I.Purpose
The purpose of this policy is to provide guidance on the
requirements for IWT.
II.Effective
Date
Immediately
III.Rescission
ODJFS, Workforce Innovation and Opportunity Act Policy Letter
No. 15-23, Incumbent Worker Training (IWT) Guidelines (March 29, 2016).
IV.Background
IWT under WIOA provides both workers and employers with the
opportunity to build and maintain a quality workforce and increase both
participants’ and companies’ competitiveness. It is a type of work-based
training and upskilling designed to ensure that employees of a company can
acquire the skills necessary to retain employment and/or advance within the
company, or to acquire the skills necessary to avert a layoff.
IWT is a business service designed to develop a highly skilled
workforce which will result in increased business financial viability, stability,
competitiveness, and productivity. To avert the risk of closing, IWT may be
developed with a business or business association to maintain their competitive
status, incorporate new technology, or prevent downsizing.
Workers participating in IWT will benefit by enhancing existing
skills, learning new skills, or earning employer or industry recognized
credentials, in addition to retaining employment, maintaining their careers,
and/or increasing their earnings potential. IWT will also allow the opportunity
for backfilling vacated positions resulting from the promotion of newly trained
workers.
Local workforce development areas (local areas) can use up to 20
percent of their adult and dislocated worker allocations to provide for the
federal share of the cost of providing IWT.
V.Definitions
Cohort: a group of trainees to be
trained by an employer as part of a single application for IWT.
Incumbent worker: a worker employed with the company for at
least six months when the incumbent worker training starts.
Incumbent worker training: training designed to meet the special
requirements of an employer (including a group of employers) to retain a
skilled workforce or avert the need to lay off employees by assisting the
workers in obtaining the skills necessary to maintain or retain employment or
have the opportunity for increased earnings potential through promotion.
In-kind contribution: non-cash
contribution of goods or services provided by the business.
Layoff aversion: a continuum of
strategies targeted to specific employers or industries that are experiencing a
decline and have the potential to undergo layoffs or are experiencing a serious
skills gap that impacts their ability to compete and retain workers. A layoff
is considered to be averted when:
1.A worker's job
is saved at an existing employer facing a risk of downsizing or closing; or
2.A worker at
risk of dislocation faces a brief gap of unemployment when transitioning to a
different job with the same employer or is hired at a new job with a different
employer.
Non-Federal Share: the portion of
training costs the employer is required to pay for their employee’s
participation in IWT. The minimum non-Federal share is determined by the size
of the employer.
VI.Local
Workforce Development Area Requirements
The local area must establish policies and definitions to
determine which workers or groups of workers, are eligible for incumbent worker
services. The local policy should establish the criteria to be considered for
an employer to be eligible for IWT as well as IWT program requirements,
application process and amount of the non-federal share.
The local area shall establish criteria for identifying
employers and any targeted industries and economic sectors, using resources
such as business services representatives (BSR), Chambers of Commerce or the
local media. Further, the local area is required to develop IWT program
policies and procedures in a manner that coordinates with the array of business
services available through JobsOhio, the Ohio Development Services Agency
(DSA), and other state and local stakeholders.
A.Types
of IWT
IWT is restricted to skill attainment activities. The training
should benefit workers by making them more qualified in their line of business
and/or by providing them with skills for new products or processes. It is
desired that the training results in credentials or industry recognizable
skills that promote the worker's career and increases overall employability.
B.Eligibility
of Participating Businesses
Local areas must determine an employer’s eligibility to
participate in IWT based on the following factors, which help to evaluate
whether training would increase the competitiveness of the employees and/or
employers:
1.The
characteristics of the participants in the program, specifically the extent to
which they historically represent individuals with barriers to employment as
defined in WIOA sec. 3(24), and how they would benefit from retention or
advancement.
2.The
relationship of the training to the competitiveness of a participant and the
employer.
