Division of Federal Employees' Compensation (DFEC)
Paragraph and Subject
RCHB Trans. No.
Table of Contents
1. Assisted Re-employment. Assisted Reemployment (AR) is an employment incentive program sponsored by the DFEC with the goal of increasing employment opportunities for FECA injured workers (IWs) through provision of a temporary wage subsidy to employers. The AR program supports and encourages private sector businesses to provide permanent job opportunities to DFEC IWs by offering partial reimbursement of wages paid to new hires during an initial period of employment.
Note - AR should not be confused with DFEC sponsored On-the-Job Training (OJT) programs. OJT does not include salary reimbursement to employers and is most effectively used when an IW needs training to acquire new skills that is best provided on the job, rather than in a more formal training or educational facility.
Explicit authority for this program has been contained in the FECA program's budgetary authority for many years.
a. Benefits of Assisted Reemployment. The goal of AR is to provide a mutually beneficial opportunity for both potential employers and DFEC IWs.
(1) Benefits to Employers. For employers, AR benefits may include:
(a) Reducing the cost of hiring and training a new employee through the initial period of salary reimbursement.
(b) Saving time with the recruitment process. DFEC Rehabilitation Counselors (RCs) can forward job-ready, qualified candidates with the skills and experience to match available job openings.
(c) Maintaining control of the hiring process. The employer has the opportunity to consider qualified DFEC candidates, but maintains the authority to decide who to interview and who (if any) to hire.
(d) Access to support and consultation services at no cost during at least the first 60 days of employment. Vocational rehabilitation professionals can provide guidance and assistance with employee-related disability or work issues, if needed, to help facilitate a positive transition to employment.
(e) Opportunity for a more diversified workforce which may support the business' Equal Employment Opportunity (EEO) or other inclusion goals.
(f) Potential eligibility for state or Federal tax credits for hiring persons with disabilities (availability varies by state).
(2) Benefits to IWs. Benefits to IW's may include:
(a) Potential for expanded possibilities or "open doors" to employment opportunities.
(b) Potential for faster placement.
(c) Support for disability-related and work issues provided by the RC and DFEC staff during the period of transition to reemployment.
b. Eligibility for Assisted Reemployment.
(1) Eligible IWs. The use of AR may be proposed for the IW by the DFEC Claims Examiner (CE), Rehabilitation Specialist (RS) or the RC during the Plan Development phase or at any other time during the placement process. The use of AR is encouraged at all times but especially in situations in which the IW may be difficult to place due to the type/severity of the disability and/or other personal or social issues, including challenged labor markets or competitive fields.
AR should be considered for IWs who currently qualify for the selected position, and the unsubsidized wages should fairly and reasonably represent the IW's earning capacity. AR should not be substituted for necessary training or to employ the IW in an unsuitable position. If training is necessary, formal or on-the-job training should be completed before AR is implemented.
(2) Eligible Employers. AR salary reimbursement may be offered to employers in the private sector, or to state and local government agencies. It may not be offered to Federal agencies at this time.
A business owned or managed by the IW, the IW's relative, an employee of OWCP (or his/her family), or a contracted DFEC RC (or his/her family) is not eligible for an AR subsidy.
If the IW is released to full-time work, the AR subsidy should only be considered for employers offering full-time work. A part-time AR subsidy should not be considered for an IW who has been released to full-time work.
Employers are expected to offer a genuine job in good faith, which is anticipated to be permanent (and last beyond the subsidy period) and which they might have hired another worker to perform. The job must be described in writing so that DFEC can determine whether it is consistent with the IW's necessary work restrictions.
Employers are expected to provide the usual benefits which they would provide to other employees. Private sector employers will provide workers' compensation insurance as required within their state jurisdiction. While the employer retains the right to discipline or terminate an IW for cause (as with any other employee in similar circumstances) the aim is that, due to the partnership with DFEC, the employer will work with the RC to resolve any concerns prior to taking final measures.
c. Reimbursement Parameters. The rate and duration of wage reimbursements should be negotiated separately with each employer, depending on the nature of the job market and the particular circumstances in the case. The exact amount of the reimbursement will depend on several factors, including the starting wage and the IW's current amount of wage loss compensation. The RS will work with the RC to determine the amount of wage reimbursement available.
AR subsidies are subject to these restrictions:
(1) AR subsidies of six months to one year are the most common, but an AR subsidy may be paid for up to 36 months, depending on the case.
(2) The rate of reimbursement may not exceed 75% of gross wages paid.
(3) At no time may the wage subsidy paid to the employer, plus any wage loss compensation payment paid to the IW, exceed the amount of compensation for total disability which would be paid to the IW in the absence of employment. The RS will assist the RC with determination of the subsidy amounts.
(4) If a subsidy of longer than one year is approved, the subsidy should be tiered and gradually phased out during the course of the agreement, usually in no more than three rate changes, e.g. 75% in the first year, 50% in the second year and 25% in the last year.
(5) The subsidy is not transferrable from one employer to another.
(6) If the IW's entitlement to wage loss compensation is terminated for any reason, the AR subsidy must be terminated as well.
(7) If the IW's entitlement to wage loss compensation is suspended, AR subsidy payments will be suspended during the same period of time.
(8) If the IW quits or is terminated from the position for which the AR subsidy is being paid, the subsidy will terminate as of that date.
