42 U.S.C. § 12636 — Notice, hearing, and grievance procedures

(a) In general. (1) Suspension of payments. Under this subchapter, the Corporation^* may suspend or end payments under a covered grant or contract, or revoke positions approved as national-service positions, when it finds a material failure to comply with this subchapter or the grant or contract terms. (2) Procedures. The Corporation must ensure that assistance is not suspended for noncompliance except in an emergency. An emergency suspension may last one or more 30-day periods, totaling no more than 90 days. Assistance may not be ended or positions revoked for noncompliance unless the recipient received reasonable notice and a full and fair hearing opportunity.

(b) Hearings. Required hearings or meetings must be held where convenient for the recipient.

(c) Transcript or recording. A transcript or recording must be made and available for inspection by anyone.

(d) State^* legislation. This subchapter does not prevent a State from passing consistent laws implementing these programs.

(e) Construction. This subchapter does not connect performing service with receiving Federal student^* financial aid, except aid provided under this chapter.

(f) Grievance procedure. (1) A recipient must create and maintain a process for participants, labor organizations, and other interested people to file and have decided grievances about covered projects, including proposed placements. (2) Except for fraud or criminal-activity claims, a grievance must be filed within 1 year after the alleged event. (3) A hearing must occur within 30 days after filing, and a decision must be made within 60 days. (4) Arbitration. (A)(i) If the decision is adverse, or 60 days pass without a decision, the filer may submit the grievance to binding arbitration before a qualified, independent arbitrator jointly selected by the parties. (ii) If they cannot agree, the Chief Executive Officer must appoint one from a qualified list within 15 days after a request. (B) The arbitration must occur within 45 days after the request, or within 30 days after appointment when the CEO appoints the arbitrator. (C) The decision must be made within 30 days after the proceeding starts. (D)(i) The parties split the cost equally. (ii) If the participant^*, labor organization, or other interested person wins, the State or local applicant that is a party must pay all arbitration costs and that filer’s attorney fees. (5) A proposed placement challenged by a grievance may not be made unless it matches the grievance’s resolution. (6) Remedies may include suspending or ending assistance, barring the placement, selecting an applicant or reinstating a participant, changing that person’s service terms, and—when the grievance concerns section 12637(a) or (b) and the recipient employed the displaced worker—reinstatement, lost wages and benefits, restoration of employment terms and privileges, and other fair relief needed to correct the violation or make the worker whole. (7) A suit to enforce an arbitration award may be filed in any United States district court with jurisdiction, without regard to the amount in dispute or the parties’ citizenship.