to address these deficiencies. When 
the SMA finds corrective action(s) necessary, the ES Office Manager or 
other appropriate ES staff must develop a corrective action plan in 
accordance with the requirements identified at paragraph (h)(3)(v) of 
this section. The SMA also must advise the SWA on means to improve the 
delivery of services.
    (3) Participate in on-site reviews of one-stop centers on a regular 
basis (regardless of whether or not they are designated significant 
MSFW one-stop centers) using the procedures set forth in paragraphs 
(h)(3)(i) through (vii) of this section.
    (i) Before beginning an onsite review, the SMA or review staff must 
study:
    (A) Program performance data;
    (B) Reports of previous reviews;
    (C) Corrective action plans developed as a result of previous 
reviews;
    (D) Complaint logs, as required by the regulations under part 658 
of this chapter, including logs documenting the informal resolution of 
complaints and apparent violations; and
    (E) Complaints elevated from the office or concerning the office.
    (ii) The SMA must ensure that the onsite review format, developed 
by ETA, is used as a guideline for onsite reviews.
    (iii) Upon completion of an onsite monitoring review, the SMA must 
hold one or more wrap-up sessions with the ES Office Manager and staff 
to discuss any findings and offer initial recommendations and 
appropriate technical assistance.
    (iv) After each review, the SMA must conduct an in-depth analysis 
of the review data. The conclusions, including findings and areas of 
concern and recommendations of the SMA, must be put in writing and must 
be sent directly to the State Administrator, to the official of the SWA 
with authority over the ES office, and other appropriate SWA officials.
    (v) If the review results in any findings of noncompliance with the 
regulations under this chapter, the SMA's report must include the 
necessary corrective action(s). To resolve the findings, the ES Office 
Manager or other appropriate ES staff must develop and propose a 
written corrective action plan. The plan must be approved or revised by 
SWA officials and the SMA. The plan must include the actions required 
to correct any compliance issues within 30 business days or, if the 
plan allows for more than 30 business days for full compliance, the 
length of and the reasons for the extended period and the major interim 
steps to correct the compliance issues must be specifically stated. 
SWAs are responsible for assuring and documenting that the ES office is 
in compliance within the time period designated in the plan.
    (vi) SWAs must submit to the appropriate ETA regional office copies 
of the onsite review reports and corrective action plans for ES 
offices.
    (vii) The SMA may delegate the review described in paragraph (h)(3) 
of this section to the SMA's staff, if the SMA finds such delegation 
necessary. In such event, the SMA is responsible for and must approve 
the written report of the review.
    (4) Ensure all significant MSFW one-stop centers not reviewed 
onsite by Federal staff are reviewed at least once per year by the SMA 
or their staff, and that, if necessary, those ES offices in which 
significant problems are revealed by required reports, management 
information, the Complaint System, or other means are reviewed as soon 
as possible.
    (5) Review and approve the SWA's AOP.
    (6) On a regular basis, review outreach staff's daily logs and 
other reports including those showing or reflecting the outreach 
staff's activities.
    (7) Write and submit annual summaries to the State Administrator 
with a copy to the Regional Administrator and the National Monitor 
Advocate.
    (i) The SMA must participate in Federal reviews conducted pursuant 
to part 658, subpart G, of this chapter, as requested by the Regional 
or National Monitor Advocate.
    (j) The SMA must monitor the performance of the Complaint System, 
as set forth at Sec. Sec.  658.400 and 658.401 of this chapter. The SMA 
must review the ES office's informal resolution of complaints relating 
to MSFWs and must ensure that the ES Office Manager transmits copies of 
the Complaint System logs pursuant to part 658, subpart E, of this 
chapter to the SWA.
    (k) The SMA must serve as an advocate to improve services for 
MSFWs.
    (l) The SMA must establish an ongoing liaison with WIOA sec. 167

[[Page 82729]]

National Farmworker Jobs Program (NFJP) grantees and other 
organizations serving farmworkers, employers, and employer 
organizations in the State.
    (m) The SMA must establish an ongoing liaison with the State-level 
Equal Opportunity (E.O.) Officer.
    (n) The SMA must meet (either in person or by alternative means), 
at minimum, quarterly, with representatives of the organizations 
pursuant to paragraphs (l) and (m) of this section, to receive input on 
improving coordination with ES offices or improving the coordination of 
services to MSFWs. To foster such collaboration, the SMAs must 
communicate freely with these organizations. The SMA must also 
establish Memorandums of Understanding (MOUs) with the NFJP grantees 
and may establish MOUs with other organizations serving farmworkers as 
appropriate.
    (o) The SMA must conduct frequent field visits to the working, 
living, and gathering areas of MSFWs, and must discuss the SWA's 
provision of ES services and other employment-related programs with 
MSFWs, crew leaders, and employers. Records must be kept of each such 
field visit.
    (p) The SMA must participate in the appropriate regional public 
meeting(s) held by the Department of Labor Regional Farm Labor 
Coordinated Enforcement Committee, other Occupational Safety and Health 
Administration and Wage and Hour Division task forces, and other 
committees as appropriate.
    (q) The SMA must ensure that outreach efforts in all significant 
MSFW one-stop centers are reviewed at least yearly. This review will 
include accompanying at least one outreach staff from each significant 
MSFW one-stop center on field visits to MSFWs' working, living, and/or 
gathering areas. The SMA must review findings from these reviews with 
the ES Office Managers.
    (r) The SMA must review on at least a quarterly basis all 
statistical and other MSFW-related data reported by ES offices in 
order:
    (1) To determine the extent to which the SWA has complied with the 
ES regulations; and
    (2) To identify the areas of non-compliance.
    (s) The SMA must have full access to all statistical and other 
MSFW-related information gathered by SWAs and ES offices and may 
interview ES staff with respect to reporting methods. After each 
review, the SMA must consult, as necessary, with the SWA and ES offices 
and provide technical assistance to ensure accurate reporting.
    (t) The SMA must review and comment on proposed State ES 
directives, manuals, and operating instructions relating to MSFWs and 
must ensure:
    (1) That they accurately reflect the requirements of the 
regulations; and
    (2) That they are clear and workable. The SMA also must explain and 
make available at the requestor's cost, pertinent directives and 
procedures to employers, employer organizations, farmworkers, 
farmworker organizations, and other parties expressing an interest in a 
readily identifiable directive or procedure issued and receive 
suggestions on how these documents can be improved.
    (u) The SMA must prepare for the State Administrator, the Regional 
Monitor Advocate, and the National Monitor Advocate an Annual Summary 
describing how the State provided ES services to MSFWs within the State 
based on statistical data, reviews, and other activities as required in 
this chapter. The summary must include:
    (1) A description of the activities undertaken during the program 
year by the SMA pertaining to their responsibilities set forth in this 
section and other applicable regulations in this chapter.
    (2) An assurance that the SMA is a senior-level official who 
reports directly to the State Administrator or the State 
Administrator's designee as described at paragraph (c) of this section.
    (3) An evaluation of SMA staffing levels, including:
    (i) An assurance the SMA devotes all of their time to Monitor 
Advocate functions or, if the SMA conducts their functions on a part-
time basis, an assessment of whether all SMA functions are able to be 
effectively performed on a part-time basis; and
    (ii) An assessment of whether the performance of SMA functions 
requires increased time by the SMA (if part-time) or an increase in the 
number of ES staff assigned to assist the SMA in the performance of SMA 
functions, or both.
    (4) A summary of the monitoring reviews conducted by the SMA, 
including:
    (i) A description of any problems, deficiencies, or improper 
practices the SMA identified in the delivery of services;
    (ii) A summary of the actions taken by the SWA to resolve the 
problems, deficiencies, or improper practices described in its service 
delivery; and
    (iii) A summary of any technical assistance the SMA provided for 
the SWA, ES offices, and outreach staff.
    (5) A summary and analysis of the outreach efforts undertaken by 
all significant and non-significant MSFW one-stop centers, as well as 
the results of those efforts, and an analysis of whether the outreach 
levels and results were adequate.
    (6) A summary of the State's actions taken under the Complaint 
System described in part 658, subpart E, of this chapter, identifying 
any challenges, complaint trends, findings from reviews of the 
Complaint System, trainings offered throughout the year, and steps 
taken to inform MSFWs and employers, and farmworker advocacy groups 
about the Complaint System.
    (7) A summary of how the SMA is working with WIOA sec. 167 NFJP 
grantees, the State-level E.O. Officer, and other organizations serving 
farmworkers, employers, and employer organizations in the State, and an 
assurance that the SMA is meeting at least quarterly with these 
individuals and representatives of these organizations.
    (8) A summary of the statistical and other MSFW-related data and 
reports gathered by SWAs and ES offices for the year, including an 
overview of the SMA's involvement in the SWA's reporting systems.
    (9) A summary of the training conducted for ES staff on techniques 
for accurately reporting data.
    (10) A summary of activities related to the AOP and an explanation 
of whether those activities helped the State reach the objectives 
described in the AOP. At the end of the 4-year AOP cycle, the summary 
must include a synopsis of the SWA's achievements over the previous 4 
years to accomplish the objectives set forth in the AOP, and a 
description of the objectives which were not achieved and the steps the 
SWA will take to address those deficiencies.
    (11) For significant MSFW one-stop centers, a summary of the 
State's efforts to comply with Sec.  653.111.

