OPINION

RIDGWAY, Judge:

In some cases for as many as 30 or 40 years up to the time of their termination in 2003, Plaintiffs in this action (the "Former Employees") labored in the oil and gas industry, supporting exploration, drilling, and production from the same wells owned by the same oil company, doing the same tasks, day in and day out, seated at the same desks, inside the same facility in Tulsa, Oklahoma.

The Former Employees' initial employer, Amoco Corporation, merged with The British Petroleum Company p.l.c. in 1998, and — as a result — the Former Employees became employees of BP Amoco Group (now known as BP p.l.c., or simply "BP"). The Former Employees survived the layoffs that followed the 1998 merger. Their colleagues who were less fortunate were later certified as eligible to apply for Trade Adjustment Assistance ("TAA") benefits, in 1999.

In 2000, the Former Employees were struck by another wave of corporate restructuring, when BP "outsourced" their unit to Pricewaterhouse Coopers ("PwC"). Two years later, IBM acquired PwC's consulting services business. Thus, the Former Employees were employees of IBM at the time of their termination in late 2003.

According to the Former Employees, although they had been "outsourced" — first to PwC, and then to IBM — nothing ever really changed except the company signing their paychecks. At the time of their termination, they were still sitting at the same desks in the same building doing the same work for the same company in support of the same production facilities as their former colleagues who were laid off in 1998. Just as their colleagues laid off in 1998 had done, the Former Employees here filed a TAA petition. But the Former Employees' petition met a very different fate.

Pending before the Court is Plaintiffs' Motion for Judgment on the Agency Record, challenging the Labor Department's denial of the Former Employees' petition for TAA benefits. See generally Memorandum in Support of Plaintiff's Motion for Summary Judgment on the Agency Record ("Pls.' Brief"); Plaintiffs' Reply to Defendant's Responsein Opposition to Plaintiffs' Motion for Judgment on the Agency Record ("Pls.' Reply Brief"). The Government opposes Plaintiffs' motion, maintaining that the Labor Department's determination is supported by substantial evidence in the record and otherwise in accordance with law. See generally Defendant's Response in Opposition to Plaintiffs' Motion for Judgment Upon the Agency Record ("Def.'s Brief").

Jurisdiction lies under 28 U.S.C. § 1581(d)(1) (2000). For the reasons set forth below, Plaintiffs' motion is granted in part, and this action is remanded to Defendant for further proceedings consistent with this opinion.

I. The Relevant Legal Framework

Trade adjustment assistance ("TAA") programs historically have been — and today continue to be — touted as the quid pro quo for U.S. national policies of free trade. See generally Former Employees of Chevron Prods. Co. v. U.S. Sec'y of Labor, 27 CIT ___, ___, 298 F. Supp. 2d 1338, 1349-50 (2003) ("Chevron III") (summarizing policy underpinnings of trade adjustment assistance laws).

The trade adjustment assistance laws are generally designed to assist workers who have lost their jobs as a result of increased import competition from — or shifts in production to — other countries, by helping those workers "learn the new skills necessary to find productive employment in a changing American economy." Former Employees of Chevron Prods. Co. v. U.S. Sec'y of Labor, 26 CIT 1272, 1273, 245 F. Supp. 2d 1312, 1317 (2002) ("Chevron I") ( quoting S. Rep. No. 100-71, at 11 (1987)). Today's TAA program entitles eligible workers to receive benefits which may include employment services (such as career counseling, resume-writing and interview skills workshops, and job referral programs), vocational training, job search and relocation allowances, income support payments, and a Health Insurance Coverage Tax Credit. See generally 19 U.S.C. § 2272 et seq. (2000 Supp. II 2002).

The trade adjustment assistance laws are remedial legislation and, as such, are to be construed broadly to effectuate their intended purpose. UAW v. Marshall, 584 F.2d 390, 396 (D.C. Cir. 1978) (recognizing the "general remedial purpose" of TAA statutes, and noting that "remedial statutes are to be liberally construed"). Moreover, both "because of the ex parte nature of the certification process, and the remedial purpose of [the statutes], the [Labor Department] is obliged to conduct [its] investigation with the utmost regard for the interests of the petitioning workers." Stidham v. U.S. Dep't of Labor, 11 CIT 548, 551, 669 F. Supp. 432, 435 (1987) ( citing Abbott v. Donovan, 7 CIT 323, 327-28, 588 F. Supp. 1438, 1442 (1984) (quotations omitted)).

Thus, although the Labor Department is vested with considerable discretion in the conduct of its investigations of trade adjustment assistance claims, "there exists a threshold requirement of reasonable inquiry." Former Employees of Hawkins Oil Gas, Inc. v. U.S. Sec'y of Labor, 17 CIT 126, 130, 814 F. Supp. 1111, 1115 (1993). Courts have not hesitated to set aside agency determinations which are the product of perfunctory investigations.

A. The "Service Workers" Test

Thus, on its face, the TAA statute does not speak directly to the coverage of "service workers" such as the Former Employees here. However, for nearly 25 years, the Labor Department has interpreted the statute to cover service workers where:

(1) their separation was caused importantly by a reduced demand for their services from a parent firm, a firm otherwise related to the subject firm by ownership, or a firm related by control;

(2) the reduction in the demand for their services originated at a production facility whose workers independently met the statutory criteria for certification; and

(3) the reduction directly related to the product impacted by imports.

Central to the case at bar is the concept of "control," reflected in the first criterion of the service workers test (above). Historically, the Labor Department interpreted "control" to refer to "ownership and corporate voting control." Former Employees of Pittsburgh Logistics Systems, Inc. v. U.S. Sec'y of Labor, 27 CIT ___, ___, 2003 WL 22020510 at *9 (2003) ("Pittsburgh Logistics II"). However, in Pittsburgh Logistics, the court ruled that the term must be interpreted more expansively, to include not only corporate/legal control, but also operational and management/administrative control as well. See Pittsburgh Logistics II, 27 CIT at ___, 2003 WL 22020510 at **11-12, 14.

In response to Pittsburgh Logistics and other similar cases, the Labor Department recently revised its policy on certification of so-called "leased" workers (such as the Former Employees here). See Labor Department Internal Memo re: New Leased Workers Policy (Jan. 23, 2004) (CSAR 261-62).

B. The Labor Department's New Leased Workers Policy

The workers in Pittsburgh Logistics had been terminated from their employment at an LTV Steel Company facility in Independence, Ohio, after LTV ceased production. The Pittsburgh Logistics (" PLS") workers petitioned for TAA certification, asserting that they were a " PLS subdivision" of LTV consisting of former LTV workers who had been "outsourced" to PLS; "that they were under the de facto control of LTV"; and that their duties were essential to the production of steel at LTV facilities.Former Employees of Pittsburgh Logistics Systems, Inc. v. U.S. Sec'y of Labor, 27 CIT ___, ___, 2003 WL 716272 at * 2 (2003) ("Pittsburgh Logistics I").

Although the Labor Department had certified workers at LTV's Cleveland plant (as well as certain workers at LTV's Independence facility), the agency initially denied the petition of the PLS workers, based in part on its finding that they were service workers and that their employer — PLS — was not related to LTV by ownership or "control." Pittsburgh Logistics I, 27 CIT at ___, 2003 WL 716272 at **1-2. But, based on the court's more expansive interpretation of the term "control," and its determination that the PLS workers were indeed under the operational control of LTV, the Labor Department was ordered to certify the PLS workers as eligible for TAA benefits.Pittsburgh Logistics II, 27 CIT at ___, 2003 WL 22020510 at **14-15. Wackenhut raised basically the same issues presented inPittsburgh Logistics. See Former Employees of Wackenhut Corp. v. U.S. Sec'y of Labor, Court No. 02-00758. The Wackenhut Corporation had supplied BHP Copper, Inc. with workers who had provided security services at a BHP production facility in Arizona. Following lay-offs due to increased imports of copper cathodes and closure of the facility, the Labor Department certified BHP workers at the facility as eligible for TAA. But the agency twice denied the petition filed by the Wackenhut workers.

