[Federal Register Volume 75, Number 182 (Tuesday, September 21, 2010)]
[Notices]
[Pages 57517-57519]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-23497]


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DEPARTMENT OF LABOR

Employment and Training Administration

[TA-W-70,344]


Atlantic Southeast Airlines, a Subsidiary of Skywest, Inc., 
Airport Customer Service Division, Including On-Site Leased Workers of 
Delta Global Services, Inc., Fort Smith, AR; Notice of Negative 
Determination on Remand

    On July 6, 2010, the United States Court of International Trade 
(USCIT) granted the Department of Labor's request for voluntary remand 
to conduct further investigation in Former Employees of Atlantic 
Southeast Airlines, a Subsidiary of Skywest, Inc., Airport Customer 
Service Division v. United States Secretary of Labor (Court No. 09-
00522).

Background

    On September 28, 2009, the Department of Labor (Department) issued 
a Negative Determination regarding eligibility to apply for Trade 
Adjustment Assistance (TAA) under the Trade Act of 1974, as amended 
(hereafter referred to as the Act) applicable to workers and former 
workers of Atlantic Southeast Airlines, a Subsidiary of Skywest, Inc., 
Airport Customer Division, Fort Smith, Arkansas (subject firm). AR 35. 
Workers at the subject firm (subject worker group) provided airline 
ground services, such as baggage handling, at the Forth Smith, Arkansas 
airport. AR 8, 14, 17, 25-26, 34. The Department's Notice of negative 
determination was published in the Federal Register on November 17, 
2009 (74 FR 59251). AR 48.
    The negative determination stated that the subject firm did not 
import services like or directly competitive with the services supplied 
by the subject workers in the period under investigation nor shift the 
supply of these services to a foreign country during this period. A 
customer survey was not conducted because the subject firm's customers 
were private individuals who traveled through Fort Smith, Arkansas 
airport. AR 35-38.
    By application dated October 19, 2009, a petitioner requested 
administrative reconsideration on the Department's negative 
determination. In the request for reconsideration, the petitioner 
alleged that workers at the subject firm provided services to 
individuals employed at firms that employed workers eligible to apply 
for TAA and that workers at the subject firm should also be eligible to 
apply for TAA as ``downstream producers'' to these firms. AR 42-43.
    Because the petitioner did not provide information that had not 
been previously considered, the Department

[[Page 57518]]

issued a Notice of Negative Determination Regarding Application for 
Reconsideration applicable to workers at the subject firm on November 
5, 2009. AR 44. The Notice of determination was published in the 
Federal Register on December 8, 2009 (74 FR 64736). AR 54.
    In the complaint to the USCIT, dated December 2, 2009, the 
Plaintiff reiterated the reconsideration application allegations, 
claiming that workers at the subject firm are eligible to apply for TAA 
as secondarily affected workers because they provided transportation 
services to individuals employed at manufacturing firms in the Fort 
Smith area that employed worker groups eligible to apply for TAA and 
which used the airport at which the subject firm employed the worker 
group. The complaint stated that ``our station was closed as a direct 
result of down sizing and closing of major companies in our area; all 
of which are receiving TAA benefits.'' The Plaintiff did not provide 
additional information in support of the complaint, but attached a copy 
of the request for reconsideration.
    On June 30, 2010, the Department requested voluntary remand to 
address the allegations made by the Plaintiff, to determine whether the 
subject worker group is eligible to apply for TAA, and to issue an 
appropriate determination. On July 6, 2010, the USCIT granted the 
Department's Motion for voluntary remand.

