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WIOA core program performance negotiations and sanctions
Summary ETA and the Education Department explained how states negotiate WIOA core program performance targets and when sanctions can follow performance or reporting failures. The attachments give data and model details for the negotiations. Change 1 later rescinded this base letter, and Change 2 replaced Change 1.
Document
Federal guidance
Agency
U.S. Department of Labor, Employment and Training Administration (ETA)
Document number
TEGL No. 11-19
Date issued
February 6, 2020
Status
Rescinded
Rescinded by TEGL 11-19, Change 1; ETA lists this base advisory as Rescinded. Change 2 later rescinded Change 1.
Status last verified October 24, 2026
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Official attachments: Attachment 1, Attachment 2, Attachment 3, Attachment 4, Attachment 5.
CLASSIFICATION
EMPLOYMENT AND TRAINING ADMINISTRATION WIOA
ADVISORY SYSTEM CORRESPONDENCE SYMBOL
U.S. DEPARTMENT OF LABOR OPDR
Washington, D.C. 20210 DATE
February 6, 2020
ADVISORY: TRAINING AND EMPLOYMENT GUIDANCE LETTER NO. 11-19
TO: STATE WORKFORCE AGENCIES
STATE WORKFORCE ADMINISTRATORS
STATE WORKFORCE LIAISONS
STATE AND LOCAL WORKFORCE BOARD CHAIRS AND DIRECTORS
STATE LABOR COMMISSIONERS
STATE LMI DIRECTORS
FROM: JOHN PALLASCH /s/
Assistant Secretary
SUBJECT: Negotiations and Sanctions Guidance for the Workforce Innovation and
Opportunity Act (WIOA) Core Programs
1. Purpose. Through this guidance, the U.S. Departments of Labor and Education
(Departments) delineate the process for negotiating levels of performance, as required by
section 116(b)(3)(A)(iv) of the Workforce Innovation and Opportunity Act (WIOA). This
guidance also provides explanation of the two instances in which a state may be sanctioned
for performance failure or for failure to report (section 116(f) of WIOA). Section 116 of
WIOA, its implementing regulations, and this guidance govern how the Departments will
determine when it is necessary to sanction a state, which is statutorily required by WIOA.1
2. Action Requested. Distribute this information to the appropriate state and local staff.
Please make this information available to the appropriate program, reporting, performance
accountability, and technical staff.
1
This guidance is a statement of the Departments’ policy regarding the Workforce Innovation and Opportunity Act.
Other than statutory and regulatory requirements included in this document, the contents of this guidance do not
have the force and effect of law. This document is intended only to provide clarity regarding existing requirements
under the applicable law or agency policies.
RESCISSIONS EXPIRATION DATE
None Continuing
3. Summary and Background.
Summary – This letter provides guidance on the requirements for reaching agreement on the
negotiated levels of performance and the application of sanctions for the states2 outlined in
section 116 of WIOA and its implementing joint regulations in 20 CFR part 677 and
34 CFR parts 361 and 463. This guidance supplements the guidance provided by the
Departments in “Performance Accountability Guidance for WIOA Title I, Title II, Title III,
and Title IV Core Programs,” issued December 16, 2016 and updated August 17, 2017, and
“WIOA Annual Performance Report Submission,” issued September 11, 2017.3
Background – WIOA establishes performance accountability indicators and performance
reporting requirements to assess the effectiveness of states and local areas in achieving
positive outcomes for individuals served by the workforce development system’s six core
programs.4
Under section 116(b)(2)(A) of WIOA, there are six primary indicators of performance for
which each of the state’s core programs must negotiate targets with its respective Federal
agency:
The percentage of program participants who are in unsubsidized employment during the
second quarter after exit from the program (for the title I Youth program, the indicator is
the percentage of program participants in education or training activities, or unsubsidized
employment, during the second quarter after exit);
The percentage of program participants who are in unsubsidized employment during the
fourth quarter after exit from the program (for the title I Youth program, the indicator is
the percentage of program participants in education or training activities, or unsubsidized
employment, during the fourth quarter after exit);
The median earnings of program participants who are in unsubsidized employment
during the second quarter after exit from the program;
2
As stated in 20 CFR § 677.150(d), 34 CFR § 361.150(d), and 34 CFR § 463.150(d), the negotiations and sanctions
process only applies to states as defined in sec. 3(56) of WIOA – each of the several states of the United States, the
District of Columbia, and the Commonwealth of Puerto Rico. It does not apply to the outlying areas as defined in
sec. 3(45)—American Samoa, Guam, the Commonwealth of the Northern Mariana Islands, the U.S. Virgin Islands,
and the Republic of Palau.
3
See Attachment 5 – References.
4
The six core programs are the Adult, Dislocated Worker, and Youth programs, authorized under WIOA title I and
administered by DOL; the Adult Education and Family Literacy Act (AEFLA) program, authorized under WIOA
title II and administered by ED; the Employment Service program authorized under the Wagner-Peyser Act, as
amended by WIOA title III and administered by DOL; and the Vocational Rehabilitation (VR) program authorized
under title I of the Rehabilitation Act of 1973, as amended by WIOA title IV and administered by ED.
The percentage of program participants who attain a recognized postsecondary credential,
or a secondary school diploma or its recognized equivalent, during participation in or
within one year after exit from the program, provided that a program participant who
obtains a secondary school diploma or its recognized equivalent is included in the
percentage of program participants who have attained a secondary school diploma or its
recognized equivalent only if the participant also is employed or is enrolled in an
education or training program leading to a recognized postsecondary credential within
one year after exit from the program (this indicator does not apply to the Employment
Service program authorized under the Wagner-Peyser Act, as amended by WIOA title
III);
The percentage of program participants who, during a program year, are in an education
or training program that leads to a recognized postsecondary credential or employment
and who are achieving measurable skill gains toward such a credential or employment
(this indicator does not apply to the Employment Service program authorized under the
Wagner-Peyser Act, as amended by WIOA title III); and
The effectiveness in serving employers. The Departments determined that the
Effectiveness in Serving Employers indicator will be measured as a shared outcome
across all six core programs within each state to ensure a holistic approach to serving
employers. The Departments will continue piloting approaches for measuring this
indicator for the first two years of PY 2020-2023 Unified or Combined State Plans.
