A Replacement for H2A?

If you want to get a farmer-of-few-words talking, ask them what they don’t like about the H2A program. Then you can sit back and get comfortable while they count the ways.

Most growers resort to H2A only when they’ve run out of other options. The quality of the workers is usually quite good, but the cost and the red tape are formidable.

So you would think legislation for a more flexible guestworker program would be met with enthusiasm, but a recent headline in California Ag Today summed up many growers’ feelings about the proposed legislation: “Agricultural Guest Act Won’t Help California.”

The Agricultural Guestworker Act (AG Act or H2C) would replace the H2A program and allow an additional 500,000 non-residents to work year-round on US farms and ranches.

Mike Gempler, Executive Director of the Washington Growers League and an expert in ag labor legislation said, “The cap will cause shortage of 446,000 ag workers per year. Settled out farmworkers will be forced to become temporary visa workers and not have a path to citizenship, and E-verify will be instituted without a way to get supplemental workers to meet shortage. As it is written, I give it a low chance of passing the House. The ag industry sees it as a vehicle for positive change and hopes to improve it.”

Under the H2C program, the initial visa would be valid for three years, but the worker would have to “touch back” (return to their home country) for at least 45 days during that three year period. Family members could not accompany the worker. Current undocumented workers could be included in the program and thereby be exempt from deportation, but they would also have to comply with the touchback period, requiring them to return to their country, regardless of whether they left it three years ago or thirty years ago. Employers using H2C workers would have to e-verify all of their workers, which is one of the most problematic parts of the legislation from the point of view of many employers and worker advocates.

Unlike H2A, there would be no requirements that the employer provide housing or transportation. Workers would be required to purchase health insurance. Ten percent of the employee’s wages would be withheld by the employer and available in a trust administered by the USDA to help employees return home during the touchback period.

According to Gempler, employers would not be required to hire local workers once H2C workers arrived as they are with H2A. And employers can petition for workers much closer to the harvest, so they’re more likely to get the timing right than when they have to plan six months out. The Secretary of Ag would then have to approve or decline the petition within five days. Gempler sees it as a positive change that the program would be administered by the USDA rather than the USDOL.

Other changes if H2C took the place of H2A would include:

  • Lower wages state min wage instead of Adverse Effect Wage Rates

  • 50% guarantee of hours instead of 75% guarantee

  • Longer period of stay-18 months for seasonal, 36 months for non-seasonal

  • Attestation instead of labor certification process: quicker and easier and don’t have to prove shortage

  • Adds processing as an allowed job

  • No civil actions without mediation request at least 90 days prior

  • Possibility for employer to require arbitration

Labor advocates worry that with lower state wages, plus the requirement to pay for health insurance, and housing, plus the deductions for the trust and other federal deductions, could leave workers with very little pay left over. Wages for agricultural workers in Mexico are in the realm of $1.00-$1.50 an hour, so H2A jobs are still very attractive.

We did some rough calculations to see at what point an H2C job would be unattractive to a Mexican worker. Our assumptions were:

  • $10/hour, 24 work days per month, 8 hours a day,

  • $400/month for housing, $150/month for health insurance, $300/month for food and other living expenses, $600 one-way costs for travel from Mexico to the US

  • 10% withholding for the trust and 10% withholding for social security and unemployment (funds which would reportedly be used to administer the program)

This leaves $3.31/hour in savings if the worker gets 100% of the contract hours. The H2C requirement is just 50% of the contract hours. Since employers would no longer pay for transportation from the country of origin nor housing, there would be an incentive for employers to bring more people than necessary for their average needs, in order to have enough for their peaks. So let’s assume workers get 75% of the contract hours. If that were the case, workers would have about $2.48/hour in savings left over with an H2C job. To save more money, it’s possible workers would end up in substandard housing, or even camping. This could become a risk to food safety, not to mention a risk to the image of growers and brands.

Wages and working conditions in Mexican agriculture are improving as the country faces a shortage of workers particularly in the northern ag centers of Sinaloa, Sonora and Baja. It’s conceivable that within a few years, the cost/benefit of leaving their families for a year or more to make perhaps 30-50% more in wages (assuming there would be savings living with family at home) might start to look less attractive, and the lines of workers hoping for a US work visa could start to dwindle.

We asked Gempler what he thinks the agricultural labor situation would look like in five years if this law passes as-is.

“[We’ll see] an acute shortage of workers. Great disruption and displacement for thousands of settled out farmworker families who will be required to leave the US, at least for a while, and who will not have permanent status in the US.”

What’s next for this bill? Reportedly it’s moving forward to the full House Committee on Agriculture. Want to weigh in? Make your voice heard to your local grower association, your congressperson, or directly to the House Committee on Agriculture.