Petition for Rulemaking on the H-2A Wage Methodology
From tom bortnyk, sr vp & general counsel at mÁsLaborThe following petition was submitted to the Acting Secretary of Labor, Julie Su, urging the reevaluation of the Adverse Effect Wage Rate (AEWR) methodology used to determine the required minimum wages for agricultural workers employed pursuant to the H-2A nonimmigrant visa program.
Pursuant to 5 U.S.C. § 553(e) and enacting regulations at 43 C.F.R. Part 14, Mid-Atlantic Solutions, LLC dba másLabor hereby petitions the U.S. Department of Labor to amend, repeal, or issue a new rule concerning the Adverse Effect Wage Rate (AEWR) methodology, used to determine the required minimum wages for agricultural workers employed pursuant to the H-2A nonimmigrant visa program. The current AEWR methodology is set forth at 20 C.F.R. § 655.120.
For over two decades, másLabor and its subsidiary AgWorks H2, LLC (“AgWorks”) have been the leading for-profit, non-association H-2A agents, representing thousands of H-2A employers across the country. Each year, the Department certifies másLabor and AgWorks clients for nearly 50,000 H-2A job positions across a diverse cross-section of agricultural industries and in nearly all 50 states. We are also industry leaders, advocating for seasonal agricultural businesses through our membership on the Executive Committee of the National Council of Agricultural Employers (“NCAE”) and involvement with countless industry organizations and associations, including several in which we serve as the preferred service provider to members. This includes esteemed organizations such as the Washington Grower’s League, the Florida Nursery Growers and Landscape Association, the Ohio Green Industry Association, and the Oregon Association of Nurseries.
Additionally, másLabor and AgWorks staff includes some of the nation’s foremost subject matter experts on the H-2A program. Our team’s work has been highlighted in national trade publications and each year we are invited to speak at local, regional, and national trade shows, conferences, and educational seminars on a variety of H-2A-related topics. It is because of our renown and thought leadership in the industry that we are frequently the go-to background resource for national medica publications and have, on numerous occasions, served as background sources for publications such as The New York Times, The Washington Post, and Bloomberg, among others.
We share our industry status and experience to emphasize our unique position within the industry; that is, our size, scale, and geographic/industry reach gives us unparalleled insight into the practical impact of the Department’s regulatory provisions. One common denominator – across all industries and regions of the country – is concern over the AEWR and its sustainability. In recent years, these concerns have escalated to industry-wide alarm given the apparent wage spiral as well as the new 2023 AEWR methodology that incorporates non-farm Occupational Employment and Wage Statistics (“OEWS”) data into the program. It is precisely these recent trends that have prompted us to take action and join with industry colleagues in petitioning for change.
The Immigration and Nationality Act (“INA”) gives the Department a statutory directive to protect the wages and working conditions of similarly employed U.S. workers, while also “testing” the labor market to determine the availability of qualified U.S. workers able, willing, and available to perform the job. The INA is silent as to how the Department must prevent such adverse effects. Logically, however, the Department must first establish that there is an adverse effect before it can undertake mitigation and prevention measures to prevent it. Further, the INA places an affirmative obligation on the Department to certify that “no adverse effect” exists by employing foreign H-2A workers (i.e., that the adverse effect has been avoided by virtue of the employer’s compliance with H-2A program regulations).
As an initial matter, we submit that the Department’s current regulatory framework does not satisfy its obligations under the law. Specifically, we note that notwithstanding the INA’s mandates, neither the AEWR methodology nor the broader H-2A regulations require the Department to establish that there is an adverse effect; the Department’s framework merely assumes that one exists, and then promulgates preventative measures to protect against these phantom adverse effects. There is no data to support this premise and no methodology to validate or confirm any findings; the Department’s determination is conclusory and circular, and therefore its method and framework for prevention is entirely arbitrary and capricious. The Department’s systemic failure to perform this critical evaluation is, therefore, a significant procedural flaw in the current H-2A legal framework that must be addressed.
