[Federal Register: August 7, 2003 (Volume 68, Number 152)]
[Notices]
[Page 47097-47099]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr07au03-91]
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DEPARTMENT OF LABOR
Employment and Training Administration
[TA-W-42,113]
The Wackenhut Corporation, San Manuel, AZ; Notice of Negative
Determination on Reconsideration on Remand
The United States Court of International Trade (USCIT) granted the
Secretary of Labor's motion for a voluntary remand for further
investigation in Former Employees of Wackenhut Corporation v. U.S.
Secretary of Labor, No. 02-00758.
October 15, 2002, the Department of Labor (Department) issued a
denial of Trade Adjustment Assistance (TAA) certification for the
workers of The Wackenhut Corporation, San Manuel, Arizona. The decision
was based on the investigation finding that the workers firm provided
security services and did not produce an article in accordance with
section 222(3) of the Trade Act of 1974. The notice of negative
determination regarding eligibility for workers of The Wackenhut
Corporation, San Manuel, Arizona (hereafter referred to as Wackenhut),
was published in the Federal Register on November 5, 2002 (67 FR 67421-
67423).
The initial TAA investigation showed that Wackenhut in Phoenix,
Arizona, supplied workers to perform security services at BHP Copper,
Inc. in San Manuel, Arizona. Workers of BHP Copper, Inc., in San
Manuel, Arizona produced copper cathodes. On March 25, 2002, the
Department issued a certification of eligibility for workers of BHP
Copper, Inc., Pinto Valley, Miami, Arizona, to apply for TAA (TA-W-
39,949). On August 8, 2002, the Department amended that certification
to include workers of BHP Copper, Inc. (hereafter referred to as BHP),
Tucson/San Manuel Operations, Tucson/San Manuel, Arizona (TA-W-
39,949A). The workers of BHP in Tucson/San Manuel, Arizona produced
copper cathodes.
The Wackenhut petitioners did not file a request with the
Department for administrative reconsideration, but chose instead to
seek judicial review with the U.S. Court of International Trade. The
U.S. Department of Labor submitted to the Court the administrative
record for the Wackenhut petition investigation (TA-W-42,113).
The plaintiffs' counsel subsequently submitted declarations about
the work performed at the BHP site by the Wackenhut employees. The
declarations alleged that the worker group performed work involving
copper production.
A former Wackenhut employee, the Captain, also known as Officer in
Charge (OIC) of Wackenhut operations at BHP in San Manuel, Arizona,
declared that by 2002, Wackenhut employees' responsibility for copper
production-related work at BHP included, but was not limited to: (1)
Preparation of finished copper cathodes for shipment, including
completion of paperwork relating to the shipping and inspecting; (2)
receipt of shipments of sulfuric acid necessary for the production
processes of copper cathodes, and (3) the disposal operations for
byproducts.
A former BHP official, the Corporate Manager for Safety, Health and
Security, who spent about 60 percent of his time at the Tuscon/San
Manuel facility, made similar statements and declared that Wackenhut
employees at BHP in San Manuel, Arizona were an integral part of
production and shipping operations, in addition to their security
functions. He declared that as layoffs of BHP employees occurred, the
responsibilities of Wackenhut employees increased; they were asked to
assume increasing responsibilities relating to the production of copper
at the facility.
On remand, the Department contacted the BHP Vice President,
Administration, to obtain information about the work performed by
Wackenhut at the BHP San Manuel, Arizona facility. He provided a copy
of the contract between BHP and Wackenhut. It is noted that the
contract includes BHP facilities other than the San Manual, Arizona
location. The contract was for a 3-year period, between January 1998
and January 2001 and was informally extended on a month-to-month basis
until terminated in August of 2002. The BHP Vice President,
Administration, consulted with BHP officials that were responsible for
operations and production of copper cathodes at San Manuel. The primary
duties of Wackenhut, as described in the contract between Wackenhut and
BHP, were to control ingress and egress of all employees, visitors,
deliveries and service providers, and to escort material deliveries to
appropriate unloading areas and assure correct paperwork is completed.
Under the contract, Wackenhut provided security services. The
Department determined that such
[[Page 47098]]
services are not related to the production of copper cathodes.
The Department contacted the Wackenhut official at the Phoenix,
Arizona, office about who would be the Wackenhut person most
knowledgeable about the day-to-day activities for the Wackenhut
employees at BHP in San Manuel. Although the TAA petition for workers
of Wackenhut identified the Area Manager as the contact person, the
plaintiffs cited that this individual would not have the day-to-day
knowledge of the work performed by Wackenhut employees at the BHP
operations. The Area Manager, however, identified himself and the
Captain/OIC at BHP in San Manuel, Arizona.
The Department asked the Area Manager for Wackenhut how the workers
were involved in production and shipping of copper cathodes at BHP in
San Manuel, Arizona. He responded that the workers of Wackenhut did not
produce any sort of tangible product for BHP; involvement of copper
cathode production was limited to access/egress control and building/
perimeter patrol at the mine site. He added that Wackenhut did perform
some OSHA/MSHA and First Responder training to BHP mine personnel in
support of mine operations. The Area Manager was also asked if the
Wackenhut employees at BHP in San Manuel did work other than that
specified in the contract. He responded that all duties would be
detailed in the site's security Post Orders and any amendment to those
Orders. Furthermore, Wackenhut employees were not authorized to perform
any duties other than those in the Post Orders.
