Notice2024-21709
Request for Information on Direct and Indirect Labor
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
September 23, 2024
Issuing agencies
Committee for Purchase From People Who Are Blind or Severely Disabled
Abstract
The Committee for Purchase From People Who Are Blind or Severely Disabled (operating as the U.S. AbilityOne Commission (Commission)) is seeking information on proposed definitions of direct labor and categories of indirect labor; and ideas about categorizing employment tasks as direct labor or indirect labor on Federal contracts for the purposes of compliance with the Javits-Wagner-O'Day (JWOD) Act (41 U.S.C. Chapter 85). The information provided in response to this request for information (RFI) will inform the Commission as it seeks to modernize the AbilityOne Program.
Full Text
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<title>Federal Register, Volume 89 Issue 184 (Monday, September 23, 2024)</title>
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[Federal Register Volume 89, Number 184 (Monday, September 23, 2024)]
[Notices]
[Pages 77487-77488]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2024-21709]
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COMMITTEE FOR PURCHASE FROM PEOPLE WHO ARE BLIND OR SEVERELY DISABLED
Request for Information on Direct and Indirect Labor
AGENCY: Committee for Purchase from People Who Are Blind or Severely
Disabled.
ACTION: Request for information.
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SUMMARY: The Committee for Purchase From People Who Are Blind or
Severely Disabled (operating as the U.S. AbilityOne Commission
(Commission)) is seeking information on proposed definitions of direct
labor and categories of indirect labor; and ideas about categorizing
employment tasks as direct labor or indirect labor on Federal contracts
for the purposes of compliance with the Javits-Wagner-O'Day (JWOD) Act
(41 U.S.C. Chapter 85). The information provided in response to this
request for information (RFI) will inform the Commission as it seeks to
modernize the AbilityOne Program.
DATES: Comments must be received by October 22, 2024.
ADDRESSES: Electronic Submission of Comments. Please submit any
comments electronically through <a href="https://www.regulations.gov">https://www.regulations.gov</a> and follow
the instructions for submitting comments. To locate the RFI, search for
Docket No. CPPBSD-2024-0010.
Accessible Format: Individuals with disabilities can obtain this
document, as well as the comments or other documents in the public
rulemaking record for this RFI, in an alternative accessible format by
contacting the individual listed in the FOR FURTHER INFORMATION section
of this document.
Electronic Access to This Document: The official version of this
document is the document published in the Federal Register. You may
access the official edition of the Federal Register and the Code of
Federal Regulations at <a href="http://www.govinfo.gov">www.govinfo.gov</a>. You may also access Commission
documents published in the Federal Register by using the article search
feature at: <a href="http://www.federalregister.gov">www.federalregister.gov</a>.
FOR FURTHER INFORMATION CONTACT: Cassandra Assefa, Regulatory and
Policy Attorney, Office of General Counsel, Committee for Purchase From
People Who Are Blind or Severely Disabled, 355 E Street SW, Suite 325,
Washington, DC 20024; telephone: (202) 430-9886; email:
<a href="/cdn-cgi/l/email-protection#c1a2a0b2b2a4a7a081a0a3a8ada8b5b8aeafa4efa6aeb7"><span class="__cf_email__" data-cfemail="6d0e0c1e1e080b0c2d0c0f0401041914020308430a021b">[email protected]</span></a>.
SUPPLEMENTARY INFORMATION:
I. Background
In 1938, the legislation that became the JWOD Act was signed to
create jobs for blind individuals. In 1971, the Act was amended to
expand the JWOD Program's scope to include employing individuals with
severe disabilities.\1\ In 2006, the JWOD Program was renamed the
AbilityOne Program by the Committee for Purchase From People Who Are
Blind or Severely Disabled. In 2011, the Committee began operating as
the U.S. AbilityOne Commission.
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\1\ 41 U.S.C. Chapter 85, Committee For Purchase From People Who
Are Blind or Severely Disabled.
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The JWOD Act continues to serve as an employment catalyst by making
it mandatory for Federal agencies to procure certain products and
services from NPAs employing individuals who are blind or have
significant disabilities. The Commission votes to place on a
[[Page 77488]]
Procurement List suitable products and services that government
agencies must then procure from a qualified nonprofit agency (NPA).
Federal agencies do not have to follow the normal government
competitive procedures when acquiring Procurement List items from an
authorized NPA, making it more efficient for both the Federal agencies
and the qualified NPA.\2\
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\2\ Federal Acquisition Regulation 8.7, Acquisition From
Nonprofit Agencies Employing People Who Are Blind or Severely
Disabled.
