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

(a) In general The Corporation can suspend or end payments under a grant or contract, or take away a position's status as an approved national service position, if it finds a "material failure" to follow this subchapter or the grant's terms. To make that fair, the Corporation must set up procedures so that: funding isn't suspended for breaking the rules except in emergencies, where a suspension can run for one or more 30-day periods up to 90 days total; and funding isn't terminated or taken away for breaking the rules unless the recipient first gets reasonable notice and a full, fair hearing. (b) Hearings Any hearings needed under this section must be held somewhere convenient for the recipient getting the assistance. (c) Transcript or recording Every hearing under this section must be transcribed or recorded, and that record must be available for anyone to inspect. (d) State legislation This section doesn't stop a state from passing its own laws to help carry out these programs, as long as the state law is consistent with this subchapter. (e) Construction Nothing here should be read to tie performing national service to receiving federal student financial aid — except for aid that comes from this chapter itself. (f) Grievance procedure Any entity getting this assistance must set up and run a process for handling complaints ("grievances") from participants, labor organizations, and other interested people about its projects, including complaints about where a participant gets placed. A grievance must be filed within one year of the event it's about, unless it involves fraud or a crime — those have no deadline. A hearing on a grievance must happen within 30 days of filing, and a decision within 60 days. If a decision goes against the person who filed the grievance, or if 60 days pass with no decision, that person can take the grievance to binding arbitration before an independent arbitrator both sides agree on. If they can't agree on an arbitrator, the Chief Executive Officer picks one from a list within 15 days of being asked. The arbitration hearing must happen within 45 days of the request (or within 30 days of the arbitrator's appointment, if the Chief Executive Officer appointed them), and the arbitrator must decide within 30 days after the hearing starts. Normally each side pays half the arbitration's cost. But if the participant, labor organization, or other individual wins, the state or local recipient must pay the whole cost plus the winner's attorney's fees. If a grievance is about where a participant will be placed, that placement can't happen until it matches how the grievance was resolved. Remedies for a winning grievance can include: suspending or ending the program's funding; blocking the disputed placement; and, for an individual applicant or participant, getting selected or reinstated plus other changes to their service terms. If the grievance is about an employer displacing a worker (as barred by section 12637(a) or (b)) and that employer gets this assistance, remedies can also include reinstating the displaced employee, paying back their lost wages and benefits, restoring their other job terms, and any other fair relief needed to fix the violation or make them whole. Finally, anyone can sue in federal district court to enforce an arbitration award under this section, no matter how much money is involved or where the parties live.