From labor disputes cases to labor and employment publications, for your research, you’ll find solutions on Bloomberg Law®. Protect your clients by developing strategies based on Litigation...
April 28 — Employers seeking H-2B workers will have to get the Labor Department to certify that they met program requirements, and both U.S. and foreign workers will have additional protections under an interim final rule jointly issued April 28 by the DOL and Department of Homeland Security.
The DOL and DHS the same day issued a final H-2B wage rule (RIN 1615-AC02) that sets the methodology for determining prevailing wages under the low-skilled, nonagricultural guestworker program based on the Occupational Employment Statistics survey from the DOL's Bureau of Labor Statistics and employer-provided private surveys. The new H-2B wage rule bans prevailing wage determinations based on the Service Contract Act and Davis-Bacon Act, however.
According to the DOL and DHS, the interim final H-2B rule (RIN 1615-AC06) is “virtually identical” to one issued by the DOL in 2012, which never went into effect because of court-issued injunctions.
However, the DOL and DHS said the interim final rule contains “a number of improvements” in the labor certification process, including:
• increased opportunities for U.S. workers to become aware of job opportunities;
• use of a certification-based model rather than relying on employer attestations;
• creation of an employer registration process;
• additional worker protections; and
• provisions designed to increase transparency, such as a requirement that employers disclose their use of foreign labor recruiters.
“The Departments believe that these procedures and additional worker protections will lead to an improved temporary employment certification process,” the DOL and DHS said.
Both rules are scheduled for publication in the April 29 Federal Register. Comments on the interim H-2B rule are due 60 days after publication.
Both the interim final H-2B rule and the final H-2B wage rule are a response to litigation over corresponding regulations initially promulgated solely by the DOL. In both instances, the regulations were invalidated by a federal court after a determination was made that the Immigration and Nationality Act doesn't confer rulemaking authority to the DOL in the H-2B context.
The interim final H-2B rule responds to the U.S. District Court for the Northern District of Florida's decision in Perez v. Perez, No. 3:14-cv-00682 (N.D. Fla. March 4, 2015), which enjoined the DOL's 2008 H-2B regulations for the same reasons the court enjoined the 2012 regulations the prior December in Bayou Lawn & Landscape Services v. Perez, 2014 BL 370226, No. 3:12-cv-00183 (N.D. Fla. 2014). The injunction shut down the entire H-2B program until the court issued a temporary stay.
Because it was necessary to have regulations in place when the stay expires May 15, the DOL and DHS said there is “good cause” under the Administrative Procedure Act to issue an interim final rule without prior notice-and-comment and that is effective immediately.
The H-2B wage rule is the final version of an interim final rule issued in April 2013, which responded to an injunction by the U.S. District Court for the Eastern District of Pennsylvania in Comité de Apoyo a Los Trabajadores Agricolas v. Solis, 933 F. Supp. 2d 700, 2013 BL 74772 (E.D. Pa. 2013). The CATA decision enjoined the DOL's 2008 H-2B wage rule, which the DOL had been using because of a continued congressional ban on funding for a replacement rule issued in 2011.
After that funding ban was lifted, the DOL indicated that it intended to issue a new proposed H-2B wage rule, but the DOL and DHS abandoned that effort in light of the Perez litigation and the need to issue new regulations expeditiously.
In both rules, the DOL and DHS establish the authority for the labor certification process by stating that the DHS has determined that the DOL is the best agency for the DHS to consult with in determining whether or not to issue H-2B visas, pursuant to the INA. The regulations, in turn, present the most effective method for setting the standards by which the DOL will provide that consultation, the departments said.
The interim final rule is effective immediately, although labor certification applications submitted before its release will be processed under the old rules. Employers with a start date prior to Oct. 1, 2015, also will be permitted to use the interim rule's emergency processing provisions, which cut down on processing times, the rule said.
According to the DOL and DHS, the interim rule makes some changes to definitions from the old regulations. For example, “corresponding employment” includes U.S. workers performing substantially the same work in the job order or substantially the same work performed by the H-2B workers.
However, certain categories of “incumbent employees” are excluded, meaning the employer isn't required to offer them the same wages and working conditions as H-2B workers. Other incumbent U.S. workers must be offered the same wages and working conditions under the interim rule.
