Companies, in many cases, register to access incentive funding. Often it is much higher (per participant) in the states and lower at the federal level. But some states are very challenging to deal with and can take years for approval of new programs. The juice is not worth the squeeze. This system needs a real overhaul, it won’t be able to scale like this.
As you know putting together the pieces to make RA's work is a task since we do not have a national structure, sustainable funding, sustainable supportive services or the long-term commitment to make this work. Compare this to Europe. I do like the fact that when RA Programs work they do embed the training and education with the employer. In many professions (e.g., doctors) we provide a great deal of work-based learning but don't call it apprenticeship. Thanks for your great column, hope to cross paths one of these days at a state or national conference.
I’d like to see the DOL streamline apprenticeships like the SEC does for investment advisors.
1. Set a De Minimis Exemption
SEC Rule:
A registered investment advisor (RIA) does not need to register with a state until they have 5+ clients in that state.
Proposal to DOL:
Allow up to 5 registered apprentices to perform work as an out-of-state contractor without needing to register in that state or request reciprocity.
Once a contractor has 6+ registered apprentices in a state, require reciprocity to be requested.
2. Set a Threshold to Auto-Register Nationally
SEC Rule:
RIAs who reach $100 million in AUM can register nationally and are required by the time they reach $110 million in AUM.
Proposal to DOL:
Once a contractor has registered apprentices working in 3 states, automatically register federally so they are good nationwide.
3. Issue Annual Notice Filings
SEC Rule:
During the RIAs annual ADV filing, they must issue notices to each state where they have clients. Simply check the box next to the state where one has clients, pay a small fee, and the notices are sent.
Proposal to DOL:
The contractor would file annual notices to the states where they’re performing work or plan to work. The notices would include updated information on the program and a small processing fee.
No more lengthy state registration or clunk reciprocity.
4. Allow States 3 Add-On Rules
SEC Rule:
States may impose limited additional requirements on SEC-registered RIAs, such as notice filings or fees, but cannot require full state registration.
Proposal to DOL:
Limit the number of rules a state can add on top of the federal rules.
Any proposed add-ons go to a fast-track review: states have 30 days to prove it's essential. If they can't, the rule is waived with no appeal required.
5. Create a Neutrality Check
SEC Rule:
SEC oversight ensures state requirements don’t conflict with federal standards, maintaining a balanced regulatory framework free from undue influence by any single group.
Proposal to DOL:
Unions represent less than 10% of the workforce but have an outsized grip on the national apprenticeship system.
Require all state add-ons to undergo independent audits by non-union experts before even hitting that 30-day clock.
—
My perspective is that of a power user, I leave the policy stuff to you, Nick.
Companies, in many cases, register to access incentive funding. Often it is much higher (per participant) in the states and lower at the federal level. But some states are very challenging to deal with and can take years for approval of new programs. The juice is not worth the squeeze. This system needs a real overhaul, it won’t be able to scale like this.
As you know putting together the pieces to make RA's work is a task since we do not have a national structure, sustainable funding, sustainable supportive services or the long-term commitment to make this work. Compare this to Europe. I do like the fact that when RA Programs work they do embed the training and education with the employer. In many professions (e.g., doctors) we provide a great deal of work-based learning but don't call it apprenticeship. Thanks for your great column, hope to cross paths one of these days at a state or national conference.
I’d like to see the DOL streamline apprenticeships like the SEC does for investment advisors.
1. Set a De Minimis Exemption
SEC Rule:
A registered investment advisor (RIA) does not need to register with a state until they have 5+ clients in that state.
Proposal to DOL:
Allow up to 5 registered apprentices to perform work as an out-of-state contractor without needing to register in that state or request reciprocity.
Once a contractor has 6+ registered apprentices in a state, require reciprocity to be requested.
2. Set a Threshold to Auto-Register Nationally
SEC Rule:
RIAs who reach $100 million in AUM can register nationally and are required by the time they reach $110 million in AUM.
Proposal to DOL:
Once a contractor has registered apprentices working in 3 states, automatically register federally so they are good nationwide.
3. Issue Annual Notice Filings
SEC Rule:
During the RIAs annual ADV filing, they must issue notices to each state where they have clients. Simply check the box next to the state where one has clients, pay a small fee, and the notices are sent.
Proposal to DOL:
The contractor would file annual notices to the states where they’re performing work or plan to work. The notices would include updated information on the program and a small processing fee.
No more lengthy state registration or clunk reciprocity.
4. Allow States 3 Add-On Rules
SEC Rule:
States may impose limited additional requirements on SEC-registered RIAs, such as notice filings or fees, but cannot require full state registration.
Proposal to DOL:
Limit the number of rules a state can add on top of the federal rules.
Any proposed add-ons go to a fast-track review: states have 30 days to prove it's essential. If they can't, the rule is waived with no appeal required.
5. Create a Neutrality Check
SEC Rule:
SEC oversight ensures state requirements don’t conflict with federal standards, maintaining a balanced regulatory framework free from undue influence by any single group.
Proposal to DOL:
Unions represent less than 10% of the workforce but have an outsized grip on the national apprenticeship system.
Require all state add-ons to undergo independent audits by non-union experts before even hitting that 30-day clock.
—
My perspective is that of a power user, I leave the policy stuff to you, Nick.