MCAA Encourages Member Comments on Proposed Alternative Apprenticeship Registration Regulation

June 25, 2019

The Mechanical Contractors Association of America (MCAA) advises its members that comments on the U.S. Department of Labor’s (DOL) proposed regulations that were published today are due by August 26, 2019. The proposed regulations are published in 84 Federal Register 29970 and following.

The new alternative apprenticeship registration, approval and operational oversight system creates a new parallel to the traditional Labor Department or State Apprenticeship Council apprenticeship registration, approval and oversight model. Under the regulatory proposal, the Federal apprenticeship regulations would encompass two parts:

  • The traditional system, which for now still includes the traditional construction industry programs in the usual 29 CFR 29 Part A, Registered Apprenticeship Programs
  • A parallel industry-approved system in a new 29 CFR 29 Part B, comprised of Standards Recognition Entities (SREs) of Industry-Recognized Apprenticeship Programs (IRAPs)

The rationale for creating the new system was derived from the Trump Administration’s Executive Order 13801, Expanding Apprenticeship in America, in June 2017. The Executive Order set up a blue-ribbon panel to consider ways to expand apprenticeship in the domestic economy.  The assumption underlying the Administration’s initiative was that the yawning skills gap in the American workforce and consequent unfilled job openings stem from the failure of the large part of the domestic business economy to utilize apprenticeship as a workforce development tool.

The premise was that the complexity of the current DOL/SAC state system embodies a degree of complexity that frustrates large-scale use of the traditional registration process. Allowing a greater degree of flexibility to SREs and IRAPs as compared with the traditional registration process will perforce lead to an exponential growth in the use of apprenticeship across sectors of the economy that have not previously used apprenticeship as a workforce development tool.

Throughout the course of the initial policy-making process, the EO and the DOL process evinced continued assurances that the construction industry would be exempt from incursion by the SRE/IRAP process because the construction industry has the distinction of being the largest and most successful user of the traditional process. Fully 48% of all registered apprentices on average over the past 5 years work in the construction industry, surpassing DOD military apprenticeships, the second largest user, at 32% of all registered apprentices.

Those assurances have been confirmed in a §29.31, Scope of Deconfliction between Apprenticeship Programs under Subpart A of the proposal and spelled out in Subpart B of the same section as follows:

“The Department will only recognize Standard Recognition Entities that seek to recognize Industry Programs in sectors without significant registered apprenticeship opportunities.

For purposes of this Section, a sector with significant registered apprenticeship opportunities is one that has had more than 25% of all federal registered apprentices per year on average over the prior 5-year period, or that has had more than 100,000 federal registered apprentices per year on average over the prior 5-year period, or both, as reported through the prior fiscal year by the Office of Apprenticeship.”

However, there is other language that could attract comments seeking regulatory expansion into the Registered Apprenticeship operations for construction, as follows:

“…the Department expects to identify the U.S. Military and construction as contexts where registered apprenticeship opportunities are already significant.  Accordingly, the Department would not, at least initially, accept applications from SREs seeking to recognize apprenticeship programs in the U.S. Military or in construction.” [Emphasis added.]

The 155-page proposed regulations embody a complex alternative private sector registration and oversight regime that is based on a series of underlying assumptions and expectations and cost/benefit and cost assumptions that must be held to very close scrutiny.

It may be expected that proponents of the new alternative system will press in regulatory comments for use of IRAPs across all industries, and to look for ways to more readily convert IRAPs into a traditional registration process.

The initial proposed regulations raise questions about the applicability of related Federal benefits of IRAPs as compared with Registered Programs, and the applicability of grant entitlement and EEO and affirmative action compliance as it relates to both types of programs.  The proposal also says the regulations would not constitute a “major rule” ($100 million economic impact) for purposes of the Congressional Review Act.

MCAA is working with the UA, the North American Building Trades Unions (NABTU) and our sister apprenticeship sponsoring employer associations in the Construction Employers of America (CEA) to provide a comprehensive analysis and comments on the proposal.  We also are asked to refer the proposal to our local affiliates, employers and apprenticeship trustees for their analysis and written comments on the proposal as a comprehensive and unique set of perspectives from across the country will be most helpful in the ongoing regulatory process.

MCAA will provide additional details as they become available.

For More Information

For further information contact John McNerney, MCAA General Counsel, at 301-869-5800.

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