As the final stumbling block to comprehensive immigration reform is removed – a system to provide for future flows of lower skilled workers, we can only hope that this presumed successor to the H-2B will prove more functional than the present convoluted skein it will replace.]
A Knotty Future For the H-2B Program
First, the uncertainly from the courts. In just the past four years, legal disputes over the H-2B program and DOL’s authority to issue regulations have grown increasingly complex, involving no fewer than four separate lines of litigation heard by judges in four district courts and three courts of appeals, with cases presenting overlapping issues and claims producing conflicting decisions affecting different groups of plaintiffs, defendants and intervening parties. Presently, contradictory decisions from federal courts in Pennsylvania and Florida about whether DOL possesses authority to issue H-2B regulations are on appeal at the 3rd and 11th Circuit Courts of Appeal, respectively.
The litigation began in Pennsylvania in 2009 with a suit by a worker advocacy group challenging DOL’s first-ever H-2B regulations. A 2010 decision in that case found flaws with the notice and comment process relating to DOL’s 4-tier wage calculation methodology in the program. As a result of the court’s decision, DOL continued to use the 4-tier wage structure while they attempted to promulgate a replacement rule.
In August 2011, DOL proposed a replacement rule, commonly known as the H-2B Wage Rule. But in doing so, DOL fundamentally altered the longstanding wage methodology in the program forcing some employers to immediately absorb wage increases of more than 100%. In the fall of 2011, facing the prospect of economic ruin from DOL’s wage rates, employers filed suit in Louisiana (subsequently transferred to Pennsylvania) challenging the agency’s authority to issue the Wage Rule. Shortly thereafter, DOL published another set of H-2B regulations, which were then enjoined by a federal court in Florida.
Last week, the Pennsylvania judge added to the uncertainty for employers by issuing a decision relating to the original H-2B case from 2009. In the most recent opinion, the judge removed from the H-2B regulations, the 4-tier wage calculation that had been found procedurally invalid in the 2010 opinion (by the now-deceased judge who originally heard the case), but which DOL was continuing to use as a result of the other litigation and intervening congressional action.
DOL’s actions add to the uncertainty. In response to the most recent ruling, DOL declared in a March 29 Notice, that as of March 22 it is no longer issuing H-2B wages to employers unless they seek a wage based on (1) a collective bargaining agreement, (2) a Service Contract Act determination, (3) a Davis-Bacon Act determination, or (4) a private wage survey. DOL further indicates in the Notice that it will publish yet another rule within 30 days describing how it will issue H-2B wages in the future.
But, in the midst of the litigation back in the fall of 2011, Congress sided with employers opposed to DOL’s Wage Rule by attaching a “rider” to the agency’s appropriations bill that prohibits the agency from implementing that rule. The rider has repeatedly been renewed, including as recently as last week when the President signed into law the 2013 government funding bill on March 26. As part of the ongoing restriction on DOL’s appropriations bill, Congress (and the President) have directed DOL to continue to apply the very same 4-tier wage methodology vacated by the Pennsylvania judge on March 21.
So what will DOL do when it issues a new wage rule in the next few weeks? Curiously, DOL’s Notice says it will promulgate a rule “that complies with the court’s interpretation of what the statutory and regulatory framework require.” Missing from that statement is any recognition that Congress has already dictated what is required by DOL.
Congress started it all. Much of this uncertainty stems from the language Congress used (or didn’t) when the H-2B program was created as part of the Immigration Reform and Control Act in 1986. The sparse statutory language describing the H-2B program, particularly when compared to the language describing the H-2A program, has led to real questions about the extent, and even the existence, of DOL regulatory authority over the program. Those questions continue to produce a growing mountain of court decisions, congressional directives, regulations, enjoined regulations, and statutory language [8 U.S.C 1101(a)(15)(H)(ii)(b)] that have tied the H-2B program in knots.
The H-2B program is a critical lifeline for many seasonal businesses that cannot find sufficient numbers of U.S. workers who want to take the relatively short-term employment opportunities. Studies have shown that these seasonal jobs filled by foreign workers are, however, important to our economy and lead to the employment of many thousands more year-round U.S. workers. If the DOL fails to provide H-2B employers with market-based wage rates, critical seasonal jobs will go unfilled and as a result, businesses and their U.S. workers will suffer.
Congress has an excellent opportunity to clear up the uncertainty about the H-2B program as part of comprehensive immigration reform legislation. Unfortunately, as many learned observers have noted, real concerns persist about whether an immigration deal can be reached given the hostility some interest groups reportedly have towards any type of guest worker program.
If, as an old Pope once said, “hope springs eternal,” let’s hope the arrival of spring brings some untangling of uncertainties for employers who rely on the H-2B program to meet their short-term and seasonal labor needs.