Employers that use the H-2B non-immigrant visa program to obtain unskilled workers from outside the U.S. may need to increase their budgets for these workers following a federal judge’s decision upholding the Department of Labor’s authority to issue a new wage order. U.S. District Court Judge Legrome D. Davis has upheld the validity of the Department of Homeland Security’s delegation of authority to the DOL to create regulations for setting the prevailing wage rates to be paid by employers to unskilled alien workers in the United States under the H-2B visa program.  The Louisiana Forestry Ass’n et al. v. Solis, et al., No. 11-7687 (E.D. Pa. Aug. 20, 2012). Employers that participate in the H-2B visa program anticipate they could be required to pay up to $847 million in wages to H-2B workers as a result of the DOL’s new Wage Methodology for Temporary Non-agricultural Employment H-2B Program (the Wage Rule). The Wage Rule is scheduled to become effective on October 1, 2012.

The H-2B visa program enables employers in the U.S. to secure visas for foreign unskilled non-agricultural temporary workers for temporary employment in the U.S. Under current law, up to 66,000 H-2B visas are available on an annual basis. As a prerequisite, employers must obtain a temporary labor certification from the DOL that establishes that U.S. workers are not able, willing, qualified and available to perform the offered employment at the prevailing wage rate. As a part of the temporary labor certification process, the DOL must determine the prevailing wage rate for the offered employment and employers are required to conduct recruitment for U.S. workers offering a wage not less than the prevailing wage rate.

The DOL Wage and Hour Division is responsible for investigating violations and conducting enforcement actions against H-2B employers.  An employer who fails to pay the required prevailing wage rate is subject to back pay orders, civil fines, and debarment from the H-2B program. 

The plaintiffs in the case before the court, consisting of employer associations representing the logging, lodging, sugar cane production, amusement park and seafood processing industries, challenged the authority of the DOL to create and implement the new Wage Rule and the authority of the DHS to delegate such authority to the DOL under the Homeland Security Act of 2002.

Citing the DOL’s role in administering the H-2B temporary labor certification process, which included the setting of prevailing wage rates under the Immigration and Nationality Act of 1952, as amended, and the agency’s continuing role under the Immigration Reform and Control Act of 1986, Judge Davis held that DHS acted reasonably in designating the DOL as a consulting agency. He concluded, “The DOL’s labor certification is reasonably connected to the DHS’s ultimate determination whether a foreign worker admitted under an H-2B visa would displace a capable unemployed United States worker….Therefore, the DHS may condition its grant of an H-2B visa on receiving a labor certification from the DOL. The ultimate decision making authority still remains with the DHS.”

Barring further judicial action or administrative agency delays, H-2B employers in the U.S. will be required to be in compliance with all stated requirements, including providing non-H-2B employees the same wages and benefits accorded to H-2B workers for doing substantially the same work.