[Federal Register: November 13, 2007 (Volume 72, Number 218)]
[Notices]
[Page 63929-63930]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr13no07-90]
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DEPARTMENT OF LABOR
[TA-W-61,897]
Employment and Training Administration
Management Business Solutions, LLC, Applications Support
Department, Fort Collins, Colorado; Notice of Negative Determination
Regarding Application for Reconsideration
By application dated October 17, 2007, workers requested
administrative reconsideration of the Department's negative
determination regarding eligibility for workers and former workers of
Management Business Solutions, LLC, Applications Support Department,
Fort Collins, Colorado (subject firm) to apply for Trade Adjustment
Assistance (TAA) and Alternative Trade Adjustment Assistance (ATAA).
The determination was issued on September 6, 2007. The Notice of
determination was published in the Federal Register on September 21,
2007 (72 FR 54076).
The worker-filed TAA/ATAA petition was denied because the subject
firm does not produce an article within the meaning of section
222(a)(2) of the Act. The determination stated that, because the
workers did not produce an article, and did not support a firm or
appropriate subdivision that produced an article domestically, the
workers cannot be considered import impacted or affected by a shift of
production abroad. Workers are engaged in support of internal business
applications for the subject firm's clients.
Pursuant to 29 CFR 90.18(c), administrative reconsideration may be
granted if:
(1) It appears on the basis of facts not previously considered that
the determination complained of was erroneous;
(2) it appears that the determination complained of was based on a
mistake in the determination of facts not previously considered; or
(3) in the opinion of the Certifying Officer, a misinterpretation
of facts or of the law justified reconsideration of the decision.
The request for reconsideration alleges that (1) the subject firm
shifted production of an article (``application management service'')
overseas and (2) consulting firms, such as the subject firm, are
covered by the Trade Act because it ``does not differentiate between
types of businesses that it covers.''
It is the Department's policy that the subject firm must produce an
article domestically. The Department's policy
[[Page 63930]]
is supported by current regulation. 29 CFR section 90.11(c)(7) requires
that the petition includes a ``description of the articles produced by
the workers' firm or appropriate subdivision, the production or sales
of which are adversely affected by increased imports, and a description
of the imported articles concerned. If available, the petition should
also include information concerning the method of manufacture, end
uses, and wholesale or retail value of the domestic articles produced
and the United States tariff provision under which the imported
articles are classified.''
In order to determine whether the subject firm is a manufacturing
firm, the Department consulted the Web site for the North American
Industry Classification System (NAICS). The NAICS Web site (http://www.naics.com/faq.htm#q1
) states that ``The North American Industry
Classification System * * * was developed as the standard for use by
Federal statistical agencies in classifying business establishments for
the collection, analysis, and publication of statistical data related
to the business economy of the U.S.'' The NAICS designation identifies
the primary activity of the company, which is useful in understanding
what a firm does for its customers, which, in turn, aids in determining
whether a firm produces an article or provides services for its
customers.
The subject firm is categorized in NAICS subsection 541611
(``Administrative Management and General Management Consulting
Services''). This category consists of ``establishments primarily
engaged in providing operating advice and assistance to businesses and
other organizations on administrative management issues, such as
financial planning and budgeting, equity and asset management, records
management, office planning, strategic and organizational planning,
site selection, new business startup, and business process
improvement'' and includes ``establishments of general management
consultants that provide a full range of administrative; human
resource; marketing; process, physical distribution, and logistics; or
other management consulting services to clients.''
After careful review of the request for reconsideration and
previously submitted information, the Department determines that the
subject firm is a service firm and not a manufacturing firm. As a
corollary, the Department determines that there was no shift of
production abroad.
The Department operates the program in accordance with current law,
and while the Department has discretion to issue regulations and
guidance on the operation of a program that it is charged with
implementing, the Department cannot expand the program to include
workers that Congress did not intend to cover.
In 2002, while amending the Trade Act, the Senate explained the
purpose and history of TAA:
Since it began, TAA for workers has covered mostly manufacturing
workers, with a substantial portion of program participants being
steel and automobile workers in the mid- to late-1970s to early
1980s, and light industry and apparel workers in the mid- to late-
1990s. In fiscal years 1995 through 1999, the estimated number of
workers covered by certifications under the two TAA for workers
programs averaged 167,000 annually, reaching a high of about 228,000
in 1999, despite a falling overall unemployment rate. During the
same period, approximately 784 firms were certified under the TAA
for firms program. Participating firms represent a broad array of
industries producing manufactured products, including auto parts,
agricultural equipment, electronics, jewelry, circuit boards, and
textiles, as well as some producers of agricultural and forestry
products.
S. Rep. 107-134, S. Rep. No. 134, 107th Cong., 2nd Sess. 2002, 2002 WL
221903 (February 4, 2002)(emphasis added). Clearly, the language
suggests that the focus of TAA is the manufacture of marketable goods.
Congress has recognized the difference between manufacturers and
service firms and that an amendment to the Trade Act is needed to cover
workers in service firms. It has recently rejected at least two
attempts to amend the Trade Act to expand TAA coverage to service
firms. It did not pass the ``Trade Adjustment Assistance Equity for
Service Workers Act of 2005'' or the ``Fair Wage, Competition, and
Investment Act of 2005.'' Most recently, Senator Baucus introduced the
``Trade and Globalization Adjustment Assistance Act of 2007'' which
provides for an expansion of coverage to workers in a ``service sector
firm'' when there are increased imports of services like or directly
competitive with articles produced or services provided in the United
States, or a shift in provision of like or directly competitive
articles or services to a foreign country, and Congressman Rangel
introduced a similar bill in the House of Representatives that was
discussed in late October 2007.
Until Congress amends the Trade Act to cover service workers, in
order to be considered eligible to apply for adjustment assistance
under section 223 of the Trade Act of 1974, the worker group seeking
certification (or on whose behalf certification is being sought) must
work for a firm or appropriate subdivision that produces an article and
there must be a relationship between the workers' work and the article
produced by the workers' firm or appropriate subdivision that produces
an article domestically.
After careful review of the request for reconsideration and
previously submitted materials, the Department determines that there is
no new information that supports a finding that section 222(a)(2) of
the Trade Act of 1974 was satisfied and that there was no mistake or
misinterpretation of the facts or the law.
Conclusion
After review of the application and investigative findings, I
conclude that there has been no error or misinterpretation of the law
or of the facts which would justify reconsideration of the Department
of Labor's prior decision. Accordingly, the application is denied.
Signed at Washington, DC this 5th day of November 2007.
Elliott S. Kushner,
Certifying Officer, Division of Trade Adjustment Assistance.
[FR Doc. E7-22062 Filed 11-9-07; 8:45 am]
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