The Frances Perkins Building of the U.S. Department of Labor headquarters in Washington, D.C.

The recent trade war has resulted in economic stress for many employers. Unfortunately, many employers have needed to let go certain workers in order to run their businesses. The trade adjustment assistance (TAA) program is a federal program that provides aid to workers who lose their jobs or whose hours of work and wages are reduced either because their jobs moved outside the United States or because of an increase in directly competitive imports. Providing information to federal and state agencies as part of the investigation for determining TAA eligibility for separated workers has surfaced as a unique challenge for employers because these matters move fast and entail a complex web of overlapping federal and state regulations and policies. Further, failure to handle these matters carefully could result in sensitive company information being disclosed to the government and, ultimately, to competitors and the public. This article provides guidance to employers in navigating their responsibilities when separated workers seek TAA benefits.

What Is Trade Adjustment Assistance?

The TAA program, administered by the U.S. Department of Labor (DOL), offers significantly enhanced benefits and reemployment services to help former employees prepare for and obtain suitable employment, such as training, job search and relocation allowances, income support, and other reemployment services. These benefits are provided at no expense to employers.

To obtain TAA benefits, a petition must be filed with the DOL's TAA program requesting certification as workers adversely affected by foreign trade. A petition for TAA may be filed by a group of three or more workers, their union, or other duly authorized representative. Once a complete petition is filed, the Office of Trade Adjustment assistance initiates an investigation to determine whether a group of workers meets the group eligibility requirements based on whether they were separated from their employment because:

• The sales or production of the workers' firm have decreased absolutely and imports of articles or services like or directly competitive with those produced by the workers' firm have increased; or
• The workers' firm has moved production of the articles or services that the petitioning workers produced to a foreign country or the firm has acquired, from a foreign provider, articles or services that are directly competitive with those produced by the workers; or
• The workers' firm is a supplier or a downstream producer to a TAA-certified firm and either the sales or production for the TAA-certified firm accounted for at least 20% of the sales or production of the workers' firm, or a loss of business with a TAA-certified firm contributed importantly to the workers' job losses; or
• The workers' firm has been publicly identified by the U.S. International Trade Commission as injured by a market disruption or other qualified action.

What Is the Employer's Role in DOL's Investigation?

As part of DOL's investigation, the agency will seek information from the employer to aid the agency in determining whether affected workers are eligible for benefits. Depending on the scope of the petition, the information could pertain to the employer's entire business or a particular division or location.

DOL will likely issue a "business data request" to the affected workers' former employer seeking substantial confidential and sensitive information related to the employer's business. The requested information typically includes an explanation of the company's organizational structure, a description of the articles manufactured by the company, employment levels, numbers of recent and future worker separations, the reasons for those worker separations, data related to production, exports, and imports for the articles produced, a list of the subject firm's customers (and related sales data) that account for the majority of the decline in sales of the article, and contact information on companies providing temporary workers, among other items. DOL may also seek additional information based on the employer's answers to the initial requests.

Given that DOL must make its determination within 40 days after the filing date of the petition, the agency will seek a quick response to its requests. Importantly, DOL can obtain any requested information through subpoena if the employer fails to timely comply with the requests.

Upon receipt of the business data request, employers and their counsel should carefully evaluate the scope of the request and engage with the DOL investigator to better understand what information is absolutely necessary for DOL's investigation. For example, if workers were separated from the company because their jobs were moved overseas, DOL may not need information related to the entire company's sales, production, imports, and exports in order to make its determination.

Understandably, employers will have concerns about providing confidential information to a government agency. While DOL promises to protect the confidentiality of the provided information, employers should be aware that any submitted information is subject to disclosure under the Freedom of Information Act (FOIA). This has gained greater importance in light of the U.S. Supreme Court's decision in Food Marketing Institute v. Argus Leader Media, 139 S. Ct. 2356 (2019), which addresses the government's ability to withhold information under the FOIA exemptions. This is another reason why employers should make every effort to understand the confines of the request—and the amount of sensitive, confidential information requested—as soon as possible.

What Happens After DOL Issues a Determination?

If DOL determines that a petition meets the relevant criteria, it will issue a certification describing the eligible worker group and specifying the beginning and ending dates of the relevant period. Generally, the certification covers all members of the worker group who are separated or threatened with separations during the period beginning one year before the petition was filed and ending two years after the date of the certification.

Individual benefits are funded by the federal government and administered by state agencies through their workforce systems and unemployment insurance systems. Upon receipt of DOL's certification, the relevant state agency may contact the employer to obtain a list of workers in the eligible worker group, along with the workers' contact information. The state agency will then notify each of these workers of the benefits and services available to them under the TAA program, including the deadlines that apply to applications for these benefits.

While the state may seek substantial information for each separated worker during the relevant time period, the applicable federal regulations provide that the employer need only provide a narrower range of information, such as the names and mailing addresses of all workers separated from adversely affected employment. So, employers faced with a broad request from a state agency should carefully evaluate the request and not respond blindly.

After the certification is issued, DOL's practice is to publicly disclose two pieces of information—the estimated number of allegedly affected workers and the countries impacting workers—by including it in a public dataset accessible from the DOL's website. The employer generally has about two weeks from the date of the certification to object to the disclosure by providing a detailed statement indicating why the company believes that disclosure of the information could cause competitive harm. DOL will separately notify the employer if it receives a FOIA request for an employer's complete response to the Business Data Request and related information.

Chris Wilkinson is a labor and employment partner in Orrick, Herrington & Sutcliffe's Washington, D.C. office and former associate solicitor for civil rights and labor management for the U.S. Department of Labor. David B. Smith is a senior associate in the firm's employment practice in the Washington, D.C. office.