January 6, 2021

Foreign Labor Options for Northeast Agricultural Producers

Foreign Labor

Volume 15, Issue 1
January 2021

Click here for a PDF version of this month's issue.

Foreign Labor Options for Northeast Agricultural Producers

Finding, hiring, developing and retaining adequate labor resources are some of the most pressing challenges for agricultural employers. Local workers are often not available in sufficient numbers to meet the needs of farm employers, or are uninterested in seasonal or temporary jobs, or farm work in general.

Immigration and Customs Enforcement (ICE) raids and I-9 audits are increasing each year. Immigration violations of undocumented workers can’t be resolved within the United States. Persons who entered illegally, or overstayed visas, must return to their home countries to fix their status.

However, there are a number of immigrant and non-immigrant visa categories available to Northeast agricultural producers, as well as some fishing and forest product producers. Recently, Harris Beach law firm presented a webinar series sponsored by Farm Credit East which provided an overview of three options: H-2B, H-2A and Permanent Residency. This article is a brief summary of these programs. For more information, please review the webinar recordings.

H-2B – Temporary or seasonal nonagricultural workers

H-2 visas are for lower-skilled temporary or seasonal workers (as opposed to H-1 visas, which are generally given for higher-skilled positions). H-2A is for agricultural workers and will be addressed later, while H-2B is for nonagricultural workers.

The biggest issue with H-2B is that there is an annual cap for the number of visas that can be issued: 66,000 – split between two seasons – October 1 (first half of the fiscal year), and April 1 (second half of the fiscal year). The second half is most competitive, with only 33,000 visas for the whole country. The U.S. Department of Labor (DOL) will receive as many as 200,000 requests for these visas. In some recent years, additional visas have been made available on an ad hoc basis, but this has been inconsistent.

H-2B workers must fill a temporary or seasonal job. The job cannot be year-round and has a 10-month limit (effectively nine months under current DOL regs). The work must be full-time (35 or more hours per week).

There is a specific multi-step process to obtaining H-2B workers. Employers are advised to begin about six months in advance of their anticipated need for workers. Employers must pay “prevailing wage” for the category of employment as determined by DOL, a benchmark of what businesses in the local area are paying for comparable workers. Employers must also pay in- and out-bound transportation costs, and all consular and agent fees. As with most regular employees, employers must also have workers’ compensation, pay overtime for hours worked over 40 hours, and withhold applicable state and federal payroll taxes. Employers must also pay at least the H-2B prevailing wage to all U.S. workers performing the same duties as the H-2B workers.

Notably, with H-2B, employers are not required to provide or pay for housing, but they should make arrangements for workers’ housing in advance of their arrival, as their ability to quickly find suitable accommodations will be limited.

H-2B workers cannot be used for “agricultural work.” However, there is some overlap between H-2B and H-2A, and some farms do use H-2B workers, such as equine operations or for work on the farm that does not qualify as “agricultural work,” such as shipping, retail or other positions. The most common sectors for H-2B are hospitality and resort businesses, landscaping, and construction. Some fishing and forestry businesses use them as well.

Regarding the visa cap, because the H-2B visa is so oversubscribed, DOL enters all applications received during the initial three calendar days of the filing period (Jan 1-3 for April 1 start) into a lottery. Even if employers do not get allocated any visas, they may still get a job certification that could be used for transfers. H-2B workers can be transferred from one employer to another without being subject to the cap.

So, if you are a landscaper for example, it may make sense for you to partner with say, a ski area, who has H-2B workers in the winter. You could transfer them to your business for the growing season, and then they could return to the ski area again next winter. Workers can transfer in that fashion for up to three years before they are required to leave the country for a period of time to reset their eligibility.

As with all visas for foreign workers, employers must demonstrate that no U.S. workers (either U.S. citizens or those legally present on eligible visas) are available. This is done through a process of recruitment, as specified by DOL. U.S. workers must be preferentially hired before the arrival of H-2 workers, and for a period of time after their arrival.

H-2A – Temporary or seasonal agricultural workers

In a similar fashion to H-2B, H-2A is for temporary or seasonal workers, but for agricultural positions. This program serves about 15,000 agricultural employers nationwide, for more than 268,000 positions. Unlike the H-2B visa, the H-2A has no cap.

