WASHINGTON, DC – The American Federation of Teachers (AFT) and the National Student Legal Defense Network (Student Defense) are calling on the Department of Education to drop its legal defense of the Trump Administration’s repeal of the Gainful Employment Rule. In a January 2020 lawsuit, Student Defense and the AFT asserted that the Department hastily enacted this rule change that was riddled with errors and left students at the mercy of predatory for-profit colleges. Despite ostensibly representing a break from the Trump Administration’s lax oversight of predatory schools, the Biden Administration continues to defend the repeal in court.
"Rescinding this rule was nothing more than a student- and taxpayer-funded gift from Betsy DeVos to her friends in the for-profit industry,” said AFT President Randi Weingarten. “I know the Biden Administration takes seriously their responsibility to protect students trying to access quality higher ed opportunities and looking out for borrowers who are planning their college, career and beyond. Dropping the defense of DeVos’s Gainful Employment Repeal is an easy first step."
Last week, a group of 24 progressive organizations called on Education Secretary Miguel Cardona to stop defending the Gainful Employment Rule. The Obama-era policy stipulated that for-profit and career college programs would be considered passing and leading to gainful employment if the annual loan payment of a typical graduate does not exceed 20 percent of his or her discretionary income or 8 percent of his or her total earnings.
“The Gainful Employment Rule helped ensure students were seeing real value in their academic programs and sought to ensure students were not trapped in a cycle of debt,” said Student Defense President Aaron Ament. “The Department should stop defending Betsy DeVos and focus on defending students and taxpayers.”
Four years ago this week, the Department of Education, under former Secretary of Education Betsy DeVos, formed a "Regulatory Reform Task Force,” which—within one month of its formation—had called for the Gainful Employment regulation to be repealed. After formally rescinding the rule in 2019, the Department acknowledged the change would cost taxpayers $6.2 billion over ten years in Pell Grants and other student aid that otherwise would not have gone to low-quality programs.
The Department also found in 2017 that 98 percent of programs that failed to clear the Gainful Employment hurdle were offered by for-profit colleges. As a result, rescinding this rule has had a disproportionate impact on Black and Latino students who are both over-represented in enrollment at for-profit institutions and have lower graduation rates from these colleges than they do at public and nonprofit colleges.