Applying the same narrow definition of "control" that it had applied in Pittsburgh Logistics, the Labor Department concluded that the Wackenhut workers could not be certified as service workers because "Wackenhut and BHP are not controlled or substantially beneficially owned by the same persons." The Wackenhut Corporation, San Manuel, AZ: Notice of Negative Determination on Reconsideration on Remand, 68 Fed. Reg. 47,097, 47,098 (Aug. 7, 2003); ("Wackenhut Notice of Denial on Reconsideration") see also Notice of Determinations Regarding Eligibility to Apply for Worker Adjustment Assistance and NAFTA Transitional Adjustment Assistance, 67 Fed. Reg. 67,421 (Nov. 5, 2002).

The issuance of Pittsburgh Logistics II turned the tide for the Wackenhut workers. Based on Pittsburgh Logistics, the Labor Department revised its policy on the treatment of leased workers, resulting in the Wackenhut workers' certification. See The Wackenhut Corp., San Manuel, AZ: Notice of Revised Determination, 69 Fed. Reg. 26,623 (May 13, 2004) (referring to "a reinterpretation of the Trade Act term [`]workers of a firm[']") ("Wackenhut Notice of Revised Determination").

As the Government explains it, "[i]n response to the Court's decision in Pittsburgh Logistics, [the Labor Department] issued a memorandum that clarified . . . that the agency would no longer categorically deny certification for leased service workers." Def.'s Brief at 35; see also Labor Department Internal Memo re: New Leased Workers Policy (CSAR 261-62). According to that January 2004 memorandum, which specifically referencesWackenhut, "the existence of a standard contract between the contractor firm [ i.e., the leased workers' employer] and the subject firm [ i.e., the company producing the trade-impacted article] which should be considered sufficient evidence to prove the existence of a joint employer relationship." Labor Department Internal Memo re: New Leased Workers Policy (CSAR 261-62). The memorandum further specifiesthat "[w]orkers covered by the contract must perform their duties onsite at the affected location." Id.

Other than the statement quoted above, the Labor Department memorandum says little about the concept of a "joint employer" relationship, except to incorporate by reference another memorandum — missing from the record here — which apparently discusses that concept at greater length. See Labor Department Internal Memo re: New Leased Workers Policy (CSAR 261-62) (referring to a "memorandum, dated November 21, 2003, requesting [a] decision on the issue of leased production vs. service workers" that apparently outlines options including a "`joint employer' option (Option 1)," which the new Leased Workers Policy purports to adopt with certain "important differences"). And, as detailed in section IV.C.1 below, the Labor Department memorandum is silent on the agency's rationale for its so-called "location requirement" — i.e., its requirement that leased workers must "perform their duties onsite at the affected location" to be eligible for certification. Id.

C. "Certified" vs. "Certifiable"

Before service workers [could] be considered eligible for TAA, they [had to] be in direct support of an affiliated facility currently certified for TAA or employed on a contractual basis at a location currently certified for TAA.

Consent Motion for [Second] Voluntary Remand at 5 (citation omitted).

In response to an inquiry from the Court in this case questioning the Labor Department's interpretation, the Government advised that the agency had reconsidered its position. Under the Labor Department's new policy, as of April 2004:

Labor will certify petitions from workers who perform services for a firm or an appropriate subdivision of such firm if the work of the petitioning workers is related to the firm's production of a "trade-impacted" article under 19 U.S.C. § 2272 and the workers otherwise satisfy Trade Act eligibility criteria. Id. As explained in section IV.D below, however, it is not entirely clear exactly how the new policy set forth above intersects with the Labor Department's new Leased Workers Policy and the classic service workers test. It is therefore not entirely clear exactly what workers such as the Former Employees here must prove to establish their right to TAA certification.

II. Background

A. The Facts of the Case

Till 1998, the Former Employees were employed by Amoco Corporation, working at an accounting center in Tulsa, Oklahoma ("Accounting Center"). Supplemental Administrative Record ("SAR") 119. In December 1998, Amoco merged with The British Petroleum Company p.l.c. As a result of that merger, the Former Employees became employees of the new combined corporate entity — BP Amoco Group (now known as BP p.l.c., or simply "BP"). Administrative Record ("AR") 43; SAR 119. Throughout this period, the company continued to be engaged in the exploration, drilling, and production of oil and natural gas in the United States. SAR 120, 190.

After the 1998 merger, BP reduced its workforce at the Accounting Center. Although the Former Employees who are plaintiffs here survived that reduction in force, some of their colleagues at the Accounting Center were not so lucky. However, the Labor Department later determined that the workers laid off from the Accounting Center had been "engaged in activities related to exploration and production of crude oil and natural gas," and were therefore entitled to TAA certification. That certification, in turn, was amended to reflect new ownership and another name change to BP/AMOCO Production Company, Inc. See AR 43; SAR 125-26; Notice of Denial of Reconsideration, 69 Fed. Reg. at 20,644. The certification expired two years later, in mid-February 2001. Id.

In the meantime, the Former Employees and others at the Accounting Center who had survived the post-merger reductions in force were swept up in another wave of corporate restructuring. In 2000, BP "outsourced" the Former Employees' unit to Pricewaterhouse Coopers ("PwC"). Then, in October 2002, IBM acquired PwC's consulting services business. As a result, the PwC workers remaining at the Accounting Center — including the Former Employees here — ultimately became employees of IBM. SAR 145-46.

Although the Former Employees had been "outsourced" by BP — first to PwC, and then to IBM — their job descriptions never changed. As two of the Former Employees explained in declarations submitted to the Labor Department, even after their "outsourcing," the workers at the Accounting Center continued to work for BP — "managing oil and gas production and related leases, managing BP's production-related assets and equipment, accounting for various production plants, supporting division order operations, performing procurement functions, and submitting regulatory government reports on North American production." Declaration of Brenda Betts ("Betts Decl.") ¶ 3 (SAR 138); Declaration of Julia Mouser ("Mouser Decl.") ¶ 3 (SAR 144). They even continued to sit at the same desks, and received the same salaries. Betts Decl. ¶¶ 7, 8 (SAR 139-40); Mouser Decl. ¶¶ 7, 8 (SAR 145-46).

The Former Employees thus emphasize that, at the time of their termination in 2003, they were doing the same work for BP as their former colleagues who were laid off following the BP-Amoco merger and who were later certified as eligible for TAA in 1999. Betts Decl. ¶ 6 (SAR 139); Mouser Decl. ¶ 6 (SAR 145). Indeed, the Former Employees attest that, at all times, BP continued to retain control over work done at the Accounting Center, both as a matter of contract and as a matter of operational reality. Betts Decl. ¶ 11 (SAR 140); Mouser Decl. ¶ 11 (SAR 146).

The Former Employees point first to the Service Level Agreement ("SLA"), the contract between BP and PwC/IBM, which governed the Former Employees' responsibilities and was referenced in memoranda and handouts specifying their job requirements and goals. Betts Decl. ¶ 9 (SAR 140); Mouser Decl. ¶ 9 (SAR 146). As to day-to-day operations, the Former Employees attest that — throughout their tenure at the Accounting Center — they devoted 100% of their time to BP projects; that they received instructions (both directly and indirectly) from BP managers; that they were required to "code" all their time using a BP tracking system in order to allow BP to track their activities; that — in all external communications — they were required to say or write, "This is [name of Former Employee] from IBM, doing business for BP"; and that all decisions on matters such as incurring costs and undertaking new projects were made by BP management. Betts Decl. ¶¶ 3,10-11 (SAR 138, 140-41); Mouser Decl. ¶¶ 3, 10-11 (SAR 144, 146-47).

BP also remaineda physical presence at the Accounting Center, even after the "outsourcing." The Former Employees continued to work alongside BP personnel, who were permanently assigned to the Accounting Center. In addition, BP maintained a treasury, the mainframe computer, and other critical infrastructure there. Betts Decl. ¶ 12 (SAR 141); AR 7; Pls.' Brief at 22-23.