What is agricultural work? Agricultural work includes: The cultivation of soil; raising, feeding, caring for, training, or management of livestock, bees, poultry, fur-bearing animals or wildlife; or the raising or harvesting of any other agricultural or horticultural commodity. Notably, services performed in connection with production or harvesting of maple sap, in connection with the raising or harvesting of mushrooms, or in connection with the hatching of poultry constitute agricultural labor only if such services are performed on a farm.

Processing of commodities raised on the employer’s farm is considered agricultural labor, but any processing of products raised on another farm does not qualify as agricultural labor.

Similar to the H-2B, employers must pay prevailing wage, which for H-2A is referred to as the Adverse Effect Wage Rate, or AEWR. This varies by state. For New York, that rate was $14.29 per hour in 2020. The work must be full-time and temporary or seasonal (up to 10 months). Year-round positions are not eligible. On top of the AEWR pay rate, employers must provide housing free of charge, as well as transportation to and from their home country. The worker housing must be inspected by the State Workforce Agency (SWA). Drinking water from non-municipal sources (i.e. wells) must be tested annually.

Employers must also recruit and preferentially hire U.S. workers over H-2A workers. This means contacting any U.S. employees laid off from the prior season to see if they are willing to return, as well as conducting domestic recruitment. Employers must submit a recruitment report and must provide the name of each U.S. worker who applied for the job and whether they were hired or why they weren’t. These records must be retained for a period of three years. Employers must continue to cooperate with the SWA in recruiting and hire any U.S. workers until 50% of the work period is completed. Employers must complete and retain a final recruitment report at the 50% mark of the work period.

Employers must report any termination or abandonment of workers within two working days. It’s also worth noting that the terms and conditions of H-2A contract apply to all – including domestic workers – they must receive the AEWR rate as well if performing similar duties to H-2A workers.

Permanent foreign labor options for U.S. employers

Another option for U.S. employers to obtain foreign workers is by sponsoring them for permanent residency – a “green card.”

It’s noteworthy that nearly any position can qualify if it is full-time and year-round. The position need not be “highly skilled.” If timed carefully, the employer can continue to bring in H-2 workers until the last stage of the green card process is filed. Permanent foreign worker sponsorship is open to all sectors and not limited to agriculture.

Immigration sponsorship through employment is a three-step process. First, the employer must get a prevailing wage determination, then file the I-140 form, after which they can get either adjustment of status (if in the U.S.) or consular processing (if outside the U.S.), and finally a green card is issued. The total process can take up to two years. Government fees total approximately $2,000 (higher if expedited processing is requested). Legal fees are additional.

Once workers receive their green card, they can live and work without restriction in the U.S. as their status is not tied to their employment. However, many employers enter into a reimbursement arrangement or minimum tenure period with the employee. It is possible to have an agreement requiring workers to stay with the employer for a certain period after receiving their green card or else reimburse the employer for expenses.

There are limits on number of green cards issued each year – approximately 140,000 employment-based and 226,000 family-based green cards are issued annually. Each country also has a ceiling number of visas. When either preference group or country quota are met, waiting lists build. India and China typically have a backlog, but most other countries do not.

As with non-immigrant work visas, employers must conduct recruiting of U.S. workers meeting the job criteria, and complete and retain a recruitment report.

Conclusion

Finding adequate labor has been a challenge for Northeast farming, fishing and forestry producers for a long time. However, there are several options to secure foreign workers for U.S. employers. While each of the three options presented can be a bit complicated, with assistance, they have become viable solutions for thousands of businesses across the country.

Note that the above descriptions are only high-level summaries of the processes involved. For more information, we encourage you to view the recordings of the Harris Beach webinars sponsored by Farm Credit East, which are available at FarmCreditEast.com/webinars.

Please be advised that the author of this article is not an attorney, and no attorney-client relationship is created by its publication. The article is for information purposes only, and employers should discuss any policies or practices with experienced employment law counsel.

Editor: Chris Laughton
Contributors: Tom Cosgrove and Chris Laughton

View previous editions of the KEP

Farm Credit East Disclaimer: The information provided in this communication/newsletter is not intended to be investment, tax, or legal advice and should not be relied upon by recipients for such purposes. Farm Credit East does not make any representation or warranty regarding the content, and disclaims any responsibility for the information, materials, third-party opinions, and data included in this report. In no event will Farm Credit East be liable for any decision made or actions taken by any person or persons relying on the information contained in this report.

Editor: Chris Laughton
Contributors: Tom Cosgrove and Chris Laughton

View previous editions of the KEP

Tags: immigration, labor