0
18. Amend Sec.  653.109 by:
0
a. Revising paragraph (b)(9);
0
b. Redesignating paragraph (b)(10) as paragraph (b)(11);
0
c. Adding a new paragraph (b)(10); and
0
d. Revising paragraphs (g), (h) introductory text, and (h)(1).
    The revision and additions read as follows:


Sec.  653.109  Data collection and performance accountability measures.

* * * * *
    (b) * * *
    (9) Agricultural clearance orders (including field checks), MSFW

[[Page 82730]]

complaints and apparent violations, and monitoring activities;
    (10) The number of reportable individuals and participants who are 
MSFWs; and
* * * * *
    (g) Meet equity indicators that address ES controllable services 
and include, at a minimum, individuals referred to a job, receiving job 
development, and referred to supportive or career services.
    (h) Meet minimum levels of service in significant MSFW States. That 
is, only significant MSFW States will be required to meet minimum 
levels of service to MSFWs. Minimum level of service indicators must 
include, at a minimum, individuals placed in a job, individuals placed 
long-term (150 days or more) in a non-agricultural job, a review of 
significant MSFW one-stop centers, field checks conducted, outreach 
contacts per quarter, and processing of complaints. The determination 
of the minimum service levels required of significant MSFW States must 
be based on the following:
    (1) Past SWA performance in serving MSFWs, as reflected in on-site 
reviews and data collected under paragraph (b) of this section.
* * * * *

0
19. Amend Sec.  653.110 by revising paragraph (b) to read as follows:


Sec.  653.110  Disclosure of data.

* * * * *
    (b) If a request for data held by a SWA is made to the ETA national 
or regional office, ETA must forward the request to the SWA for 
response.
* * * * *

0
20. Amend Sec.  653.111 by revising the section heading and paragraphs 
(a) and (b) to read as follows:


Sec.  653.111  State Workforce Agency staffing requirements for 
significant MSFW one-stop centers.

    (a) The SWA must staff significant MSFW one-stop centers in a 
manner facilitating the delivery of ES services tailored to the unique 
needs of MSFWs. This includes recruiting qualified candidates who meet 
the criteria in Sec.  653.107(a)(3).
    (b) The SMA, Regional Monitor Advocate, or the National Monitor 
Advocate, as part of their regular reviews of SWA compliance with these 
regulations, must monitor the extent to which the SWA has complied with 
its obligations under paragraph (a) of this section.
* * * * *

0
21. Amend Sec.  653.501 by:
0
a. Revising the introductory text of paragraph (a) and paragraph 
(a)(1);
0
b. Revising paragraph (c)(3) introductory text; and
0
c. Revising the first sentence in the introductory text of paragraph 
(d)(1) and paragraphs (d)(3), (6), (10), and (11).
    The revisions and additions read as follows:


Sec.  653.501  Requirements for processing clearance orders.

    (a) Assessment of need. No ES staff may place a job order seeking 
workers to perform farmwork into intrastate or interstate clearance 
unless:
    (1) The ES office and employer have attempted and have not been 
able to obtain sufficient workers within the local labor market area; 
or
* * * * *
    (c) * * *
    (3) SWAs must ensure that the employer makes the following 
assurances in the clearance order:
* * * * *
    (d) * * *
    (1) The order-holding ES office must transmit an electronic copy of 
the approved clearance order to its SWA. * * *
* * * * *
    (3) The approval process described in this paragraph (d)(3) does 
not apply to clearance orders that are attached to applications for 
foreign temporary agricultural workers pursuant to part 655, subpart B, 
of this chapter; such clearance orders must be sent to the processing 
center as directed by ETA in guidance. For noncriteria clearance orders 
(orders that are not attached to applications under part 655, subpart 
B, of this chapter), the ETA regional office must review and approve 
the order within 10 business days of its receipt of the order, and the 
Regional Administrator or their designee must approve the areas of 
supply to which the order will be extended. Any denial by the Regional 
Administrator or their designee must be in writing and state the 
reasons for the denial.
* * * * *
    (6) ES staff must assist all farmworkers to understand the terms 
and conditions of employment set forth in intrastate and interstate 
clearance orders and must provide such workers with checklists showing 
wage payment schedules, working conditions, and other material 
specifications of the clearance order.
* * * * *
    (10) Applicant-holding offices must provide workers referred on 
clearance orders with a checklist summarizing wages, working conditions 
and other material specifications in the clearance order. The checklist 
must include language notifying the worker that a copy of the original 
clearance order is available upon request.
    (11) The applicant-holding office must give each referred worker a 
copy of the list of worker's rights described in Departmental guidance.
* * * * *

0
22. Amend Sec.  653.502 by revising paragraph (d) to read as follows:


Sec.  653.502  Conditional access to the Agricultural Recruitment 
System.

