I.Purpose

To outline the policy and to provide direction to local areas providing OJT to participants with formula funds.

II.Effective Date

July 1, 2012 through June 30, 2017

III.Background

Through OJT activities provided under the Workforce Investment Act (WIA), workers can obtain the skill sets necessary to fill the jobs that are available and are being created in this economy. OJT activities can support the development of a workforce with skills that meet the needs of employers and provide additional training options for workers and employers.

OJT activities are provided to eligible participants via an OJT agreement between the local area and the employer. Such an agreement specifies the duration of training as well as the skills and competencies to be acquired by the participant. The length of the training period depends on the funding source of the OJT, the complexity of the job, as well as the participant's skills and prior work experience. Employers must commit to hire and retain the participant at the end of a successful training period. In sum, OJT provides an incentive to employers to hire individuals and invest in their skill development, and trainees can earn a wage as they learn.

The state requested a waiver extension to permit an increase in employer reimbursement through a sliding scale based on the size of the employer. The United States Department of Labor (USDOL) approved this waiver extension on December 2012, for the new Program Year (PY) 2012. The implementation of the sliding scale is at the discretion of the local areas. An extension of this waiver has been granted through June 30, 2017.

IV.Requirements

"On-the-job training'' means training by an employer to an employee who is an eligible WIA participant engaged in productive work in a job that:

• Provides knowledge or skills essential to the full and adequate performance of the job;
• Relates to the introduction of new technologies, new production or new procedures, upgrading to new jobs that require additional skills, workplace literacy, and other appropriate purposes identified by the local board;
• Provides reimbursement to the employer for the costs associated with training the OJT trainee, which are usually calculated at half the participant's pay rate for the agreed-upon training period; and
• Is limited in duration as appropriate to the occupation for which the participant is being trained, taking into account the content of the training, the prior work experience of the participant, and the service strategy of the participant, as appropriate.

OJT participants must receive wages, benefits, and working conditions that are equal to those provided to regular employees who have worked a similar length of time and are doing the same type of work. Appropriate workers compensation insurance protection must also be provided to all OJT participants by the employer.

Outreach

Although the state has a waiver, OJT will be promoted at a 50% reimbursement rate with utilization of the sliding scale on a case-by-case basis, as determined by the local areas. Alternatively, local areas are encouraged to revise existing local OJT policy to utilize the optional sliding scale or develop new OJT policy to implement the sliding scale under certain specific situations. Possible situations that could warrant the use of the sliding scale waiver may include:

• For individuals facing significant barriers to employment;
• For small and mid-sized businesses that would qualify for a higher reimbursement rate;
• Local areas with higher than average unemployment rate;
• For small and mid-sized businesses offering an exceptional level of training;
• For small and mid-sized businesses providing benefits and a higher wage rate;
• For small and mid-sized businesses using expensive tools or equipment to provide training;
• For small and mid-sized businesses providing significant workplace safety precautions and safety training; and/or
• The availability of OJT funding in the local area.

Local areas are not restricted by the above considerations and they are encouraged to develop criteria for such other situations that would render use of the sliding scale waiver meaningful.

Required Components of OJT

A.Participant Eligibility

WIA-funded OJT is available for eligible WIA youth, unemployed and under-employed adult and dislocated workers, including employees of an employer. Employed workers may be eligible for WIA-funded OJTs when the employee is not earning a self-sufficient wage as determined by the local area. Individuals who have completed formal training via an Individual Training Account (ITA) may be considered for OJT if it creates an opportunity for a positive outcome.

Before approving an OJT, the local area will assess the potential participant to ensure suitability for the OJT. The assessment, at a minimum, shall include the occupation's particular skill requirements, the participant's academic and occupation skill level, prior work experience, level of job difficulty, and the participant's individual employment plan (IEP). The results of this assessment will be used, in part, to determine the appropriateness of and suitability for the OJT.

WIA youth aged 14-21 years may qualify for OJT, although such training may not be an appropriate activity for youth under age 18 whose employability plan is geared toward completion of secondary education instead of employment.

OJT participants are not eligible to receive Needs Related Payments (NRPs). Further, OJT participants cannot be members of the immediate family of the business owner or participant's direct supervisor. Note: refer to the Ohio Department of Job and Family Services (ODJFS) OJT Procedures Manual for the different situations in which OJT-related conflict of interest may arise.

