DOL ANNOUNCES UPCOMING CHANGES TO AEWR

Unrest and uncertainty have once again visited the H-2A Program’s AEWR Methodology. 

Near the end of last year, the previous rule (which, for many, increased wages based on arbitrary similarities with non-ag occupations) was replaced by the Interim Final Rule (IFR). While the IFR is decidedly more complex than the pre-2023 methodology, it did bring substantial relief to employers by taking a more common-sense approach to job categorization, attempting to base wage rates on actual market conditions, and taking H-2A housing expenses into account.

However, on September 2nd, DOL announced that the IFR has been successfully challenged by United Farm Workers (UFW). The United States District Court for the Eastern District of California found the IFR unlawful and has ordered DOL to quickly come up with a new AEWR methodology and re-set the AEWR rates according to that methodology.

Interestingly, the court’s decision didn’t vacate the IFR, so, for now, the current wage rates remain active.

Unfortunately, the court has ordered DOL to notify employers with active job orders that they “may” need to pay back wages when the new AEWRs go into effect (specifically for the period of September 2nd, 2026 through the effective date of the new AEWRs) if the new wage rates are higher.

DOL’s notice made it clear that employers are not currently under any obligation to issue back pay, and they are specifically disputing whether one can legally be imposed. However, they recommend keeping detailed records of all H-2A workers and U.S. workers in corresponding employment who do any work between September 2nd and whenever the new rule comes out, just in case.

As always, we’ll continue to monitor the situation and provide updates as soon as more information becomes available. Be sure to stay tuned!