Major Change to the H-2B Visa Program Rule Now in Effect

NCA Alert

Published Thursday, April 30, 2015
by Brad Steele

As a direct result of federal litigation filed by workers alleging employer violations of the H-2B Visa Program rules, the Department of Labor (DOL) and the Department of Homeland Security (DHS) have issued an Interim Final Rule that overhauls the entire program. For clubs that utilize the H-2B program, this new rule adds a significant number of new requirements that must be followed when recruiting, employing, and paying H-2B (and American) workers.

While the rule is labeled “interim,” all of these new requirements are in effect NOW. The rule applies to H-2B workers currently at your club or who will be at your club any time after yesterday, April 29. DOL and DHS have used a specific exemption in the law that permits them to implement this new regulation without first opening it up to public comment, which is standard before a new rule is issued.

There are a significant number of new mandates under this rule, and clubs using the program should begin discussing the rule’s effects with their local counsel immediately. Some specific areas of great concern include:

  • The rule establishes a “corresponding employment” requirement. This requires clubs to increase a U.S. worker’s wages to the H-2B prevailing wage if that worker does “substantially the same work” as an H-2B worker. This requirement only applies if the U.S. worker makes less than the prevailing wage.

 

This mandate means the moment an H-2B worker is asked to do substantially the same work as a U.S. worker or a U.S. worker is asked to do substantially the same work as an H-2B worker, a higher wage will be triggered. Not only does this mean that current club personnel could be owed higher wages, but it also means any new seasonal U.S. worker must be paid the higher wage.

There is an exemption for employees who have been on the job for at least 52 weeks before the H-2B workers start and whose job responsibilities are not substantially reduced during the H-2B job period. If there are incidental or occasional instances where H-2B workers’ and U.S. workers’ duties overlap, then the corresponding employment requirement will not be triggered.

 

  • This rule mandates that clubs must now provide a guaranteed number of hours and pay to their H-2B employees. Specifically, the rule establishes a “three-quarters guarantee,” which means clubs must pay their H-2B workers 75% of their hours during a 12-week period—even if they do not work due to inclement weather or other unforeseen circumstances. Of course, this three-quarters guarantee applies to all U.S. workers who are in corresponding employment.

 

  • This rule also changes the number of hours an H-2B worker must work from 30 to 35 hours per week. Thus, there are now more hours that must be guaranteed.

 

  • Additionally, this rule requires clubs to pay all transportation, visa, food, and lodging costs for their H-2B workers as they travel from their hometown, to their home country’s consular city, to the club and then home again. A club may reimburse its H-2B worker for these costs, but that must be done within the first work week. This requirement also applies to all U.S. workers who are coming from some other location within the U.S.

 

  • The rule prohibits clubs from using the attestation process for securing their labor certification. Instead, clubs must now apply for an H-2B Registration and then apply for a Temporary Employment Certification. All appropriate documentation must accompany both applications.

 

  • It requires clubs to recruit U.S. workers by contacting all former workers who worked at the club within the last year (other than those fired for cause). If a club is unionized, it must notify the union of the job openings. If it is not unionized, the club must post a notice of the job openings for 15 consecutive business days in two conspicuous places throughout the club (it may also be posted online).

 

  • It requires clubs to advertise in a newspaper of general circulation two times, with one of those ads running in the Sunday edition. The ads must include:

 

  1. A description of the job duties, minimum education requirements, the number of hours and days employees are required to work as well as the job’s start and end dates;
  2. The number of job openings and that the job is a full-time, temporary position;
  3. The wage rate, and whether overtime and on-the-job training will be offered;
  4. Whether the club will offer room and board, and daily transportation to and from work and what the club will charge for these services;
  5. That the club will pay for all transportation, subsistence, and lodging costs to bring a worker to the club’s location and return the worker to his home if he does not live near the club; and
  6. That the club will guarantee to pay at least 75% of the worker’s hours

 

  • It mandates that recruitment for U.S. workers begin within 14 calendar days from the date a club receives its labor certification and that clubs must continue to hire U.S. workers up to 21 days before their H-2B workers start.

 

  • It requires clubs to provide the same information they use to recruit U.S. workers when recruiting foreign workers. If a club uses an H-2B recruiting service, the club must include specific language in its contract with the recruiter that prohibits the imposition of fees on H-2B workers.

 

  • It requires clubs to hang an “Employee Rights” poster issued by DOL.

 

  • It requires clubs to notify DOL and the Department of Homeland Security (DHS) within two days of an H-2B worker or U.S. worker abandoning the job.

 

  • It imposes a monetary penalty of up to $10,000 and possible debarment from the program for 1-5 years for failure to comply with any of these regulations.  

 

This new rule is in addition to an H-2B Wage Rule that has also gone into effect. Taken together, these two rules will place a tremendous burden on clubs that utilize the H-2B visa program.

NCA is actively working with our allies on the H-2B Workforce Coalition and on Capitol Hill to stop this rule, but it may be a difficult task. Congressional action will take months to complete and there is little chance the president will sign it. Removing funding for the rule is also another option, but that would only occur in FY16 and it will still require the president to sign off.

If action in Congress cannot fix this problem, we will likely file a lawsuit to stop the rule; however, there is a risk pursuing a legal remedy. Should we file litigation and succeed in getting the rule stayed, DOL and DHS have indicated they will have to stop the entire program for lack of a valid set of operating regulations. As such, our options are limited but we will pursue all avenues to relieve the pressure clubs are feeling under this new rule.

For additional information on the two rules and to print the required poster, please click here.

Finally, should you or your club’s attorney have any further questions, please do not hesitate to contact NCA’s Vice President of Government Relations and General Counsel, Brad D. Steele, at steele@nationalclub.org.

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