B.Employer Eligibility

OJT is provided under an agreement with an employer in the public, private non-profit, or private for-profit sector to WIA eligible participants. Careful consideration should be given while selecting a participating employer. Examples of potential business functions to research before selecting an employer include but are not limited to:

• Working conditions (safety and health);
• Presence of health benefits;
• Wage structure;
• Turnover rates;
• Adequate staff and equipment to carry out the training; and
• Compliance with federal, state and local laws.

Information collected for each employer should be captured on the employer information form. This form must be maintained on file and be made available for auditing and monitoring purposes.

Private placement agencies: A private placement agency is an eligible employer for WIA-funded OJTs, and local areas are encouraged to determine policy on OJTs with private placement agencies (e.g. OJTs in scenarios of "temp," "temp to hire" or continued long-term employment).

While private placement agencies are usually the employer of record, the host employers are responsible for providing the work and work space. Training, however, can be the responsibility of the host employer, the private placement agency or both.

Note: Refer to the ODJFS OJT Procedures Manual for factors to be considered before writing OJT agreements with a private placement agency.

Disqualifying factors: Employers will be disqualified from participating in the OJT program in the following situations:

• Failure to retain: The local WIB must not enter into an agreement with an employer who has previously exhibited a pattern of failing to provide OJT participants with continued long-term employment.
• Failure to provide comparable working conditions: The employer must comply with all applicable federal, state, local laws and regulations related to providing reasonable working conditions. OJT 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.
• Relocation: If during completion of the employer information form, it is determined that a business has relocated from one U.S. labor market to another and caused dislocation at the original location, OJTs may be available at the new location only after the business has conducted work at the new location for more than 120 days. Note: refer to the ODJFS OJT Procedures Manual for factors to be considered in determining whether business relocation has occurred.
• Layoff: Absent a clear and applicable layoff definition within a collective bargaining agreement or personnel policy governing a local operation, a layoff is defined as termination with the intent to recall. A laid off employee who refuses a recall request is no longer considered to be in layoff status. Layoff recall rights will last six months from the last day of work prior to the layoff.
• If the employer has laid off someone from a similar or "substantially equivalent" work at the same local operation, no OJT or other subsidized employment is permitted. The work is considered substantially equivalent if the overlap between the work (duties and job titles) is 80% or greater. If more than one person is laid off from a substantially equivalent job, and all these persons worked their last day more than six months before the training plan begins, the OJT may proceed and the employer may be reimbursed regardless of the previous layoffs.
• Worker displacement: Training positions covered may not have been created by the displacement of an unsubsidized employee by a WIA subsidized employee. This includes partial displacement such as reduction in the hours of non-overtime work, wages, or employment benefits. There is no requirement for the job to be similar or substantially equivalent. The key is employer intent: if an unsubsidized employee's earnings are reduced by hiring a WIA subsidized participant to offset the lost productivity, it is considered displacement.

C.Employer Information Form (Pre-award review)

Prior to the placement of an OJT participant, an employer pre-screening must be conducted and an information form must be completed to ensure that the employer meets the minimum standards and can provide both training and long-term employment to the OJT participant. The Employer Information Form (EIF) may be completed once rather than each time an OJT is approved. In case of a collective bargaining agreement, the employer and union must provide concurrence before the OJT begins. The WIA staff at the local area is expected to contact the employer's union representative if the job is under bargaining unit authority.

The employer information form should be updated if:

• The business is sold or transferred;
• Other significant changes affecting training, hiring, job retention occur; and
• At least once a year from the date of issuance.

The employer information form must include the following information:

1.Consultation with labor organizations and others in the affected local areas;

2.Review and documentation of employer's compliance with all applicable business licensing, taxation and insurance requirements;

3.Review of whether the business or part of a business displaced any workers as a result of relocation from one U.S. labor market to another; and

4.Review of whether the business has laid off someone from a similar or substantially equivalent job in order to receive subsidized employment.

If the employer is new to the area or expanding its operation, additional information must be obtained in order to establish that the company is not relocating from another U.S. labor market. This information must include:

1.Names under which the establishment does business, including predecessors and successors of interest;

2.Name, title, and address of the company official certifying the information;

3.Review of whether WIA assistance was sought in connection with past or impending job losses at other facilities; and

4.Review of whether Worker Adjustment and Retraining Notification (WARN) notices relating to the employer have been filed.

Employers must assure that documentation related to the statements captured by the local area is available upon request for monitoring purposes.

Local areas may use the state's employer information form template as provided in the ODJFS OJT Procedures Manual, or develop their own form so long as they include all required elements contained within the template.