(9) If the employer fails to respond in full to any inquiry made by the DFEC pertaining to the IW or the subsidy arrangement, the AR subsidy may be terminated.
(10) An AR Memorandum of Agreement must be signed by the employer and included in the DFEC case file prior to any payment being made. A sample AR Memorandum of Agreement can be found as Exhibit 1 of the FECA PM 8-0800.
(11) Wage reimbursements made to employers will be treated as taxable income, and a Form 1099 will be issued to each employer at the end of each calendar year.
d. Assisted Reemployment Process.
(1) First Steps. Before proceeding with AR, the case file should document that the Employing Agency (EA) has declined or failed to offer appropriate modified employment. Additionally, AR subsidies should not be considered in instances where the IW is not putting forth a good-faith effort in the return to work process or is otherwise demonstrating poor conduct.
Prior to consideration of AR, the RC and RS should discuss whether the IW is an appropriate candidate who may benefit from AR in the placement process. If so, the RS will provide the RC with information pertaining to the amount of the possible AR wage subsidy based on the IW's wage loss compensation. The RC, in cooperation with the IW and under the guidance of the RS, will then incorporate AR into the vocational rehabilitation plan and placement efforts.
The RC should discuss AR with the IW to facilitate his/her understanding of the incentive program so that the IW may also use AR as a tool on his or her own behalf, as possible, when reaching out to employers and engaging in job search efforts.
(2) AR and Placement Services. As the job search begins and progresses, the RC is expected to initiate contacts with employers and engage in placement services as discussed in the Placement – New Employer (PNE) section of this handbook (See Part 8 of this handbook). During this process, the RC is encouraged to liberally use AR information, as appropriate, as a tool to network with and market to employers and to generate interview opportunities for the IW.
The RC should inform interested employers of all potential benefits of the AR program as well as pertinent aspects of the AR subsidy, including: details of the Assisted Reemployment Memorandum of Agreement, information needed by DFEC to assure prompt processing of wage reimbursement submissions, and also that wage reimbursement payments must be reported as taxable income. The RC and RS may arrange to discuss all relevant issues and answer any questions that the employer may have.
In situations where the IW has been the only contact with a prospective employer, and prefers that the RC not make direct contact, the IW can make the choice to discuss AR on his/her own behalf or not. The RC can assist the IW to determine any advantages and/or disadvantages in such situations.
(3) AR Approval. Once an employer has agreed to hire the IW and to receive an AR subsidy, the RS will draft an Assisted Reemployment Memorandum of Agreement to record the terms of the wage subsidy. The RC and/or RS should provide the Agreement to the employer and facilitate signatures. The RS should then send a copy of the signed agreement to the employer and the IW for their records.
The Memorandum of Agreement will state the employer's intention to hire the IW, a description of the job, duties, starting pay rate and terms of reimbursement.
When the IW accepts a position, the RC must notify the RS promptly via the Rehabilitation Action Report, Form OWCP-44. The IWs DFEC wage loss compensation will be adjusted based on the unsubsidized wage rate to be paid.
(4) AR Employment Support. The RC should provide support and guidance as needed to both the employer and the IW during the agreed upon period of time of early employment. Unless otherwise directed by the RS, minimum requirements for follow-up, professional hours and reports will be consistent with general PNE procedures. (See Part 8 of this handbook).
(5) AR and Closure. A worker may be considered successfully rehabilitated when employed for more than 60 days without interruption. Normally, the RS will close the vocational rehabilitation case at this time. The same basic principle applies to cases with AR subsidies except that wage reimbursement payments continue to be monitored by the RS and made on the IW's behalf for the agreed upon period of time.
(6) AR and Post-Employment Services (PES). PES may be provided for an additional amount of time (or intermittently throughout the reimbursement period) if approved by the RS for adjustment difficulties or as otherwise needed to maintain the job. These services may include counseling, guidance, additional training, medical rehabilitation and/or consultation and support to both the employer and the IW.
Recommendations for PES should be discussed with, and authorized by, the RS. If authorized, extensions are usually granted in 30-60 day intervals and meant to address specific issues.
When PES services are no longer needed or helpful, the RS may direct the RC to close the vocational rehabilitation case.
e. Payment of AR Subsidies. All steps which employers must take to obtain accurate and timely reimbursements should be specified in the AR Memo of Agreement. Employers must be registered as DFEC vendors through the the OWCP central bill payment system in order to receive reimbursement.
On a quarterly basis, employers may claim reimbursement by completing and submitting Form CA-2231, "Claim for Reimbursement, Assisted Reemployment." The form, available on the DFEC website, certifies that the IW has been paid wages according to the terms of the agreement. The form must be filled out completely, and signed by the employer and IW/employee. To ensure timely payment, it should be submitted directly to the RS who will authorize and submit the reimbursement request for processing via the OWCP central bill payment system.
If the IW/employee quits, is terminated or suspended from work, or if the RC suspects any changes in the work arrangement, the RC must notify the RS immediately via the Rehabilitation Action Report, Form OWCP-44. The RC should then contact the RS to determine how to proceed with services and to determine whether any action is needed regarding the employer's subsidy.
f. Assisted Reemployment Forms. The Memorandum of Agreement will be provided to the RC by the RS.
The Form CA-2231, "Claim for Reimbursement, Assisted Reemployment" is available on the DFEC website at: http://www.dol.gov/owcp/regs/compliance/ca-2231.pdf