29 U.S.C. § 3228 — Worker ownership, readiness, and knowledge
submitted 4 years ago by Pub. L. 117-328 to r/title-29-LABOR · 1,551 words · no verdicts yet
This section creates a Department of Labor initiative to promote employee ownership. It authorizes grants, technical assistance, evaluations, reports, and specified appropriations.
(a) Definitions. “Existing program” means an employee-ownership program that exists when the Secretary acts under this section. “Initiative” means the Employee Ownership Initiative in subsection (b). “New program” means an employee-ownership program that does not yet exist when the Secretary acts. “Secretary” means the Secretary of Labor. “State” has the meaning in section 3102.
(b)(1) The Secretary must establish the Employee Ownership Initiative in the Department of Labor to promote employee ownership. (2) The Secretary must support existing State programs and help form new State programs. (3) To do that, the Secretary must make grants authorized by subsection (d) and either serve as a clearinghouse for techniques used by programs and share information about them, or fund outside groups to gather and distribute that information. (4) The Secretary must consult the Treasury Secretary, or the delegate, about arrangements whose administration or enforcement belongs to Treasury.
(c)(1) No later than 180 days after December 29, 2022, the Secretary must establish a program encouraging new and existing State programs to foster employee ownership throughout the United States. (2) The program must encourage programs focused on: (A) education and outreach about employee ownership and succession planning, including financial education, employee teams, open-book management, and tools for sharing ideas about business success; (B) technical help for employees becoming owners, for exploring full or partial transfers to employees, and for starting new employee-owned businesses; (C) training employees and employers about participation in open-book management, teams, committees, and other ways to increase employee input; and (D) training entities to seek funding, establish programs, and carry them out.
(c)(3) The Secretary may include provisions that, for education and outreach, target retiring owners, senior managers, labor organizations, trade associations, community and economic-development organizations; encourage workshops and conferences; and distribute materials. For technical help, provisions may give preliminary help, feasibility assessments, funding for objective third-party feasibility studies and preliminary valuations, help selecting and monitoring qualified professionals, and a data bank for legal, financial, and technical advice. For participation training, provisions may provide courses and networks of employee-owned companies. For training new programs, provisions may provide visits to existing programs and training materials. (4) The Secretary must issue guidance recommending that grantees and one-stop partners be proactive and comprehensive in promoting employee ownership to increase productivity and broaden capital ownership. The Secretary must also issue, after consulting Treasury, acceptable standards and procedures for establishing good-faith fair market value for shares acquired by an employee stock ownership plan.
(d)(1) The Secretary may make grants for State new or existing programs for education and outreach; technical assistance; employee and employer training; cooperation among employee-owned firms; and training new programs by participants in existing programs. Grants for that last type of training may not exceed 10 percent of all grants under this section in a fiscal year. (2) The Secretary sets each grant’s amount and conditions, subject to paragraph (6), considering the applicant’s capacity. (3) Applicants must apply when, how, and with the information the Secretary reasonably requires. (4) A State may sponsor and submit an application for a qualifying local government, State-supported college, or nonprofit organization. (5)(A) If a State fails to support or establish a program in a fiscal year, qualifying local entities in that State may apply on their own in later fiscal years. (B) The State may still apply later, but may not screen those local applications before sending them to the Secretary. (6) A recipient’s total grant in a fiscal year may not exceed $300,000 in 2025, $330,000 in 2026, $363,000 in 2027, $399,300 in 2028, or $439,200 in 2029. (7) Each recipient must annually report how it spent grant funds during the preceding 12 months.
(e) The Secretary may reserve no more than 10 percent of a fiscal year’s appropriations for evaluations of the grant programs and related technical assistance.
(f) Within 36 months after December 29, 2022, the Secretary must report to Congress on progress toward employee ownership in United States businesses and analyze critical costs and benefits of activities under this section.
(g)(1) Grant appropriations are authorized at $4,000,000 for 2025, $7,000,000 for 2026, $10,000,000 for 2027, $13,000,000 for 2028, and $16,000,000 for 2029. (2) Administrative-expense appropriations are authorized at $200,000 for 2024 and, for each year 2025 through 2029, no more than the smaller of $350,000 or 5 percent of that year’s maximum grant appropriation.
In this section:
The term “existing program” means a program, designed to promote employee ownership, that exists on the date on which the Secretary is carrying out a responsibility authorized under this section.
The term “Initiative” means the Employee Ownership Initiative established under subsection (b).
The term “new program” means a program, designed to promote employee ownership, that does not exist on the date on which the Secretary is carrying out a responsibility authorized under this section.
The term “Secretary” means the Secretary of Labor.
The Secretary shall establish within the Department of Labor an Employee Ownership Initiative to promote employee ownership.
In carrying out the Initiative, the Secretary shall—
support within the States existing programs designed to promote employee ownership; and
facilitate within the States the formation of new programs designed to promote employee ownership.
To carry out the functions enumerated in paragraph (2), the Secretary shall support new programs and existing programs by—
making Federal grants authorized under subsection (d); and
acting as a clearinghouse on techniques employed by new programs and existing programs within the States, and disseminating information relating to those techniques to the programs; or
funding projects for information gathering on those techniques, and dissemination of that information to the programs, by groups outside the Department of Labor.
The Secretary shall consult with the Secretary of the Treasury, or the Secretary’s delegate, in the case of any employee ownership arrangements or structures the administration and enforcement of which are within the jurisdiction of the Department of the Treasury.
Not later than 180 days after December 29, 2022, the Secretary shall establish a program to encourage new programs and existing programs within the States to foster employee ownership throughout the United States.
