Subpart R - Public Interest Exclusions

§ 40.361 What is the purpose of a public interest exclusion (PIE)?

(a) To protect the public interest, including transportation employers and employees, from serious noncompliance with DOT drug and alcohol testing rules, the Department’s policy is to ensure that employers conduct business only with responsible service agents.

(b) The Department therefore uses PIEs to exclude from participation in DOT's drug and alcohol testing program any service agent who, through serious noncompliance with this part or other DOT agency drug and alcohol testing regulations, demonstrates they are not currently acting in a responsible manner.

(c) A PIE is a serious action that the Department takes only to protect the public interest. The Department intends to use PIEs only to remedy situations of serious noncompliance, not for punishment.

(d) Nothing in this subpart precludes a DOT agency or the Inspector General from taking other actions authorized by its regulations concerning service agents or employers who violate those regulations.

§ 40.363 On what basis may the Department issue a PIE?

(a) If you are a service agent, the Department may issue a PIE concerning you if it determines that you have failed or refused to provide drug or alcohol testing services consistent with the requirements of this part or a DOT agency drug and alcohol regulation.

(b) The Department may also issue a PIE if you have failed to cooperate with DOT agency representatives concerning inspections, complaint investigations, compliance and enforcement reviews, or requests for documents and other information related to compliance with this part or other DOT regulations.

§ 40.365 What is the Department's policy concerning starting a PIE proceeding?

Cross Reference: Link to an amendment published at 88 FR 27650, May 2, 2023.

(a) It is the Department’s policy to initiate a PIE proceeding only in cases of serious, uncorrected noncompliance with this part, especially where the violation affects safety, test result integrity, privacy, due process, program honesty, or cooperation with DOT agency representatives.

(b) The following are examples of serious noncompliance that the Department considers valid grounds for starting a PIE proceeding. These are not exhaustive but serve to illustrate the level of seriousness that may justify initiating a PIE:

(1) For an MRO: Verifying tests as positive without interviewing employees or performing duties without required qualifications.

(2) For a laboratory: Refusing to provide required information; failing to conduct required validity testing; or repeatedly making testing errors that result in test cancellations. (The Department generally does not initiate a PIE proceeding for matters where HHS certification applies.)

(3) For a collector: A pattern of unauthorized direct observations or failure to conduct them when required.

(4) For collectors, BATs, or STTs: Using unapproved forms, testing equipment, or kits.

(5) For a collector, BAT, or STT: A pattern of fatal flaws or significant, uncorrected collection process errors.

(6) For a laboratory, MRO, or C/TPA: Failing to report test results as required.

(7) For a laboratory: Falsifying, concealing, or destroying documentation, including litigation packages.

(8) For SAPs: Offering services without meeting qualifications or conducting evaluations without face-to-face interviews.

(9) For any service agent: Conflicts of interest, such as financial incentives tied to referrals.

(10) Falsely claiming to be approved or certified by the Department or using unauthorized DOT logos or emblems.

(11) Improperly disclosing employee test results, using blanket consents, or creating unauthorized databases.

(12) Interfering with an MRO's ability to communicate with DOT or retaliating for doing so.

(13) Encouraging or directing employers not to comply with this part.

(14) Serious violations of DOT agency regulations that impact Department-wide standards (e.g., random testing selection failures).

§ 40.367 Who initiates a PIE proceeding?

The following DOT officials may initiate a PIE proceeding:

(a) The drug and alcohol program manager of a DOT agency;

(b) An official of ODAPC, other than the Director; or

§ 40.369 What is the discretion of an initiating official in starting a PIE proceeding?

(a) Initiating officials have broad discretion in deciding whether to start a PIE proceeding.

(b) In exercising this discretion, the initiating official must consider the Department’s policy on the seriousness of the service agent’s conduct (see § 40.365), and all available information about the case. The official may also consider resource availability.

(c) A decision not to initiate a PIE proceeding does not imply that the Department views the service agent as compliant or that other remedies are unavailable.

§ 40.371 On what information does an initiating official rely in deciding whether to start a PIE proceeding?

(a) An initiating official may rely on credible information from any source.

(b) Before sending a correction notice (see § 40.373), the initiating official may informally contact the service agent to gather information that could affect the decision to send the notice. Any resulting information may be considered in the decision-making process.

§ 40.373 Before starting a PIE proceeding, does the initiating official give the service agent an opportunity to correct problems?

(a) Yes. The initiating official must send a correction notice before starting a PIE proceeding.

(b) The correction notice identifies the specific compliance areas needing correction to avoid a PIE.

(c) If you make and document corrections to the satisfaction of the initiating official within 60 days of receiving the notice, the official will not start a PIE proceeding. The official may verify the corrections and, if satisfied, issue a written closure notice.

§ 40.375 How does the initiating official start a PIE proceeding?