Therefore, states are not required to submit an expected level of performance for the
Effectiveness in Serving Employers indicator for PY 2020 and PY 2021. However, core
programs are expected to collect data and select one agency to report joint results for this
indicator for PY 2020 and PY 2021 as they did for PY 2016-2019 plans.
WIOA requires the Governor of each state to submit a Unified or Combined State Plan that
includes a four-year strategy for the state’s workforce development system and to submit a
modification to that plan after two years (sections 102(c) and 103(b)(1) of WIOA). The
expected levels of performance for each primary indicator of performance for each core
program must be included in the initial submission of a Unified or Combined State Plan and
in the required two-year modification of the plan (section 116(b)(3)(A)(iii) of WIOA)). The
approved Unified or Combined State Plan and the required two-year modification must
reflect two years of negotiated levels of performance (section 116(b)(3)(A)(iv) of WIOA).
Additional information on the process for setting these levels of performance is provided
below.
4. Negotiations and Sanctions Guidance.
Definitions of Terms
Below, the Departments provide clarification about the various terms relevant to the
process of establishing levels of performance under WIOA section 116(b):
Expected levels of performance are the levels of performance proposed by the state in
the initial submission of the Unified or Combined State Plan and in the required two-year
modification of the Unified or Combined State Plan prior to negotiations (WIOA section
116(b)(3)(A)(iii)) for each primary indicator of performance for each core program;
Negotiated levels of performance are the levels of performance mutually agreed to by
the state and the Department for each respective program. The negotiations process must
be based on four factors described in section 4 of this guidance. These negotiated levels
of performance must be incorporated into the approved Unified or Combined State Plan
and the approved two-year modification of that Plan (WIOA section 116(b)(3)(A)(iv)) for
each primary indicator of performance for each core program;
Adjusted levels of performance are levels of performance determined by adjusting the
negotiated levels of performance at the end of the program year to reflect actual
characteristics of participants served and the actual economic conditions experienced
using the statistical adjustment model (see below) (WIOA section 116(b)(3)(A)(vii));
Actual level of performance is the outcome reported by a state on the Statewide
Performance Report (ETA-9169 OMB No. 1205-0526) for each primary indicator of
performance for each core program (section 116(d)(2) of WIOA). Actual levels of
performance will be compared to the adjusted levels of performance at the close of the
program year to determine the state’s performance success or failure;
Adjustment factor is a positive or negative difference that will be added to the
negotiated level of performance to determine the adjusted level of performance. The
adjustment factor is the difference between the estimated levels of performance predicted
by the statistical adjustment model prior to the start of the program year and the levels of
performance re-estimated by the statistical adjustment model after the close of the
program year. This calculation will yield a positive or negative difference, which will be
used as the adjustment factor for the program year;
Individual indicator score is the proportion the actual level of performance represents
of the adjusted level of performance for a single performance indicator for a single
program. It is calculated by dividing the actual level of performance achieved by the
adjusted level of performance;
Overall state program score is the average of the individual indicator scores for a
single WIOA core program across performance indicators;
Overall state indicator score is the average of the individual indicator scores for a
single performance indicator across WIOA core programs; and
Statistical adjustment model is an objective regression model used to estimate levels of
performance and adjusted levels of performance. Before the program year, the statistical
adjustment model determines estimates that are used as a factor in the negotiations
process. After the program year, the estimates derived from the statistical adjustment
model are applied to the actual economic conditions and characteristics of participants
served to determine the adjustment factor (WIOA section 116(b)(3)(A)(viii)). Economic
conditions include differences in unemployment rates and job losses or gains in particular
industries. Characteristics of participants include, but are not limited to, indicators of
poor work history, lack of work experience, lack of educational or occupational skills
attainment, dislocation from high-wage and high-benefit employment, low levels of
literacy or English proficiency, disability status, homelessness, ex-offender status, and
welfare dependency. The statistical adjustment model also takes into account other
factors that, through empirical support, are determined to have an effect on predicting
state outcomes.
The Negotiations Process Overview
WIOA section 116(b)(3)(A)(iv) requires that states reach agreement with the
Departments on levels of performance for each primary indicator of performance for each
of the core programs. The Departments call these agreed-upon levels “negotiated levels
of performance,” and they must cover the first two program years of the Unified or
Combined State Plan. States also are required to reach agreement with the Departments
on negotiated levels of performance for each of the primary indicators of performance for
each of the core programs for the third and fourth years of the Unified or Combined State
Plan. These negotiated levels of performance must be incorporated into the Unified or
Combined State Plan during the required two-year modification of a plan (WIOA section
116(b)(3)(A)(iv)). Attachment 3—“WIOA Negotiations/Performance Process”—
illustrates the process for negotiations and determining performance success or failure,
which is detailed later in this guidance. The primary indicator for the effectiveness in
serving employers has not yet been defined. For this reason, the negotiations process
described below does not include this indicator. States should continue to report
performance on the pilot measures described in the joint performance accountability
guidance (“Performance Accountability Guidance for Workforce Innovation and
Opportunity Act (WIOA) Title I, Title II, Title III, and Title IV Core Programs,” DOL
TEGL 10-16, change 1, OCTAE PM 17-2, and RSA TAC 17-01 dated August 2017)
until this indicator is defined.
