06/11/2013

New H-2B wage rule will better protect U.S. and migrant workers

The SPLC submitted comments this week in support of the U.S. Department of Labor and Department of Homeland Security’s new H-2B wage rule. This rule, which was implemented on a temporary basis in April, represents an important victory for U.S. workers and a milestone in the SPLC’s advocacy on behalf of H-2B guest workers.

The purpose of the prevailing wage is to ensure U.S. worker wages are not depressed by the influx of foreign workers to the U.S. labor market. Federal regulations require employers that are seeking to import H-2B workers pay those workers the area’s prevailing wage for the occupation. This requirement ensures that employers cannot undercut U.S. worker wages by paying their H-2B workers less than the average wage for the job in the same geographic area.

In theory, the prevailing wage requirement is an important safeguard against wage depression. In practice, it has had the opposite effect. Indeed, the Department of Labor found that the former wage rule led to underpayment of wages in nearly 96 percent of cases. This was because the former methodology for calculating the H-2B prevailing wage rate set wages far below the median wages that are paid in the applicable industries. This indisputably served to depress wages of U.S. workers. It also made the jobs to be filled by H-2B workers less desirable to U.S. workers.

This wage depression is exacerbated by the abusive conditions under which H-2B workers are often employed. The SPLC’s report, Close to Slavery, documents the chronic wage and hour abuses involving H-2B workers. In fact, since 2004, the SPLC has represented guest workers in obtaining settlements and judgments of approximately $20 million.

There can be no doubt that the impact of such pervasive wage and hour violations is to depress wages in those industries. Moreover, guest workers are generally unable to bargain for better wages and working conditions. This means that, over time, wages decline and the jobs become increasingly undesirable to U.S. workers. Given this, it is crucial that the department implement a prevailing wage rule that includes strong safeguards for U.S. worker wages and working conditions.

In 2008, the SPLC, along with other worker advocacy organizations, filed a lawsuit on behalf of U.S. and H-2B workers against the Department of Labor to challenge this harmful wage rule. The workers prevailed in this lawsuit, and the department issued a new rule that better protects U.S. and H-2B workers.

This rule should have gone into effect in September 2011, but it never did. H-2B employers and employer associations attacked the rule in the courts, and its implementation was effectively blocked by Congress, largely due to the efforts of a few vocal senators and representatives from states with industries that rely heavily on H-2B workers. As a result, the former wage rule remained in effect, resulting in the gross underpayment of wages to hundreds of thousands of H-2B and U.S. workers.  

The SPLC persisted in its legal efforts to topple this harmful wage rule, and in March, along with other worker advocates, won the legal battle to have the old wage rule invalidated once and for all.

The court also ordered the department to create an interim rule immediately. The Department of Labor and the Department of Homeland Security created this new rule, and today marks the end of the period for the public to comment on it. It’s no surprise a large group of employers and employer associations are opposing it. Employers have long enjoyed a wage regime that allowed them to pay H-2B workers artificially low wages.

Demanding that this status quo continue is bad for U.S. workers and the nation’s economy. Given that the Senate immigration bill allows for hundreds of thousands of more guest workers to come into the United States each year, a prevailing wage rule that protects – not harms – U.S. workers is more important than ever.