Although the Former Employees had successfully weathered repeated corporate shake-ups in the past, their luck ran out when they were terminated in late 2003 — a development which they trace to surging imports of oil and natural gas, as well as BP's shift from domestic to foreign production. Betts Decl. ¶ 14 (SAR 141); Mouser Decl. ¶ 14 (147).

B. The Procedural History of the Case

1. The First Negative Determination

The entirety of the Labor Department's initial investigation was limited to a two-page questionnaire, sent to an IBM official. See CAR 15-16. The agency posed two questions concerning whether IBM produced an article at the Accounting Center. Nowhere did the agency seek to elicit information concerning the Former Employees' potential eligibility for certification as service workers. And nowhere did the agency probe IBM's contractual relationship with any other company — even though, on their petition form, the Former Employees listed "IBM/BP Amoco" in the space provided for "Company Name," and explained elsewhere on the form that the "Accounting Center performs accounting services for BPAmerica/BP Amoco Oil." AR 2. Based on the scant information before it, the Labor Department sent a letter to the Former Employees, informing them that their TAA petition had been denied. The letter also outlined the process for requesting reconsideration of the agency's determination. However, it failed to advise the Former Employees of the option of seeking judicial review instead. See AR 25-28.

Out of an abundance of caution, one of the Former Employees filed both a request for reconsideration with the Labor Department and a letter with this Court seeking judicial review (later deemed the Complaint). AR 32; Letter from B. Betts to U.S. Court of International Trade (Feb. 11, 2004). Confronted with a request for administrative reconsideration and a Summons and Complaint challenging the same TAA determination, the Government requested that the case be remanded to allow the Labor Department to consider the request for reconsideration. See Motion for Voluntary Remand and Relief from Filing the Administrative Record ("Motion for First Voluntary Remand"). The remand was granted less than a week later.

2. The First Voluntary Remand

A mere one day after the case was remanded to allow for a more "complete . . . administrative process," the Labor Department issued the results of its investigation on remand, denying the Former Employees' TAA petition once again. See Motion for First Voluntary Remand; Notice of Denial of Reconsideration, 69 Fed. Reg. 20,644.

This time, the Labor Department's negative determination was based primarily on its finding that the Former Employees were "service workers." According to the agency's criteria then in place, service workers were eligible for TAA certification only if they were either "in direct support of an affiliated facility currently certified for TAA or employed on a contractual basis at a location currently certified for TAA." Notice of Denial of Reconsideration, 69 Fed. Reg. at 20,644 (emphasis added).

The Labor Department concluded that the Former Employees did not meet the applicable criteria. Id. The agency apparently never considered whether the 1999 certification of the Former Employees' colleagues at the Accounting Center constituted evidence that the Former Employees — as service workers — had provided "direct support" to BP. Id. ("The previous certification has no bearing on the determination of eligibility at this time."). Moreover, the agency paid scant attention to the undisputed fact that the Former Employees were paid by BP prior to 1999, and that — notwithstanding their "outsourcing" — they had continued to perform the same work for BP up to the time of their discharge. AR 50; Notice of Denial of Reconsideration, 69 Fed. Reg. at 20,644-45.

The sole evidence to which the Labor Department pointed to support its determination was a statement by an IBM official in Raleigh, North Carolina, who reportedly told the agency that there was no affiliation between the Accounting Center and BP, and that IBM "provide[d] accounting services to [BP] at many locations in the United States and abroad out of [the Accounting Center]." AR 6, 50; Notice of Denial of Reconsideration, 69 Fed. Reg. at 20,644-45. Significantly, that same IBM official later disclaimed "any firsthand knowledge of daily work activities of the Former Employees," and recommended that "someone else at IBM should be contacted for additional information." See SAR 123.

3. The Second Voluntary Remand

The Labor Department requested 60 days to complete its second remand investigation. According to the Government, the two-month delay was necessary because the Labor Department's "initial investigation and the inquiries conducted under [the first voluntary remand] were limited to finding out if the service workers in question were performing services for a currently certified facility." Consent Motion for [Second] Voluntary Remand at 5-6.

The Government explained that — as discussed in section I.C above — the Labor Department had recently announced a new interpretation of the service workers criteria, which would be applied in the course of the remand. Id. The Government further explained that, on remand, the agency "intend[ed] to supplement the administrative record with additional evidence regarding the relationship" between the Accounting Center and BP. Id.

In the two months that followed, the contract between BP and IBM governing the Accounting Center — the Service Level Agreement, or "SLA" — was one of the most important issues on the table. CSAR 256-58. Indeed, in an e-mail message to an IBM official, one of the Labor Department's investigators stated that evidence of a contractual or operational relationship between BP and the Accounting Center/IBM was "extremely crucial" in determining the Former Employees' eligibility for TAA certification. CSAR 257.

With this new focus to its investigation, the Labor Department verified the existence of the SLA between BP and IBM, under which employees at the Accounting Center continued to provide services to BP even after the "outsourcing" — although the agency failed to obtain a copy of the SLA itself. The agency also learned that, while some IBM employees at the Accounting Center served some other companies, "most" of the work done at that location was for BP. CSAR 256.

A week before the 60-day remand period expired, the Labor Department contacted counsel for the Former Employees to seek their consent to a two-week extension of time for the filing of the remand results, to allow the Labor Department to obtain factual information from BP that was essential to its investigation. Two days later, counsel for the Former Employees was contacted again. This time, the Labor Department sought consent to an extension of three weeks. According to the agency investigator who placed the call, the additional time was necessary to "gather and evaluate the information from BP." See Pls.' Brief at 13. The Former Employees consented to the requested extensions. However, the Government never filed a motion with the Court. See Pls.' Brief at 12-13; Def.'s Brief at 26-27.

Instead — mere days after seeking the Former Employees' consent to a three-week extension of time — the Labor Department filed the results of its second remand investigation, on the 60-day deadline. The agency denied certification of the Former Employees yet again. Notice of Second Negative Redetermination on Remand, 69 Fed. Reg. 48,527.

As the Government explains in its brief, the Labor Department cited three grounds for its determination:

(1) petitioners were not eligible as production workers because the TAA certification for another worker group was immaterial;

(2) the petitioners were not eligible as support service workers because they were not under the `control' of British Petroleum (`BP') during the relevant time period; and

(3) even if BP had `control' of the petitioners, they would not be eligible for TAA benefits because they were not working in a BP production facility or appropriate subdivision of such a facility.

Def.'s Brief at 16 (summarizing Notice of Second Negative Redetermination on Remand, 69 Fed. Reg. 48,527). As discussed in greater detail below, grounds (2) and (3) turn on the interpretation and application of the Labor Department's new Leased Workers Policy.

III. Standard of Review

Judicial review of a Labor Department determination denying certification of eligibility for trade adjustment assistance benefits is confined to the administrative record. See, e.g., Former Employees of Chevron Products Co. v. United States, 27 CIT ___, ___, 279 F. Supp. 2d 1342, 1350 (2003) ("Chevron II") (citations omitted). The agency's determination must be sustained if it is supported by substantial evidence in the record and is otherwise in accordance with law. 19 U.S.C. § 2395(b); Former Employees of Shaw Pipe, Inc. v. U.S. Sec'y of Labor, 21 CIT 1282, 1284-85, 988 F. Supp. 588, 590 (1997) (citations omitted);Former Employees of Merrow Mach. Co. v. U.S. Sec'y of Labor, 18 CIT 17, 18-19, 843 F. Supp. 1480, 1481 (1994) (citations omitted).

The Labor Department's findings of fact are thus conclusive if they are supported by substantial evidence. See Former Employees of Galey Lord Indus., Inc. v. Chao, 26 CIT 806, 808-09, 219 F. Supp. 2d 1283, 1285-86 (2002) (citations omitted);Merrow Mach. Co., 18 CIT at 19, 843 F. Supp. at 1481 ( citing 19 U.S.C. § 2395(b)). "However, substantial evidence is more than a `mere scintilla'; it must be enough to reasonably support a conclusion." Chevron II, 27 CIT at ___, 279 F. Supp. 2d at 1349 ( citing Galey Lord Indus., Inc., 26 CIT at 808, 219 F. Supp. 2d at 1286 (citations omitted)).

