42 USC 2753 - Grants for Federal work-study programs

(a) Agreements required 
The Secretary is authorized to enter into agreements with institutions of higher education under which the Secretary will make grants to such institutions to assist in the operation of work-study programs as provided in this part.
(b) Contents of agreements 
An agreement entered into pursuant to this section shall
(1) provide for the operation by the institution of a program for the part-time employment, including internships, practica, or research assistantships as determined by the Secretary, of its students in work for the institution itself, work in community service or work in the public interest for a Federal, State, or local public agency or private nonprofit organization under an arrangement between the institution and such agency or organization, and such work
(A) will not result in the displacement of employed workers or impair existing contracts for services;

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(B) will be governed by such conditions of employment as will be appropriate and reasonable in light of such factors as type of work performed, geographical region, and proficiency of the employee;
(C) does not involve the construction, operation, or maintenance of so much of any facility as is used or is to be used for sectarian instruction or as a place for religious worship; and
(D) will not pay any wage to students employed under this subpart[1] that is less than the current Federal minimum wage as mandated by section 206 of title 29;
(2) provide that funds granted an institution of higher education, pursuant to this section, may be used only to make payments to students participating in work-study programs, except that
(A) for fiscal year 1999, an institution shall use at least 5 percent of the total amount of funds granted to such institution under this section in any fiscal year to compensate students employed in community service (including a reasonable amount of time spent in travel or training directly related to such community service), except that the Secretary may waive this subparagraph if the Secretary determines that enforcing it would cause hardship for students at an institution;
(B) for fiscal year 2000 and succeeding fiscal years, an institution shall use at least 7 percent of the total amount of funds granted to such institution under this section for such fiscal year to compensate students employed in community service, and shall ensure that not less than 1 tutoring or family literacy project (as described in subsection (d) of this section) is included in meeting the requirement of this subparagraph, except that the Secretary may waive this subparagraph if the Secretary determines that enforcing this subparagraph would cause hardship for students at the institution; and
(C) an institution may use a portion of the sums granted to it to meet administrative expenses in accordance with section 1096 of title 20, may use a portion of the sums granted to it to meet the cost of a job location and development program in accordance with section 2756 of this title, and may transfer funds in accordance with the provisions of section 1095 of title 20;
(3) provide that in the selection of students for employment under such work-study program, only students who demonstrate financial need in accordance with part F [20 U.S.C. 1087kk et seq.] and meet the requirements of section 1091 of title 20 will be assisted, except that if the institutions grant under this part is directly or indirectly based in part on the financial need demonstrated by students who are
(A)  attending the institution on less than a full-time basis, or
(B)  independent students, a reasonable portion of the grant shall be made available to such students;

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(4) provide that for a student employed in a work-study program under this part, at the time income derived from any need-based employment is in excess of the determination of the amount of such students need by more than $300, continued employment shall not be subsidized with funds appropriated under this part;
(5) provide that the Federal share of the compensation of students employed in the work-study program in accordance with the agreement shall not exceed 75 percent, except that
(A) the Federal share may exceed 75 percent, but not exceed 90 percent, if, consistent with regulations of the Secretary
(i) the student is employed at a nonprofit private organization or a government agency that
(I) is not a part of, and is not owned, operated, or controlled by, or under common ownership, operation, or control with, the institution;
(II) is selected by the institution on an individual case-by-case basis for such student; and
(III) would otherwise be unable to afford the costs of such employment; and
(ii) not more than 10 percent of the students compensated through the institutions grant under this part during the academic year are employed in positions for which the Federal share exceeds 75 percent; and
(B) the Federal share may exceed 75 percent if the Secretary determines, pursuant to regulations promulgated by the Secretary establishing objective criteria for such determinations, that a Federal share in excess of such amounts is required in furtherance of the purpose of this part;
(6) include provisions to make employment under such work-study program reasonably available (to the extent of available funds) to all eligible students in the institution in need thereof;
(7) provide assurances that employment made available from funds under this part will, to the maximum extent practicable, complement and reinforce the educational program or vocational goals of each student receiving assistance under this part;
(8) provide assurances, in the case of each proprietary institution, that students attending the proprietary institution receiving assistance under this part who are employed by the institution may be employed in jobs
(A) that are only on campus and that
(i) to the maximum extent practicable, complement and reinforce the education programs or vocational goals of such students; and
(ii) furnish student services that are directly related to the students education, as determined by the Secretary pursuant to regulations, except that no student shall be employed in any position that would involve the solicitation of other potential students to enroll in the school; or
(B) in community service in accordance with paragraph (2)(A) of this subsection;
(9) provide assurances that employment made available from funds under this part may be used to support programs for supportive services to students with disabilities;
(10) provide assurances that the institution will inform all eligible students of the opportunity to perform community service, and will consult with local nonprofit, governmental, and community-based organizations to identify such opportunities; and
(11) include such other reasonable provisions as the Secretary shall deem necessary or appropriate to carry out the purpose of this part.
(c) Private sector employment agreement 
As part of its agreement agreement[2] described in subsection (b) of this section, an institution of higher education may, at its option, enter into an additional agreement with the Secretary which shall
(1) provide for the operation by the institution of a program of part-time employment of its students in work for a private for-profit organization under an arrangement between the institution and such organization that complies with the requirements of subparagraphs (A) through (D) of subsection (b)(1) of this section and subsection (b)(3) of this section;
(2) provide that the institution will use not more than 25 percent of the funds made available to such institution under this part for any fiscal year for the operation of the program described in paragraph (1);
(3) provide that, notwithstanding subsection (b)(5) of this section, the Federal share of the compensation of students employed in such program will not exceed 60 percent for academic years 19871988 and 19881989, 55 percent for academic year 19891990, and 50 percent for academic year 19901991 and succeeding academic years, and that the non-Federal share of such compensation will be provided by the private for-profit organization in which the student is employed;
(4) provide that jobs under the work study program will be academically relevant, to the maximum extent practicable; and
(5) provide that the for-profit organization will not use funds made available under this part to pay any employee who would otherwise be employed by the organization.
(d) Tutoring and literacy activities 

(1) Use of funds 
In any academic year to which subsection (b)(2)(B) of this section applies, an institution shall ensure that funds granted to such institution under this section are used in accordance with such subsection to compensate (including compensation for time spent in training and travel directly related to tutoring in reading and family literacy activities) students
(A) employed as reading tutors for children who are preschool age or are in elementary school; or
(B) employed in family literacy projects.
(2) Priority for schools 
To the extent practicable, an institution shall
(A) give priority to the employment of students in the provision of tutoring in reading in schools that are participating in a reading reform project that
(i) is designed to train teachers how to teach reading on the basis of scientifically-based research on reading; and
(ii) is funded under the Elementary and Secondary Education Act of 1965 [20 U.S.C. 6301 et seq.]; and
(B) ensure that any student compensated with the funds described in paragraph (1) who is employed in a school participating in a reading reform project described in subparagraph (A) receives training from the employing school in the instructional practices used by the school.
(3) Federal share 
The Federal share of the compensation of work-study students compensated under this subsection may exceed 75 percent.
[1] So in original. Probably should be “part”.
[2] So in original.