The negotiations process will proceed as follows:
As stated above, each state must submit expected levels of performance in its Unified
or Combined State Plan and in the two-year modification of that plan. Expected
levels of performance for the first two years of a state plan must be submitted in the
initial submission of the Unified or Combined State Plan and in the initial
submission of the two-year modification of that Plan, for years three and four, as
described in 20 CFR § 677.170(a) and 34 CFR § 361.170(a) and § 463.170(a).
Expected levels of performance must be stated to the nearest tenth of a percent
(XX.X %) or to the nearest whole dollar for median earnings. States are reminded
that the expected levels of performance proposed by states in their plan must be
published for public comment prior to plan submission in accordance with state law,
regulation, and policy;
After the Unified or Combined State Plan submission, the state must negotiate and
reach agreement with the respective Federal agency on the negotiated levels of
performance for the indicators for each of the first two years of the Unified or
Combined State Plan (or for the third and fourth years of the Unified or Combined
State Plan during the required two-year modification process) for each of the core
programs under WIOA section 116(b)(3)(A)(iv). The factors that will be taken into
account during the negotiations process are described in detail below under
Negotiation Factors;
The Departments will use the statistical adjustment model as a tool in the
negotiations process to estimate the state’s levels of performance prior to the
program year to help reach agreement on the negotiated levels of performance. The
negotiation factors outlined in WIOA section 116(b)(3)(A)(v) and further described
below under Negotiation Factors will be taken into account during this process; and
Once negotiated levels of performance are agreed upon, the state must incorporate
the negotiated levels of performance into the Unified or Combined State Plan and
the two-year modification of that plan prior to the plan’s approval (section
116(b)(3)(A)(iv) of WIOA).
Use of the Statistical Adjustment Model in the Negotiations Process
As required by section 116(b)(3)(A)(viii) of WIOA, the Departments will use the
statistical adjustment model to ensure that the impact of participant characteristics and
economic conditions in the state are accounted for in determining the negotiated levels of
performance.
The statistical adjustment model will provide two major functions in performance
negotiations and assessment of state performance. First, it is one of the factors used
when coming to agreement on the negotiated levels of performance. It is used to account
for the economic conditions and the characteristics of participants to be served in the state
and/or local areas (section 116(b)(3)(A)(v)(II) of WIOA). Second, it will be used at the
close of a program year to adjust the negotiated levels of performance for the actual
economic conditions experienced and actual characteristics of participants served (section
116(b)(3)(A)(vii) of WIOA); these are the adjusted levels of performance.
The Departments recognize that the use of the statistical adjustment model is a new
requirement for the core programs and believe that it will be critically important to the
WIOA performance negotiations process. As more data become available, the
Departments will periodically review the model and refine it as necessary. State
performance will be assessed using the iteration of the model used to negotiate the levels
of performance for that program year.
Negotiating Levels of Performance
Unified or Combined State Plan submissions and the two-year modifications to those
plans must contain expected levels of performance for the primary indicators of
performance (section 116(b)(3)(A)(iii) of WIOA). Submitting this information is the first
step in the negotiations process. Once the expected levels of performance have been
submitted, each core program must begin negotiations with its respective Federal agency
(section 116(b)(3)(A)(iv) of WIOA). Title I WIOA and title III Employment Service
programs will conduct these negotiations with their DOL-Employment and Training
Administration (ETA) Regional Offices. The title II AEFLA program will conduct
negotiations with the Office of Career, Technical, and Adult Education’s (OCTAE)
Division of Adult Education and Literacy, and the title IV VR program will conduct
negotiations with the Rehabilitation Services Administration’s (RSA) State Monitoring
and Program Improvement Division. The agencies will review how this process applies
to the Effectiveness in Serving Employers indicator, once the pilot phase is completed.
Additional guidance will be provided on the process for negotiating this joint indicator.
States have access to their own historical performance information and various other
tools and resources, such as data from the Bureau of Labor Statistics or U.S. Census
Bureau. These tools may be used to establish the states’ expected levels of performance.
When using other resources to analyze the relationship between labor market or
economic conditions and actual performance, states should consider the reference period
of the resource and the timeframes associated with each of the primary indicators of
performance and apply them accordingly.
Negotiation Factors
In reaching agreement on the negotiated levels of performance, states and the
Departments must apply the following factors pursuant to section 116(b)(3)(A)(v) of
WIOA. Note that WIOA does not specify more or less weight on any specific
negotiation factor.
1. Take into account how the levels involved compare with the negotiated levels of
performance established for other states (section 116(b)(3)(A)(v)(I) of WIOA).
The Departments will provide the most recent performance data for all states,
including previous actual, negotiated, and adjusted levels of performance, and will
use this information throughout the negotiations process.
2. Ensure that the levels involved are adjusted using an objective statistical adjustment
model provided by the Departments (section 116(b)(3)(A)(v)(II) of WIOA).
Before the negotiations process begins, the Departments will provide the estimated
outcomes produced by the statistical adjustment model, including the coefficients and
state specific values for each variable. This information will include levels of
performance, as estimated by the Departments, to be used to inform the negotiations
process. State agencies and their respective Federal agencies must negotiate using the
levels of performance estimated by the model for each primary indicator of
performance. These estimated levels of performance may not be altered for the
purposes of negotiations, including any changes in participant characteristics or
economic conditions anticipated by the state that would result in changes to the levels
of performance predicted by the statistical model. Any changes in participant
characteristics or economic conditions will be reflected in the model by using the
actual participant characteristics and economic conditions after the close of the
program year, and they will not be factored into the negotiations process.
3. Take into account the extent to which the levels involved promote continuous
improvement in performance accountability measures by the state and ensure optimal
return on the investment of Federal funds (section 116(b)(3)(A)(v)(III) of WIOA).
The Departments consider continuous improvement to be a critical factor in the
negotiations process. The Departments will consider continuous improvement factors
that ensure optimal return on investment of Federal funds.