* * * * *
    (d) Notice of denial. If the Regional Administrator denies the 
request for conditional access to the intrastate or interstate 
clearance system they must provide written notice to the employer, the 
appropriate SWA, and the ES office, stating the reasons for the denial.
* * * * *

0
23. Amend Sec.  653.503 by revising paragraphs (a) and (b) to read as 
follows:


Sec.  653.503  Field checks.

    (a) If a worker is placed on a clearance order, the SWA must notify 
the employer in writing that the SWA, through its ES offices, and/or 
Federal staff, must conduct unannounced field checks to determine and 
document whether wages, hours, transportation, and working and housing 
conditions are being provided as specified in the clearance order.
    (b) Where the SWA has made placements on 10 or more agricultural 
clearance orders (pursuant to this subpart) during the quarter, the SWA 
must conduct field checks on at least 25 percent of the total of such 
orders. Where the SWA has made placements on nine or fewer job orders 
during the quarter (but at least one job order), the SWA must conduct 
field checks on 100 percent of all such orders. This requirement must 
be met on a quarterly basis.
* * * * *

0
24. Add Sec.  653.504 to read as follows:


Sec.  653.504  Severability.

    Should a court hold any portion of any provision of this part to be 
invalid, the provision will be construed so as to continue to give the 
maximum effect to the provision permitted by law, unless such holding 
is one of total invalidity or unenforceability, in which event the 
provision or subprovision will be severable from this part and will not 
affect the remainder thereof.

[[Page 82731]]

PART 658--ADMINISTRATIVE PROVISIONS GOVERNING THE WAGNER-PEYSER ACT 
EMPLOYMENT SERVICE

0
25. Revise the authority citation for part 658 to read as follows:

    Authority:  Pub. L. 113-128, 128 Stat. 1425 (July 22, 2014); 29 
U.S.C. chapter 4B.


0
26. Amend Sec.  658.400 by revising the second sentence of paragraph 
(a) and paragraph (d) to read as follows:


Sec.  658.400  Purpose and scope of subpart.

    (a) * * * Specifically, the Complaint System processes complaints 
against an employer about the specific job to which the applicant was 
referred through the ES and complaints involving the failure to comply 
with the ES regulations under parts 651, 652, 653, and 654 of this 
chapter and this part. * * *
* * * * *
    (d) A complainant may designate an individual to act as their 
representative.

0
27. Amend Sec.  658.410 by:
0
a. Revising paragraphs (c), (g), (h), (k), and (m);
0
b. Removing paragraph (n); and
0
c. Redesignating (o) as paragraph (n) and revising the newly 
redesignated paragraph (n)..
    The revisions and redesignation read as follows:


Sec.  658.410  Establishment of local and State complaint systems.

* * * * *
    (c) SWAs must ensure centralized control procedures are established 
for the processing of complaints and apparent violations. The ES Office 
Manager and the State Administrator must ensure a central complaint log 
is maintained, listing all complaints taken by the ES office or the SWA 
and apparent violations identified by ES staff, and specifying for each 
complaint or apparent violation:
    (1) The name of the complainant (for complaints);
    (2) The name of the respondent (employer or State agency);
    (3) The date the complaint is filed or the apparent violation was 
identified;
    (4) Whether the complaint is made by or on behalf of a migrant and 
seasonal farmworker (MSFW) or whether the apparent violation affects an 
MSFW;
    (5) Whether the complaint or apparent violation concerns an 
employment-related law or the ES regulations; and
    (6) The actions taken (including any documents the SWA sent or 
received and the date the SWA took such action(s)), and whether the 
complaint or apparent violation has been resolved, including 
informally.
* * * * *
    (g) All complaints filed through the ES office must be processed by 
a trained Complaint System Representative.
    (h) All complaints received by a SWA must be assigned to a trained 
Complaint System Representative designated by the State Administrator. 
Complaints must not be assigned to the State Monitor Advocate (SMA).
* * * * *
    (k) The appropriate ES staff processing a complaint must offer to 
assist the complainant through the provision of appropriate services.
* * * * *
    (m) Follow-up on unresolved complaints. When an MSFW submits a 
complaint, the Complaint System Representative must follow up monthly 
on the processing of the complaint and must inform the complainant of 
the status of the complaint. No follow-up with the complainant is 
required for non-MSFW complaints.
    (n) A complainant may designate an individual to act as their 
representative throughout the filing and processing of a complaint.

0
28. Amend Sec.  658.411 by:
0
a. Revising paragraphs (a)(2)(i) and (ii), (a)(3), the first sentence 
of paragraph (a)(4), and paragraphs (b)(1) introductory text, 
(b)(1)(i), and (b)(1)(ii)(A), (B), (D), and (E);
0
b. Adding paragraph (b)(1)(ii)(F); and
0
c. Revising paragraphs (c), (d)(1) introductory text, (d)(1)(i), 
(d)(1)(ii)(A), (B), (C), and (D), (d)(1)(iii) and (iv), the 
introductory text of (d)(3), (d)(4), the introductory text of 
(d)(5)(i), (d)(5)(ii), (d)(5)(iii)(G), and (d)(6).
    The revisions and addition read as follows:


Sec.  658.411  Action on complaints.