Statutory Requirements

    The Act authorizes the Department to certify worker groups as 
eligible to apply for TAA generally when the increased imports or 
shifts in production of articles or supply of services of the workers' 
firm contributed importantly to a significant number or proportion of 
worker separations or threats of separation and there have been 
absolute decreases in the sales or production of the workers' firm.
    In narrowly defined circumstances, Section 222(c) of the Act, 19 
U.S.C. 2272(c), permits the certification of worker groups based on the 
direct relationship between the workers' firm and another firm that 
employed a worker group eligible to apply for TAA (a primary firm). For 
the Department to issue such a ``secondary worker'' certification to 
workers of a Supplier or a Downstream Producer, the following criteria 
must be met:
    (1) A significant number or proportion of the workers in the 
workers' firm or an appropriate subdivision of the firm have become 
totally or partially separated, or are threatened to become totally or 
partially separated;
    (2) The workers' firm is a Supplier or Downstream Producer to a 
firm that employed a group of workers who received a certification of 
eligibility under Section 222(a) of the Act, 19 U.S.C. 2272(a), and 
such supply or production is related to the article or service that was 
the basis for such certification; and
    (3) Either
    (A) the workers' firm is a supplier and the component parts it 
supplied to the firm described in paragraph (2) accounted for at least 
20 percent of the production or sales of the workers' firm; or
    (B) a loss of business by the workers' firm with the firm described 
in paragraph (2) contributed importantly to the workers' separation or 
threat of separation.
    Section 222(d)(3)(A) of the Act, 19 U.S.C. 2272(d)(3)(A), states 
that a ``downstream producer means a firm that performs additional, 
value-added production processes or services directly for another firm 
for articles or services with respect to which a group of workers in 
such other firm has been certified under subsection (a).''
    Section 222(d)(3)(B) of the Act, 19 U.S.C. 2272(d)(3)(B), states 
that ``value-added production processes or services include final 
assembly, finishing, testing, packaging, or maintenance or 
transportation services.''

Investigations of Petition, Application for Reconsideration, and USCIT 
Complaint

    The petitioners identified the subject worker group as twelve 
``airline customer service and ramp agents'' in the employ of Atlantic 
Southeast Airlines (ASA) working at Fort Smith, Arkansas. AR 4. The 
petition states that ``ASA is closing stations @ Ft. Smith and all 
surrounding airports.'' AR 5.
    Information provided by the subject firm during the initial 
investigation revealed that, at the Fort Smith, Arkansas location, the 
subject worker group consisted of airport station manager(s), airport 
station supervisor(s), and airport ramp/baggage agent(s). AR 25-26. The 
initial investigation also revealed that the subject firm had a 
contract with Delta Air Lines to supply airport ramp and baggage agents 
and airport station supervisors and managers. AR 14, 17, 24-25, 27-28, 
33-34. The subject firm also employed temporary workers supplied by 
Delta Global Services, Inc. to perform security personnel and 
administrative support personnel services at the Fort Smith, Arkansas 
airport. AR 25, 33.
    The initial investigation also revealed that the worker separations 
were due to the subject firm's failure to win a bid to continue to 
supply services at the Fort Smith, Arkansas airport. Specifically, when 
Delta Air Lines and Northwest Air Lines merged, their operations were 
consolidated and regional airlines with contracts to supply services at 
airports where they operated were invited to submit new bids to 
maintain operations at those airports. The subject firm did not win the 
bid to supply services at the Fort Smith, Arkansas airport because the 
merged entity decided to use the company that supplied the same 
services to Northwest Air Line rather than complete the bidding 
process. AR 17, 25, 33-34.
    In the request for reconsideration, the petitioner alleged that 
because the subject firm is ``completely reliant on the manufacturing 
industry in our town'' and because the businesses ``discontinued their 
flights with us due to their downsizing,'' the workers of the subject 
firm should be eligible to apply for TAA as ``downstream producers'' to 
those companies in the area who employed workers eligible to apply for 
TAA because they used the Fort Smith, Arkansas airport. AR 42-43.
    In the negative determination regarding the application for 
reconsideration, the Department stated that because the subject firm 
did not perform additional, value-added production processes or 
services directly to these primary firms, the subject firm is not a 
downstream producer. Therefore, the application for reconsideration was 
denied. AR 44-47.
    During the remand investigation, the Department carefully reviewed 
previously-submitted information and obtained additional information 
from the subject firm regarding its operations. The subsequent 
investigation covered the reasons for the subject firm's closure of its 
Fort Smith, Arkansas operations, the type of work engaged in by the 
subject worker group and where the work that it performed is currently 
taking place, the nature of the customer base at that location, and the 
customer(s) of the subject firm.
    The remand investigation confirmed that the subject firm did not 
solicit business for Delta Air Lines, SAR 24, 27, or maintain or have 
access to Delta Air Lines' customer list. SAR 3, 19, 27. The subject 
firm provided ground handling and ticketing services to Delta Air Lines 
customers, who included individual passengers, corporate accounts and 
travel agencies. SAR 3, 19, 21, 27. Under contract to Delta Air Lines, 
on some flights, the subject firm also provided aircraft and personnel. 
SAR 19, 27. The

[[Page 57519]]

subject firm, and not Delta Air Lines, paid the subject worker group. 
SAR 19, 27.

