E9-5042. Hafner USA, Inc., New York, NY; Notice of Negative Determination on Reconsideration

On January 13, 2009, the Department issued an Affirmative Determination Regarding Application for Reconsideration of the negative determination regarding workers' eligibility to apply for Trade Adjustment Assistance (TAA) and Alternative Trade Adjustment Assistance (ATAA) applicable to workers and former workers of Hafner USA, Inc., New York, New York (subject firm). The Department's Notice was published in the Federal Register on January 26, 2009 (74 FR 4460).

The initial determination was based on the Department's findings that the subject worker group does not support a firm or appropriate subdivision that produces an article domestically.

In order to apply for TAA based on increased imports, the subject worker group must meet the group eligibility requirements under Section 222(a) of the Trade Act of 1974, as amended. Under Section 222(a)(2)(A), the following criteria must be met:

A. A significant number or proportion of the workers in such workers' firm, or an appropriate subdivision of the firm, have become totally or partially separated, or are threatened to become totally or partially separated; and

B. The sales or production, or both, of such firm or subdivision have decreased absolutely; and

C. Increased imports of articles like or directly competitive with articles produced by such firm or subdivision have contributed importantly to such workers' separation or threat of separation and to the decline in sales or production of such firm or subdivision.

29 CFR 90.2 states that a group means “three or more workers in a firm or an appropriate subdivision thereof” and that a significant number or proportion of the workers means “at least three workers in a firm (or appropriate subdivision thereof) with a work force of fewer than 50 workers.” The regulation also states that “increased imports means that imports have increased either absolutely or relative to domestic production compared to a representative base period. The representative base period shall be one year consisting of the four quarters immediately preceding the date which is twelve months prior to the date of the petition.”

Because the petition date is October 3, 2008, the relevant period (the twelve months prior to the date of the petition) is October 2007 through September 2008 and the representative base period is October 2006 through September 2007.

The Department has carefully reviewed information submitted during the initial and reconsideration investigations. The Department determines that the petition did not cover a valid worker group (the group consisted of only two workers at the subject firm) and that, during relevant period, less that three workers were separated or were threatened with separation from the subject firm.

Based on the information above, the Department determines that the group eligibility requirements under Section 222(a) of the Trade Act of 1974, as amended, were not met.

Even if there was a valid worker group and the worker separation threshold was met, the Department would not have issued a certification applicable to the subject worker group.

During the reconsideration investigation, the Department confirmed that the subject firm ceased production in the United States in 2005. The North Carolina facility identified in the request for reconsideration was a marketing office. The Virginia facility identified in the request for reconsideration (Hafner LLC, a subsidiary of Hafner, Inc., Gordonsville, Virginia) was certified on May 16, 2005 (TA-W-57,119) based on a shift of production to Canada.

Because there was no domestic production during the relevant period, the Department determines that there was no domestic production that increased imports could have impacted. Further, the Department determines that there was no shift of production to a foreign country during the relevant period.

In order for the Department to issue a certification of eligibility to apply for Alternative Trade Adjustment Assistance (ATAA), the subject worker group must be certified eligible to apply for Trade Adjustment Assistance (TAA). Since the subject workers are denied eligibility to apply for TAA, the workers cannot be certified eligible for ATAA.

Conclusion

After reconsideration, I affirm the original notice of negative determination of eligibility to apply for worker adjustment assistance for workers and former workers of Hafner USA, Inc., New York, New York.

Signed at Washington, DC, this 24th day of February 2009.

Elliott S. Kushner,

Certifying Officer, Division of Trade Adjustment Assistance.