    (a) * * *
    (2) * * *
    (i) Make every effort to obtain all the information they perceive 
to be necessary to investigate the complaint;
    (ii) Request that the complainant indicate all of the physical 
addresses, email addresses, telephone numbers, and any other helpful 
means by which they might be contacted during the investigation of the 
complaint; and
* * * * *
    (3) The staff must ensure the complainant (or their representative) 
submits the complaint on the Complaint/Referral Form or another 
complaint form prescribed or approved by the Department or submits 
complaint information which satisfies paragraph (a)(4) of this section. 
The Complaint/Referral Form must be used for all complaints, including 
complaints about unlawful discrimination, except as provided in 
paragraph (a)(4) of this section. The staff must offer to assist the 
complainant in filling out the form and submitting all necessary 
information and must do so if the complainant desires such assistance. 
If the complainant also represents several other complainants, all such 
complainants must be named. The complainant, or their representative, 
must sign the completed form in writing or electronically. The identity 
of the complainant(s) and any persons who furnish information relating 
to, or assisting in, an investigation of a complaint must be kept 
confidential to the maximum extent possible, consistent with applicable 
law and a fair determination of the complaint. A copy of the completed 
complaint submission must be given to the complainant(s), and the 
complaint form must be given to the appropriate Complaint System 
Representative described in Sec.  658.410(g).
    (4) Any complaint in a reasonable form (letter or email) which is 
signed by the complainant, or their representative, and includes 
sufficient information to initiate an investigation must be treated as 
if it were a properly completed Complaint/Referral Form filed in 
person. * * *
    (b) * * *
    (1) When a complaint is filed regarding an employment-related law 
with an ES office or a SWA, and paragraph (c) of this section does not 
apply, the office must determine if the complainant is an MSFW.
    (i) If the complainant is a non-MSFW, the office must immediately 
refer the complainant to the appropriate enforcement agency, another 
public agency, a legal aid organization, and/or a consumer advocate 
organization, as appropriate, for assistance. Upon completing the 
referral, the local or State representative is not required to follow 
up with the complainant.
    (ii) * * *
    (A) Take from the MSFW or their representative, in writing (hard 
copy or electronic), the complaint(s) describing the alleged 
violation(s) of the employment-related law(s); and
    (B) Attempt to resolve the issue informally at the local level, 
except in cases where the complaint was submitted to the SWA and the 
Complaint System Representative determines that they must take 
immediate action or in cases where informal resolution at the local 
level would be detrimental to the complainant(s). In cases where 
informal

[[Page 82732]]

resolution at the local level would be detrimental to the 
complainant(s), the Complaint System Representative must immediately 
refer the complaint to the appropriate enforcement agency. 
Concurrently, the Complaint System Representative must offer to refer 
the MSFW to other ES services should the MSFW be interested.
* * * * *
    (D) If the ES office or SWA Complaint System Representative 
determines that the complaint must be referred to a State or Federal 
agency, they must refer the complaint immediately to the appropriate 
enforcement agency for prompt action.
    (E) If the complaint was referred under paragraph (b)(1)(ii)(D) of 
this section, the representative must notify the complainant of the 
enforcement agency to which the complaint was referred.
    (F) When a complaint alleges an employer in a different State from 
where the complaint is filed has violated an employment-related law:
    (1) The ES office or SWA receiving the complaint must ensure the 
Complaint/Referral Form is adequately completed and then immediately 
send a copy of the Complaint/Referral Form and copies of any relevant 
documents to the SWA in the other State. Copies of the referral letter 
must be sent to the complainant, and copies of the complaint and 
referral letter must be sent to the ETA Regional Office(s) with 
jurisdiction over the transferring and receiving State agencies. All 
such copies must be sent via hard copy or electronic mail.
    (2) The SWA receiving the complaint must process the complaint as 
if it had been initially filed with that SWA.
    (3) The ETA Regional Office with jurisdiction over the receiving 
SWA must follow up with it to ensure the complaint is processed in 
accordance with these regulations.
* * * * *
    (c) Complaints alleging unlawful discrimination or reprisal for 
protected activity. All complaints received under this subpart by an ES 
office or a SWA alleging unlawful discrimination or reprisal for 
protected activity in violation of nondiscrimination laws, such as 
those enforced by the Equal Employment Opportunity Commission (EEOC) or 
the Department of Labor's Civil Rights Center (CRC), or in violation of 
the Immigration and Nationality Act's anti-discrimination provision 
found at 8 U.S.C. 1324b, must be logged and immediately referred to the 
State-level E.O. Officer. The Complaint System Representative must 
notify the complainant of the referral in writing.
    (d) * * *
    (1) When an ES complaint is filed with an ES office or a SWA, and 
paragraph (c) of this section does not apply, the following procedures 
apply:
    (i) When an ES complaint is filed against an employer, the proper 
office to process the complaint is the ES office serving the area in 
which the employer is located.
    (ii) * * *
    (A) The ES office or SWA receiving the complaint must ensure the 
Complaint/Referral Form is adequately completed, and then immediately 
send a copy of the Complaint/Referral Form and copies of any relevant 
documents to the SWA in the other State. Copies of the referral letter 
must be sent to the complainant, and copies of the complaint and 
referral letter must be sent to the ETA Regional Office(s) with 
jurisdiction over the transferring and receiving State agencies. All 
such copies must be sent via hard copy or electronic mail.
    (B) The SWA receiving the complaint must process the complaint as 
if it had been initially filed with that SWA.
    (C) The ETA Regional Office with jurisdiction over the receiving 
SWA must follow up with it to ensure the complaint is processed in 
accordance with these regulations.
    (D) If the complaint is against more than one SWA, the complaint 
must so clearly state. Additionally, the complaints must be processed 
as separate complaints and must be processed according to procedures in 
this paragraph (d).
    (iii) When an ES complaint is filed against an ES office, the 
proper office to process the complaint is the ES office serving the 
area in which the alleged violation occurred.
    (iv) When an ES complaint is filed against more than one ES offices 
and is in regard to an alleged agency-wide violation, the SWA 
representative or their designee must process the complaint.
* * * * *
    (3) When a non-MSFW or their representative files a complaint 
regarding the ES regulations with a SWA, or when a non-MSFW complaint 
is referred from an ES office the following procedures apply:
* * * * *
    (4)(i) When a MSFW or their representative files a complaint 
regarding the ES regulations directly with a SWA, or when a MSFW 
complaint is referred from an ES office, the Complaint System 
Representative must investigate and attempt to resolve the complaint 
immediately upon receipt and may, if necessary, conduct a further 
investigation.
    (ii) If resolution at the SWA level has not been accomplished 
within 20 business days after the complaint was received by the SWA (or 
after all necessary information has been submitted to the SWA pursuant 
to paragraph (a)(4) of this section), the Complaint System 
Representative must make a written determination regarding the 
complaint and must send electronic copies to the complainant and the 
respondent. The determination must follow the procedures set forth in 
paragraph (d)(5) of this section.
    (5)(i) All written determinations by the SWA on complaints under 
the ES regulations must be sent by certified mail (or another legally 
viable method) and a copy of the determination may be sent via 
electronic mail. The determination must include all the following:
    (ii) If the SWA determines that the employer has not violated the 
ES regulations, the SWA must offer to the complainant the opportunity 
to request, in writing, a hearing within 20 business days after the 
certified date of receipt of the notification.
    (iii) * * *
    (G) With the consent of the SWA and of the State hearing official, 
the party who requested the hearing may withdraw the request for the 
hearing in writing before the hearing.
* * * * *
    (6) A complaint regarding the ES regulations must be processed to 
resolution by these regulations only if it is made within 2 years of 
the alleged occurrence.
* * * * *

0
29. Amend Sec.  658.417 by revising paragraph (b) to read as follows:


Sec.  658.417  State hearings.