D.OJT Agreement

One OJT agreement (blanket agreement) is required per employer regardless of the number of participants trained or hired. The agreement may be effective for a maximum period of one year and cover all training plans approved with the employer prior to the OJT Agreement's end date. Careful employer screening, through completion of the employer information form, must precede the agreement. The agreement, while establishing the reimbursement procedures, remains non-financial in nature, and no money is obligated until the training plan is approved for an eligible participant. Moreover, in case a collective bargaining agreement exists, the union must be a co-signatory on the OJT agreement.

The OJT agreement should be modified before expiration only if there are significant changes, such as layoffs or changes in OJT rules and or policy.

Local areas may choose to complete the agreement with every OJT training plan in lieu of a blanket agreement.

E.Participant Training Plan

Duration: The duration of the OJT shall not exceed a maximum of 1,040 hours unless extenuating circumstances exist, in which case appropriate documentation is required. The length of the training considers several factors such as participants' skills gap including prior work experience, the occupation for which the participant is receiving training, the content of training, and the service strategy of the participant.

Exceptions for individuals with disabilities or other significant barriers: OJT participants facing a significant barrier to employment, such as a disability covered under the Americans with Disabilities Act (ADA), may be considered for a longer training duration up to 50% additional hours when compared to typical length of a similar OJT, not exceeding a maximum of 1,560 hours.

The training plan obligates training funds for a participant and outlines the planned training activities to be accomplished during the training period. Unlike the OJT agreement, the training plan is required for each participant. The plan constitutes the financial obligation between the agency or service provider and the employer, and is the document which authorizes reimbursement of the agreed upon amount upon successful completion of the training plan period (or the retention period, if applicable). The following types of activities are prohibited from OJTs:

• Sectarian activities: Funds provided to employers for OJT may not be used to employ the participant/trainee in a position involving political or sectarian activities. Further, OJT participants may not assist, promote or deter union organizing, or engage in political activities during work hours.
• Religious activities: OJT participants are prohibited to be employed in the construction, operation, or maintenance of any facility which is used for religious instruction or worship.

OJT providers may base the identification of skills needed and justification of training duration upon the Occupational Information Network (O*NET) and specific vocational preparation (SVP), company job description, input from the employer/supervisor and/or other appropriate data sources. Consideration should also be given to the occupation's particular skill requirements, the participant's academic and occupational skill level, prior work experience, level of job difficulty and the participant's IEP.

F.Employer Reimbursement

Sliding scale waiver: The USDOL sliding scale uses the following considerations to determine reimbursement rate, based upon employer size:

• Up to 90% for employers with 50 or fewer employees;
• Up to 75% for employers with 51-250 employees; and
• For employers with more than 250 employees, the existing 50% reimbursement rate will continue to apply.

Employer size is based on the size of the company's local operation where the OJT placements will be made, and not on the total nationwide employment. For instance, a hotel chain that employs thousands nationwide, but only 40 at its company in the targeted region, may be eligible for reimbursement up to 90%, when reimbursement is determined based on size. In determining the geographic boundaries that define the employer's local operation, local areas should use their best judgment based on analysis of each employer's size and structure.

Head count: The following guidelines should be applied while determining head count at a local operation:

1.Include all full time and part time workers and temporary and permanent workers at the work site including all managers and front line workers;

2.Include any individuals employed by a staffing agency who are subject to the day to day control of the host employer;

3.Do not use "Full Time Equivalents" (FTEs). Every worker counts as "1";

4.Include individuals employed within the same local operation;

5.Do not include individuals employed by and subject to the day to day control of other employers or independent contractors;

6.The "head count" is a snapshot. Use the best, good faith estimate given by the employer on the day when the OJT employer information form is completed.

Local areas should use reasonable judgment in determining head count, along with being consistent and documenting their methodologies. The determination for head count is applied while completing the employer information form and need not be updated unless the employer requests or until the OJT agreement expires. Thus, if a small employer becomes a large employer in the midst of the OJT agreement period, the employer reimbursement rate will remain unchanged until the agreement expires.

Payment points: Local areas can develop their own procedure regarding payment points so long as the reimbursement does not exceed 50% of wages or the higher rate based on the sliding scale, if appropriate. Local areas also have discretion in determining if they wish to withhold reimbursement for 30, 60 or 90 days to ensure retention after the end of training. The state does not mandate or prohibit OJT holdback tied to employment or retention. However, local areas must ensure that this information is reflected in the local policy, the OJT agreement and the OJT training plan.

During the WIA-funded OJT, participants might also become eligible for other funding streams, such as TAA, that would preclude their receiving continued funding under the OJT. In such an instance, local areas must develop a plan regarding payment points and transitioning participants from one program to another without negatively affecting the employer or the participant.