The Departments acknowledge that there are many ways to define continuous
improvement as related to state or national program circumstances. For example,
continuous improvement may reflect:
an increase from the levels of performance previously attained;
increases in percentile rankings of levels of performance either nationally or
among similar states;
a change in service strategy and delivery, including more progressive or
innovative approaches;
a change in the intensity or comprehensiveness with which customers are served;
or
a maintenance of previous performance for the top performing states.
The Departments acknowledge that changes to service strategy or customers served
do not always lead to increases in performance levels.
States and local areas must adhere to the priority of service requirements of WIOA
title I programs as established in WIOA5. Additionally, the Departments encourage
all other WIOA programs to serve more individuals with barriers to employment who
may need more intensive services to achieve a positive outcome. The effect of
serving more of these customers will be accounted for in the adjusted levels of
performance calculated after the program year.
4. Take into account the extent to which the levels involved will assist the state in
meeting the performance goals established by the Secretaries of Education and Labor
in accordance with the Government Performance and Results Act of 1993 (GPRA)
(section 116(b)(3)(A)(v)(IV) of WIOA).
Section 116(b)(3)(A)( vi) of WIOA requires the Departments to establish long term
goals for the adjusted levels of performance for each of their core programs through
GPRA expectations. GPRA is a mechanism through which Congress and the Office
of Management and Budget evaluate the success of Federal programs, including those
operated by states and local areas. During negotiations, the Departments will take
into consideration levels of performance that will assist the Federal agencies in
meeting the established GPRA goals.
Determination of Sanctions
There are two types of failure that can lead to sanctions: failure to report and failure to
meet adjusted levels of performance (section 116(f) of WIOA). A discussion of both
circumstances is below.
a. Sanctions for Failure to Report
Sanctions will be applied when a state fails to submit the performance reports to the
appropriate Federal agency, as required under WIOA section 116(d) (section 116(f)(1)(B)
of WIOA). Consistent with 20 CFR § 677.185(a) and 34 CFR §§ 361.185(a) and
463.185(a), the Departments consider a state as failing to submit the performance reports
if the state either: (1) does not submit performance reports by 11:59 p.m. local time6 on
October 1 or (2) submits performance reports by the date for timely submission, but the
report is incomplete. Annual performance report requirements are complete when the
state:
attests all reports are complete and accurate to the best of their knowledge;
submits a WIOA Statewide Performance Report (ETA-9169) for each of the six
WIOA core programs;
5
WIOA section 134(c)(3)(E) and TEGL 19-16 provide additional information regarding priority of service
populations and service requirements.
6
Local time references the state capital’s time zone.
reports all elements of the WIOA Statewide Performance Reports as data are
available according to the reporting periods of each indicator;
makes available a mechanism of electronic access to local area performance reports
for WIOA title I programs;
makes available a mechanism of electronic access to Eligible Training Provider
(ETP) performance reports for WIOA title I programs; and
submits at least one WIOA Statewide Performance Report that includes Effectiveness
in Serving Employers performance results reflecting all six core programs.
If the performance report submitted by the state does not meet all of the above
requirements by the reporting deadline, it is incomplete.
The Departments implemented sanctions provisions for failure to report beginning with
the PY 2017 WIOA Statewide Performance Reports submission, which was due on
October 1, 2018.7
Consistent with section 116(f)(1)(B) of WIOA, sanctions will not be applied in cases where
failure to report is due to exceptional circumstances outside the state’s control as determined by
the Departments. The Departments defined exceptional circumstances in 20 CFR § 677.185(b)
and 34 CFR §§ 361.185(b) and 463.185(b). Exceptional circumstances may include, but are not
limited to:
natural disasters;
unexpected personnel transitions; and
unexpected technology related issues.
In instances of exceptional circumstances causing a state’s failure to report that occur
more than 30 calendar days before the established deadline, the state must notify the
Secretary of Labor or Education, as appropriate, by requesting a reporting extension no
later than 30 calendar days prior to the established deadline for submission (20 CFR §
677.185(c)(1) and 34 CFR §§ 361.185(c)(1) and 463.185(c)(1)).
Extension Requests
In the event of exceptional circumstances as just described, the state must notify the
Secretary of Labor or Education, as appropriate, in writing of a potential impact on the
State’s ability to submit its State annual performance report in order not to be considered
failing to report (20 CFR § 677.185(c) and 34 CFR §§ 361.185(c) and 463.185(c)). In so
doing, the State’s request for an extension should include a detailed account identifying
the unexpected events precluding timely reporting sufficient for the Departments to make
7
ETP performance reports are required to be submitted beginning with the PY 2018 Annual Report due on October
1, 2019.
a determination. Information that should be included in an extension request is as
follows:
Sufficient detail of the unexpected circumstances that will lead to untimely or
incomplete reporting to warrant an extension;
A proposed extension, fitting of the circumstances causing the delay, which should
not exceed 30 calendar days after the established annual reporting deadline; and
Any other information that the state deems relevant to help explain the need for an
extension.
The state must submit the extension request as soon as possible, but not later than 30
calendar days prior to the established annual reporting deadline (20 CFR § 677.185(c)(1)
and 34 CFR §§ 361.185(c)(1) and 463.185(c)(1)). The annual reporting deadline is
October 1 each year; therefore, states must submit reporting extension requests not later
than September 1 (or the next business day if September 1 falls on a holiday or weekend).
In cases where exceptional circumstances occur within 30 calendar days of the
established annual reporting deadline, the state must submit an extension request to the
Secretary of Labor or Education, as applicable, as soon as possible but not later than the
established annual reporting deadline (20 CFR § 677.185(c)(2) and 34 CFR §§
361.185(c)(2) and 463.185(c)(2)). Under these circumstances in addition to the above,
the request also should include sufficient explanation as to why notification of the delay
could not be provided 30 calendar days prior to the established annual reporting deadline.
