The H-2A program, which allows employers to employ foreign nationals to fill temporary U.S. agricultural jobs, plays an essential role in the U.S. agricultural workforce. According to the U.S. Department of State, almost 300,000 H-2A visas were issued in 2022, making up approximately ten percent of overall agricultural labor. In the past few years, the Department of Labor (“DOL”), the agency that issues H-2A certifications and oversees compliance with labor laws, has proposed and adopted rules to amend the H-2A program, including the 2023 rule amending the adverse effect wage rates (“AEWR”) methodology. The purpose of the new rule, according to the DOL, is to “improve the [AEWR’s] consistency and accuracy based on the work actually performed by these workers and to better prevent H-2A workers’ employment negatively affecting the wages of U.S. workers in similar positions.” This new rule has drawn criticism from members of Congress leading some lawmakers to submit a bipartisan letter to the Appropriations Committees, and to introduce resolutions in the House of Representatives and the Senate. The new rule is also being challenged in three courts. This article will discuss the Congressional actions and legal challenges raised against the DOL’s February 2023 rule.
Background on the Rule
On February 28, 2023, the DOL published a final rule amending the AEWR methodology for the temporary employment of H-2A nonimmigrants in non-range occupations in the United States, and the final rule went into effect on March 30, 2023. Employers seeking to hire temporary agricultural workers through the H-2A program must certify that “such services or labor will not adversely affect the wages and working conditions of workers in the United States similarly employed.”
One of the ways DOL determines that the employment of H-2A workers does not adversely affect workers in the United States is by using the AEWR. The AEWR is the minimum wage that employers must pay H-2A workers. The AEWR for range occupations, which includes all occupations involving herding and production of livestock on the range, is the same monthly rate across all states. The AEWR for non-range occupations is a set hourly rate for each state, that is the same rate for six occupational classifications. The DOL’s final rule amends how the AEWR is calculated for non-range occupations. Under the final rule, DOL has developed two methods for determining the AEWR based on whether the occupation is included in the U.S. Department of Agriculture’s (USDA) Farm Labor Survey.
Additionally, the final rule requires the Office of Foreign Labor Certification to publish the AEWRs at least once per calendar year in the Federal Register. Lastly, the final rule adds a provision that applies to H-2A workers that have job duties that do not fit into one occupational classification. Under the final rule, “If the job duties on the job order cannot be encompassed within a single occupational classification, the applicable AEWR shall be the highest AEWR for all applicable occupations.” The DOL website, O*Net Online, includes descriptions of tasks and work activities for each occupational classification to assist employers in classifying their employees.
Congressional Letter to Appropriators – On January 11, 2024, a group of federal lawmakers, including seventy-four Republicans and four Democrats, sent a letter to the House and Senate Appropriations Committees requesting that the committees “prohibit funds from being used to implement a wage increase or otherwise freeze the H-2A wage rates at January 2023 levels.” In their letter, the lawmakers claim that the new 2024 AEWR, continues to make agricultural guest labor unaffordable for employers. The group indicates that while freezing the rates at January 2023 levels is the requested first step, a permanent solution is needed to determine the AEWR’s impact on agricultural employers.
Resolution on the DOL Rule – On April 25, 2023, Senator Tim Scott from South Carolina, along with thirty-six Republican co-sponsors, introduced S.J.Res.25, a resolution to nullify the February 2023 DOL H-2A Wage Rate Rule. The resolution, H.J.Res.59, was also introduced in the House of Representatives on April 25, 2023, by Representative Ralph Norman from South Carolina and seventy-one Republican co-sponsors. Both resolutions were referred to the Committees on the Judiciary.
Three cases were filed in 2023 challenging the February 2023 DOL H-2A wage rule discussed above – Florida Growers Ass’n, Inc. v. Su, 8:23-cv-00889, M.D.Fla., Teche Vermilion Sugar Cane Growers Ass’n, Inc. v. Su, 6:23-cv-00831, W.D.La., and USA Farm Labor, Inc. v. Su, 1:23-cv-00096, W.D.N.C.
