A Victory for U.S. and Migrant Workers

For 5 years, the Obama administration has been trying to make reasonable improvements to one of the United States’ main guestworker program for lower skilled workers. The H-2B visa is used by businesses that want low-cost gardeners, hotel maids, cooks and dishwashers, forestry workers, workers to pick and pack crab meat, and various other kinds of laborers. The businesses that hire H-2B workers don’t want U.S. workers who expect a decent wage and they don’t want U.S. workers who might get sick of poor working conditions and quit to find a better job. They want migrant laborers from abroad, who may think being paid a poverty-level wage is a great windfall and who can’t quit—no matter how abusive the working conditions are—because they will be deported if they try to switch jobs. Many H-2B workers secure their temporary jobs in the United States by paying labor recruiters thousands of dollars to connect them to U.S. employers. The employers that ultimately hire them benefit from this arrangement because H-2Bs workers are so indebted to recruiters that their lives will be in danger if they return home before their contract is finished. Businesses call this a “reliable” workforce.

The Bush administration issued rules for the H-2B visa that gave businesses what they wanted: below-market wages so they could discourage U.S. workers from applying and underpay the migrants who did apply. EPI’s analysis has shown that the Bush rules led to wages that fell more than 25 percent below the true prevailing wage. Migrant advocates sued to have the Bush rules thrown out, and a federal court agreed. So the Obama administration set out to rewrite the rules to protect both U.S. workers who might want some of these jobs and the mostly Mexican migrants who come to work with H-2B visas. The Department of Labor issued rules to require more honest recruiting of U.S. workers before a business can look abroad, rules to protect the migrants against exploitation by recruiters and businesses, and—most importantly—a rule to set a true prevailing wage that businesses using the H-2B visa have to offer and pay to U.S. and migrant workers alike.

The businesses that use the H-2B program, led by the U.S. Chamber of Commerce, sued to stop the Labor Department from improving the rules and they managed, for a time, to get Congress to block funding for enforcement of the Obama administration’s new rules. The Bush rule created several non-existent skill levels for occupations that in reality have only one skill level (like dishwasher), and then calculated artificially low prevailing wages for the occupations to reflect the lowest of the invented skill levels. This methodology has been invalidated in court multiple times, which ultimately led to the Department of Labor and the Department of Homeland Security jointly issuing an interim prevailing wage rule last year that more accurately reflected the true market wage for the occupation in the local area. However, that rule contained a massive loophole that effectively permitted the businesses themselves to set the prevailing wage based on their own self-serving wage surveys. Unsurprisingly, businesses responded by exploiting that loophole. Now, after several years of litigation in federal courts in Pennsylvania and Louisiana, the U.S. Court of Appeals for the 3rd Circuit has given workers a solid, complete legal victory.

In summary, the court ruled that the Bush-era method of determining what wages had to be advertised and paid was arbitrary, capricious, and invalid. The court ruled that letting businesses determine the prevailing wage based on their own private surveys when reliable and adequate government surveys are available, is illegal.

The effect of this litigation is two-fold: By requiring employers to advertise jobs at the true locally prevailing wage rather than an artificially reduced wage, it makes it likelier that U.S. workers will take the landscape gardening, forestry, construction, truck driving and other jobs H-2B businesses would rather give to temporary migrants. And when U.S. workers can’t be found, it means that the population of 100,000 or so H-2B migrant workers in the country will earn better wages, be able to pay off their debts, and perhaps even save something for themselves and their families.

The individual plaintiffs and the organizations that brought this case to the Court of Appeals, including Centro de los Derechos del Migrante, the Southern Poverty Law Center, Friends of Farmworkers, and Florida Legal Services, deserve our praise for their tenacity and their sense of justice, as do the very determined and skillful lawyers who represented them, including Ed Tuddenham, who argued the case before the court.