(a) Nature of Agreement. Before any ASW is placed with an employer, Selective Service and the employer shall enter into an employment agreement that specifies their respective duties and responsibilities under the Alternative Service Program.

(b) Restrictions on Selective Service. The Selective Service System shall not act in any controversy involving ASW's wages, hours and working conditions except to the extent any of these subjects is specifically covered in §1656.7, §1656.9, or the employment agreement between Selective Service and the employer.

(c) Investigating and Negotiating. Whenever there is evidence that an employer appears to be in violation of §1656.7, Selective Service will investigate the matter. If the investigation produces substantial evidence of violations of §1656.7, Selective Service will resolve the matter.

(d) Termination of Employment Agreement. If a resolution of a dispute cannot be reached by negotiation within a reasonable time, the Selective Service System shall terminate the employment agreement and shall reassign the ASW.