The interim rule also defines “full time” work as 35 hours per week and defines job contractors that can jointly apply for labor certification with their employer-clients. In particular, job contractors only are allowed to file for labor certification based on a seasonal or one-time need for workers.
Except in the event of a one-time need, “temporary need” under the interim rule is defined as nine months instead of the previous 10. The nine-month limitation applies to the other three types of temporary need—seasonal, peakload and intermittent.
The interim rule requires that employers' agents provide copies of current agreements with the employers, which the DOL will review both to determine a bona fide relationship between the employer and agent and to ensure that the agreement contains the required prohibition on payment of recruitment and other fees by the H-2B workers. That requirement applies to all agents or recruiters the employer uses or plans to use to solicit workers, whether they're located in the U.S. or abroad.
Similarly, the interim rule requires disclosure to the DOL of the names and geographic locations of persons and entities hired by or working for foreign labor recruiters, as well as any agents or persons and entities who will solicit H-2B workers. The DOL will establish a public list of all these recruiters in order to bolster program transparency and protect workers by providing them with a way to ensure that the recruiter is recruiting for a legitimate job opportunity in the U.S., the DOL and DHS said.
It also will strengthen the DOL's ability to enforce program requirements, the departments said.
Before filing a labor certification application, employers will have to go through a registration process that encompasses the DOL's determination that the employer actually has a temporary need for the workers. The registration period in most cases lasts for three years, allowing employers in years two and three to file labor certification applications without having to go through registration first, the departments said.
Under the interim rule, registrations must be submitted between 120 and 150 days before the start date of need for the H-2B workers.
A new registration prior to the end of the three -year period must be filed if: the employer's need for workers increases by more than 20 percent (or 50 percent if the employer requests 10 or fewer workers); the dates of need of the job opportunity have changed by more than 30 calendar days from the initial registration year for the entire period of need; and/or the temporary nature of the employer's need for services or labor has materially changed.
Once the employer obtains registration and a prevailing wage determination—under the companion final rule—an employer can file a labor certification application, along with copies of all agreements with agents and recruiters and a copy of the job order filed with the state workforce agency, which must be filed at the same time.
The interim rule states that the application must be filed between 75 and 90 days before the start date of need for the workers. Electronic filing through the DOL's iCERT system is available.
The interim rule incorporates the process for staggered entry of H-2B workers in the seafood industry, which was permanently authorized under the fiscal year 2015 omnibus appropriations act.
In addition, the interim final rule adds emergency filing procedures that will be allowed if the employer proves “good and substantial cause,” which may include the substantial loss of U.S. workers because of acts of God or a similar unforeseeable human-made catastrophic event that is wholly outside the employer’s control, unforeseeable changes in market conditions or pandemic health issues.
The interim rule lists several assurances that employers must make in the job orders placed with SWAs—prohibition against preferential treatment and bona fide job requirements.
The interim rule also requires that job orders contain: benefits, wages and working conditions; a list of board, lodging or facilities provided; any deductions from paychecks; the three-fourths guarantee; a statement about employer reimbursement for transportation and visa fees; a statement about tools, supplies and equipment provided by the employer; and information such as the employer's contact information and a full description of the job opportunity in order to provide U.S. workers with full information.
The interim final rule additionally contains substantive program requirements, including the rate and method by which workers must be paid, authorized and prohibited paycheck deductions, a requirement that the work be full-time (35 hours per week) and that job qualifications and requirements be consistent with the normal and accepted qualifications and requirements by non-H-2B employers for the same occupation in the area of intended employment.
The three-fourths guarantee contained in the interim rule requires that workers be offered work hours equal to at least three-fourths of the workdays of each 12-week period if the period of employment covered by the job order is 120 days or more, and each six-week period if the period of employment covered by the job order is less than 120 days. The employer must pay workers what they would have earned for those hours even if they aren't actually worked, unless the worker voluntarily fails or refuses to work those hours or an event outside the employer's control makes fulfillment impossible.
A workday is based on the hours stated in the job order, and the 12-week period is based on the employer's workweek for pay purposes, the DOL and DHS said.