3.Other factors
local areas determine appropriate, which may include, but are not limited to,
the following:
a.The number of
employees participating in the training;
b.The employees’
advancement opportunities along with wages and benefits (both pre- and
post-training earnings);
c.The existence
of other training and advancement opportunities provided by the employer;
d.Credentials
and skills gained as a result of the training;
e.Layoffs
averted as a result of the training;
f.Utilization
as part of a larger sector and/or career pathway strategy; or
g.Employer size.
Additional factors identified by the local area must be included
in the local policy to ensure consistent application for all employers.
Disqualifying Factors
Businesses that fail to meet any of the following qualifying
criteria are not eligible to receive funds for IWT:
1.Businesses
must not be presently debarred, susp y of the following qualifying criteria are
not eligible to receive funds for IWT: Ohio. This information can be found at https://businesssearch.ohiosos.gov/
or https://sam.gov/content/home
2.Businesses or
voluntarily excluded from participation in transactions by USDOL or the state
of Local areas will require businesses to disclose any known outstanding tax
liabilities with other states prior to entering into past due. outstanding tax
liability, which may include letters from the business or from the State from
which the tax liability occurred eligibility to receive IWT funds. The local area must document any resolution
of
3.Ohio
businesses must have all the approvals, licenses, or other qualifications
needed to conduct business in the state, and all must be current. Should this
status change during the time local IWT program activities are occurring and
the business is disqualified from conducting business in Ohio, all training
under the IWT program must cease.
4.The employer
must comply with all applicable federal, state, and local laws and regulations
related to providing reasonable working conditions. IWT participants are not
permitted to train or work in buildings or surroundings under working
conditions that are unsanitary, hazardous, or dangerous to the trainee's health
or safety.
5.Governmental
entities, including the city, county, and state, may not participate in the
local IWT program. Health care providers that are operating as not-for-profit
entities are the only allowable exceptions to this prohibition.
6.Businesses
that have relocated to Ohio and have laid-off workers at their former location
in the United States may not be considered for this program until they have
been in operation at the new location for 120 days.
a.To verify that a business is not
relocating employment from another area, a pre-award review must be undertaken
and documented by the local area.
The review must include the names under which the establishment conducts
business, including predecessors and successors in interest; the name, title,
and address of the company official certifying the information, and whether WIOA assistance is being sought in
connection with past or impending job losses at other facilities of their
company. The pre-award review should also include a review of whether
appropriate notices have been filed, as required by the Worker Adjustment
Retraining Notification (WARN) Act. The review may also include consultations
with labor organizations and others in the affected local area(s).
7.Businesses
must not have any outstanding civil, criminal or administrative fines or
penalties owed to or pending in the state of Ohio.
8.IWT activities
will not be permitted when any of the following apply:
a.Any other
individual is on layoff from the same or any substantially equivalent job.
b.The employer
has terminated the employment of any regular, unsubsidized employee or
otherwise caused an involuntary reduction in its workforce with the intention
of filling the vacancy with the IWT participant; or
c.The job is
created in a promotional line that infringes in any way on thepromotional opportunities of currently
employed workers.
9.Businesses may
be deemed ineligible if they have received payments under a previous WIOA
contract and exhibited a pattern of failure to provide workers continued
long-term employment as regular employees with wages and working conditions at
the same level and to the same extent as similarly situated employees.
C.Eligibility
of Incumbent Workers
Local areas must establish policies and definitions to determine
which workers, or groups of workers, are eligible for incumbent worker
services.
An incumbent worker does not have to meet the eligibility
requirements for career and training services for Adults and Dislocated Workers
under WIOA, unless they also are enrolled as a participant in the WIOA Adult or
Dislocated Worker program.
To qualify as an incumbent worker, the incumbent worker must be:
1.Employed;
2.Meet the Fair
Labor Standards Act requirements for an employer-employee relationship; and
3.Have an
established employment history with the employer for six months or more (which
may include time spent as a temporary or contract worker performing work for
the employer receiving IWT funds).
If IWT is being provided to a cohort of employees, not every
employee in the cohort must have an established employment history with the
employer for 6 months or more, if the majority of employees being trained meets
the employment history requirement.
