A legal compromise stabilizes H-2A labor rates for two more years.
In an effort to reduce production costs, the U.S. Department of Agriculture tried to discontinue the use of its Farm Labor Survey (FLS) in late September. The survey is used to set the wage standard for foreign labor known as the Adverse Effect Wage Rate (AEWR).
Labor unions feared the move and sued USDA. Experts believed that there wouldn’t be any standard data to set H-2A labor rates other than state minimum wages without that survey. The current AEWR in California is $14.77; however, the state minimum wage is $12 per hour for employers with 25 employees or less and $13 per hour for employers with 26 employees or more. Arizona’s H-2A rate is $12.91 while their state minimum wage is $11 per hour.
In late October, a federal judge agreed with the lawsuit and ordered the USDA to continue the survey but also put a temporary freeze on adjusting the AEWR every year. The Department of Labor announced the final rule last week to freeze the current H-2A labor rates for each state through 2022. Labor unions keep the protections for foreign workers and the agriculture industry gets stabilized rates for two more years.
The final rule states that increases after 2022 will be based on the Employment Cost Index. The index is a function of the Bureau of Labor Statistics and is a national average that will cover most agricultural jobs.
All of this could change after all of the November 3 ballots are counted. A new administration could review lots of decisions made by former leaders. Western Growers’ President Dave Puglia commented on the action in a press release stating, “We applaud the Administration for taking this preliminary step toward AEWR rationality. However, rules are subject to the whims of the administration in office. They cannot address every need of the farm workforce, which is why we will continue to work toward a more permanent and complete legislative solution that creates a more workable H-2A program and provides a pathway to legalization for existing agricultural workers.”
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