Moreover, the evidence on which the agency relies does not exist in a vacuum. Thus, to determine whether substantial evidence exists, the record compiled by the agency must be reviewed "in its entirety, including all evidence that `fairly detracts from the substantiality of the evidence.'" Consol. Bearings Co. v. United States, 412 F.3d 1266, 1269 (Fed. Cir. 2005) (citations omitted); see also Gerald Metals, Inc. v. United States, 132 F.3d 716, 720 (Fed. Cir. 1997) ("[T]he substantiality of evidence must take into account whatever in the record fairly detracts from its weight." (citations omitted));Chevron II, 27 CIT at ___, 279 F. Supp. 2d at 1350 ("[A]n assessment of the substantiality of record evidence must take into account whatever else in the record fairly detracts from its weight." (citations omitted)).

Finally, all rulings based on the agency's findings of fact must be "in accordance with the statute and not . . . arbitrary and capricious"; to that end, "the law requires a showing of reasoned analysis." Former Employees of Gen. Elec. Corp. v. U.S. Dep't of Labor, 14 CIT 608, 611 (1990) ( quoting UAW v. Marshall, 584 F.2d at 396 n. 26).

In short, although it is clear that the scope of judicial review is narrow, and that a court is not free to substitute its judgment for that of the agency, it is equally clear that "the agency must examine the relevant data and articulate a satisfactory explanation for its action including a `rational connection between the facts found and the choice made.'" Former Employees of Alcatel Telecomms. v. Herman, 24 CIT 655, 658-659, (2000) ( quoting Motor Vehicle Mfr.'s Assn'n v. State Farm Mut. Auto Ins., 463 U.S. 29, 43 (1983) (citations omitted)).

Where good cause is shown, a case may be remanded to the Labor Department for further investigation and analysis. 19 U.S.C. § 2395(b); see also Former Employees of Motorola Ceramic Products v. United States, 336 F.3d 1360, 1362 (Fed. Cir. 2003) (citations omitted). Moreover, the agency is on notice that if its "failure to conduct an adequate investigation . . . [is] taken as indicative that [it] does not care to perform its duties competently . . . the court will not remand. . . ." Former Employees of Barry Callebaut v. Herman, 25 CIT 1226, 1234-35, 177 F. Supp. 2d 1304, 1312-13 (2001). See also Former Employees of Hawkins Oil Gas, Inc. v. U.S. Sec'y of Labor, 17 CIT 126, 130-31, 814 F. Supp. 1111, 1115-16 (1993) (ordering certification where "another remand . . . would be futile"); cf. Former Employees of Pittsburgh Logistics Sys., Inc. v. U.S. Sec'y of Labor, 27 CIT ___, ___, 2003 WL 22020510 at * 7 (2003) (ordering certification where agency "continue[d] to adhere to a discredited position . . . at odds with the developed facts of the record"). But see Def.'s Brief at 38-42 (arguing that the Court lacks authority to order certification). To date, the Court of Appeals has side-stepped the issue. See Former Employees of Marathon Ashland Pipe Line LLC v. Chao, 370 F.3d 1375, 1386 (Fed. Cir. 2004) (finding, under the circumstances, "no occasion to address the government's argument that the remedy ordered by the [Court of International Trade] was outside [its] authority"); Former Employees of Barry Callebaut v. Chao, 357 F.3d 1377, 1383 (Fed. Cir. 2004) (deeming "moot" "the question of the Court of International Trade's authority to order Labor to certify [workers]" for TAA benefits).

IV. Analysis

As summarized in section II.B above, the determination here under review is the product of a second voluntary remand. See Second Negative Redetermination on Remand, 69 Fed. Reg. 48,527. The Government sought that remand to afford the Labor Department what was the agency's third "bite at the apple," but its first opportunity to review the Former Employees' petition in light of the recent clarification of (or change to) the agency's "service workers" analysis, discussed I.A above. Under that new analysis (effective as of April 2004):

Labor will certify petitions from workers who perform services for a firm or an appropriate subdivision of such firm [implicating the agency's new Leased Workers Policy] if the work of the petitioning workers is related to the firm's production of a "trade-impacted" article under 19 U.S.C. § 2272 and the workers otherwise satisfy Trade Act eligibility criteria.

Consent Motion for [Second] Voluntary Remand at 5.

The Government's motion succinctly outlined the scope of the investigation to be conducted by the Labor Department pursuant to the second voluntary remand:

The new investigation will focus first upon whether the petitioners are providing support for an IBM facility that produces a trade impacted article. If so, Labor will investigate whether the other applicable criteria for TAA certification have been met. If not, Labor will investigate the relationship between the petitioners and BP/AMOCO [apparently in accordance with the agency's new Leased Workers Policy]. If there is insufficient evidence of a relationship that will support certification, Labor will conclude its investigation and reaffirm the initial denial of benefits. If there is sufficient affiliation [pursuant to the Labor Department's "leased workers policy"], Labor will then investigate BP/AMOCO's operations to determine if the IBM workers are providing support for [BP/AMOCO's] production of a trade-impacted article. If so, Labor will investigate whether the other applicable eligibility criteria for TAA certification have been met. If not, Labor would reaffirm the initial denial of benefits.

Consent Motion for [Second] Voluntary Remand at 6.

As the Government explains in its brief, as a result of the Labor Department's investigation conducted pursuant to the second voluntary remand, the agency reaffirmed yet again its denial of the Former Employees' TAA petition, citing three grounds:

(1) petitioners were not eligible as production workers because the TAA certification for another worker group was immaterial;

(2) the petitioners were not eligible as support service workers because they were not under the `control' of British Petroleum (`BP') during the relevant time period; and

(3) even if BP had `control' of the petitioners, they would not be eligible for TAA benefits because they were not working in a BP production facility or appropriate subdivision of such a facility.

Def.'s Brief at 16 (summarizing Notice of Second Negative Redetermination on Remand, 69 Fed. Reg. 48,527).

As detailed more fully below, the first of the three grounds cited is predicated on a fundamental mischaracterization of the Former Employees' claims. And, as to the other two, the Labor Department's findings and conclusions are either unsupported by substantial evidence or otherwise not in accordance with law, or both.

A. The Labor Department's Determination As to "Production Workers"

The Labor Department and the Government waste much ink analyzing the Former Employees as "production workers," challenging, inter alia, the Former Employees' reliance on the 1999 TAA certification of their former colleagues at the Accounting Center who were laid off following the 1998 merger. See, e.g., Notice of Denial of Reconsideration, 69 Fed. Reg. 20,644; Notice of Second Negative Redetermination on Remand, 69 Fed. Reg. 48,527; Def.'s Brief at 29-34.

In fact, it does not appear that the Former Employees here ever even claimed to be production workers. Certainly they do not rely on the 1999 TAA certification to establish that they should be so classified. See generally Pls.' Brief at 3, 32-33 (explaining that Labor Department "mischaracterized the [Former Employees'] argument . . . regarding their involvement in the production of crude oil and natural gas" and that "the Former employees relied on the 1999 certification . . . to demonstrate that the jobs performed by the Former Employees, which were the same jobs Labor acknowledged were part of the 1999 certification, were necessary for the production of oil and natural gas.").

More to the point, however, the Labor Department and the Government are much too cavalier in summarily dismissing as "immaterial" the 1999 certification. As discussed more fully in section V.D below, that prior certification bears directly on (and, indeed, may be conclusive as to) the question of whether, at the time of their discharge, "the [Former Employees were] providing support for [BP's] production of a trade-impacted article." See Consent Motion for [Second] Voluntary Remand at 6 (indicating that, if agency's analysis in course of second remand found sufficient "affiliation" between IBM and BP/AMOCO, agency would then "investigate BP/AMOCO's operations to determine if the IBM workers [were] providing support for [BP/AMOCO's] production of a trade-impacted article").

