2. Employment & Training
3. Partners
4. WIOA Title I-A & I-B
5. Policy & Procedure Manual
6. Previous Policy - 8.5.4

8.5.4 Training Type 2: On-the-Job Training

Effective date: July 1, 2024 - September 30, 2024

On-the-Job Training (OJT) is a work-based, occupational training service provided by an employer to a paid participant who is engaged in productive work in a job that¹:

1. provides knowledge or skills essential to the full and adequate performance of the job;
2. provides reimbursement to the employer of up to 50 percent of the wage rate of the participant (up to 75 percent in certain circumstances²), for costs of providing the training and additional supervision related to the training;
   AND
3. is limited in duration.³

While WIOA does not set a specific limit for the duration of an OJT, local WDBs and their service providers must limit OJT contracts to the period of time required for a participant to become proficient in the occupation for which the training is being provided.⁴ In determining the duration of the contract, local WDBs and service providers must take into account the content of the training, the prior work experience of the participant, and the participant's individual employment plan (for participants in the WIOA Adult Program or Dislocated Worker Program) or individual service strategy (for participants in the WIOA Youth Program), as appropriate.⁵

Local WDBs or their service providers provide OJT via a contract with an employer or registered apprenticeship program sponsor in the private for-profit sector, the non-profit sector, or the public sector. The WIOA participant receives occupational training in exchange for the wage rate reimbursement to the employer, as stipulated in the OJT contract.⁶

Eligibility Requirements for Employed Participants

While OJTs are primarily designed to first hire a participant and provide them with the knowledge and skills necessary for full performance of the job⁷, there are instances when OJTs are allowable for employed workers.

An OJT contract may be written for an eligible employed worker when all of the following requirements are met:

• the participant meets eligibility requirements for training services;
• all required components of an OJT are met;
  AND
• the OJT relates to the introduction of new technologies, introduction to new production or service procedures, and/or upgrading to new jobs that require additional skills, workplace literacy, or other appropriate purposes identified by the local WDB.⁸

Employer Eligibility Requirements

OJT employers are not required to be included on the Eligible Training Program List (ETPL).⁹

Local WDBs or their service providers must not enter into OJT contracts with employers who received payments under previous contracts under WIOA or WIA (the Workforce Investment Act) and have exhibited a pattern of failing to provide OJT participants with:

• continued long-term employment as regular employees with the same level of wages and employment benefits (including health benefits) as other employees with comparable seniority who are doing the same type of work;
  OR
• similar working conditions as other employees doing the same type of work.¹⁰

DWD-DET does not permit local WDBs or their WIOA Title I-B service providers to be employers in WIOA-funded OJT contracts.

Funding

Under WIOA, local WDBs or service providers may reimburse an OJT employer for up to 50 percent of the wage rate of the participant. This is meant to cover the employer's costs for training participants, providing additional supervision related to the training, and the participant's potentially lower productivity while in OJT.¹¹ There is no requirement for employers to document these specific costs.¹²

In limited circumstances the local WDB may increase the reimbursement rate for OJT contracts up to 75 percent of the wage rate,¹³ taking the following into account:

• whether the participants are individuals with barriers to employment;¹⁴
• the size of the employer, with an emphasis on small businesses;¹⁵
• the quality of employer-provided training and advancement opportunities, such as if the training is for an in-demand occupation and will lead to an industry-recognized credential;¹⁶
  AND
• other factors the local WDB may determine to be appropriate, such as the number of employees participating, wage and benefit levels of the employees (both at present and after completion), and relation of the training to improving the participant's competitiveness in the labor market.¹⁷

The Trade Adjustment Assistance (TAA) Program allows reimbursement to employers up to 50 percent of the wage rate for OJTs, while WIOA allows up to 75 percent reimbursement. When a WIOA participant is co-enrolled in TAA and receives OJT, WIOA may reimburse employers any additional amount needed to bring the total reimbursement to employers up to 75 percent.¹⁸ In this circumstance, because TAA must be the primary source of assistance for workers covered by a TAA certification, the TAA Program would cover the first portion of the wage reimbursement and WIOA would cover the remaining portion. See section 13.1.2. for more details on funding coordination for co-enrolled participants.

OJT and Apprenticeships

Registered apprenticeships generally involve both classroom and on-the-job training. Local WDBs and service providers may enter into OJT contracts with registered apprenticeship program sponsors or employers for the OJT portion of the registered apprenticeship program,¹⁹ and may use Individual Training Accounts (ITAs) to cover the technical, classroom instruction portion of a registered apprenticeship.²⁰ Depending on the length of the registered apprenticeship and the local WDB's training policies, these funds may cover some or all of the registered apprenticeship training.²¹ See section 7.1.4 for more details on use of ITAs with Registered Apprenticeship.

