There is a new Adverse Effect Wage Rate (AEWR) for 2022. The AEWR is the minimum wage an H-2A non-immigrant agricultural worker must be paid. The DOL has also proposed changes to the way in which these wages are set for some jobs.
AEWR wages did not apply when state or collectively bargained wages were higher. The new AEWR will differ by state and region. States in the Southeast will be seeing the lowest rate with a minimum wage of $11.99 per hour. In comparison, the west coast will have the highest rate, with Washington and Oregon at $17.41 and California having a rate of $17.51. Washington and Oregon have had their rates increase by 30% during the past five years, and California has had their rate rise by 39%. However, the largest increases have occurred in Colorado, Nevada, and Utah, with an increase of 42%. These increases were reported in an analysis done by the Farm Bureau.
In the past, data from the USDA’s Farm Labor Survey (FLS) was used in computing the AEWR. However, challenges to the way the rate was calculated along with a two-year freeze of the AEWR ended up in court, which caused a delay in the 2021 rate being released. After this, the DOL again used the old method.
The changes that the DOL has proposed would leave most types of jobs continuing to depend on FLS data, but the DOL will be allowed to use another tool. They will have the option of using the Occupational Employment and Wage Statistics survey when the jobs being considered are not included in the FLS, or the FLS does not have enough data.
One concern about the proposed rule is that it would make it hard for employers to create a payroll budget for their payroll for the year due to the varied tasks involved in farm work, making it difficult to determine wage rates since a worker performing varied jobs may need to be paid the higher wage rate. Additionally, employers are concerned about the wage rates in the new proposal because they believe that they are unnecessarily high.
AEWR is intended to prevent the wages paid to H-2A workers from hurting the wags of potential domestic workers. However, some employers claim that domestic workers don’t want the jobs, and the wage rates hurt employers because they can’t charge enough for their products to make up for the increased wages. The public has until January 31 to comment on the proposed rule.
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