B. The Labor Department's Determination As to "Service Workers" and "Control"

The Former Employees accuse the Labor Department of focusing solely on the fact that BP lacked corporate ownership of IBM, and — in contravention of Pittsburgh Logistics — ignoring other relevant evidence indicating that BP retained and continued to exercise actual operational control over the Former Employees at the Accounting Center, even after they were "outsourced" by BP. See Pls.' Brief at 2-3, 16-22, 30-32; Pls.' Reply Brief at 3, 12. Those accusations are not entirely without foundation. It is, however, also true that — as the Government indignantly observes — the Labor Department is not required to ignore evidence of "legal affiliation" (or lack thereof). See Def.'s Brief at 11, 18.

In any event, it is now clear beyond cavil that, in determining "control," the Labor Department cannot confine its analysis solely to legal formalities such as corporate ownership or affiliation. Since at least Pittsburgh Logistics and the development of the Labor Department's new Leased Workers Policy, the agency must define "control" more broadly, to include operational reality — for example, "who `exercised actual control' over and who `managed and directed'" the workers in question. See generally Pittsburgh Logistics II, 27 CIT at ___, 2003 WL 22020510 at * 9; Labor Department Internal Memo re: New Leased Workers Policy (CSAR 261-62).

Incredibly, the Government asserts flatly that "there is no evidence in the record . . . upon which [the Labor Department] could conclude that BP had `control' over the [Former Employees]." See Def.'s Brief at 20 (emphasis added). To the contrary, as it currently stands, the Administrative Record is replete with essentially uncontradicted evidence which tends to prove that, at all relevant times, BP exercised management and operational control over the Former Employees — that, as the Former Employees put it, virtually nothing about their jobs changed after the outsourcing, except the name of the company signing their paychecks.

Specifically, the Former Employees attest that, after BP outsourced part of its workforce to PwC, "[a]lthough the name on [their] paycheck[s] changed, [they] continued to perform the same work for the benefit of BP that [they had] performed while being paid directly by BP," and that — even after their PwC unit was acquired by IBM — they "continued to perform the same job functions and sit at the same desk[s] that they did when [they were] . . . employee[s] of BP." The Former Employees further attest that, at all times throughout their tenure at the Accounting Center, "BP was contractually and operationally in control of the work performed [there]. . . . BP maintained the power to manage and direct [their] daily activities." Indeed, even after the "outsourcing," in all external communications, the Former Employees were required to identify themselves as "doing business for BP." See Betts Decl. ¶¶ 7, 8, 10, 11 (SAR 138-41); Mouser Decl. ¶¶ 7, 8, 10, 11 (SAR 144-47).

Moreover, it appears from the record that the Accounting Center was a "shared" facility, with BP maintaining a physical presence there even after the "outsourcing." According to the Former Employees, they worked alongside BP personnel who were permanently assigned to the Accounting Center. The uncontroverted evidence further establishes that BP maintained infrastructure — including, inter alia, a treasury and the mainframe computer — at that location. The facility itself was even sometimes referred to as "the BP [or ` British Petroleum'] Accounting Center operated by IBM." See CSAR 256; Betts Decl. ¶ 10 (SAR 140); AR 32; Pls.' Brief at 9, 22-24 n. 9; Notice of Denial of Reconsideration, 69 Fed. Reg. at 20,644 (referring to "the British Petroleum Accounting Center operated by IBM").

In sum, the existing Administrative Record includes relatively ample evidence supporting the Former Employees' claims that — as a practical matter — BP continued to exercise management and operational control over their work up to the time of their termination. In contrast, there is only minimal evidence to support the Labor Department's determination that, at the time of their termination, the Former Employees were under the operational control of IBM. Moreover, the relatively little evidence that supports the agency's position consists of mere conclusory assertions (generally by IBM officials) and/or statements that are contradicted by other record evidence that the Labor Department has failed to address.

The Labor Department's finding that "the IBM contract with BP does not subject the [Former Employees] to the kind of control by BP" that would make them eligible for TAA certification as leased workers is particularly baffling, for two reasons. See Notice of Second Negative Redetermination on Remand, 69 Fed. Reg. at 48,528.

First, the Labor Department has never even seen a copy of the BP-IBM contract (known within the two companies as the "Service Level Agreement," or "SLA"). The agency's findings as to the content of that contract thus are based solely on the conclusory statements of an IBM official, which are — in turn — substantially controverted by the Former Employees. And, as discussed below, the Labor Department may not rely on the legal conclusions of others as a substitute for its own analysis of the relevant facts. Nor is it permitted to rely on evidence which is fundamentally at odds with other record evidence (at least not without reconciling discrepancies).

A second concern — equally, if not more, troubling — is the implication that the Labor Department need not look beyond the four corners of the relevant contract to determine whether a company producing a trade-impacted article exercised operational "control" over a particular group of leased workers. See Notice of Second Negative Redetermination on Remand, 69 Fed. Reg. at 48,528 (agency finding that " the . . . contract . . . does not subject the . . . workers to the kind of control" that would render the workers eligible for TAA certification). AsPittsburgh Logistics held — and as the Labor Department's new Leased Workers Policy reflects — legal formalities (such as contractual provisions) are not conclusive on the issue of "control." The agency must look beyond such matters, and consider actual operational control as well.

The Government insists that the Labor Department did, in fact, evaluate operational control. See Def.'s Brief at 18-19. However, the determination issued by the agency itself reflects virtually no analysis beyond corporate ownership and legal control, with the exception of its findings that the Former Employees were "subject to IBM's terms and conditions of employment, [and] reported to IBM managers" and that they were "located at an IBM facility." See Notice of Second Negative Redetermination on Remand, 69 Fed. Reg. at 48,527. As note 21 above explains, the first quoted finding has no solid foundation in the existing evidentiary record. And the second quoted finding — that the Former Employees were "located at an IBM facility" (and "were not employed at any BP facility during the relevant time period") — is equally infirm, as discussed in detail in section IV.C, below.

To be sure, it is not the role of the Court in reviewing the Labor Department's determinations to re-weigh the evidence and substitute its judgment for that of the agency. But the Court is charged with determining whether or not the agency's determination is supported by "substantial evidence" in the record. See 19 U.S.C. § 2395. That analysis necessarily requires a review of the evidence on which the agency relies in the context of the entirety of the administrative record as a whole (including "whatever in the record fairly detracts from" that evidence). See, e.g., Gerald Metals, 132 F.3d at 720; Consol. Bearings Co., 412 F.3d at 1269. Thus, evidence that — standing alone — might otherwise constitute "substantial evidence" may not measure up where, for example, the agency has taken the evidence out of context, or where (as here) there is substantial contradictory evidence in the record that the agency has failed to address.

In the instant case, for example, the Labor Department accorded great weight to an IBM official's representation that the Former Employees "were subject to IBM's terms and conditions of employment, [and] reported to IBM managers." Compare CSAR 256 (IBM e-mail to Labor Department) with Notice of Second Negative Redetermination on Remand, 69 Fed. Reg. at 48,527 (agency finding that Former Employees "were subject to IBM's terms and conditions of employment, [and] reported to IBM managers"). In effect, the agency delegated to an IBM official the power to decide a key aspect of the Former Employees' TAA petition. But, "it is Labor's responsibility, not the responsibility of [a] company official, to determine whether a former employee is eligible for benefits."Former Employees of Federated Merch. Group v. United States, 29 CIT ___, ___, 2005 WL 290015 at * 6 (2005) (citation omitted).

In short, the Labor Department cannot simply adopt as its own the legal conclusions of employers on the issue of "control." Rather, the agency must reach its own conclusions, based on its own thoughtful, thorough, independent analysis of all relevant record facts. See generally Former Employees of Electronic Data Sys. Corp. v. U.S. Sec'y of Labor, 28 CIT ___, ___, 350 F. Supp. 2d 1282, 1292-93 (2004) (in relying on company official's statement that company "did not produce articles, but provided computer related services," Labor Department improperly "substituted one . . . [company official's] opinion that the company did not produce `articles' for [the agency's] own legal inquiry").