Issues on Remand

    The Plaintiff alleged in the complaint to the USCIT that the 
decline in travel in the Forth Smith, Arkansas area is attributable to 
a reduction in the operations of local firms that employed workers 
eligible to apply for TAA, and that this decline contributed to worker 
separations at the subject firm.
    Because there is no dispute that a significant proportion or number 
of workers of the subject firm was separated, the only issues for the 
Department to decide on remand are whether or not the remaining two 
criteria of Section 222(c) of the Act have been met. Specifically, the 
Department must determine whether or not the subject firm meets the 
requirements of a ``downstream producer'' under Sections 222(c) and (d) 
of the Act and, if so, whether or not the loss of business by the 
subject firm with a primary firm contributed importantly to the subject 
worker group separations or threat of separations.
    The investigations revealed that the services supplied by the 
subject firm were provided under contract exclusively for Delta Air 
Lines, AR 14, 24-25, 27-28, 33-34, SAR 3, 19, 21, 27, but that the 
subject worker group worked for the subject firm and not for Delta Air 
Lines. SAR 19, 27. Delta Air Lines was the sole customer of the subject 
firm. SAR 3, 21, 27. The Fort Smith, Arkansas airport users such as 
leisure travelers, travel agencies, corporate accounts, and the 
military may have benefited from the services supplied by the subject 
firm, and one or more of these entities may have employed workers who 
are eligible to apply for TAA. However, workers and former workers of 
Delta Air Lines at Fort Smith, Arkansas airport are not eligible to 
apply for TAA. SAR 32-33.
    Section 222(d)(3)(A) of the Act requires that a ``downstream 
producer'' perform ``additional, value-added production processes or 
services directly for another firm for articles or services with 
respect to which a group of workers in such other firm has been 
certified under subsection (a) [of Section 222 of the Act].'' Section 
222(d)(3)(B) includes ``transportation services'' among those services.
    The subject firm cannot meet the statutory definition of a 
``downstream producer'' because it only directly provided services to 
Delta Air Lines (not for the customers of Delta Air Lines). SAR 3, 21, 
27. The subject firm did not supply services directly related to the 
production or supply of an article or service that was a basis for a 
TAA certification. SAR 32-33.
    Moreover, Section 222(c)(2) of the Act does not permit secondary 
worker certification unless the service provided by the subject firm 
``is related to the article or service that was the basis for such 
certification [under Section 222(a) of the Act].'' Certification of a 
worker group under Section 222(c) of the Act may not be based on a 
secondary worker certification. Therefore, even if Delta Air Lines 
workers could be certified eligible to apply for TAA on the basis that 
Delta Air Lines provided transportation services related to the 
production or supply of an article or service that was a basis for a 
TAA certification of one or more of its customers, workers of the 
subject firm may not be certified as adversely affected secondary 
workers.
    The Plaintiff also alleged that the domestic merger between Delta 
Air Lines and Northwest Airlines shows trade impact that resulted in 
the worker group layoffs.
    The Department investigated this allegation during the remand 
investigation, and confirmed that worker separations at the subject 
firm are attributable to Delta Air Lines ceasing operations out of the 
Fort Smith, Arkansas airport. SAR 3, 19, 21, 27. However, the newly-
merged airline maintained operations out of the Fort Smith, Arkansas 
location using a different airline customer service provider. SAR 3, 
19, 21, 27. Further, those services provided by the subject firm cannot 
be imported or shifted abroad as they are used directly by domestic 
passengers. As such, conducting a survey of Delta Air Lines to 
determine whether it increased its imports of services like or directly 
competitive with those supplied by the subject firm (as requested by 
Plaintiff's counsel) is not necessary.
    Based on a careful review of previously-submitted information and 
new information obtained during the remand investigation, the 
Department determines that the petitioning workers have not met the 
eligibility criteria of Section 222(c) of the Trade Act of 1974, as 
amended.

Conclusion

    After careful reconsideration, I affirm the original negative 
determination of eligibility to apply for worker adjustment assistance 
for workers and former workers of Atlantic Southeast Airlines, a 
Subsidiary of Skywest, Inc., Airport Customer Division, including on-
site leased workers of Delta Global Services, Inc., Fort Smith, 
Arkansas.

    Signed at Washington, DC this 3rd day of September, 2010.
Del Min Amy Chen,
Certifying Officer, Office of Trade Adjustment Assistance.
[FR Doc. 2010-23497 Filed 9-20-10; 8:45 am]
BILLING CODE 4510-FN-P