New H-2A wage rule is met with criticism from industry groups

Not all changes are welcome ones. The Department of Labor published on Feb. 28 its final rule changing how its sets H-2A program adverse effect wage rates, rankling fresh produce industry groups.

“American farmers are already stretched to the limit by rising costs and shrinking margins. With economic blinders on, the administration will now mandate that farmers pay higher wages to H-2A workers and domestic workers in corresponding employment,” Western Growers President and CEO Dave Puglia said in a news release.

Related news: H-2A program sees double-digit gains in positions filled

The new rule updates the approach to setting field and livestock farmworker wage rates for the H-2A temporary visa program. The amendments in the department's final rule include:

• Bureau of Labor Statistics’ Employment Cost Index will determine wages and salaries for the previous year.

• Stabilization of rates, reducing wild fluctuations in wage rates.

• Stipulation that workers doing different jobs must be paid the highest level wage for the job classification.

• Restoring the annual federal survey of farm employers to set the adverse effective wage rate (AEWR).

The department said in a statement that the new rule improves consistency of AEWRs, provides stronger worker protections and establishes better stability for employers complying with these wage obligations.

Not everyone agrees with that assessment.

The final rule goes into effect on March 30, 2023, and the modification in how the agency sets H-2A wage rates was not received with praise.

“The changes made to the AEWR calculation attempt to revise a fatally flawed wage calculation that should be scrapped in its entirety,” the International Fresh Produce Association said in a statement.

“The fresh produce and floral industry already face enough challenges and the publication of today’s AEWR rule is just one more burden our industry can simply not bear,” IFPA CEO Cathy Burns said in a statement. “The H-2A program is unaffordable, ineffective and out of date, and these program changes make it even more difficult for our members to find the workers they need. This is why Congress must act to pass agricultural immigration reform now. America’s agricultural producers simply cannot wait any longer.”

Related news: Grower group expresses alarm over new H-2A wage rule

Puglia of Western Growers agrees that the changes will heighten challenges faced by growers, fearing that the H-2A update could spark a shift towards production outside of the U.S.

“Increasing wages by regulatory order will force farmers to cut back on plantings in the U.S. and increase their farm operations in Mexico and other countries where wages are a fraction of the H-2A wage,” Puglia said. “No one in the administration would want those things to happen, but these are the entirely foreseeable consequences of economically myopic policy decisions like this.” 

Read the Department of Labor’s final rule on the Federal Register.