Under the Post Orders, Wackenhut provided security services. The
Department determined that such services are not related to the
production of copper cathodes.
Since the services described by the OIC cannot be considered
producing the article, on remand the Department asked the Wackenhut OIC
to explain how they prepared the finished copper cathodes for shipment.
She responded that after the BHP Shipping Clerks were laid off,
Wackenhut was left with the responsibility to inspect the load and
complete the paperwork. Without the proper paperwork completed and
signed by security, the load was not allowed to leave BHP San Manuel.
She made similar statements with respect to the receipt and delivery of
a wide variety of products and by-products essential to BHP
manufacturing.
The former Corporate Manager for Safety, Health and Security for
BHP was asked how Wackenhut workers were engaged in the production of
copper cathodes. He responded that they would weigh out and count the
number of copper cathodes leaving the BHP premises. Furthermore, they
would weigh in copper anodes that were entering the BHP premises for
further processing.
When a worker group applies for Trade Adjustment Assistance TAA,
the fundamental test the Department of Labor applies is whether the
workers' firm or appropriate subdivision is producing an import-
impacted article during the relevant time period. If the worker group
produces an article they are considered production workers.
Section 222 of the Trade Act establishes that the Department must
not certify a group unless increases of imports of articles like or
directly competitive with articles produced by such workers' firm or an
appropriate subdivision thereof contributed importantly to such total
or partial separation, or threat thereof, and to such decline in sales
or production. The phrase of particular importance in this case is
``articles produced by such workers' firm or an appropriate subdivision
thereof.'' Under this requirement, the Department cannot issue a
certification of eligibility to a worker group unless the workers' firm
or an appropriate subdivision of the workers' firm produces an import-
impacted article.
An appropriate subdivision is limited to the workers' firm and
section 90.2 of the Trade Adjustment Assistance program regulations
permits the inclusion of multiple entities within the firm only if they
are affiliated entities. The Department's investigation indicates that
substantially the same persons do not control Wackenhut or BHP. The
contract between Wackenhut and BHP indicate that they are separate
corporations. Therefore, the Department finds that Wackenhut and BHP
are not controlled or substantially beneficially owned by the same
persons. They are independent business entities and as such the word
firm as defined in section 90.2, workers' firm cannot mean both
Wackenhut and BHP.
The Department's interpretation of ``appropriate subdivision
hereof'' is limited to related or affiliated firms and cannot be
expanded to encompass an unaffiliated firm. This interpretation is
consistent with section 222 of the Trade Act of 1974 which requires the
Department to consider whether a significant number of workers have
been separated from the workers' firm or appropriate subdivision of the
firm.
The contract between BHP and Wackenhut (the independent contractor)
establishes that all persons employed by the contractor shall be deemed
to be employees of the contractor; in this case Wackenhut. The
Department has consistently determined that the critical employment
factor is which firm was obligated to pay the employee during the
relevant period. Because Wackenhut was so obligated, the Department has
determined that Wackenhut is the workers' firm.
Therefore, the Department finds that the petitioners are employees
of Wackenhut and cannot be certified as an appropriate subdivision (or
as part of an appropriate subdivision) of BHP.
In order to consider the petitioners producing articles, the
Wackenhut workers would have to transform a thing into something new
and different. Security services, weighing incoming and outgoing
shipments, completing paperwork for incoming and outgoing shipments,
escorting trucks to the proper location, and providing safety training
for both BHP and Wackenhut employees could be considered ``services''
related to the production of the articles produced at BHP. The
Department thoroughly investigated and could not find any evidence that
any employees of Wackenhut actually produced any articles or that the
petitioners transformed anything into something new and different.
Consequently, they are not eligible for certification as production
workers.
Conclusion
Whether the performance of services by the petitioners is related
or unrelated to production is not relevant to determining their
eligibility for certification. Under section 222 of the Act, what is
relevant is whether the workers' firm or an appropriate subdivision of
the workers' firm produces an article. The workers' firm in this case
is Wackenhut. Wackenhut is not affiliated with BHP. The evidence
clearly establishes that Wackenhut does not produce, directly or
through an appropriate subdivision, an import-impacted article. Once
the Department concludes that the workers' employer was not a firm that
produced an import-impacted article, it may conclude that the workers
are not eligible for assistance without further analysis. Because the
petitioners are employees of a firm or subdivision that does not
produce a trade-impacted article, they are not eligible for
certification.
After reconsideration on voluntary remand, I affirm the original
notice of negative determination of eligibility to apply for adjustment
assistance for workers and former workers of The Wackenhut Corporation,
San Manuel, Arizona.
[[Page 47099]]
Signed at Washington, DC, this 29th day of July, 2003.
Linda G. Poole,
Certifying Officer, Division of Trade Adjustment Assistance.
[FR Doc. 03-20116 Filed 8-6-03; 8:45 am]
BILLING CODE 4510-30-P