Nor is the Labor Department permitted to accept at face value information provided by a source where either (a) that information is contradicted by other evidence on the record, or (b) there is some other reason to question the veracity of the information or the credibility of the source. Here, most of the information on which the agency relied was contradicted by other record evidence; and the source of much of that information was at least arguably suspect. Under the circumstances, the Labor Department was obligated to corroborate that information. Inexplicably, the agency failed to do so. See generally Former Employees of Marathon Ashland Pipe Line, LLC v. Chao, 370 F.3d 1375, 1385 (Fed. Cir. 2004) (ruling that the Labor Department is entitled to base TAA determinations on statements of company officials "if the Secretary reasonably concludes that those statements are creditworthy" and if the statements "are not contradicted by other evidence"; but — where a conflict in the evidence exists — the Labor Department is "precluded . . . from relying on the representations by the employer" and is required to take further investigative steps before making [its] certification decision") (emphasis added).

The Government attempts to summarize the facts of Pittsburgh Logistics and to cast them so as to distinguish that case from this one. See Def.'s Brief at 21-23. But the specific facts ofPittsburgh Logistics are not the "acid test" for operational control, i.e., the standard against which all such cases are to be judged. By definition, such an inquiry is fact-intensive, and cannot be reduced to any definitive, neat and tidy checklist or formula. To reach a determination on "control," the Labor Department is necessarily required to engage in a case-by-case analysis of all relevant facts. The bottom line here is that — with the possible exception of the workers' locations (discussed in detail in section IV.C below) — the Labor Department can point to little or no concrete evidence in the existing Administrative Record to distinguish this case in any meaningful fashion from other similar cases (such as Pittsburgh Logistics and Wackenhut) where leased workers have been certified for TAA.

The Government's attempts to invoke principles of agency law are similarlyunavailing. See, e.g., Def.'s Brief at 11 (alleging that BP-IBM "relationship . . . did not rise to the level of agency control") (emphasis added), 20 (arguing that Former Employees have not identified "any aspect of the [BP-IBM] relationship that rendered the petitioners agents of BP, rather than IBM" and that "there is no evidence . . . of an agency relationship") (emphases added), 29 (asserting that criteria used in performance reviews of Former Employees do not "necessarily . . . constitute evidence of BP's `control' over those workers to form a principal-agent relationship") (emphasis added).

Putting aside for the moment reservations concerning the wisdom of blindly incorporating wholesale into TAA law the entirety of agency law, it is enough to note that the Government's application of that law to the facts of this case is — at a bare minimum — overly-simplistic and incomplete. For example, under basic principles of agency law, "holding out" is a central concept in establishing the existence of an agency relationship. In the instant case, the undisputed evidence of record establishes that — in all their communications, whether by e-mail, fax or phone — the Former Employees were not merely authorized but expressly required by BP to affirmatively hold themselves out as "doing business for BP." See Betts Decl. ¶ 10 (SAR 140); Mouser Decl. ¶ 10 (SAR 146).

That same record evidence also refutes the repeated efforts of the Government and the Labor Department to dismiss the relationship between BP and the former employees it outsourced to PwC/IBM as nothing more than a standard, routine "service provider-client" relationship. See Def.'s Brief at 11, 18-20; Notice of Denial of Reconsideration, 69 Fed. Reg. at 20,644 (referring to BP as a "customer or client" of IBM); Notice of Second Negative Redetermination on Remand, 69 Fed. Reg. at 48,527 (finding that IBM employees at Accounting Center provide services to "multiple clients, including BP"). In contrast to this case, in the typical "service provider-client" relationship, the "client" does not even authorize — much less require — that the "service provider" expressly hold itself out as acting on behalf of the "client."

Finally, as the Labor Department notes in its Second Negative Redetermination on Remand, there is some record evidence to indicate that some of the IBM workers at the Accounting Center have done some work for companies in addition to BP. But the Labor Department "spins" that information by referring broadly to the Accounting Center's work for "multiple clients, including BP." The effect is to obscure the fact that even the IBM official on whom the agency relied confirmed that "most" of the work at the Accounting Center was done for BP.

Historically, service workers have been eligible for certification if at least 25% of their work is in support of a "trade-impacted" article. See, e.g., Abbott v. Donovan, 8 CIT 237, 241, 596 F. Supp. 472, 475-76 (1984). In the instant case, the Labor Department failed to elicit evidence to quantify precisely the extent of any work done for companies other than BP. But there can be no doubt that "most" is more than 25%.

On remand, the Labor Department shall reevaluate the existing record evidence on the issue of "control" (focusing — inter alia — on the Former Employees' specific representations and sworn statements of fact on the matter), and shall conduct such further investigation of the relevant facts as is necessary to fully develop the evidentiary record (including solicitation of additional information from the Former Employees, among other sources). As discussed above, the agency may not rely on conclusory assertions by company officials — particularly not as to "ultimate facts" and legal determinations entrusted to the agency, and particularly not where those conclusory assertions are contradicted by detailed, specific factual statements made by the Former Employees under penalty of perjury.

On remand, the Labor Department shall clearly articulate and apply a standard for "control" that is consistent with this opinion (clarifying and updating that set forth in its new Leased Workers Policy). The agency shall detail the rationale for the standard that it articulates, and — in applying that standard to the Administrative Record as supplemented on remand — shall ensure that its redetermination is supported by substantial evidence, taking into consideration all other evidence that fairly detracts from its weight. See, e.g., Universal Camera Corp. v. NLRB, 340 U.S. 474, 488 (1951).

C. The Labor Department's Treatment of the Location of the Former Employees' Workplace

As its third and final ground for denying the Former Employees' TAA petition, the Labor Department concluded that — even if BP exercised "control" over the Former Employees — the Former Employees could not be certified because they were not "co-located with BP workers at a BP facility that produces an article." Notice of Second Negative Redetermination on Remand, 69 Fed. Reg. at 48,528; see also Def.'s Brief at 16 ("even if BP had `control' of the [Former Employees], they would not be eligible for TAA benefits because they were not working in a BP production facility or appropriate subdivision of such a facility") (emphasis added).

The Labor Department's determination on this so-called "location requirement" defies meaningful judicial review, for two overarching reasons. First, the agency utterly failed to articulate the legal and policy bases for its position (or, frankly, even to adequately explain exactly what that position is). And, second, even if the agency had adequately explained and justified its legal position, the factual record that it compiled on the issue is — in a word — anemic.

1. The Adequacy of the Agency's Rationale

The Government takes the position that the Labor Department's "location requirement" is mandated by the language of the TAA statute. Specifically, the Government asserts that the agency's "location requirement" flows from "the statutory requirement that . . . workers be ` in . . . [ a] firm, or an appropriate subdivision of the firm.'" See Def.'s Brief at 35-36 (emphasis and first ellipses added) ( quoting 19 U.S.C. § 2272(a)(1) (Supp. II 2002)). The Government thus apparently contends that the statute's reference to a "firm" is a reference to a physical location. But that claim wilts under scrutiny.

Dictionary definitions establish conclusively that a "firm" is "[a] commercial partnership of two or more persons." The American Heritage Dictionary 506 (Houghton Mifflin Co. 2d college ed. 1982). There is therefore no need here to parse the language of the TAA statute, or to have recourse to legislative history, or to resort to the finer points of linguistic analysis. The plain meaning of the word "firm" is clear. And, contrary to the Government's claims, a "firm" is not a physical location at all, much less any particular location (such as the premises where "production" of a trade-impacted article occurs, or premises owned or staffed by the company producing a trade-impacted article).

Neither the Labor Department nor the Government has proffered any rationale whatsoever (other than the statutory interpretation discussed above) to justify the Labor Department's position that, to be eligible for TAA certification, the Former Employees must have been "co-located with BP workers at a BP facility that produces an article." Notice of Second Negative Redetermination on Remand, 69 Fed. Reg. at 48,528.