Local WDBs and service providers that link OJT with registered apprenticeship programs should consider how the length of these programs align with performance measures and take steps to fully account for their progress. For example, registered apprenticeship programs often last longer than an OJT, so a local WDB or service provider should work with the apprenticeship sponsor to explore options to document measurable skill gains during training and/or to build interim apprenticeship credentials that align with the conclusion of the OJT training period and/or use of ITA funds for related technical instruction.²²

If the apprentice is unemployed at the time of participation, the OJT component of the registered apprenticeship must be conducted as it would for any other OJT participant who was unemployed at the time of participation.²³

If the apprentice is employed at the time of participation, the OJT requirements for employed workers must be met in addition to the requirements that apply to all OJT contracts.²⁴

Local OJT Provision Requirements

The purpose of OJT is to address specific gaps in participants' knowledge or skills that prevent the participant from performing assigned job duties fully and adequately.²⁶ Therefore, each OJT participant must have a unique written OJT training plan that is tailored to the participant's specific needs; the hours and skills included in a training plan must not simply mirror those in past training plans developed for the same business or the same occupation.²⁶

DWD-DET requires local WDBs to define in local policy what constitutes a pattern of failing to provide OJT participants with continued employment as employees with the required wages, benefits and working conditions under previous WIOA or WIA-funded OJT contracts. Similarly, local WDBs that would like the flexibility of increasing the wage reimbursement levels above 50 percent must outline in local policy what factors will be used when deciding to increase the level.²⁷

When a local WDB has decided to increase the wage reimbursement level for a particular participant's OJT, in compliance with local policy, the factors that were considered must be documented²⁸. DWD-DET requires this documentation be included in the participant's OJT contract.

Local WDBs and service providers must continually monitor their OJT contracts to ensure that participants receive training that will help them to successfully retain employment by providing them with relevant skills and opportunities for career advancement.²⁹

Performance Implications

On-the-Job Training (OJT) is not included in the credential attainment performance indicator because, although it often provides employment benefits to recipients of these services, it rarely results in a credential.³⁰ See section 11.5.7 for more details about who is included in the denominator of the Credential Attainment Rate.

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• ¹ WIOA Sec. 3(44)
• ² 20 CFR 680.730
• ³ WIOA Sec. 3(44) (c)
• ⁴ 20 CFR § 680.700(c)
• ⁵ WIOA Sec. 3(44)(c); 20 CFR § 680.700(c)
• ⁶ 20 CFR § 680.700 (a)
• ⁷ 81 FR 56149
• ⁸ 20 CFR § 680.710
• ⁹ 81 FR 56150
• ¹⁰ 20 CFR § 680.700(b)
• ¹¹ 20 CFR § 680.700(a); 20 CFR § 680.720(a)
• ¹² 20 CFR § 680.720(c)
• ¹³ 20 CFR § 680.700 (a). Because the regulation specifically states that local WDBs may increase reimbursement rates for OJT contracts above 50 percent, DWD-DET requires service providers that administer OJT contracts to obtain approval from the local WDB before they can provide an OJT reimbursement rate that exceeds 50 percent.
• ¹⁴ 20 CFR § 680.730 (a)(1)
• ¹⁵ 20 CFR § 680.730 (a)(2); DOL recommends that local WDBs and states refer to the Small Business Administration's standard for defining small business concerns, which varies by industry: 13 CFR § 121.201
• ¹⁶ 20 CFR § 680.730 (a)(3); DOL declined to define "industry-recognized credential," noting that such a definition could limit future innovation around industry-relevant training: 81 FR 56127.
• ¹⁷ 20 CFR § 680.730 (a)(4)
• ¹⁸ TEGL 19-16, p. 35
• ¹⁹ 20 CFR § 680.740(a)
• ²⁰ 20 CFR § 680.750; 20 CFR 680.330; TEGL 19-16, p. 14
• ²¹ 20 CFR § 680.740(a)
• ²² This is a recommendation provided DOL in Strategies for Implementing OJT Simply and Effectively: An On-the-Job Training Brief and Resource Guide, p. 11.
• ²³ 20 CFR § 680.740(b)
• ²⁴ 20 CFR § 680.740(b)
• ²⁵ This is a DWD-DET requirement based on guidance provided by DOL in Strategies for Implementing OJT Simply and Effectively: An On-the-Job Training Brief and Resource Guide, pp. 6 - 8.
• ²⁶ This is a DWD-DET requirement based on guidance provided by DOL in Strategies for Implementing OJT Simply and Effectively: An On-the-Job Training Brief and Resource Guide, p. 7.
• ²⁷ 20 CFR § 680.730(b)
• ²⁸ 20 CFR 680.730(b)
• ²⁹ 81 FR 56149
• ³⁰ 20 CFR 677.155(a)(1)(iv) and TEGL 19-16, p. 15