Decision empowers Department of Labor, could cost employers additional $847 million

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The U.S. Department of Labor has the authority to set the rules governing the amount that foreign guest workers, who do the work that Americans can't or won't, will be paid, a federal judge in Philadelphia has ruled in a case that could cost employers $847 million.

U.S. District Judge Legrome D. Davis of the Eastern District of Pennsylvania held that Congress intended for the Department of Labor to engage in the execution of the H-2B visa program through which employers can bring foreign workers to the country.

Judge Davis denied summary judgment to several associations representing employers from various industries -- including logging, hotel, carnival, sugar cane and commercial crawfishing -- that filed suit after the department issued a revised rule.

The new rule would result in a pay increase of $4.83 per hour, which means employers would be paying workers an additional $847 million, according to the opinion.

The H-2B visa program allows employers to hire a temporary unskilled foreign workers if American workers aren't available in that occupation, at the "prevailing wage rate." That's why the determination of that "prevailing wage" -- and the agency that is responsible for determining it -- is important in visa cases such as this one.

When Congress broke the old visa program into two sections -- one for farm workers and the other for non-farm workers -- by enacting the Immigration Reform and Control Act in 1986, it deliberately maintained the original definition of "worker," Judge Davis said in his 43-page opinion in Louisiana Forestry Association v. Solis.

The employers' associations had argued that the Department of Labor had no authority to draw up rules regarding a program that it doesn't control, meaning that the 2011 wage rule, which would result in a substantial increase in the amount employers would have to pay foreign workers, could not stand.

Judge Davis noted that the statute conferring authority to issue the visas to the Department of Homeland Security states that the department can do so after consulting with relevant governmental agencies, although it doesn't specify which ones.

The ambiguity regarding what agencies should be consulted means that the Department of Homeland Security has the broad authority to decide, Judge Davis said.

It issued a regulation designating the Department of Labor as such an agency, stating that an employer must first apply with the secretary of labor for a temporary labor certification before petitioning the Department of Homeland Security for a visa, according to the opinion.

The visa program permits employers to hire foreign workers only if there are no American workers to fill the position at the prevailing wage.

For temporary labor certification purposes, the Department of Labor must determine the prevailing wage for a given job because "the availability of unskilled United States workers is, for obvious reasons, partially determined by the offered wage," Judge Davis explained in a footnote.

The Department of Homeland Security acted reasonably in designating the Department of Labor as a consulting agency, Judge Davis said, rejecting the plaintiffs' argument that the Department of Homeland Security "improperly 'offloaded' some of its jurisdiction to the [Department of Labor]," according to the opinion.

"The [Department of Labor's] labor certification is reasonably connected to the [Department of Homeland Security's] ultimate determination whether a foreign worker admitted under an H-2B visa would displace a capable unemployed United States worker," Judge Davis said. "Therefore, the [Department of Homeland Security] may condition its grant of an H-2B visa on receiving a labor certification from the [Department of Labor]. The ultimate decision-making authority still remains with the [Department of Homeland Security]."

Both Lauren Fox of Blank Rome in Philadelphia, who represented the plaintiffs, and Charles Miller, spokesman for the Department of Justice, said they had no comment on the case.

legalnews

Saranac Hale Spencer: sspencer@alm.com or 215-557-2449. To read more articles like this, visit www.thelegalintelligencer.com.


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