D.Training
Provider Considerations
IWT may be provided through ITAs or through contracts for
services. If the training is provided
through an ITA, all requirements of such ITA must be followed, including the
eligibility requirements for career and training services for adults and
dislocated workers and the use of approved eligible training providers under
WIOA.
If a contract is used to provide the IWT, this contract must
have been established through proper procurement procedures.
The training may be provided by a public or private educational
institution, a private training company or private instructor, a company
employee, or a combination of training providers.
Training providers without satisfactory past performance,
accreditation, curricula that lead to credentials, relevant training
experience, accredited instructors, high job placement rates, and/or high
training completion rates, should be avoided.
Training may be conducted at the employer’s own facility, at a
public or private training provider’s facility, online, or at a combination of
sites that best meet the needs of the employer and trainees. The training
facility should provide an environment that supports learning and be within
reasonable proximity to the trainees, so the cost and time required for travel
is minimized.
E.Procurement
of Training
Local areas have several options to determine how best to
provide the training needed by a business as described below:
1.Local areas
may enter into contracts with eligible training providers (ETP) without any
additional procurement requirements. Utilization of the state of Ohio's ETP
list is for universally applicable off-the-shelf employer training and is not
intended to include unique, specialized, or employer-specific training.
2.A business may
receive IWT assistance on a reimbursement basis. In order for a business to utilize the reimbursement option, the
following guidelines must be followed:
a.Businesses may
receive reimbursement for their actual training costs incurred under this
program, as outlined in this policy.
b.Local area
approval of a training plan is required before reimbursement may be provided to
a business. The development of training plans is the joint responsibility of
the local area and the business.
c.The training
plan must identify all of the following:
i.The
provider(s) of training.
ii.Type of
training.
iii.Planned start
and end dates.
iv.Number of
individuals to be trained.
v.The projected
cost of training.
vii.Any other
information required by the local area.
Training costs approved for reimbursement must be allowable as
defined by state and local policy.
Training plans must be approved by the local area prior to the start
date of training. Businesses must agree to provide all documentation required
by the local area to be reimbursed for the training.
d.Training
providers are not required to be listed on the state's eligible training
provider list for the purpose of providing training under paragraph 2 of this
section. Local areas may assist businesses in identifying potential providers
of training; however, the selection of a training provider is not subject to
state or federal procurement requirements.
3.For businesses
not following the guidelines in paragraph 2 of this section and that have
training needs that cannot be provided by Ohio's eligible training providers,
local areas will need to follow proper procurement procedures as identified in
rules 5101:9-4-07
and 5101:9-4-07.1
of the Ohio Administrative Code, or local procurement policies if more
restrictive.
F.Allowable
and Unallowable Costs for IWT
Allowable costs may include only costs directly related to
training. Allowable costs may include:
1.Instructor/trainer
salaries.
2.Curriculum
development, textbooks, manuals, training software, materials and
non-consumables.
3.Training
facility costs (off-site training).
4.Other
necessary and reasonable costs directly related to training.
Unallowable costs include but are not limited to:
1.Foreign travel
.
2.Purchase or
lease of capital equipment.
3.Encouragement
or inducement of a business or part of a business to relocate from any location
in the United States.
4.Use of IWT
funds to pay for a worker's training wages.
IWT funds may be used to train employees in management skills
such as Six Sigma and LEAN if promotional opportunities or increased wages can
be identified post training. IWT funds
may not be used for LEAN or Six Sigma training for the purpose of layoff
aversion.
IWT funds may not be used to reimburse
training costs that are being reimbursed by another State or Federal training
program.
G.Cost
Sharing Requirements for IWT
Local areas are required to establish policies regarding the
non-federal share of the cost of IWT. Employers are required to pay for a
significant cost of the training for those individuals in IWT. This can be done
through both cash payments and fairly evaluated in-kind contributions.
Examples of in-kind contributions could include but are not
limited to the following:
1.Wages paid to
trainees during the training period
2.Equipment
purchased to be used in the training project
3.Manuals and
textbooks
4.Curriculum
development
5.Facility usage
6.Travel and
lodging costs.