* * * * *
    (b) The State hearing official may decide to conduct hearings on 
more than one complaint concurrently if they determine that the issues 
are related or that the complaints will be processed more expeditiously 
if conducted together.
* * * * *

0
30. Amend Sec.  658.419 by:
0
a. Revising paragraph (a); and
0
b. Adding paragraph (d).
    The revisions and addition read as follows:


Sec.  658.419  Apparent violations.

    (a) If an ES staff member observes, has reason to believe, or is in 
receipt of

[[Page 82733]]

information regarding an apparent violation, except as part of a field 
check under Sec.  653.503 of this chapter, the staff member must 
document the apparent violation and refer it to the ES Office Manager, 
who must ensure the apparent violation is documented in the Complaint 
System log, as described at Sec.  658.410.
* * * * *
    (d) Apparent violations of nondiscrimination laws must be processed 
according to the procedures described in Sec.  658.411(c).

0
31. Amend Sec.  658.420 by revising paragraphs (b) and (c) to read as 
follows:


Sec.  658.420  Responsibilities of the Employment and Training 
Administration regional office.

* * * * *
    (b) The Regional Administrator must designate Department of Labor 
officials to process ES regulation-related complaints as follows:
    (1) All complaints received at the ETA regional office under this 
subpart that allege unlawful discrimination or reprisal for protected 
activity in violation of nondiscrimination laws, such as those enforced 
by the EEOC or CRC, or in violation of the Immigration and Nationality 
Act's anti-discrimination provision found at 8 U.S.C. 1324b, must be 
logged and immediately referred to the appropriate State-level E.O. 
Officer(s).
    (2) All complaints other than those described in paragraph (b)(1) 
of this section must be assigned to a regional office official 
designated by the Regional Administrator, provided that the regional 
office official designated to process MSFW complaints must be the 
Regional Monitor Advocate (RMA).
    (c) Except for those complaints under paragraph (b)(1) of this 
section, the Regional Administrator must designate Department of Labor 
officials to process employment-related law complaints in accordance 
with Sec.  658.422, provided that the regional official designated to 
process MSFW employment-related law complaints must be the RMA. The RMA 
must follow up monthly on all complaints filed by MSFWs including 
complaints under paragraph (b)(1) of this section.
* * * * *

0
32. Amend Sec.  658.421 by revising the section heading, the first 
sentence of paragraph (a)(1), introductory text of (a)(2), the first 
sentences of paragraphs (a)(2)(i) and (b), and paragraphs (c) and (d) 
to read as follows:


Sec.  658.421  Processing of Wagner-Peyser Act Employment Service 
regulation-related complaints.

    (a) Except as provided below in paragraph (a)(2) of this section, 
no complaint alleging a violation of the ES regulations may be 
processed at the ETA regional office level until the complainant has 
exhausted the SWA administrative remedies set forth at Sec. Sec.  
658.411 through 658.418. * * *
    (2) If a complaint is submitted directly to the Regional 
Administrator and if they determine that the nature and scope of a 
complaint described in paragraph (a) of this section is such that the 
time required to exhaust the administrative procedures at the SWA level 
would adversely affect a significant number of individuals, the RA must 
accept the complaint and take the following action:
    (i) If the complaint is filed against an employer, the regional 
office must process the complaint in a manner consistent with the 
requirements imposed upon State agencies by Sec. Sec.  658.411 and 
658.418. * * *
* * * * *
    (b) The ETA regional office is responsible for processing appeals 
of determinations made on complaints at the SWA level. * * *
    (c)(1) Once the Regional Administrator receives a timely appeal, 
they must request the complete SWA file, including the original 
Complaint/Referral Form from the appropriate SWA.
    (2) The Regional Administrator must review the file in the case and 
must determine within 10 business days whether any further 
investigation or action is appropriate; however, if the Regional 
Administrator determines that they need to request legal advice from 
the Office of the Solicitor at the U.S. Department of Labor, then the 
Regional Administrator is allowed 20 business days to make this 
determination.
    (d) If the Regional Administrator determines that no further action 
is warranted, the Regional Administrator will send their determination 
in writing to the appellant within 5 days of the determination, with a 
notification that the appellant may request a hearing before a 
Department of Labor Administrative Law Judge (ALJ) by filing a hearing 
request in writing with the Regional Administrator within 20 working 
days of the appellant's receipt of the notification.
* * * * *

0
33. Amend Sec.  658.422 by revising the section heading and paragraphs 
(a) through (c) to read as follows:


Sec.  658.422  Processing of employment-related law complaints by the 
Regional Administrator.

    (a) This section applies to all complaints submitted directly to 
the Regional Administrator or their representative.
    (b) Each complaint filed by an MSFW alleging violation(s) of 
employment-related laws must be taken in writing, logged, and referred 
to the appropriate enforcement agency for prompt action. If such a 
complaint alleges a violation of nondiscrimination laws or reprisal for 
protected activity, it must be referred to the appropriate State-level 
E.O. Officer in accordance with Sec.  658.420(b)(1).
    (c) Each complaint submitted by a non-MSFW alleging violation(s) of 
employment-related laws must be logged and referred to the appropriate 
enforcement agency for prompt action. If such a complaint alleges a 
violation of nondiscrimination laws or reprisal for protected activity, 
it must be referred to the appropriate State-level E.O. Officer in 
accordance with Sec.  658.420(b)(1).
* * * * *

0
34. Amend Sec.  658.424 by revising paragraph (d) to read as follows:


Sec.  658.424  Proceedings before the Office of Administrative Law 
Judges.

* * * * *
    (d) The ALJ may decide to consolidate cases and conduct hearings on 
more than one complaint concurrently if they determine that the issues 
are related or that the complaints will be processed more 
expeditiously.
* * * * *

0
35. Amend Sec.  658.425 by revising paragraph (a)(1) to read as 
follows:


Sec.  658.425  Decision of Department of Labor Administrative Law 
Judge.

    (a) * * *
    (1) Rule that they lack jurisdiction over the case:
* * * * *

0
36. Add Sec.  658.427 to read as follows:


Sec.  658.427  Severability.

    Should a court hold any portion of any provision of this part to be 
invalid, the provision will be construed so as to continue to give the 
maximum effect to the provision permitted by law, unless such holding 
is one of total invalidity or unenforceability, in which event the 
provision or subprovision will be severable from this part and will not 
affect the remainder thereof.

0
37. Amend Sec.  658.602 by revising paragraphs (f)(2) through (4), (g), 
(j) introductory text, (j)(8), (l) through (n), (o) introductory text 
paragraph, (p) through (r), (s) introductory text

[[Page 82734]]

paragraph, and (s)(2) and (3) to read as follows:


Sec.  658.602  Employment and Training Administration National Office 
responsibility.