The interim rule also requires employers to pay workers for inbound travel and subsistence if they complete 50 percent of the employment period covered by the job order, including for U.S. workers who have traveled such a distance that they can't be expected to return home each day. The employer also must pay for return travel and subsistence where workers complete the employment period or the employer dismisses the worker before the end of that period, unless the H-2B worker has obtained work with another H-2B employer. Return costs also don't need to be paid in the event of voluntary abandonment by the worker, the DOL and DHS said.
Copies of the job order must be provided to H-2B workers by the time they apply for a visa, and to corresponding U.S. workers no later than their first day of work. Notices of worker rights must be posted in English and other appropriate languages where the DOL provides translations.
The interim rule protects workers from retaliation for contact or consultation with an attorney or an employee of a legal assistance organization, or contact with labor unions, worker centers and community organizations. That includes oral complaints and complaints made internally to employers, and it applies to current, former and prospective workers, the DOL and DHS said.
Similarly, employers are prohibited from preferential treatment of H-2B workers, and must engage in nondiscriminatory hiring practices—which includes ensuring that U.S. workers aren't required to have job qualifications or requirements that aren't required of H-2B workers.
Employers are under a continuing obligation to hire qualified U.S. workers until 21 days before the date of need, even after a recruitment report is submitted to the DOL.
In addition, the interim rule goes beyond the 2008 regulations to prohibit hiring H-2B workers unless there is no strike or lockout at any of the employer’s work sites in the area of intended employment for which the employer is requesting H-2B certification, rather than solely no strike or lockout in the positions being filled by H-2B workers. Similarly employed U.S. workers can't be laid off from 120 days after the date of need to the end of the certification period, although layoffs during the certification period are permitted for job-related reasons as long as H-2B workers are laid off first.
Former U.S. workers in the same occupation and place of employment listed on the labor certification application who worked for the employer in the past year must be contacted about the job opportunity, although the employer need not contact those who were dismissed for cause or who voluntarily abandoned the work.
The DOL must be notified when H-2B workers are separated from employment, but the DOL and DHS said this notification requirement shouldn't be used as threats against vulnerable workers to keep them in abusive work situations.
The interim final rule also lays out employers' recruitment requirements, which the DOL and DHS said must still include newspaper advertisements. “Low-wage workers are less likely to have internet access than more skilled workers, and are thus more likely to search for jobs using traditional means,” the departments said.
In addition to the requirement that former U.S. employees be contacted, the interim rule also requires employers to contact the collective bargaining representative, if applicable, or post a notice to employees for at least 15 consecutive business days in at least two conspicuous locations at the place of intended employment or in some other manner that provides reasonable notification.
The interim rule also includes record retention requirements similar to the previous regulations.
The interim rule additionally contains a section titled “integrity matters,” which focuses on the DOL's means of ensuring that program requirements are met. This section addresses DOL audits, assisted recruitment ordered by the DOL certifying officer, revocations of labor certifications and debarment.
The DOL and DHS said the interim rule allows for debarment of agents and attorneys for conduct that isn't tied to that of the employer, a change from prior regulations. Previously, agents and attorneys had to have participated in program violations by the employer to be eligible for debarment.
In addition, the DOL and DHS said the interim final rule adds a new part to the regulations “to further define and clarify the protections for workers.”
The new regulatory provisions add workers in corresponding employment to the protected worker group, impose additional recruitment obligations and employer obligations for laid-off U.S. workers, increase wage protections for H-2B workers and workers in corresponding employment and enhance the enforcement role of the DOL's Wage and Hour Division in administrative proceedings following a WHD investigation, such as by allowing the WHD to pursue debarment itself rather than simply recommending debarment to the DOL's Employment and Training Administration.
In a separate, final rule, the DOL and DHS laid out the methodology for determining the prevailing wage that must be paid to H-2B workers, a step that must be completed as part of the labor certification process.
Although the departments determined not to reopen the notice-and-comment period, they did respond to the comments received in response to the April 2013 interim final H-2B wage rule. For example, they considered, and rejected, commenters' challenges to the DHS's authority to consult with the DOL and the DHS's authority to set H-2B prevailing wages.
Most of the comments were directed toward the various methods for determining the prevailing wage.