All extension requests will be reviewed by the Departments for completeness and a
thorough explanation of exceptional circumstances. The Departments may grant
extension requests as submitted, grant extension requests with revisions, or reject the
extension requests. Proposed reporting extensions should not exceed 30 calendar days
after the established annual reporting deadline and should be appropriate to and
commensurate with the cause of the requested extension.
Additionally, all extension requests should include the names and contact information of
each responsible state designee or designated point of contact who will ensure that the
extension deadline will be met.
In the event of failure to report timely or completely, pursuant to section 116(f)(1)(B) of
WIOA, the Governor’s discretionary funds provided under section 128(a) of WIOA will
be reduced by five percent of the maximum available allotment in the immediately
succeeding program year. The WIOA Joint Final Rule at 20 CFR § 677.195 and 34 CFR
§§ 361.195 and 463.195 clarified that the sanction is equal to five percent of the
maximum allotment percentage that could be reserved by the Governor in the succeeding
program year rather than a five percentage point reduction from the percentage that a
Governor elected to reserve. This sanction will be enforced for each year in which a state
fails to report timely or completely.
b. Sanctions for Failure to Meet Adjusted Levels of Performance
In accordance with 20 CFR § 677.190(d) and 34 CFR §§ 361.190(d) and 463.190(d), a
performance failure occurs if:
any single Individual Indicator Score for any single core program falls below 50
percent of the adjusted level of performance;
the Overall State Program Score falls below 90 percent for that single core program;
or
the Overall State Indicator Score falls below 90 percent for that single measure.
Any State that fails to meet adjusted levels of performance for the primary indicators of
performance for any year will receive technical assistance, including assistance in the
development of a performance improvement plan provided by the Secretary of Labor or
Secretary of Education (20 CFR § 677.190(b) and 34 CFR §§ 361.190(b) and
463.190(b)). However, if the state has the same performance failure occur in two
consecutive program years, the Departments will apply sanctions. Further explanation of
how technical assistance and sanctions will be applied is provided later in this section.
Determining Performance Success or Failure
The Departments will determine state performance success or failure at the end of each
program year. In order to make a determination of success or failure, the negotiated
levels of performance for that year will be adjusted using the statistical adjustment model,
which will factor in data on the actual economic conditions of the state and the actual
characteristics of the populations served by the program during that year. This
adjustment will be calculated as described above in the definitions of adjustment factor
and adjusted levels of performance. A detailed explanation of this calculation is found in
Attachment 2 “Calculation—Adjusted Level of Performance.” This will determine the
adjusted levels of performance for the program year against which the state’s actual
levels of performance will be evaluated through the calculation of the performance score.
Attachment 4, “Determining Performance Success or Failure,” provides an overview of
the entire process.
The individual indicator score is calculated by dividing the actual level of performance
achieved by the adjusted level of performance. The adjusted level of performance is
calculated by adding the adjustment factor to the negotiated level of performance. The
individual indicator score will not be rounded; it will be truncated to the first decimal
place. A detailed example can be found in Attachment 1.
Table 1, below, illustrates the determination of performance success or failure across all
indicators of performance for a single core program. The performance scores are
calculated for each primary indicator of performance and the average is computed. In
this example, the Individual Indicator Score for Employment Rate—4th Quarter after Exit
of 46.8 percent is a performance failure because it is below the 50.0 percent threshold.
The Overall State Program Score of 81.5 percent is obtained by averaging the scores for
each indicator in the program. In Table 1 below, this is a performance failure because the
core program did not achieve 90 percent. Percentages will not be rounded in this
calculation; they will be truncated to the tenth of a percent. Note that the Effectiveness in
Serving Employers indicator is not included in this calculation because this indicator is
not yet defined by the Departments.
Table 1: Calculation of Overall State Program Score
Actual Level of
Primary Indicator Adjusted Level Individual Indicator Score
Performance
of Performance of Performance Calculation
(Numerator/Denominator)
Employment
Rate—2nd Quarter 75.1%
after Exit
Employment
Rate—4th Quarter 70.0%
after Exit
Median Earnings—
2nd Quarter after $3,434 $3,890
Exit
Credential
55.2%
Attainment
Measurable Skill
85.6%
Gains
Effectiveness in
N/A N/A N/A
Serving Employers
Overall State
Program Score*
(Average of
- - 81.5%
Individual Indicator
Scores for this Core
Program)
*For a detailed explanation of the calculation behind the Overall State Program Score, please refer to
Attachment 1.
Table 2 illustrates the calculation for a single primary indicator of performance across all
core programs. The performance scores are calculated for the Employment—2nd Quarter
after Exit indicator for each core program, and the average is computed. In this case, the
Overall State Indicator Score, which is the average of all Individual Indicator Scores, is
92.6 percent, so the core program achieved performance success. Again, percentages will
not be rounded in this calculation; they will be truncated to the tenth of a percent.
Table 2: Calculation of Overall State Indicator Score
Overall
State
Indicator
Score*
(Average
Title I- Title I- Title I- of
Program Title II Title III Title IV
Adult Youth DW Individual
Indicator
Scores
Across
Core
Programs)
Actual Level of
Performance
-
(Numerator/
Denominator)
Adjusted Level
75.1% 70.2% 75.5% 67.5% 70.0% 69.0% -
of Performance
Individual
Indicator Score 92.6%
Calculation 75.1% 70.2% 75.5% 67.5% 70.0%
= = = = = =
*For a detailed explanation of the calculation behind the Overall State Indicator Score, please refer to
Attachment 1.
Phasing in Sanctions for Performance Failure
The Departments used their transition authority under section 503(a) of WIOA to implement
a phased-in approach to determine performance success or failure for each indicator or
program, due to data availability, as described in 20 CFR § 677.190(c) and
34 CFR §§ 361.190(c) and 463.190(c).
If a performance failure occurs at the end of the program year, the respective Federal agency
and the state agency will work to develop a performance improvement plan, and the Federal
agency will provide technical assistance in accordance with section 116(f)(1)(A) of WIOA.