* * * * *
    (f) * * *
    (2) Review the performance of SWAs in providing the full range of 
ES services to MSFWs;
    (3) Take steps to resolve or refer ES-related problems of MSFWs 
which come to their attention;
    (4) Take steps to refer non-ES-related problems of MSFWs which come 
to their attention;
* * * * *
    (g) The NMA must be appointed by the Office of Workforce Investment 
Administrator (Administrator) after informing farmworker organizations 
and other organizations with expertise concerning MSFWs of the opening 
and encouraging them to refer qualified applicants to apply through the 
Federal merit system. Among qualified candidates, determined through 
merit systems procedures, individuals must be sought who meet the 
criteria used in the selection of the SMAs, as provided in SWA self-
monitoring requirements at Sec.  653.108(a) of this chapter.
* * * * *
    (j) The NMA must monitor and assess SWA compliance with ES 
regulations affecting MSFWs on a continuing basis. Their assessment 
must consider:
* * * * *
    (8) Their personal observations from visits to SWAs, ES offices, 
agricultural work sites, and migrant camps. In the Annual Report, the 
NMA must include both a quantitative and qualitative analysis of their 
findings and the implementation of their recommendations by State and 
Federal officials, and must address the information obtained from all 
of the foregoing sources.
* * * * *
    (l) If the NMA finds the effectiveness of any RMA has been 
substantially impeded by the Regional Administrator or other regional 
office official, they must, if unable to resolve such problems 
informally, report and recommend appropriate actions directly to the 
OWI Administrator. If the NMA receives information that the 
effectiveness of any SMA has been substantially impeded by the State 
Administrator, a State or Federal ES official, or other ES staff, they 
must, in the absence of a satisfactory informal resolution at the 
regional level, report and recommend appropriate actions directly to 
the OWI Administrator.
    (m) The NMA must be informed of all proposed changes in policy and 
practice within the ES, including ES regulations, which may affect the 
delivery of services to MSFWs. The NMA must advise the OWI 
Administrator concerning all such proposed changes which may adversely 
affect MSFWs. The NMA must propose directly to the OWI Administrator 
changes in ES policy and administration which may substantially improve 
the delivery of services to MSFWs. They also must recommend changes in 
the funding of SWAs and/or adjustment or reallocation of the 
discretionary portions of funding formulae.
    (n) The NMA must participate in the review and assessment 
activities required in this section and Sec. Sec.  658.700 through 
658.711. As part of such participation, the NMA, or if they are unable 
to participate, an RMA must accompany the National Office review team 
on National Office on-site reviews. The NMA must engage in the 
following activities during each State on-site review:
    (1) They must accompany selected outreach staff on their field 
visits.
    (2) They must participate in field check(s) of migrant camps or 
work site(s) where MSFWs have been placed on inter or intrastate 
clearance orders.
    (3) They must contact local WIOA sec. 167 National Farmworker Jobs 
Program grantees or other farmworker organizations as part of the on-
site review and discuss with representatives of these organizations 
current trends and any other pertinent information concerning MSFWs.
    (4) They must meet with the SMA and discuss the full range of the 
ES services to MSFWs, including monitoring and the Complaint System.
    (o) In addition to the duties specified in paragraph (f) of this 
section, the NMA each year during the harvest season must visit the 
four States with the highest level of MSFW activity during the prior 
fiscal year, if they are not scheduled for a National Office on-site 
review during the current fiscal year, and must:
* * * * *
    (p) The NMA must perform duties specified in Sec. Sec.  658.700 
through 765.711. As part of this function, they must monitor the 
performance of regional offices in imposing corrective action. The NMA 
must report any deficiencies in performance to the Administrator.
    (q) The NMA must establish routine and regular contacts with WIOA 
sec. 167 National Farmworker Jobs Program grantees, other farmworker 
organizations and agricultural employers and/or employer organizations. 
The NMA must attend conferences or meetings of these groups wherever 
possible and must report to the Administrator and the National Farm 
Labor Coordinated Enforcement Committee on these contacts when 
appropriate. The NMA must include in the Annual Report recommendations 
about how the Department might better coordinate ES and WIOA sec. 167 
National Farmworker Jobs Program services as they pertain to MSFWs.
    (r) In the event that any SMA or RMA, enforcement agency, or MSFW 
group refers a matter to the NMA which requires emergency action, the 
NMA must assist them in obtaining action by appropriate agencies and 
staff, inform the originating party of the action taken, and, upon 
request, provide written confirmation.
    (s) Through all the mechanisms provided in this subpart, the NMA 
must aggressively seek to ascertain and remedy, if possible, systemic 
deficiencies in the provisions of ES services and protections afforded 
by these regulations to MSFWs. The NMA must:
* * * * *
    (2) Provide technical assistance to ETA regional office and ES 
staff for administering the Complaint System, and any other ES services 
as appropriate.
    (3) Recommend to the Regional Administrator specific instructions 
for action by regional office staff to correct any ES-related systemic 
deficiencies. Prior to any ETA review of regional office operations 
concerning ES services to MSFWs, the NMA must provide to the Regional 
Administrator a brief summary of ES-related services to MSFWs in that 
region and their recommendations for incorporation in the regional 
review materials as the Regional Administrator and ETA reviewing 
organization deem appropriate.
* * * * *

0
38. Amend Sec.  658.603 by revising paragraphs (d)(7), (f)(1) through 
(3), (g), (i), introductory text of paragraph (k), (k)(7) and (8), (m), 
(n)(2) and (3), (o)(1), (p), (q), and (s) through (v) to read as 
follows:


Sec.  658.603  Employment and Training Administration regional office 
responsibility.

* * * * *
    (d) * * *
    (7) Unannounced field checks of a sample of agricultural work sites 
to which ES placements have been made through the clearance system to