(a) If your compliance issue is not correctable (see § 40.373(a)) or has not been corrected as described in § 40.373(c), the initiating official begins a PIE proceeding by issuing a Notice of Proposed Exclusion (NOPE). The NOPE recommends a PIE but does not constitute the Department’s decision.

(b) The NOPE includes:

1. A statement recommending that the Department issue a PIE;

2. The factual basis for noncompliance with DOT regulations;

3. A statement that the noncompliance has not or cannot be corrected;

4. The recommended scope and duration of the PIE;

5. A statement that you may contest the proposed PIE under § 40.379.

§ 40.377 Who decides whether to issue a PIE?

(a) The ODAPC Director, or designee, decides whether to issue a PIE. References to the Director include the designee, if applicable.

(b) To maintain impartiality, the Director does not participate in the decision to initiate the proceeding.

(c) A “firewall” prohibits communication between the initiating official and the Director about the case, except through official proceedings and documentation.

§ 40.379 How do you contest the issuance of a PIE?

(a) If you receive a NOPE, you may contest the proposed PIE.

(b) To do so, within 30 days of receiving the NOPE, you must take one or more of the following actions:

1. Request dismissal based on lack of serious noncompliance;

2. Submit written arguments or documentation (see § 40.381);

3. Arrange an informal meeting with the Director.

(c) If no action is taken within 30 days, the matter proceeds as an uncontested case, and the Director makes a decision based on the record.

§ 40.381 What information do you present to contest the proposed issuance of a PIE?

(a) You must provide:

1. Specific facts that contradict statements in the NOPE;

2. Identification of any prior PIEs;

3. Identification of your affiliates.

(b) You may submit arguments on the scope and duration of the PIE (see § 40.375).

§ 40.383 What procedures apply if you contest the issuance of a PIE?

(a) The Department conducts PIE proceedings in a fair and informal manner. The Director may use flexible procedures to allow you to present your case. Formal rules of evidence or procedure do not apply.

(b) The Director will consider any relevant information or argument in making a decision.

(c) You may submit documentary evidence and, if you arranged an informal meeting, present witnesses and confront those presented by the initiating official.

(d) If there are material factual disputes, the Director or designee may conduct further fact-finding.

(e) If you request a transcript of the informal meeting, the Department will provide it, but you must pay the transcription and copying costs.

§ 40.385 Who bears the burden of proof in a PIE proceeding?

(a) The initiating official, as the proponent of issuing a PIE, bears the burden of proof.

(b) The standard is preponderance of the evidence that the service agent was in serious noncompliance with this part or a DOT agency regulation.

§ 40.387 What matters does the Director decide concerning a proposed PIE?

(a) After receiving your response (see § 40.379(b)), or after 30 days with no response, the Director may:

1. Dismiss the proceeding (on request or their own motion) if the conduct does not meet the Department's standard for serious noncompliance.

* (i) If dismissed, the case is closed regarding that NOPE.

* (ii) The Department may start a new proceeding for future or different noncompliance.

2. Remand the matter to the initiating official for additional or corrected information. An amended NOPE must be issued if the basis for the PIE changes.

(b) The Director decides:

1. Whether there are material facts in dispute;

2. Whether the facts support a PIE;

3. The scope of the PIE;

4. The duration of the PIE.

§ 40.389 What factors may the Director consider?

The Director may consider aggravating and mitigating factors including, but not limited to:

(a) The actual or potential harm from the noncompliance;

(b) Frequency and/or duration of the noncompliance;

(d) Pervasiveness of noncompliance, such as:

1. Organizational involvement in or tolerance of the misconduct;

2. Positions held by individuals responsible;

3. Existence of internal control systems at the time.

(e) Compliance disposition, including:

1. Acceptance of responsibility;

2. Cooperation with the Department;

3. Internal investigations and results shared with DOT;

4. Disciplinary actions taken;

5. Corrective actions and future prevention steps.

(f) Impact on matters of Department-wide concern;

(g) Other relevant factors based on case circumstances.

§ 40.391 What is the scope of a PIE?

(a) The scope defines which divisions, services, affiliates, or individuals the PIE applies to.

(b) If the Department issues a PIE against a service agent, it applies to all relevant organizational elements involved in the noncompliance.

(d) Both the initiating official and Director must consider the factors in paragraphs (e)–(j) when determining scope.

(e) More pervasive noncompliance justifies broader scope.

(f) A PIE is not limited to the original location or employer.

(g) It applies to affiliates if they were involved in or affected by the conduct.

(h) It applies to individuals who:

1. Were involved in the misconduct while performing duties;

2. Knew of, approved, or benefited from it.

(i) If the misconduct is solely the contractor's fault, the PIE applies to the service agent only if they knew or should have known and failed to act.

(j) PIEs do not apply to non-DOT-regulated testing.

(k) Examples follow to illustrate these rules (Examples 1–7 not repeated here for brevity unless requested).

§ 40.393 How long does a PIE stay in effect?

(a) The NOPE proposes the PIE duration, which may be contested and decided upon by the Director.