Table 3 below summarizes the first years in which each performance indicator will be
evaluated for performance success or failure (with the exception of the Effectiveness in
Serving Employers performance indicator, which is currently being piloted and will be
established in subsequent guidance).
Table 3: Implementation of Performance Determination by Title and Indicator
First Program Year for which
Title Indicators of Performance Performance Success or
Failure Can Be Determined
Employment 2nd Quarter after Exit*
Title I Median Earnings 2nd Quarter after Exit PY 2020
Measurable Skill Gains
Employment 4th Quarter after Exit*
Title I PY 2022
Credential Attainment
Employment 2nd Quarter after Exit
Title II Median Earnings 2nd Quarter after Exit PY 2020
Measurable Skill Gains
Employment 4th Quarter after Exit
Title II PY 2022
Credential Attainment
Employment 2nd Quarter after Exit
Title III PY 2020
Median Earnings 2nd Quarter after Exit
Title III Employment 4th Quarter after Exit PY 2022
Title IV Measurable Skill Gains PY 2020
nd
Employment 2 Quarter after Exit
Median Earnings 2nd Quarter after Exit
Title IV PY 2022
Employment 4th Quarter after Exit
Credential Attainment
*Note that for WIOA title I Youth, these indicators include placement in education or training.
If the state has the same performance failure occur in two consecutive program years, the
Departments will apply sanctions, pursuant to section 116(f)(1)(B) of WIOA. Specifically,
the Departments will reduce the Governor’s discretionary funds provided under section
128(a) of WIOA by five percent of the maximum available amount in the program year
immediately succeeding the second consecutive performance failure. The WIOA Joint Final
Rule at 20 CFR § 677.195 and 34 CFR §§ 361.195 and 463.195 clarified that the sanction is
equal to five percent of the maximum allotment percentage that could be reserved by the
Governor in the succeeding program year rather than a five percentage point reduction from
the percentage that a Governor elected to reserve. This sanction will be enforced each
successive year in which the state continues to have the same performance failure.
Local Performance and Negotiations under WIOA Title I
a. Negotiations with Local Areas
In addition to the state negotiated levels of performance, states must work with local
workforce development areas to establish local performance goals for WIOA title I programs
(section 116(c) of WIOA).
The local board, the Chief Elected Official, and the Governor must negotiate and reach
agreement on local levels of performance based on the state negotiated levels of
performance. In negotiating the local levels of performance, the local board, the Chief
Elected Official, and the Governor also must use the above-listed four factors of negotiation
used at the state level. In addition, a statistical adjustment model that aligns with the
framework of the state-level model must be used at the end of the program year to adjust
negotiated local levels of performance in order to reflect the actual economic conditions
experienced in the local area and the characteristics of the actual individuals served
according to the state’s established policies. States should make these negotiated and
adjusted levels as well as the established policies for local performance assessment available
to the local boards and the state’s DOL-ETA Regional Office prior to the start of the program
year in which the policies will be applied.
The Departments have developed the framework for an objective statistical adjustment
model that satisfies the WIOA requirements at the state level. States must use this
framework and develop a model that satisfies their needs at the local level, both in the
performance negotiations and year-end adjustment of local levels of performance.
The local board, the Chief Elected Official, and the Governor must negotiate and reach
agreement on local levels of performance for two program years at a time, based on the
state’s negotiated levels of performance, no later than September 30 in each year in which
state negotiations occur. The state must notify its DOL-ETA Regional Office that
negotiations are complete.
b. Local Performance Success and Failure
States must use local performance goals for WIOA title I programs for two required
purposes: (1) to determine if a local area “performed successfully” for subsequent local area
designation, and (2) to determine when a state must take corrective action when a local area
fails to meet the adjusted levels of performance.
For the purpose of determining subsequent local area designation, the term “performed
successfully” means that the local area met or exceeded the levels of performance the
Governor negotiated with the local board and chief elected official for WIOA primary
indicators of performance and that the local area has not failed any individual measure for the
last two consecutive program years in accordance with a state-established definition,
provided in the state plan, of met or exceeded performance. For subsequent designation
determinations made at the conclusion of PY 2018, or at any point thereafter, states must
base their findings of whether a local area performed successfully for the two most recently
completed program years on all six of the WIOA primary indicators of performance where at
least two years of data are available.
A state must establish the threshold for failure to meet adjusted levels of performance for a
local area before coming to agreement on the negotiated levels of performance for the local
area. Following the conclusion of the program year, a state must establish the adjusted level
of performance for a local area, using the statistical adjustment model described. At least
two years of complete data on any indicator for any local core program are required in order
to establish adjusted levels of performance for a local area. States must provide technical
assistance if a local area fails to meet the adjusted levels of performance agreed to for the
primary indicators of performance in WIOA title I programs in any program year. Upon the
state’s request to the Secretary of Labor, DOL may provide this technical assistance.
The technical assistance may include:
assistance in the development of a performance improvement plan;
the development of a modified local or regional plan; or
other actions designed to assist the local area in improving performance.
If a local area fails to meet the adjusted levels of performance agreed to for the same primary
indicators of performance for the same core program authorized under WIOA title I for a
third consecutive program year, the Governor must take corrective actions. If the governor
takes corrective action against a local area for failing to meet the negotiated goals, the state
workforce agency should advise its Federal Project Officer of this action. The corrective
actions must include the development of a reorganization plan under which the Governor:
requires the appointment and certification of a new local board, consistent with the
criteria 20 CFR § 679.350;
prohibits the use of eligible providers and one-stop partners that have been identified as
achieving poor levels of performance; or
takes such other significant actions as the Governor determines are appropriate.