The Labor Department itself has provided no historical or other context for its position concerning the location of the Former Employees. And even the Government's brief sheds more heat than light on the subject. It is not entirely clear whether the Government is asserting that the Labor Department historically has consistently and uniformly required that all workers (including service as well as production workers, and non-"leased" as well as "leased" workers) must be located "onsite" — for lack of a better word — to be eligible for certification. Or whether the Labor Department is asserting only that leased workers (including both "leased" production workers and"leased" service workers) must be located "onsite" to be eligible for certification (and that the locations of non-"leased" workers — whether service workers or production workers — are irrelevant to the eligibility of those non-"leased" workers). Or whether the Labor Department is instead asserting only that service workers (whether "leased" or non-"leased") must be located "onsite" to be eligible for certification (and that the locations of production workers — whether "leased" or non-"leased" — are irrelevant to the eligibility of those production workers)Or whether the Labor Department is asserting only that leased service workers must be "onsite" to be eligible for certification (and that the locations of all other workers — including non-"leased" service workers, as well as both "leased" and non-"leased" production workers — are irrelevant to the eligibility of all those other workers).

The Government emphasizes that the location of the workers was not at issue in Pittsburgh Logistics. See Def.'s Brief at 36. But Pittsburgh Logistics firmly rejected the notion that the Labor Department could treat the single clearest indicia of "control" — corporate ownership or affiliation — as dispositive. If the Labor Department cannot treat even corporate ownership or affiliation as dispositive, it is perhaps unlikely that the agency can proffer an adequate justification for treating location as dispositive. Certainly the agency has not yet done so here.

It remains to be seen whether the Labor Department's "location requirement" can be sustained. But if it can be sustained at all, it can be sustained only (1) if the agency clearly articulates its position on the significance (if any) of the physical location of workers vis-a-vis their eligibility for TAA certification, including the distinctions — if any — that it draws between different classes of workers; (2) if the agency adequately justifies that position as a matter of law and policy (bearing in mind, inter alia, the remedial purpose of the TAA statute); and (3) if the agency's actual practice — in this and other cases — has been consistent with the position that it is espousing here. (Any inconsistencies in the agency's past practice ( e.g., as a result of changes in policy) must, of course, be explained.)

The Labor Department will have an opportunity to make the case for its "location requirement" on remand. To the extent that the Labor Department continues to maintain that the Former Employees can be certified only if they are employed "at a BP facility that produces an article" ( see Notice of Second Negative Redetermination on Remand, 69 Fed. Reg. at 48,528), the agency shall, inter alia, explain clearly and precisely (1) how it defines "facility," (2) what determines whether or not a particular "facility" is a " BP facility" (emphasis added) — or, for that matter, a "facility" of any other company, (3) what determines whether or not a particular "facility" "produces an article," and (4) what it means to be employed "at" a particular facility. With respect to each individual aspect of the quoted criterion, the Labor Department's explanation must separately and distinctly articulate in detail the legal and policy justifications for the agency's position (bearing in mind the remedial purpose of the TAA statute), and must include a full and candid discussion of the agency's actual past practice in the application of that specific individual aspect of the criterion to other TAA cases in the past (including the 1999 certification of the Former Employees' colleagues at the Accounting Center).

Finally, it bears emphasis that, even if it is not a determinative issue — a requirement — in determining workers' eligibility for TAA, location may nevertheless remain a very potent consideration. There can thus be no legitimate concern on the part of the Labor Department that the absence of a "location requirement" would "open the floodgates" of petitioners and effectively eviscerate all limitations on the scope of coverage under the statute.

2. The Adequacy of the Administrative Record

The Labor Department's failure to clearly articulate and justify its position on the significance of the location of the Former Employees (discussed above) is compounded by its failure to develop the requisite factual record to properly support a determination on the issue.

Incredibly, although location is cited as an independent — and, indeed, the ultimate — basis for denying certification in this case, the Labor Department asked only a single direct question on the subject in the course of its multiple investigations. Moreover, again — as with the Labor Department's treatment of the issue of "control" (discussed in section IV.B above) — what evidence there is in the Administrative Record as to the issue of location is either conclusory or at odds with the agency's determination. In at least one instance, it appears that the Labor Department simply got the facts flat out wrong.

As section IV.C.1 explains, the record is silent on the legal and policy bases for the Labor Department's contention that — to be eligible for certification — the Former Employees must have been "co-located with BP workers at a BP facility that produces an article." See Notice of Second Negative Redetermination on Remand, 69 Fed. Reg. at 48,528. On remand, the Labor Department must not only clearly articulate and explain any criteria for TAA certification related to petitioners' locations (together with the legal and policy justifications therefor), but — in addition — must fully develop the evidentiary record on the issue, and must ensure that its findings and conclusions on remand (applying whatever criteria it determines on remand to be appropriate) are supported by substantial evidence in the Administrative Record.

Thus, for example, as discussed in section IV.C.1, it is unclear why the Labor Department required that the Former Employees have been "co-located with BP workers" to be eligible for TAA certification. But, even assuming that the "co-location" criterion is a legitimate requirement, the existing Administrative Record is simply devoid of evidence to support the agency's finding that the Former Employees failed to satisfy it. Indeed, as note 39 explains, the Labor Department's factual determination on this point appears to be clearly erroneous. Compare Notice of Second Negative Redetermination on Remand, 69 Fed. Reg. at 48,528 with Pls.' Brief at 22-24 n. 9 (noting that "Labor never asked whether any BP employees were co-located with the Former Employees" at the Accounting Center, and that — had the agency asked — "it would have determined that twenty-four BP employees continue to work [there]"). It is telling that the Government fails even to acknowledge — much less attempt to defend — the Labor Department's finding. See Def.'s Brief at37.

As section IV.C.1 notes, it is similarly unclear why the Labor Department required that the Former Employees have been located at a "BP facility" to be eligible for TAA certification. But, even assuming that it is a legitimate criterion, the agency can point to little or no evidence in the existing Administrative Record to support its determination that the Accounting Center was not such a facility. The only direct, concrete evidence in the existing Administrative Record would appear to support a determination that the Accounting Center was, in fact, a "BP facility."

For example, it is undisputed that, even after the "outsourcing," "most" of the work done there was for BP. In addition, as discussed above, the Former Employees worked alongside BP personnel who were permanently assigned to the Accounting Center. BP also maintained infrastructure — including, inter alia, a treasury and a mainframe computer — at that location. And the facility itself was even sometimes referred to as "the BP [or ` British Petroleum'] Accounting Center operated by IBM." See CSAR 256; Betts Decl. ¶ 10 (SAR 140); AR 32; Pls.' Brief at 9, 22-24 n. 9; Notice of Denial of Reconsideration, 69 Fed. Reg. at 20,644 (referring to "the British Petroleum Accounting Center operated by IBM").

Finally, as set forth in section IV.C.1 above, it is also unclear why the Labor Department required the Former Employees to have been located at a facility "that produces an article" to be eligible for TAA certification. But, again — even assuming that it is a legitimate criterion — the agency can point to little real evidence in the existing Administrative Record to support any determination as to precisely where potentially relevant "production" was (or was not) occurring. The record evidence establishes, at most, that IBM was not producing an article at the Accounting Center, and that workers at the Accounting Center do not "support an IBM production facility" located elsewhere. See CAR 15; CSAR 199-200 (emphasis added). The Labor Department simply never probed the locations of the "production" activities of BP, or the relationship of the Former Employees' work to BP's "production."

More generally, since workers at the Accounting Center were previously certified as eligible for TAA in 1999, it is unclear why that location is now per se ineligible. The Labor Department has failed to articulate the respective rationales behind the two determinations vis-a-vis location. Nor has the Labor Department compiled an evidentiary record as to any facts it may deem relevant to support any distinctions that it seeks to draw.

