Apr 24, 2023

Ag employers group challenges Adverse Effect Wage Rate rule

The National Council of Agricultural Employers (NCAE) has filed a motion for preliminary injunction against the Department of Labor’s (DOL) new Adverse Effect Wage Rate (AEWR) regulation.

Other plaintiffs in the case are Florida Growers Association Inc., Florida Citrus Mutual, the Florida Fresh Fruit and Vegetable Association, and strawberry growers G&F Farms LLC and Franberry Farms LLC.

The lawsuit alleges that the Secretary of Labor’s action in developing the regulation was arbitrary and capricious and an abuse of the Secretary’s discretion, according to a news release. NCAE filed the motion on April 21.

“This regulation continues the DOL’s abusive practice of mandating minimum wages farmers and ranchers must pay under the Temporary H-2A Agricultural Program completely disconnected from the market for agricultural labor anywhere on the planet,” Michael Marsh, NCAE’s president and CEO, said in the release. “Not only does the rule continue to misuse the U.S. Department of Agriculture’s (USDA) Farm Labor Survey (FLS) to establish wage rates, but it also piles on farm and ranch families by requiring nonfarm wages drawn from the Bureau of Labor and Statistics (BLS) for simple, routine, on farm activities, jobs which have been performed on American farms and ranches for generations.”

Some farmworker wages will more than double under the new rule forcing family operations out of business, Marsh said in the release. “And, of course, these mandated minimum wages impact all farm wages, whether employers use the program or not,” he said in the release.

The court filing references a possible scenario for a New York apple grower. If the H-2A contract lists an employee’s duties include driving other employees to the orchard, the preamble to the Final Rule states that every worker on that contract will be transformed from a farmworker to a “chauffeur.”

“Suddenly the wage for an H-2A worker at an apple orchard jumps from the already high $16.95/hour (Adverse Effect Wage Rate) to the statewide mean for a ‘chauffeur’ of $19.52/hour,” according to the lawsuit. “So, H-2A farmworker wages in western New York might adversely affect the earnings of chauffeurs driving hedge fund managers to their private jets in the Hamptons? The (Labor) Department is not only failing to compare apples to apples; they are comparing apples to limousines!”

The AEWR is the the minimum wage for H-2A employees, set by the government each year.

The DOL received comments on the rulemaking from family farms and ranches located across the country raising concerns regarding the madness of the Secretary’s approach, Marsh said in the release.

“Commenters pointed out that the DOL’s regulations and its continued misuse of survey instruments not designed to capture actual agricultural wage rates were forcing America’s food production to flee to overseas competitors,” Marsh said in the release. As a result of DOL’s ignoring the pleas of U.S. legacy farming operations, more than 60% of the fresh fruit and more than 35% of the fresh vegetables consumed in the U.S. are being produced by overseas competitors. Farm and ranch families, the Small Business Administration, economists, and others warned the Secretary that such irresponsible action was putting America’s food security at risk, a concern seemingly ignored by the Secretary, according to the release.

NCAE has repeatedly petitioned the Secretaries of Labor to make a determination of an adverse effect to the domestic workforce due to the employment of H-2A workers prior to mandating devastating AEWRs, Marsh said in the release.

“Sadly for America, the DOL has turned its back on commonsense and the American people,” Marsh said in the release. “The economic evidence overwhelmingly supports our cause and the fact that DOL’s estimates of cost impact are short by hundreds of millions, if not ultimately, billions of dollars! These are incredible errors. Having been slammed face first into the dirt by the Executive Branch, NCAE and our farm and ranch family members had no other choice than to turn to the Judiciary hoping the Court will hear and recognize the importance of our pleas for relief.”

The legal challenge is being brought in Federal District Court in Tampa, Florida.

NCAE is the national trade association focusing on agricultural labor issues from the employer’s viewpoint.