DEPARTMENT OF LABOR

Employment and Training Administration

TA-W-70,202

EATON HYDRAULICS
SEARCY, ARKANSAS

Negative Determination Regarding Eligibility
To Apply for Worker Adjustment Assistance

In accordance with Section 223 of the Trade Act of 1974, as
amended ("Act"), 19 U.S.C. § 2273, the Department of Labor
herein presents the results of an investigation regarding
certification of eligibility to apply for worker adjustment
assistance.
Workers of a firm may be eligible for worker adjustment
assistance if they satisfy the criteria of subsection (a), (c)
or (f) of Section 222 of the Act, 19 U.S.C. § 2272(a), (c), (f).
For the Department of Labor to issue a certification for workers
under Section 222(a) of the Act, 19 U.S.C. § 2272(a), the
following three criteria must be met:
I. The first criterion (set forth in Section 222(a)(1) of the
Act, 19 U.S.C. § 2282(a)(1)) requires that a significant
number or proportion of the workers in the workers' firm
must have become totally or partially separated or be
threatened with total or partial separation.

II. The second criterion (set forth in Section 222(a)(2) of the
Act, 19 U.S.C. § 2272(a)(2)) may be satisfied in one of two
ways:
(A) Increased Imports Path:
(i) sales or production, or both, at the workers' firm
must have decreased absolutely, AND
(ii) (I) imports of articles or services like or directly
competitive with articles or services produced or
supplied by the workers' firm have increased, OR
(II)(aa) imports of articles like or directly
competitive with articles into which the
component part produced by the workers' firm was
directly incorporated have increased; OR
(II)(bb) imports of articles like or directly
competitive with articles which are produced
directly using the services supplied by the
workers' firm have increased; OR
(III) imports of articles directly incorporating
component parts not produced in the U.S. that are
like or directly competitive with the article
into which the component part produced by the
workers' firm was directly incorporated have
increased.

(B) Shift in Production or Supply Path:
(i)(I) there has been a shift by the workers' firm to a
foreign country in the production of articles or
supply of services like or directly competitive with
those produced/supplied by the workers' firm; OR
(i)(II) there has been an acquisition from a foreign
country by the workers' firm of articles/services that
are like or directly competitive with those
produced/supplied by the workers' firm.

III. The third criterion requires that the increase in imports
or shift/acquisition must have contributed importantly to
the workers' separation or threat of separation. See
Sections 222(a)(2)(A)(iii) and 222(a)(2)(B)(ii) of the Act,
19 U.S.C. §§ 2272(a)(2)(A)(iii), 2272(a)(2)(B)(ii).

Section 222(d) of the Act, 19 U.S.C. § 2272(d), defines the
terms "Supplier" and "Downstream Producer." For the Department
to issue a secondary worker certification under Section 222(c)
of the Act, 19 U.S.C. § 2272(c), to workers of a Supplier or a
Downstream Producer, the following criteria must be met:
(1) a significant number or proportion of the workers in
the workers' firm or an appropriate subdivision of the
firm have become totally or partially separated, or
are threatened to become totally or partially
separated;

(2) the workers' firm is a Supplier or Downstream Producer
to a firm that employed a group of workers who
received a certification of eligibility under Section
222(a) of the Act, 19 U.S.C. § 2272(a), and such
supply or production is related to the article or
service that was the basis for such certification; and

(3) either
(A) the workers' firm is a supplier and the component
parts it supplied to the firm described in paragraph
(2) accounted for at least 20 percent of the
production or sales of the workers' firm; or
(B) a loss of business by the workers' firm with the firm
described in paragraph (2) contributed importantly to
the workers' separation or threat of separation.

The investigation was initiated in response to a petition
filed on May 19, 2009 by an Arkansas state workforce official
on behalf of workers of Eaton Hydraulics, Searcy, Arkansas.
The workers produce valves. Applications of these valves
include various hydraulic components used in the production of
heavy machinery and construction equipment. A major portion of
sales are for the export market.
The petitioners allege that increased imports of like
products have resulted in worker separations.
The investigation included collection of data from the
subject firm, from a survey of the subject firm's largest
declining customers, and of aggregate data relating to United
States imports of like or competitive products.
With respect to Section 222(a) of the Act, the
investigation revealed that the workers of Eaton Hydraulics,
Searcy, Arkansas did not meet the criteria for certification.
Criterion II of this section has not been met because there
was no shift/acquisition by the subject firm of articles like or
directly competitive with the valves produced in Searcy,
Arkansas.
The investigation revealed that employment and sales did
not decrease from 2007 to 2008. They did decline, however, in
January through April 2009 compared to the same period in 2008.
In this January through April 2009 period imports of like or
directly competitive articles declined both absolutely and
relative to the subject firm's domestic sales.
In addition, a Department of Labor survey of the major
declining customers of the subject firm revealed that customer
imports of articles like or directly competitive with hydraulic
valves were minor and declining through April of 2009.
United States imports for consumption of fluid power valves
and hose fittings (NAICS 332912) decreased substantially in
January through May 2009 compared with the same period in 2008.
With respect to Section 222(c) of the Act, the
investigation revealed that the workers of Eaton Hydraulics,
Searcy, Arkansas did not meet the criteria for certification as
secondarily affected workers.
Criterion (2) of this section has not been met because the
workers did not produce an article or supply a service that was
used by a firm with TAA-certified workers in the production of
an article.
Finally, the group eligibility requirements under Section
222(f) of the Act, 19 U.S.C. § 2272(f), have not been satisfied
because the workers' firm has not been identified in an
affirmative finding of injury by the ITC.
Conclusion
After careful review of the facts obtained in the
investigation, I determine that workers of Eaton Hydraulics,
Searcy, Arkansas who produce custom components and line systems
are denied eligibility to apply for adjustment assistance under
Section 223 of the Act, 19 U.S.C. § 2273.
Signed in Washington, D.C., this 5th day of October 2009


/s/Richard Church
______________________________
RICHARD CHURCH
Certifying Officer, Division of
Trade Adjustment Assistance