The employer non-Federal share must not be paid by the Federal
or State government under another Federal award or State funding opportunity,
except where the Federal statute authorizing a program specifically provides
that Federal funds made available for such program can be applied to matching
or cost sharing requirements of other Federal programs.
The local area shall establish the non-Federal share of such
costs taking into consideration such other factors as the number of employees
participating in the training, wage and benefit levels of the employees, the
relationship of the training to the competitiveness of the employer and
employees, and the availability of other employer-provided training and
advancement opportunities.
The minimum amount of employer share depends on the size of the
employer:
- At least 10 percent of the cost, for employers
with 50 or fewer employees;
- At least 25 percent of the cost, for employers
with 51 to 100 employees; and
- At least 50 percent of the cost, for employers
with more than 100 employees.
Employer size is based on the number of employees currently
employed (at the time of the execution of the IWT contract) at the local
operation where the IWT program will take place. This applies to all employers,
including employers with seasonal or intermittent employee size fluctuations
VII. Fiscal
Reporting
Funds contracted to a subrecipient or vendor for an IWT program
are reported as program costs.
The fiscal agent must track funds used for IWT by funding stream
and by the year of appropriation.
The administrative cost limit remains in effect. No separate
amount may be set aside for administration of the IWT program.
Fiscal agents will report incumbent worker expenditures using
the incumbent worker code established by the Office of Fiscal and Monitoring
Services. Coding exists for both the adult and dislocated worker programs. The accrued
expenditures charged to the incumbent worker code for the adult and dislocated
worker programs must not exceed 20 percent. ODJFS will monitor costs reported
against the IWT program.
Funds that are not used for the IWT program may be expended
respectively on the Adult and Dislocated Worker programs for program activities
authorized by WIOA.
VIII. Program Reporting
The local area is required to report IWT activities via Ohio’s
case management system. Even though individuals receiving IWT are not participants
for the purpose of inclusion in WIOA primary performance indicator
calculations, States and local areas are still required to report certain
participant and performance data on all individuals who receive only IWT. The
required elements for these incumbent worker individuals are limited to basic
information and the elements needed to calculate IWT performance indicators for
employment in the 2nd and 4th quarters after exit, Median earnings in the 2nd
quarter after exit, Measurable Skill Gains, and Credential Attainment.
Local areas may choose to collect more information, if
necessary, to conduct successful IWT programs. Local areas choosing to collect
and document data elements above and beyond the requirements must ensure that
every IWT program is compliant with reporting requirements. Local policies
should include local requirements regarding data elements, documentation and
reporting.
If local areas wish to co-enroll an IWT participant in the local
adult or dislocated worker program, a full registration is required in the case
management system which includes all of the data elements needed for WIOA
participants, including performance data. Co-enrolled participants must meet
all eligibility and documentation requirements for adult, dislocated worker,
and youth programs.
IX.Monitoring
Local areas are encouraged to develop their own monitoring
policies to outline the procedures, frequency and manner in which IWTs will be
monitored and how staff persons/monitors will resolve any findings of
non-compliance.
Through the state’s monitoring system, program monitors will
review the local area’s implementation of the WIOA IWTs, including a
participant file review, during the annual onsite monitoring review for
compliance with federal and state laws and regulations. Any issues will be handled through the
state’s monitoring resolution process.
X.Technical
Assistance
For additional information, you may send your questions to
ODJFS, Office of Workforce Development: WIOAQNA@JFS.OHIO.GOV.
XI.References
Workforce Innovation and Opportunity Act, § 134(d)(4), Public
Law 113-128.
2 CFR Part 200, Appendix II
WIOA Regulations at 20 CFR Part 680
TEGL No. 19-16, “Guidance on Services provided through the Adult
and Dislocated Worker Programs under the Workforce Innovation and Opportunity
Act (WIOA) and the Wagner-Peyser Act Employment Service (ES), as amended by
title III of WIOA, and for Implementation of the WIOA Final Rules,” dated March
1, 2017
ODJFS, Workforce Innovation and Opportunity Act Policy Letter
No. 15-11.3, Use of ITAs (September 27, 2021).