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For an NPA to be eligible to provide goods or services on the
Procurement List, it must be authorized by the Commission as qualified
to serve as an authorized source in the program.
II. The Direct Labor Hour Ratio Mandate
To serve as an authorized source, an NPA must, at a minimum,
satisfy the statutory conditions described at 42 U.S.C. 8501,
paragraphs 6 and 7. Of note, part (C) of both paragraphs require that
75 percent of the direct labor hours required to produce or provide
products or services must be performed by individuals who are blind or
significantly disabled.
In calculating the 75 percent direct labor hour ratio, an NPA is
required to count not only the DLH performed in support of Procurement
List items, but pursuant to the statute, all direct labor performed by
every individual employed by the NPA.\3\ The statute defined direct
labor as all work required to prepare, process, and pack a product, or
work that directly relates to the performance of the service. The
statute specifically excludes supervision, administration, inspection,
or shipping as direct labor.
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\3\ 41 U.S.C. 8501(6)(C) and (7)(C).
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This means that when calculating the 75 percent direct labor hour
ratio, an NPA excludes ``indirect labor'' hours--i.e., ``Work that
supports the manufacturing process or delivery of services but does not
directly produce or add value to the products or services sold to a
customer. This includes supervision, administration, inspection, and
shipping.'' \4\ Historically, these exclusions were perceived as
helpful because they reduce the number of hours an NPA must count
toward the 75% direct labor hour ratio. However, when an employee who
is blind or has a significant disability moves from a direct labor hour
position to an indirect labor hour position, the NPA cannot count that
employee's indirect labor hours toward the 75 percent direct labor hour
ratio--a situation that potentially creates a disincentive for the NPA
to promote that employee to a supervisory or administrative position.
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\4\ U.S. AbilityOne Commission Policy 51.404, Direct Labor Hour
Ratio Requirements, effective October 1, 2024.
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The Commission believes that many ``indirect labor'' task or
positions could serve as an opportunity to promote employee career
advancement. However, there is little incentive for an NPA to create a
framework that actively encourages direct labor hour employees to move
to indirect labor hour positions if doing so compromises the NPA's
ability to remain in the Program by impeding its ability to meet the
Program's direct labor hour ratio requirement.
III. Request for Information
As noted above, section 8501, paragraphs 6 and 7 of the JWOD Act
list the qualifications for an NPA to serve as an authorized source for
a product or service on the Procurement List. The Commission's
interpretation of the statutory language is promulgated in the Code of
Federal Regulations (CFR) at Title 41, Chapter 51. More specifically,
the CFR adopts the JWOD Act's 75 percent direct labor hour ratio
requirement and adds a list of additional qualifications under Part 51-
4. In the CFR at Part 51-1.3, the Commission does not elaborate on the
statutory direct labor hour ratio requirement or the definition of
direct labor.
Commission policies are generally derived from Commission
regulations grounded in statute. As such, the authority to deviate from
the 75 percent direct labor hour ratio requirement, or to redefine what
counts as direct labor, is expressly limited by statute.
Notwithstanding these limitations, the Commission is exploring ways to
leverage its regulatory and sub-regulatory authority to encourage
employment opportunities that promote career mobility without
conflicting with the JWOD Act. This RFI is designed to collect
information for that purpose, through the questions below.
IV. Questions
(1) How could direct labor be defined to expand the types of tasks
or positions that can be counted as direct labor without conflicting
with the definition in the JWOD Act? The purpose of this change would
include increasing the number of direct labor hours that an NPA could
count toward meeting the direct labor hour ratio requirement.
(2) In what ways could indirect labor categories (e.g.,
supervision, administration, inspection, or shipping) be defined to
maximize employee career development without adversely impacting the
ratio requirement, and without a statutory change?
(3) What types of jobs or tasks traditionally categorized as
``indirect labor'' in accordance with the JWOD Act fall outside of
``supervision, administration, inspection, or shipping''?
(4) With respect to meeting the direct labor hour ratio
requirement, describe any challenges or successes associated with
facilitating or supporting AbilityOne employees' mobility into jobs
outside the Program; particularly, whether such mobility causes
challenges with ratio compliance, and if applicable, the steps taken to
mitigate such challenges.
Michael R. Jurkowski,
Director, Business Operations.
[FR Doc. 2024-21709 Filed 9-20-24; 8:45 am]
BILLING CODE 6353-01-P
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