This procedural defect is further exacerbated by the flawed methodology used in such prevention, which lacks a coherent economic rationale. The standard AEWR relies entirely on the U.S. Department of Agriculture’s (“USDA”) Farm Labor Survey (“FLS”), an information collection designed with the express purpose of surveying the number of workers employed in agriculture, not as a statistical basis for establishing wage rates, a fact that USDA has itself acknowledged. There is therefore a disconnect between the Department’s use (or misuse) of this data and the USDA’s objective in collecting it, which calls into question the suitability of such data as a source of truth.
Further, USDA has confirmed that H-2A wages (and wages for U.S. workers in corresponding employment who must be paid in accordance with the H-2A wage framework) are included in the FLS survey data. This inherently creates an echo effect wherein the prior year’s minimum wage skews the data used to establish the following year’s mean wage. We have seen the practical effects of this feedback loop as AEWRs across the U.S. have increased at a rate that far exceeds the increases experienced economy wide. This fact alone demonstrates that there is significant reason to doubt the accuracy or veracity of the FLS as a data source and to conclude that the AEWR methodology is wholly disconnected from true market conditions.
The Department’s most recent AEWR rulemaking effort has only added fuel to the fire. Further detaching the AEWR methodology from market conditions, the new rule imposes non-farm OEWS wage rates onto employers filing H-2A applications for “non-standard” H-2A occupations, as defined by the Bureau of Labor Statistics (“BLS”) O*NET database. Applications listing individual job duties outside of six primary occupational codes are, under the new rule, subject to the OEWS mean wage for that occupation in the state where work is performed. This is the case regardless of the extent or frequency in which such task is performed.
Frustratingly, the O*NET occupational profiles are often vague and near-universally written in a non-farm context. In practice, this new methodology has had bizarre and confounding results, such as H-2A workers being classified as Chauffeurs, Security Guards, or Fence Erectors (to name a new) for performing basic farm and ranch tasks that have existed in global agriculture for generations. With all due respect, this framework is absurd. The Department cannot say with a straight face that the employment of farm-use vehicle drivers at an orchard in Yakima or Wenatchee has an adverse effect on limousine drivers in Seattle or Bellevue. And yet, this is exactly how the rule is applied in practice.
The impact of these runaway wages has real, palpable effects on American growers as well as consumers, who must absorb and endure skyrocketing food prices, endangering food security for millions of Americans. This makes growers vulnerable to international competition. Currently, more than 60% of the fresh fruit consumed in the U.S., and more than 40% of fresh vegetables, are imported from foreign competition. Imports will continue to increase if the Department does not address this issue. Foreign competition drives American farmers and ranchers out of business and makes the U.S. more dependent on food grown abroad. This is more than food security issue – it is a national security issue.
In sum, we assert that the AEWRs are no longer reflective of market realities and that the methodology used to establish the AEWRs is conceptually flawed and inconsistent with the Department’s statutory directives under the INA. To the contrary, we assert that the AEWR methodology itself results in an adverse effect on “wages and working conditions of similarly employed U.S. workers” by virtue of the methodology’s macroeconomic impact, which serves to make American agriculture less competitive relative to foreign imports and jeopardizes the business viability of American farms. This, in turn, limits both employment opportunities and upward mobility for U.S. workers as agricultural operations are forced to cope with spiraling wage rates and increased overhead and a lack of ability to pass such costs onto consumers due to market pressure.
In light of the foregoing, we respectfully ask that the Department undertake a rulemaking effort to address the systemic issues with the AEWR and its methodology. We request a repeal of the 2023 AEWR rule (concerning OEWS wages) and new requirements for the Department to affirmatively establish the existence of an adverse effect before preventative measures can be undertaken (rather than “assuming the sale”). Finally, we ask that the Department establish a wage methodology that more accurately and reliably captures market conditions for farm labor, rather than relying on flawed data sources. These requests will, in our view, bring the H-2A regulatory framework into compliance with the Department’s statutory obligations under the INA. Thank you for your consideration of this request.