The reimbursement base is regular "straight time" hours and does not include commissions, overtime pay, holidays, vacation, sick pay or pay for other hours not worked. Further, payments to employers must be based on scheduled raises and regular pay increases if they occur.

Invoice: Payments to employers should be managed by an invoice system that documents the number of hours worked by the OJT participant and the hourly rate of pay.

It is expected that OJT participants will be retained at the completion of training.

G.Co-ordination with Trade

Individuals who are eligible for assistance under Trade Adjustment Assistance (TAA) are not eligible for WIA-funded OJTs.

If a participant is already enrolled in a WIA-funded OJT and subsequently becomes eligible for funding through TAA, the local area must determine whether to continue funding the OJT with formula dollars or to fund the remainder of the training with TAA funds based on the following criteria:

1.If the WIA-funded OJT uses a different wage reimbursement rate than the Trade program's OJT policy allows, the participant's OJT may continue to be funded by formula dollars until completion;

2.If the WIA-funded OJT uses a different payment point than the Trade program's required OJT payment point, the participant's OJT may continue to be funded by formula dollars until completion;

3.If the WIA-funded OJT uses the same wage reimbursement rate and payment point as the Trade program OJT, the local area must make arrangements for the remainder of the OJT to be funded by TAA beginning at the next payment point. Local areas must coordinate with Trade staff to develop a plan for transitioning participants from one funding stream to another without negatively affecting the employer or the participant.

Regardless of whether participants remain in the WIA-funded OJT or transition to TAA funding, it is required that the participant be co-enrolled in both the WIA-funded OJT and Trade programs and that the OJT be approved under both programs (even if it is being fully funded by formula dollars) to ensure the participant may qualify for other associated Trade benefits and services.

H.Exceptions to OJT

There are times when an OJT participant or work conditions may justify an exception to the original training plan. Local areas should outline how exceptions will be addressed in their local policies. Possible exceptions to OJT may include:

• Extending the agreed upon length of OJT duration as long as the mandated maximum number of hours are not exceeded;
• Adjusting the maximum or minimum number of hours/week to accommodate a participant's learning or other disability as long as mandated maximum number of hours are not exceeded;
• Any instances that preclude employer reimbursement for training because the participant quit or was fired for cause; and
• Consideration for OJT participants who are performing satisfactorily, have completed substantial training and will be retained by employer at end of training period, but have not learned all the requisite OJT-related skills.

I.Monitoring

Local areas are encouraged to develop their own monitoring policies to outline the procedures, frequency and manner in which OJTs will be monitored and how staff persons/monitors will resolve any findings of non-compliance.

At a minimum, monitors should:

• Document information received directly from the OJT participants;
• Obtain the trainee supervisor's perspective about the training progress; and
• Review the employer payroll records.

The key monitoring issues include verifying and documenting that:

• There was a need for training;
• Training was provided to the participant;
• The length of OJT training was reasonable;
• The employer reimbursement rate complied with policy; and
• Other applicable OJT rules and requirements were followed.

J.Reporting

All participants must be eligible, enrolled in WIA and entered in Ohio's Workforce Case Management System (OWCMS). Participants may also be co-enrolled in other state-funded WIA programs.

K.OJT Forms

The following forms must be completed and retained for monitoring purposes. For more information, refer to the ODJFS OJT Procedures Manual.

• Employer information form
• Training agreement
• Training plan
• Invoice
• Exception Request Form (if applicable)

Local areas may use the state templates or create their own forms so long as they include all the required elements contained within the templates provided in the ODJFS OJT Procedures Manual.

V.Technical Assistance

The corresponding ODJFS OJT Procedures Manual is a reference guide for local areas providing OJTs and a resource for forms, templates and information on procedural activities. For additional information, you may send your questions to ODJFS, Office of Workforce Development: WIAQNA@JFS.OHIO.GOV.

VI.References

Workforce Investment Act of 1998, Public Law 105-220, August 7, 1998.

20 C.F.R. Part 652 et al. Workforce Investment Act; Final Rules, August 11, 2000.

USDOL Training and Employment Guidance Letter No. 04-10, On-the-Job Training National Emergency Grants (OJT NEGs) Funded with American Recovery and Reinvestment Act of 2009 Resources, August 06, 2010.

USDOL waiver approval letters dated December 10, 2012 and August 8, 2013.

ODJFS OJT Procedures Manual

Rescission

WIAPL 10-08.1 On-the-Job Training (OJT) Comprehensive Policy