5. Inquiries. Questions regarding this guidance should be directed to the appropriate ETA,
OCTAE, or RSA office.
6. References. Refer to Attachment 5 of this guidance.
7. Attachments.
Attachment I: Calculation—Overall State Indicator and Program Scores
Attachment II: Calculation—Adjusted Level of Performance
Attachment III: WIOA Negotiations / Performance Process Flow Chart
Attachment IV: Determining Performance Success or Failure
Attachment V: References—Joint Negotiations and Sanctions Guidance
Attachment I
Calculation—Overall State Indicator and Program Scores
States and Federal agencies negotiate to one decimal place. Actual levels of performance are
calculated by dividing the number of successes within an indicator (numerator) by the total
number of participants matching the qualifications for the given indicator (denominator). Actual
levels of performance are reported by the state for all primary indicators of performance. In the
WIOA statewide performance report (ETA-9169), actual levels of performance are represented
by rounding to the nearest tenth of a percent, but for the purpose of performing these
calculations, actual levels of performance and adjusted levels of performance are neither rounded
nor truncated.
In the table below, refer to the column related to the title I Adult program for an example of
Employment Rate—2nd Quarter after Exit.
Numerator = 16,244 (Total number of participants in the denominator that were also
employed second quarter after exit.)
Denominator = 24,000 (Total number of participants that exited during the reporting period.)
Numerator divided by Denominator = = 0.676833
Rate reported in Annual Report = 67.7%
Adjusted level of performance = 75.2%
Employment Rate—2nd Quarter after Exit Results by Core Program
Title I Title III Title IV
Title I Title I Title II
Program Dislocated Wagner- Vocational
Adult Youth AEFLA
Worker Peyser Rehabilitation
Numerator 16,244 13,000 20,000 9,000 6,000 31,555
Denominator 24,000 18,000 30,000 15,000 12,000 42,000
Annual Report Value 67.7% 72.2% 66.7% 60.0% 50.0% 75.1%
Adjusted Level of
75.2% 72.5% 76.3% 79.7% 68.7% 65.4%
Performance
What figures are used to determine how close actual performance was to the adjusted level of
performance?
Each Indicator Score is calculated in a similar way. For those indicators reported as a
percentage, use both numerator and denominator in the next step.
The Indicator Score is calculated by dividing the actual outcome by the adjusted level of
performance.
For those indicators not reported as a percentage, such as Median Earnings in the Second Quarter
after Exit, use the value in the Annual Report and divide by the adjusted level of performance.
Attachment I
How are the Overall State Indicator Scores calculated?
After the Indicator Score is calculated for each single primary indicator of performance, it is
populated into the below matrix. Each row of Indicator Scores is averaged and truncated to one
decimal place to produce the Overall State Indicator Score. In the example below, the average of
the Employment Rate—2nd Quarter after Exit Indicator Scores for the six programs is 0.89985
and is truncated to one decimal place for an Overall State Indicator Score of 89.9%.
Primary Overall
Title I Title III Title IV
Indicator/ Title I Title I Title II State
Dislocated Wagner- Vocational
Core Adult Youth AEFLA Indicator
Worker Peyser Rehabilitation
Program Score
Employment
2nd Quarter 90.0% 99.6% 87.4% 75.3% 72.8% 114.9% 89.9%
after Exit
Employment
4th Quarter 87.4%
after Exit
Median
Earnings 2nd
111.8%
Quarter after
Exit
Credential
Attainment 130.1% N/A
Rate
Measurable
84.1% N/A
Skill Gains
Effectiveness
in Serving N/A
Employers
Overall
State
100.6% -
Program
Score
Attachment I
How are the Overall State Program Scores calculated?
After the Indicator Score is calculated for each primary indicator of performance, it is populated
into the above matrix. Each column of Indicator Scores is averaged and truncated to one decimal
place to produce the Overall State Program Score. In the example below, the average of the
Indicator Scores for the title I Adult program is 1.00689 and is truncated to one decimal place for
an Overall State Program Score of 100.6%, as shown in the table above.
Title I Adult Results by Performance Indicator
Actual Level of
Primary Indicator of Annual Report Adjusted Level of
Performance
Performance Value Performance
(Numerator/Denominator)
Employment Rate—2nd
67.7% 75.2%
Quarter after Exit
Employment Rate—4th
61.2% 70.0%
Quarter after Exit
Median Earnings—2nd
$4,350 $4,350 $3,890
Quarter after Exit
Credential Attainment 71.8% 55.2%
Measurable Skill Gains 72.0% 85.6%
Effectiveness in Serving
N/A N/A N/A
Employers
Attachment II
Calculation—Adjusted Level of Performance
The Federal agencies estimate levels of performance based on participant characteristics and
economic conditions using an objective statistical model. The initial estimated level of
performance (Estimate0) is provided to states prior to the start of the program year during the
negotiations process and is a factor in reaching agreement on the negotiated level of
performance. After the close of the program year, the Federal agencies will re-estimate the
state’s performance (Estimate1) using the same objective model coefficients updated with the
characteristics of the actual participants served and the actual economic conditions of the state.
Federal agencies will subtract the first estimate from the second estimate for the adjustment
factor. The resulting positive or negative adjustment factor is added to the negotiated level of
performance to arrive at the adjusted level of performance. These calculations are shown in
Examples 1 and 2 below. Refer to section on Determining Performance Success or Failure of the
guidance for an explanation of how the adjusted level of performance is used to determine
performance success or failure.