(b) The Director considers the seriousness of the conduct and the need to protect stakeholders, using factors listed in § 40.389.

§ 40.395 Can you settle a PIE proceeding?

Yes. At any point before the Director’s decision, the service agent and initiating official may settle the case with the Director’s concurrence.

§ 40.397 When does the Director make a PIE decision?

The Director must decide within 60 days after the record is complete. This may be extended for up to 30 days for good cause.

§ 40.399 How does the Department notify service agents of its decision?

The Director provides written notice as soon as a PIE decision is made.

(a) If no PIE is issued, the notice includes reasons and findings of fact.

(b) If a PIE is issued, the notice includes:

1. Reference to the NOPE;

2. Reasons and findings of fact;

3. The PIE's scope;

4. The PIE's duration.

§ 40.401 How does the Department notify employers and the public about a PIE?

(a) The Department maintains a document titled the List of Excluded Drug and Alcohol Service Agents, available on the DOT website (http://www.transportation.gov/odapc). A copy may also be requested from ODAPC.

(b) When the Director issues a PIE, the List is updated with the name, address, and any other applicable parties, including the scope and duration of the PIE.

(d) The Department also publishes a notice in the Federal Register when a service agent is added to or removed from the List.

§ 40.403 Must a service agent notify its clients when the Department issues a PIE?

(a) Yes. If a PIE is issued concerning you, the service agent, you must notify all your DOT-regulated employer clients in writing about the PIE, including its issuance, scope, duration, and effect. This can be fulfilled by sending the Director’s PIE decision or a separate notice. Notices must be sent within three business days of receiving the PIE notice (see § 40.399(b)).

(b) You must also offer to immediately transfer all records related to each employer and its employees to the employer or another service agent of the employer’s choosing. The transfer must be made as soon as requested.

§ 40.405 May the Federal courts review PIE decisions?

Yes. The Director’s decision is the Department’s final administrative action and is subject to judicial review under the Administrative Procedure Act (5 U.S.C. 551 et seq.).

§ 40.407 May a service agent ask to have a PIE reduced or terminated?

(a) Yes. You may request the Director to reduce or terminate a PIE’s duration or scope. This process does not reconsider the decision to issue the PIE itself.

(b) Your request must be in writing and supported by documentation.

(d) The initiating official may submit information or arguments regarding your request to the Director.

(e) If the Director confirms that the noncompliance has been resolved and that you now meet DOT requirements for testing-related services, the Director may issue a notice reducing or terminating the PIE.

§ 40.409 What does the issuance of a PIE mean to transportation employers?

(a) Employers are deemed to have notice of a PIE once it appears on the List of Excluded Service Agents (§ 40.401(a)) or is published in the Federal Register (§ 40.401(d)). Employers are responsible for ensuring they do not use service agents on the list.

(b) If you are using a service agent subject to a PIE, you must stop using their services within 90 days of the PIE publication. You may request one 30-day extension from the ODAPC Director if you are unable to find a substitute within the 90 days.

(c) Except during the 90-day period mentioned in paragraph (b), employers may not use the services of a service agent covered by a PIE. Doing so is a violation of DOT regulations and may result in sanctions such as civil penalties or suspension of Federal assistance.

(d) Employers must also avoid using subcontractors or affiliates of a service agent subject to a PIE.

Example (paragraph d):

If Service Agent R is subject to a PIE for SAP services, an employer may not use SAP services provided by R directly or through any subcontractor or affiliate tied to R.

(e) These prohibitions apply to all DOT-regulated employers, regardless of industry.

Example (paragraph e):

If a PIE was initiated by the FAA against a service agent in the aviation industry, employers in other sectors (e.g., trucking, rail, maritime) are also prohibited from using that service agent for DOT testing.

(f) A PIE does not invalidate tests already performed before the PIE issuance or during the 90-day transition period (unless stated otherwise in the Director’s decision or an extension is granted).

Example (paragraph f):

If a PIE is issued on September 1 for Service Agent N, all tests conducted using N’s services before September 1 and through November 30 remain valid, assuming they meet all other regulatory requirements.

§ 40.411 What is the role of the DOT Inspector General’s office?

(a) Anyone may report concerns of waste, fraud, or abuse by a service agent to the DOT Office of Inspector General (OIG).

(b) The OIG may pursue civil or criminal remedies in appropriate cases.

§ 40.413 How are notices sent to service agents?

(a) DOT may send notices (e.g., correction notices, NOPEs, decisions) using any method listed in paragraphs (b) or (c).

(b) Notices may be sent to:

* The service agent,

* The agent’s identified counsel,

* An agent for service of process, or

* Partners, officers, directors, owners, or joint venturers

DOT uses the last known street address, fax number, or email address. Delivery to any of these parties constitutes receipt by the service agent.

1. Upon delivery, if mailed; or five days later if undeliverable,

2. Upon transmission, if sent by fax; or five days later if undeliverable,

3. Upon delivery, if sent by email; or five days later if undeliverable.