[[Page 82735]]

determine and document whether wages, hours, and working and housing 
conditions are as specified on the clearance order. If regional office 
staff find reason to believe that conditions vary from clearance order 
specifications, findings must be documented on the Complaint/Apparent 
Violation Referral Form and provided to the State Workforce Agency to 
be processed as an apparent violation under Sec.  658.419.
* * * * *
    (f) * * *
    (1) Review the effective functioning of the SMAs in their region;
    (2) Review the performance of SWAs in providing the full range of 
ES services to MSFWs;
    (3) Take steps to resolve ES-related problems of MSFWs which come 
to their attention;
* * * * *
    (g) The RMA must be appointed by the Regional Administrator after 
informing farmworker organizations and other organizations in the 
region with expertise concerning MSFWs of the opening and encouraging 
them to refer qualified applicants to apply through the Federal merit 
system. The RMA must have direct personal access to the Regional 
Administrator wherever they find it necessary. Among qualified 
candidates, individuals must be sought who meet the criteria used in 
the selection of the SMAs, as provided in Sec.  653.108(b) of this 
chapter.
* * * * *
    (i) The RMA must participate in training sessions including those 
offered by the National Office and those necessary to maintain 
competency and enhance their understanding of issues farmworkers face 
(including trainings offered by OSHA, WHD, EEOC, CRC, and other 
organizations offering farmworker-related information).
* * * * *
    (k) At the ETA regional level, the RMA must have primary 
responsibility for ensuring SWA compliance with ES regulations as it 
pertains to services to MSFWs is monitored by the regional office. They 
must independently assess on a continuing basis the provision of ES 
services to MSFWs, seeking out and using:
* * * * *
    (7) Any other pertinent information which comes to their attention 
from any possible source.
    (8) In addition, the RMA must consider their personal observations 
from visits to ES offices, agricultural work sites, and migrant camps.
* * * * *
    (m) The Regional Administrator's quarterly report to the National 
Office must include the RMA's summary of their independent assessment 
as required in paragraph (f)(5) of this section. The fourth quarter 
summary must include an Annual Summary from the region. The summary 
also must include both a quantitative and a qualitative analysis of 
their reviews and must address all the matters with respect to which 
they have responsibilities under these regulations.
    (n) * * *
    (2) Is being impeded in fulfilling their duties; or
    (3) Is making recommendations that are being consistently ignored 
by SWA officials. If the RMA believes that the effectiveness of any SMA 
has been substantially impeded by the State Administrator, other State 
agency officials, any Federal officials, or other ES staff, the RMA 
must report and recommend appropriate actions to the Regional 
Administrator. Copies of the recommendations must be provided to the 
NMA electronically or in hard copy.
    (o)(1) The RMA must be informed of all proposed changes in policy 
and practice within the ES, including ES regulations, which may affect 
the delivery of services to MSFWs. They must advise the Regional 
Administrator on all such proposed changes which, in their opinion, may 
adversely affect MSFWs or which may substantially improve the delivery 
of services to MSFWs.
* * * * *
    (p) The RMA must participate in the review and assessment 
activities required in this section and Sec. Sec.  658.700 through 
658.711. The RMA, an assistant, or another RMA must participate in 
National Office and regional office on-site statewide reviews of ES 
services to MSFWs in States in the region. The RMA must engage in the 
following activities in the course of participating in an on-site SWA 
review:
    (1) Accompany selected outreach staff on their field visits;
    (2) Participate in a field check of migrant camps or work sites 
where MSFWs have been placed on intrastate or interstate clearance 
orders;
    (3) Contact local WIOA sec. 167 National Farmworker Jobs Program 
grantees or other farmworker organizations as part of the on-site 
review, and must discuss with representatives of these organizations 
perceived trends, and/or other relevant information concerning MSFWs in 
the area; and
    (4) Meet with the SMA and discuss the full range of the ES services 
to MSFWs, including monitoring and the Complaint System.
    (q) During the calendar quarter preceding the time of peak MSFW 
activity in each State, the RMA must meet with the SMA and must review 
in detail the State Workforce Agency's capability for providing the 
full range of services to MSFWs as required by ES regulations, during 
the upcoming harvest season. The RMA must offer technical assistance 
and recommend to the SWA and/or the Regional Administrator any changes 
in State policy or practice that the RMA finds necessary.
* * * * *
    (s) The RMA must initiate and maintain regular and personal 
contacts, including informal contacts in addition to those specifically 
required by these regulations, with SMAs in the region. In addition, 
the RMA must have personal and regular contact with the NMA. The RMA 
also must establish routine and regular contacts with WIOA sec. 167 
National Farmworker Jobs Program grantees, other farmworker 
organizations and agricultural employers and/or employer organizations 
in the RMA's region. The RMA must attend conferences or meetings of 
these groups wherever possible and must report to the Regional 
Administrator and the Regional Farm Labor Coordinated Enforcement 
Committee on these contacts when appropriate. The RMA also must make 
recommendations as to how the Department might better coordinate ES and 
WIOA sec. 167 National Farmworker Jobs Program services to MSFWs.
    (t) The RMA must attend MSFW-related public meeting(s) conducted in 
the region, as appropriate. Following such meetings or hearings, the 
RMA must take such steps or make such recommendations to the Regional 
Administrator, as the RMA deems necessary to remedy problem(s) or 
condition(s) identified or described therein.
    (u) The RMA must attempt to achieve regional solutions to any 
problems, deficiencies, or improper practices concerning services to 
MSFWs which are regional in scope. Further, the RMA must recommend 
policies, offer technical assistance, or take any other necessary steps 
as they deem desirable or appropriate on a regional, rather than State-
by-State, basis to promote region-wide improvement in the delivery of 
ES services to MSFWs. The RMA must facilitate region-wide coordination 
and communication regarding provision of ES services to MSFWs among 
SMAs, State Administrators, and Federal ETA officials to the greatest 
extent possible.

[[Page 82736]]

In the event that any SWA or other RMA, enforcement agency, or MSFW 
group refers a matter to the RMA which requires emergency action, the 
RMA must assist them in obtaining action by appropriate agencies and 
staff, inform the originating party of the action taken, and, upon 
request, provide written confirmation.
    (v) The RMA must initiate and maintain such contacts as they deem 
necessary with RMAs in other regions to seek to resolve problems 
concerning MSFWs who work, live, or travel through the region. The RMA 
must recommend to the Regional Administrator and/or the National Office 
inter-regional cooperation on any particular matter, problem, or policy 
with respect to which inter-regional action is desirable.
* * * * *

0
39. Amend Sec.  658.604 by revising paragraph (c)(3)(i) to read as 
follows:


Sec.  658.604  Assessment and evaluation of program performance data.

* * * * *
    (c) * * *
    (3) * * *
    (i) Generally, for example, a SWA has direct and substantial 
control over the delivery of ES services such as referrals to jobs, job 
development contacts, counseling, referrals to career and supportive 
services, and the conduct of field checks.
* * * * *

0
40. Amend Sec.  658.702 by revising paragraphs (a), (d), (e), (f)(2), 
and (h)(5) to read as follows:


Sec.  658.702  Initial action by the Regional Administrator.