Example 1: Adjusted Level of Performance Calculation
Expected Level of Performance 68.9%
Negotiated Level of Performance 70.2%
Estimate0 75.5%
Estimate1 73.7%
Adjustment Factor
Adjusted Level of Performance
Example 2: Adjusted Level of Performance Calculation
Expected Level of Performance 68.9%
Negotiated Level of Performance 70.2%
Estimate0 75.5%
Estimate1 78.3%
Adjustment Factor
Adjusted Level of Performance
Attachment III
WIOA Negotiations / Performance Process Flow Chart
Step 1:
States: Submit Expected Levels DOL/ED: Produce estimated
of Performance for two program levels of performance using the
years in state plans or plan statistical adjustment model.
modifications (PYs A & B).
Step 2: Before PY A begins, states and
Required DOL/ED arrive at Negotiated Levels of
State Performance for PYs A & B by considering
Actions the four factors of performance negotiations.
Step 3: PY A Concludes. DOL/ED Step 5: PY B Concludes. DOL/ED
process state data on actual outcomes & process state data on actual outcomes &
re-estimate performance levels using re-estimate performance levels using
the same objective model specification the actual characteristics of participants
and actual characteristics of participants & economic conditions of PY B.
& economic conditions of PY A. The positive or negative difference
The positive or negative difference between the DOL/ED estimates before
between the DOL/ED estimates before and after PY B are used to adjust the
and after PY A are used to adjust the negotiated levels of performance and
negotiated levels of performance and calculate the adjusted levels of
calculate the adjusted levels of performance.
performance.
Step 4: DOL/ED determine states' Step 6: DOL/ED determine states'
performance success or failure using performance success or failure using
actual results of PY A and the adjusted actual results of PY B and the adjusted
levels of performance for PY A levels of performance for PY B
For steps 4 and 6, please
see "Attachment IV—
Determining
Performance Success or
Failure"
Attachment IV
Determining Performance Success or Failure
Step 2: After the close of PY A, DOL/ED will
re-estimate the levels of performance for PY A
Step 1: DOL/ED estimate levels using the same objective model specification,
of performance for PYs A & B actual participant characteristics and actual
prior to the start of PY A. economic conditions of PY A. The positive or
negative percentage point difference between
the levels projected prior to the start of PY A
and the levels re-estimated after the close of PY
A
A isis the
the PY
PY A
A Adjustment Factor.
adjustment factor.
Step 3: DOL/ED add the PY A
Adjustment
adjustment Factor
factor toto the
the negotiated
Negotiated
Level ofperformance
level of Performanceto todetermine
determinethe
the
Adjusted
adjusted Level
level ofofperformance.
Performance.
Step 4:
Step 4: The
The actual
Actualresults
Results from
from PYPYA
A are
are thenthen divided
divided by the
by the Adjusted
adjusted level Performance Failure occurs if any
Level of Performance
of performance to determine
to determine the the Indicatorindicator
individual Score is score
belowis50%.
below
Indicator
individual Scores.
indicator scores. 50%.
Step5:
Step 5: The
Theaverage
averageofofindividual
Indicator Performance Failure occurs if any
Scores across
indicator WIOA
scores coreWIOA
across programs
coreis Overall State program
overall state Program score
Score isis below
below
the Overall State Program Score.
programs is the overall state program 90%.
score.
Step6:
Step 6: The
Theaverage
averageof ofindividual
Indicator
Scores for
indicator a single
scores for a WIOA core
single WIOA Performance Failure occurs if any
program
core programacross performance
across performance Overall State indicator
overall state Indicator score
Score isis below
below
indicators
indicators is
is the
the Overall State
overall state 90%.
Indicator
indicator Score.
score.
Attachment V
References—Joint Negotiations and Sanctions Guidance
WIOA Section 116, Performance Accountability System
WIOA Section 503, Transition Provisions
Government Performance and Results Act of 1993 (GPRA) (Public Law 103-62; 107 Stat.
285)
GPRA Modernization Act of 2010 (Public Law 111-352; 124 Stat. 3866)
WIOA Joint Rule for Unified and Combined State Plans, Performance Accountability, and
the One-Stop System Joint Provisions Final Rule, 20 CFR parts 676, 677, and 678 and 34
CFR parts 361 and 463
Workforce Innovation and Opportunity Act (WIOA) Common Performance Reporting
(OMB No. 1205-0526)
DOL-only Performance Accountability, Information, and Reporting System
(OMB No. 1205-0521)
Required Elements for Submission of the Unified or Combined State Plan and Plan
Modifications under the Workforce Innovation and Opportunity Act
(OMB No. 1205-0522)
“A Methodology for Statistical Adjustment under WIOA” report (2016), available at
https://doleta.gov/performance/guidance/docs/WIOA_Statistical_Model_Methodology_Rep
ort-6-24-2016.pdf
TEGL 14-15: Workforce Innovation and Opportunity Act (WIOA) Requirements for Unified
and Combined State Plans, available at
https://wdr.doleta.gov/directives/attach/TEGL/tegl_14-15.pdf
TEGL 10-16, Change 1: Performance Accountability Guidance for Workforce Innovation
and Opportunity Act (WIOA) Title I, Title II, Title III, and Title IV Core Programs, available
at https://wdr.doleta.gov/directives/attach/TEGL/TEGL_10-16-Change1.pdf
TEGL 19-16: Guidance on Services provided through the Adult and Dislocated Worker
Programs under the Workforce Innovation and Opportunity Act (WIOA) and the Wagner-
Peyser Act Employment Service (ES), as amended by title III of WIOA, and for
Implementation of the WIOA Final Rules, available at
https://wdr.doleta.gov/directives/attach/TEGL/TEGL_19-16.pdf
TEGL 03-17: WIOA Annual Performance Report Submission, available at
https://wdr.doleta.gov/directives/attach/TEGL/TEGL_3-17.pdf
Attachment V
TEGL 6-17: Modification Requirements for Workforce Innovation and Opportunity Act
(WIOA) Unified and Combined State Plans, available at
https://wdr.doleta.gov/directives/attach/TEGL/TEGL_6-17.pdf
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