The purpose of the program established under paragraph (1) is to encourage new and existing programs within the States that focus on—
providing education and outreach to inform employees and employers about the possibilities and benefits of employee ownership and business ownership succession planning, including providing information about financial education, employee teams, open-book management, and other tools that enable employees to share ideas and information about how their businesses can succeed;
providing technical assistance to assist employee efforts to become business owners, to enable employers and employees to explore and assess the feasibility of transferring full or partial ownership to employees, and to encourage employees and employers to start new employee-owned businesses;
training employees and employers with respect to methods of employee participation in open-book management, work teams, committees, and other approaches for seeking greater employee input; and
training other entities to apply for funding under this subsection, to establish new programs, and to carry out program activities.
The Secretary may include, in the program established under paragraph (1), provisions that—
in the case of activities described in paragraph (2)(A)—
target key groups, such as retiring business owners, senior managers, labor organizations, trade associations, community organizations, and economic development organizations;
encourage cooperation in the organization of workshops and conferences; and
prepare and distribute materials concerning employee ownership, and business ownership succession planning;
in the case of activities described in paragraph (2)(B)—
provide preliminary technical assistance to employee groups, managers, and retiring owners exploring the possibility of employee ownership;
provide for the performance of preliminary feasibility assessments;
assist in the funding of objective third-party feasibility studies and preliminary business valuations, and in selecting and monitoring professionals qualified to conduct such studies; and
provide a data bank to help employees find legal, financial, and technical advice in connection with business ownership;
in the case of activities described in paragraph (2)(C)—
provide for courses on employee participation; and
provide for the development and fostering of networks of employee-owned companies to spread the use of successful participation techniques; and
in the case of training described in paragraph (2)(D)—
provide for visits to existing programs by staff from new programs receiving funding under this section; and
provide materials to be used for such training.
The Secretary shall issue formal guidance, for—
recipients of grants awarded under subsection (d) and one-stop partners (as defined in section 3102 of this title) affiliated with the workforce development systems (as so defined) of the States, proposing that programs and other activities funded under this section be—
proactive in encouraging actions and activities that promote employee ownership of businesses; and
comprehensive in emphasizing both employee ownership of businesses so as to increase productivity and broaden capital ownership; and
acceptable standards and procedures to establish good faith fair market value for shares of a business to be acquired by an employee stock ownership plan (as defined in section 1107(d)(6) of this title).
The guidance under subparagraph (B) shall be prescribed in consultation with the Secretary of the Treasury.
In carrying out the program established under subsection (c), the Secretary may make grants for use in connection with new programs and existing programs within a State for any of the following activities:
Education and outreach as provided in subsection (c)(2)(A).
Technical assistance as provided in subsection (c)(2)(B).
Training activities for employees and employers as provided in subsection (c)(2)(C).
Activities facilitating cooperation among employee-owned firms.
Training as provided in subsection (c)(2)(D) for new programs provided by participants in existing programs dedicated to the objectives of this section, except that, for each fiscal year, the amount of the grants made for such training shall not exceed 10 percent of the total amount of the grants made under this section.
The Secretary shall determine the amount and any conditions for a grant made under this subsection. The amount of the grant shall be subject to paragraph (6), and shall reflect the capacity of the applicant for the grant.
Each entity desiring a grant under this subsection shall submit an application to the Secretary at such time, in such manner, and accompanied by such information as the Secretary may reasonably require.
Each State may sponsor and submit an application under paragraph (3) on behalf of any local entity consisting of a unit of State or local government, State-supported institution of higher education, or nonprofit organization, meeting the requirements of this section.
If a State fails to support or establish a program pursuant to this section during any fiscal year, the Secretary shall, in the subsequent fiscal years, allow local entities described in paragraph (4) from that State to make applications for grants under paragraph (3) on their own initiative.
Any State failing to support or establish a program pursuant to this section during any fiscal year may submit applications under paragraph (3) in the subsequent fiscal years but may not screen applications by local entities described in paragraph (4) before submitting the applications to the Secretary.
A recipient of a grant made under this subsection shall not receive, during a fiscal year, in the aggregate, more than the following amounts:
For fiscal year 2025, $300,000.
For fiscal year 2026, $330,000.
For fiscal year 2027, $363,000.
For fiscal year 2028, $399,300.
For fiscal year 2029, $439,200.
For each year, each recipient of a grant under this subsection shall submit to the Secretary a report describing how grant funds allocated pursuant to this subsection were expended during the 12-month period preceding the date of the submission of the report.
The Secretary is authorized to reserve not more than 10 percent of the funds appropriated for a fiscal year to carry out this section, for the purposes of conducting evaluations of the grant programs identified in subsection (d) and to provide related technical assistance.
Not later than the expiration of the 36-month period following December 29, 2022, the Secretary shall prepare and submit to Congress a report—
on progress related to employee ownership in businesses in the United States; and
containing an analysis of critical costs and benefits of activities carried out under this section.
There are authorized to be appropriated for the purpose of making grants pursuant to subsection (d) the following:
For fiscal year 2025, $4,000,000.
For fiscal year 2026, $7,000,000.
For fiscal year 2027, $10,000,000.
For fiscal year 2028, $13,000,000.
For fiscal year 2029, $16,000,000.
There are authorized to be appropriated for the purpose of funding the administrative expenses related to the Initiative—
for fiscal year 2024, $200,000, and
for each of fiscal years 2025 through 2029, an amount not in excess of the lesser of—
$350,000; or
5.0 percent of the maximum amount available under paragraph (1) for that fiscal year.
Source credit: (Pub. L. 117–328, div. T, title III, § 346, Dec. 29, 2022, 136 Stat. 5381.)
- 2022Enacted · Pub. L. 117-328 · 136 Stat. 5381
A history note hasn’t been published yet. The record shows enactment by Pub. L. 117-328 on 2022-12-29.
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