    (a) The ETA Regional Administrator is responsible for ensuring that 
all SWAs in their region are in compliance with ES regulations.
* * * * *
    (d) If the Regional Administrator determines that there is no 
probable cause to believe that a SWA has violated ES regulations, they 
must retain all reports and supporting information in Department files. 
In all cases where the Regional Administrator has insufficient 
information to make a probable cause determination, they must so notify 
the Administrator in writing and the time for the investigation must be 
extended 20 additional business days.
    (e) If the Regional Administrator determines there is probable 
cause to believe a SWA has violated ES regulations, they must issue a 
Notice of Initial Findings of Non-compliance by registered mail (or 
other legally viable means) to the offending SWA. The notice will 
specify the nature of the violation, cite the regulations involved, and 
indicate corrective action which may be imposed in accordance with 
paragraphs (g) and (h) of this section. If the non-compliance involves 
services to MSFWs or the Complaint System, a copy of said notice must 
be sent to the NMA.
    (f) * * *
    (2) After the period elapses, the Regional Administrator must 
prepare within 20 business days, written final findings which specify 
whether the SWA has violated ES regulations. If in the final findings 
the Regional Administrator determines the SWA has not violated ES 
regulations, the Regional Administrator must notify the State 
Administrator of this finding and retain supporting documents in their 
files. If the final finding involves services to MSFWs or the Complaint 
System, the Regional Administrator also must notify the RMA and the 
NMA. If the Regional Administrator determines a SWA has violated ES 
regulations, the Regional Administrator must prepare a Final Notice of 
Noncompliance which must specify the violation(s) and cite the 
regulations involved. The Final Notice of Noncompliance must be sent to 
the SWA by registered mail or other legally viable means. If the 
noncompliance involves services to MSFWs or the Complaint System, a 
copy of the Final Notice must be sent to the RMA and the NMA.
* * * * *
    (h) * * *
    (5) If, as a result of this review, the Regional Administrator 
determines the SWA has taken corrective action but is unable to 
determine if the violation has been corrected due to seasonality or 
other factors, the Regional Administrator must notify in writing the 
SWA and the Administrator of their findings. The Regional Administrator 
must conduct further follow-up at an appropriate time to make a final 
determination if the violation has been corrected. If the Regional 
Administrator's follow-up reveals that violations have not been 
corrected, the Regional Administrator must apply remedial actions to 
the SWA pursuant to Sec.  658.704.
* * * * *

0
41. Amend Sec.  658.704 by revising the fifth sentence of paragraph (d) 
and the fourth sentence of (f)(2) to read as follows:


Sec.  658.704  Remedial actions.

* * * * *
    (d) * * * The Regional Administrator must notify the SWA of their 
findings. * * *
* * * * *
    (f) * * *
    (2) * * * Two must be sent to the ETA National Office, one must be 
sent to the Solicitor of Labor, Attention: Associate Solicitor for 
Employment and Training, and, if the case involves violations of 
regulations governing services to MSFWs or the Complaint System, copies 
must be sent to the RMA and the NMA. * * *

0
42. Amend Sec.  658.705 by revising the introductory text of paragraphs 
(b) and (b)(3) and paragraphs (c) through (f) to read as follows:


Sec.  658.705  Decision to decertify.

* * * * *
    (b) The Assistant Secretary must grant the request for 
decertification unless they make a finding that:
* * * * *
    (3) The Assistant Secretary has reason to believe the SWA will 
achieve compliance within 80 business days unless exceptional 
circumstances necessitate more time, pursuant to the remedial action 
already applied or to be applied. (In the event the Assistant Secretary 
does not have sufficient information to act upon the request, they may 
postpone the determination for up to an additional 20 business days to 
obtain any available additional information.) In making a determination 
whether violations are ``serious'' or ``continual,'' as required by 
paragraph (b)(1) of this section, the Assistant Secretary must 
consider:
* * * * *
    (c) If the Assistant Secretary denies a request for 
decertification, they must write a complete report documenting their 
findings and, if appropriate, instructing an alternate remedial action 
or actions be applied. Electronic copies of the report must be sent to 
the Regional Administrator. Notice of the Assistant Secretary's 
decision must be published promptly in the Federal Register and the 
report of the Assistant Secretary must be made available for public 
inspection and copying.
    (d) If the Assistant Secretary decides decertification is 
appropriate, they must submit the case to the Secretary providing 
written explanation for their recommendation of decertification.
    (e) Within 30 business days after receiving the Assistant 
Secretary's report, the Secretary must determine whether to decertify 
the SWA. The Secretary must grant the request for decertification 
unless they make one of the three findings set forth in paragraph

[[Page 82737]]

(b) of this section. If the Secretary decides not to decertify, they 
must then instruct that remedial action be continued or that alternate 
actions be applied. The Secretary must write a report explaining their 
reasons for not decertifying the SWA and copies (hard copy and 
electronic) will be sent to the SWA. Notice of the Secretary's decision 
must be published promptly in the Federal Register, and the report of 
the Secretary must be made available for public inspection and copy.
    (f) Where either the Assistant Secretary or the Secretary denies a 
request for decertification and orders further remedial action, the 
Regional Administrator must continue to monitor the SWA's compliance. 
If the SWA achieves compliance within the time established pursuant to 
paragraph (b) of this section, the Regional Administrator must 
terminate the remedial actions. If the SWA fails to achieve full 
compliance within that time period after the Secretary's decision not 
to decertify, the Regional Administrator must submit a report of their 
findings to the Assistant Secretary who must reconsider the request for 
decertification pursuant to the requirements of paragraph (b) of this 
section.

0
43. Amend Sec.  658.706 to read as follows:


Sec.  658.706  Notice of decertification.

    If the Secretary decides to decertify a SWA, they must send a 
Notice of Decertification to the SWA stating the reasons for this 
action and providing a 10-business-day period during which the SWA may 
request an administrative hearing in writing to the Secretary. The 
document must be published promptly in the Federal Register.

0
44. Amend Sec.  658.707 by revising paragraphs (a) and (b) to read as 
follows:


Sec.  658.707  Requests for hearings.

    (a) Any SWA which received a Notice of Decertification under Sec.  
658.706 or a notice of disallowance under Sec.  658.702(g) may request 
a hearing on the issue by filing a written request for hearing with the 
Secretary within 10 business days of receipt of the notice. 
Additionally, any SWA that has received a Notice of Remedial Action 
under Sec.  658.704(c) may request a hearing by filing a written 
request with the Regional Administrator within 20 business days of the 
SWA's receipt of the notice. This request must state the reasons the 
SWA believes the basis of the decision to be wrong, and it must be 
signed by the State Administrator (electronic signatures may be 
accepted).
    (b) When the Secretary or Regional Administrator receives a request 
for a hearing from a SWA, they must send copies of a file containing 
all materials and correspondence relevant to the case to the Assistant 
Secretary, the Regional Administrator, the Solicitor of Labor, and the 
Department of Labor Chief Administrative Law Judge. When the case 
involves violations of regulations governing services to MSFWs or the 
Complaint System, a copy must be sent to the NMA.
* * * * *

Laura P. Watson,
Deputy Assistant Secretary for Employment and Training, Labor.
[FR Doc. 2023-25372 Filed 11-22-23; 8:45 am]
BILLING CODE 4510-FN-P