Thus, for example, if the agency historically has attached great weight to the name of the company on the lease or title to the premises in question, one would expect that the agency would have elicited the necessary information in the course of its investigation and included it in the evidentiary record, to support its determination. But no such information appears in the existing Administrative Record — with respect to either the timeframe of the 1999 certification, or the timeframe prior to the Former Employees' discharge. Similarly, to the extent that the agency requires that "production" have occurred on any particular premises, one would expect that the agency would have affirmatively elicited the necessary information in the course of its investigation and included that information in the evidentiary record, to support its determination. But, again, there is relatively little evidence on point in the Administrative Record here. Indeed, there is no evidence at all with respect to the timeframe of the prior certification, and (as discussed immediately above) there is no direct evidence as to the timeframe prior to the Former Employees' discharge.

The Former Employees emphasize that — from before the time of the 1999 certification right up to the time of their discharge — they continued to do the exact same work for BP, sitting at the same desks, located inside the exact same facility. Betts Decl. ¶¶ 7, 8 (SAR 139-40); Mouser Decl. ¶¶ 7, 8 (SAR 145-46). And there is, for example, nothing in the record to suggest that "production" was occurring on the premises of the Accounting Center at the time of the 1999 certification, but was later discontinued. Nor is there anything in the record to suggest that the BP facility that was producing a trade-impacted article at the time of the 1999 certification had ceased such production before the time of the Former Employees' discharge. Nor is there any indication that, at the time of their discharge, the Former Employees were located any further from "BP production" than their colleagues were at the time of the prior certification.

In short, from a review of the existing Administrative Record, it is impossible to discern exactly what circumstances changed between the time of the 1999 certification and the time of the Former Employees' discharge (other than the company name on the Former Employees' paychecks). Nor is it clear why any such changed circumstances should be significant for purposes of TAA certification.

On remand, the Labor Department shall compile a full and complete evidentiary record on this issue, documenting all potentially relevant facts and circumstances both at the time of the 1999 certification and at the time of the Former Employees' discharge (and any pertinent changes in the interim). The evidence elicited shall, inter alia, "paint a picture" and effectively map out all relevant facilities and structures and their relationships to one another (geographic and otherwise), and describe in detail the nature of the activities ("production" or otherwise) at the various facilities and structures.

In addition — particularly in light of the Former Employees' representations concerning BP's maintenance of staffing, technology, equipment, and other facilities at the Accounting Center — the Labor Department shall fully explore and document in detail all facts surrounding the nature and extent of BP's presence at, interest in, and control over the Accounting Center at the time of the Former Employees' discharge (including both the nature and extent of its actual exercise of influence, as well as any rights it may have under the terms of the BP-IBM Service Level Agreement).

D. Other Criteria for Certification

The Labor Department apparently aborted its analysis of the Former Employees' petition, and did not reach determinations on all applicable criteria for certification. For example, in the investigatory "roadmap" that it laid out when seeking its second voluntary remand, the Government advised that — if the Labor Department on remand found "sufficient affiliation [pursuant to the agency's new Leased Workers Policy]" — the agency would then proceed to "investigate BP/AMOCO's operations to determine if the [Former Employees were] providing support for [BP/AMOCO's] production of a trade-impacted article." See Consent Motion for [Second] Voluntary Remand at 6. The existing Administrative Record gives no indication that the agency ever really considered — much less made a determination on — the latter issue.

The Former Employees maintain that the ship has already sailed on the question of whether their work was in direct support of BP production. Specifically, the Former Employees emphasize that — in the course of its 1999 certification of the Accounting Center — the Labor Department determined that the Former Employees' colleagues who had just been laid off were "engaged in activities related to [BP's] exploration and production of crude oil and natural gas." See Notice of Second Negative Redetermination on Remand, 69 Fed. Reg. at 48,528 (noting that, in prior certification, agency determined that workers were "engaged in activities related to exploration and production of crude oil and natural gas") ( discussed in Pls.' Brief at 32-34).

The Labor Department and the Government seek to dismiss the 1999 certification as completely irrelevant to the petition at bar. See Notice of Second Negative Redetermination on Remand, 69 Fed. Reg. at 48,527-28 (stating that the 1999 certification "has no bearing on the [Former Employees'] eligibility"). See also Notice of Denial of Reconsideration, 69 Fed. Reg. at 20,644-45; Def.'s Brief at 29-34. But they have failed to explain how — as a matter of logic — the Former Employees' work for BP could now be found not to have been in direct support of BP's "exploration and production of crude oil and natural gas," if indeed the Former Employees' work for BP mirrored that of their former colleagues who were determined in 1999 to have been "engaged in activities related to exploration and production of crude oil and natural gas" and who were therefore covered by the prior certification.

On remand, the Labor Department shall make a determination as to whether the Former Employees were "providing support for [BP's] production" — i.e., were "engaged in activities related to exploration and production." If the agency determines that they were not so engaged, its explanation must identify and address in detail, inter alia, the specific bases (both legal and factual) for distinguishing the facts and circumstances of this petition from the facts and circumstances underlying the 1999 certification. And — whatever determination the agency reaches — that determination must be supported by substantial evidence in the record.

There are other criteria, as well, that the Labor Department has not yet addressed. However, there is much room for confusion as to precisely how the agency's classic test for certification as "service workers" is to be interpreted and applied in light of the agency's new Leased Workers Policy (as modified by the agency April 2004 policy addressing "certified" vs. "certifiable"). Although the Labor Department has not spelled out the revised criteria in this case, one recent agency determination explains:

Only in very limited instances are service workers certified for TAA. Namely the worker separations must be caused by a reduced demand for their services from a parent or controlling firm or subdivision whose workers produce an article and who are currently certifiable for TAA; or if the group of workers are leased workers who perform their duties onsite at the TAA certifiable location on [an] established contractual basis.

American Wood Notice of Denial of Reconsideration, 70 Fed. Reg. at 45,436.

Under the classic test for certification as "service workers" (discussed in section I.A, above), "the reduction in the demand for [the workers'] services" must have "originated at a production facility whose workers independently met the statutory criteria for certification." Chevron I, 26 CIT at 1285, 245 F. Supp. 2d at 1328 ( citing Bennett v. U.S. Sec'y of Labor, 20 CIT 788, 792 (1996); Abbott v. Donovan, 6 CIT 92, 100-01, 570 F. Supp. 41, 49 (1983)). Assuming that the criterion applies to the Former Employees here, the existing Administrative Record gives no indication that the Labor Department analyzed BP workers' eligibility for certification.

The Administrative Record nevertheless includes much information on point, virtually all of which was submitted by the Former Employees. For example, there is voluminous record evidence that tends both to establish the existence of increased imports during the relevant period, and to corroborate the Former Employees' claims of BP shifts in production. See, e.g., Pls.' Brief at 12, 34-38 (distilling and analyzing record evidence of increased imports and shifts in production); SAR 126-30. Indeed, the record is barren of any real evidence to the contrary.

On remand, the Labor Department shall spell out with precision all criteria applicable to the Former Employees' potential certification as leased service workers (focusing, inter alia, on the relationship, if any, between the classic test for certification as "service workers" and the criteria for certification of service workers under the agency's new Leased Workers Policy (including any revisions or clarifications of that policy in the course of the remand)). In addition, the Labor Department shall explain the origins of and legal bases for all such criteria. Further, the agency shall make determinations as to whether each of the criteria is satisfied in this case. As always, the agency's determinations must be supported by substantial evidence in the record.

V. Conclusion

Pointing to the court-ordered certification of the workers inPittsburgh Logistics, the Former Employees here urge the same result. They contend that the, throughout this case, the Labor Department has "demonstrated an unwavering commitment to a results-oriented approach," and that where — as here — the agency already has had multiple bites at the apple, certification is "the only alternative." As the Former Employees acknowledge, however, court-ordered certification is an extraordinary remedy. See Pls.' Brief at 4; Chevron II, 27 CIT at ___, 279 F. Supp. 2d at 1356. Under the circumstances, it cannot be said with certainty that one last, very brief, remand would be futile.

Plaintiffs' Motion for Judgment on the Agency Record is therefore granted in part, and this action is remanded to Defendant for further proceedings in conformity with this opinion. However, the Labor Department would be well-advised to engage in full and candid consultations with the Former Employees on all issues, and is officially on notice that no extensions of time will be granted for the filing of its redetermination on remand.

A separate order will enter accordingly.