The U.S. Department of Labor (DOL) issued a final rule on January 19 that provides a new calculation system to set wages for foreign nationals entering as H-2B temporary nonagricultural workers. The wage rates will apply to wages paid for work performed on or after January 1, 2012.

The H-2B nonimmigrant program permits U.S. employers to hire temporary foreign workers to perform nonagricultural labor/services to meet short-term seasonal or intermittent needs. U.S. employers must demonstrate the unavailability of U.S. workers and show that employment of H-2B workers will not adversely affect the wages and working conditions of similarly situated U.S. workers. The program is limited to 66,000 H-2B visas per year.

The DOL has issued regulations in 2008 setting forth a proposed wage calculation system for H-2B workers. A federal district court invalidated the 2008 rule based on the failure to adhere to requirements of the Administrative Procedures Act (APA).

The new rule eliminates the prior four-tiered wage system, which used data provided by the DOL’s Occupational Employment Statistics (OES) wage survey. Under the new rule, H-2B employers must pay a wage that meets or exceeds the highest of the following: the prevailing wage (see below), the federal minimum wage, the state minimum wage or the local minimum wage. The prevailing wage (the wage paid to similarly situated workers in the relevant geographic area) will likely be the most commonly used required wage. The prevailing wage is defined under the rule as the highest of the following:

  • Wages established under an agreed-upon collective bargaining agreement;
  • A wage rate established under the Davis-Bacon or Service Contract Act, if the H-2B position is in an occupation for which such a wage rate has been determined; or
  • The arithmetic mean wage rate established by the OES wage survey.

In very limited circumstances, employers also may be permitted to use private wage surveys to establish the required wage. In the end analysis, H-2B employers will need to compare the various wage rates to ensure compliance with the new wage rules.