The litigants in each case make similar arguments as to why the courts should invalidate the final rule. First, in all three cases the plaintiffs argue that the DOL violated the Administrative Procedures Act (“APA”) by acting outside of their statutory authority. Second, in all three cases the plaintiffs argue that the DOL violated the APA by adopting a rule that was arbitrary and capricious. Third, the plaintiffs in Florida Growers Ass’n, Inc. and Teche Vermilion Sugar Cane Growers Ass’n argued that the DOL violated the Regulatory Flexibility Act, which requires the DOL to explain why the department chose the final version of the rule instead of considering any significant alternatives. Fourth, the plaintiffs in Teche Vermilion Sugar Cane Growers Ass’n also argued that the DOL violated the Congressional Review Act, which requires “any agency action with an economic impact greater than $100 million to undergo congressional review at least sixty days prior to the effective date of the agency action. Lastly, the plaintiffs in USA Farm Labor, Inc. argued that the rule was “not a product of reasoned decision making.”
The first argument raised by the plaintiffs in all three cases was that the DOL violated the Administrative Procedures Act by acting outside of their statutory authority conferred to them in the Immigration Reform and Control Act of 1986 (“IRCA”). Under the IRCA, the plaintiffs argue that Congress requires DOL to ensure that “the employment of the alien in such labor or services will not adversely affect the wages and working conditions of workers in the United States similarly employed.” The plaintiffs claim that DOL is using year-round non-farm wages to determine some of the AEWRs for H-2A workers, who are seasonal agricultural workers, thereby comparing wages of workers who are not similarly employed. The plaintiffs argue that by comparing wages of workers who are not similarly employed, DOL is acting outside the scope of their statutory authority.
The second argument raised by the plaintiffs in all three cases is that DOL adopted a rule that was arbitrary and capricious for several reasons. While the plaintiffs make the same overall argument, each case argues that the rule is arbitrary and capricious for slightly different reasons.
The plaintiffs in Florida Growers Ass’n, Inc. claim that DOL is using the USDA’s Farm Labor Survey to set wage rates despite USDA stating that the Farm Labor Survey should not be used to set wage rates. Next, the plaintiffs claim that the regulation is vague because the rule will force employers, especially small employers, to ensure there is no overlap of duties into other occupational classifications requiring employers to pay the highest wage rate. Lastly, the plaintiffs argue that thirty days was not enough time to require employers of H-2A workers to comply with the rule.
The plaintiffs in Teche Vermilion Sugar Cane Growers Ass’n argued that DOL did not explain why it chose to rely on an additional wage setting method apart from the Farm Labor Survey. The plaintiffs further argue that DOL did not justify its change in wage setting procedures by describing “adverse effects” on U.S. workers.
Similar to the plaintiffs in Teche Vermilion Sugar Cane Growers Ass’n, the plaintiffs in USA Farm Labor, Inc. argued that DOL failed to explain why it chose a different wage setting method than the Farm Labor Survey. Additionally, the plaintiffs argue that DOL did not provide any guidance on how employers should use the new task-based classification system.
The plaintiffs in all three cases requested a preliminary injunction, which would prevent the DOL from implementing or enforcing the final rule while the court is hearing the case. The plaintiffs also requested that the court invalidate the final rule and permanently enjoin DOL from implementing and enforcing the final rule.
The final rule went into effect on March 30, 2023. In Florida Growers Association, Inc. and Teche Vermilion the courts have not ruled on the plaintiff’s motions for a preliminary injunction. The court in USA Farm Labor denied the plaintiff’s motion for a preliminary injunction and the plaintiffs appealed this decision to the U.S. Court of Appeals for the Fourth Circuit. While these cases unfold in the courts, the final DOL rule is enforceable and H-2A employers must pay their H-2A workers the 2024 AEWR set by the Office of Foreign Labor Certification administrator.
To read the DOL final rule, click here.
To read an overview of the Administrative Procedures Act, click here.
To read a prior NALC article on the Congressional Review Act, click here.
For more NALC resources on labor, click here.