The DOL and DHS specifically asked about use of the OES and whether or not skill-level tiers should be considered. The 2008 regulations adopted four skill-level tiers, but the departments said the relatively low skill levels required for H-2B occupations resulted in employers mostly using the lowest tier—the 17th percentile for wages for the occupation. That meant wages for jobs occupied by H-2B workers were being artificially depressed, the department said.
The 2011 regulations eliminated the four tiers and instead set the OES-based prevailing wage as the mean of the wages of workers in the occupation in the area of intended employment. The April 28 final rule also adopts that methodology.
The departments said worker advocates generally supported using the OES mean, while employer advocates generally supported the tiered approach. Several comments directed specifically at the forestry industry called for use of the Service Contract Act's methodology rather than the OES mean, the DOL and DHS said.
“In the absence of a tiered wage system, the Departments must assign prevailing wages in the H-2B program in a manner in which does not depress wages for U.S. workers because of the artificially elevated labor supply in the market. Thus, we must identify the point on the OES wage distribution that protects the wages of U.S. workers from the depressive effect of the influx of surplus labor,” the DOL and DHS said in the final rule.
The departments said they chose the mean rather than the median “because the mean provides equal weight to the wage rate received by each worker in the occupation across the wage spectrum and maintaining the OES mean provides regulatory continuity.”
Unlike prior iterations of the H-2B wage rule, the final rule prohibits H-2B prevailing wage determinations based on the Service Contract Act or Davis-Bacon Act. The departments based this decision in large part on the administrative difficulty in matching jobs to the SCA and DBA classifications, which often are narrower than those in the BLS's standard occupational classification (SOC) system.
The DOL and DHS said “the distinctions between the occupational categories under the SOC codes and those in the SCA and DBA and the absence of the same regulatory structures that promote effective implementation of those wage determinations” have resulted in “uncertainty and confusion in the H-2B program, which in turn has resulted in complex litigation over the proper wage.”
Those challenges “would be alleviated by relying solely on the SOC-based OES as the primary wage source for prevailing wage determinations in the H-2B program,” the departments said. “SOC occupational titles are broadly defined, and therefore capture a wider range of job duties than do the SCA and DBA occupational titles.”
The final rule does, however, allow the use of employer-provided surveys to determine the prevailing wage under certain limited circumstances. Comments to the interim final rule from worker advocates generally disfavored such surveys, while employer groups supported them.
Under the final rule, employer-provided surveys conducted by private-sector, nongovernmental entities are permissible where the OES doesn't provide data in the specific geographic area of employment, or the OES doesn't accurately represent the relevant job classification.
The geographic area exception applies where the OES doesn't report wages for the metropolitan statistical area, the MSA plus its contiguous areas or even at the state level, the departments said. The job classification exception applies if the job can't be included within an SOC classification, or if it does, it falls under the “all other” category, the DOL and DHS said.
The final rule also allows prevailing wages to be determined based on state-conducted surveys, even where the occupation is adequately represented in the OES. Such surveys must be designed and implemented independently without regard to the interest of any employer, and must be approved by a state official.
The final rule also includes methodological requirements applicable to all employer-provided surveys in order to ensure their reliability.
They include: a prohibition on use of skill level tiers, and instead using the mean or median wage of workers similarly employed—including U.S. and foreign workers—in the area of intended employment; a standard attestation providing basic methodological information; a reasonable, good faith effort to sample all employers with workers similarly employed in the occupation and area surveyed, or a survey based on a random sample; inclusion of the wages of at least three employers and 30 workers; allowance of expansion beyond the area of intended employment in limited circumstances; the survey is conducted by a state or a bona fide third party; the wage must include all types of pay; and surveys must be the most recent edition and based on wages paid no more than 24 months before the date of submission to the DOL.
Finally, the final rule requires use of a collectively bargained wage rate where there is a collective bargaining agreement applicable to the H-2B job opportunity, regardless of whether the OES mean is higher.
To contact the reporter on this story: Laura D. Francis in Washington at email@example.com
To contact the editor responsible for this story: Susan J. McGolrick at firstname.lastname@example.org
Notify me when updates are available (No standing order will be created).
Put me on standing order
Notify me when new releases are available (no standing order will be created)