Off Target: Why Trigger-Happy H-2A Reform is Bad Policy

FROM Tom Bortnyk, SR. Vp & General Counsel AT MÁSLABOR

Over the last year, the H-2A user community has been treated to an onslaught of regulatory reform efforts by the Biden Administration.

It began with last Fall’s Wish.com version of the ill-fated Trump rulemaking effort. Stripping out the Trump version’s employer-friendly provisions, the Biden rule did little to advance the purported cause of “modernizing” and “streamlining” the program. In fact, much has been written about the impact of this rule on particular H-2A constituencies, particularly smaller growers (thanks to tighter restrictions on joint employment) and Farm Labor Contractors (thanks to heightened bonding requirements). At best, the rule represented a nitpicky doubling-down by the Administration on existing program flaws.

Then bad went to worse in Spring 2023 when the U.S. Department of Labor (DOL) unveiled its rehash of Trump’s rule to reform the Adverse Effect Wage Rate (AEWR) methodology. Stripping the rule of its more balanced and sensible provisions (such as a measure to prevent year-to-year wage spirals), the rule created a new two-tiered AEWR that relies on occupational classifications defined in DOL’s O*NET system to determine worker pay; classifications that, by the way, are both arbitrary in the first place and subject to periodic changes and updates with little to no notice. In sum: an administrative nightmare with unclear rules and enforcement that few people actually understand.

Oh, and did I mention the fee increases? Not only are employers shouldering the burden of these new rules, but they’re also paying extra for the privilege. First on deck was the State Department’s modest increase to the machine-readable visa (MRV) fee from $190 per worker to $205 per worker. This was followed, however, by a proposal from U.S. Citizenship and Immigration Services (USCIS) to dramatically increase petition fees for named beneficiaries (i.e., in-country workers seeking a transfer or extension). As a cherry on top, the agency also proposed saddling H-2A employers with an “asylum fee” to help offset costs pertaining to humanitarian migration. I guess it’s easy to be generous with other people’s money.

If that wasn’t enough, in mid-September both DOL and the U.S. Department of Homeland Security (DHS) released more proposed regulations, this time to overhaul program requirements pertaining to worker protections and enforcement. The expansive rules would create a host of new employer obligations and dramatically tip the scales in favor of the worker in the employer-employee relationship.

The proposed rules are undoubtedly influenced by the Operation Blooming Onion horror story and the egregious worker abuses that took place nearly two years ago. With more than two dozen people under federal indictment, the multi-year criminal probe uncovered unthinkable acts of human trafficking, visa fraud, and forced labor, leading to well-deserved public outrage and condemnation. It’s understandable, then, why the government is eager to do something to prevent this sort of thing from happening again.

But the problem with doing something is two-fold: first, government solutions routinely fail to address the original problem and have a bad habit of creating entirely new ones; and second, government action is inherently dependent on the bureaucrats who work for the government, introducing all sorts of biases and opportunism into the mix. The very legitimate fear, of course, is that the career civil servants simply use the immediate crisis as an excuse to dust off their policy wish list and go to town pushing any number of bad ideas.

It's hard not to read through the proposed DOL and DHS rules and not arrive at that very conclusion. Indeed, the policy proposals and objectives appear to be lifted straight from organized labor’s playbook, with little regard for the practicality or wisdom of such ideas. Indeed, while in years’ past such proposals would have at least run into “we probably shouldn’t” skepticism, it’s now abundantly clear that the more activist bureaucrats in these departments are finding a more sympathetic ear.

The result, naturally, is a wildly unbalanced set of proposals that will make life exceedingly difficult for employers who are just trying to run their business. At a certain point, you have to ask: how much more can employers take? Noble policy objectives notwithstanding, the Biden Administration seems hellbent on making H-2A program participation as difficult and costly as possible. That’s an odd choice, given the importance of the program to the U.S. food supply at a time when Americans are paying record prices at the supermarket.

At this point, it is very apparent that the regulatory approach to H-2A reform is on an unsustainable path. The only thing that can blunt the effort, now, is Congress. I encourage all H-2A employers to maintain close relationships with their representatives in Washington to help them understand the true cost of these bureaucratic headaches. Until the industry holds their feet to the fire, we can expect more of the same.