This handbook and a companion video are intended for use by adult education programs interested in implementing a court referral program for adult education. It highlights the Preparation for Employment Program (PEP), a special project of the Shoals Area Tri-County Adult Education Program that requires offenders lacking minimal basic skills to enter the local adult education program. The handbook provides information on literacy and incarcerated persons in order to establish factual evidence that something must be done to change the cycle of events leading up to a person's release from jail. An overview of the court referral program is followed by detailed procedures for court referrals. These four phases are described: Phase 1--organizations/goals/objectives (meeting with agencies); Phase 2--developing paperwork (routing system, paperwork); Phase 3--implementation (roles and responsibilities for these agencies: adult education, judges, Department of Human Resources, District or County Attorney, and juvenile, adult, and federal probation officers); and Phase 4--follow-up/tracking. A day in an adult education class is then outlined. The following sample forms are appended: order to complete court referral evaluation; evaluation and recommendation--preparation for employment program; orders to appear in court; adult basic education checklist; General Educational Development Program progress checklist; and PEP project report. (YLB)