Opinion ID: 2757983
Heading Depth: 2
Heading Rank: 2

Heading: Calculation of Prevailing Wages

Text: DOL through its H-2B procedures long has sought to avoid causing adverse effects on American workers’ wages and working conditions from the admission of foreign workers by requiring H-2B employers to offer and pay at least the prevailing wage both to the H-2B workers and to the United States workers engaged for the employment opportunity. To facilitate compliance with this requirement, DOL has from time to time published specific guidelines governing the system by which it will determine the prevailing wage for the employment that an employer is seeking to fill with foreign workers. Over the years, DOL has changed its method for calculating prevailing wages on several occasions, often without giving interested parties notice of its intent to make the changes or the opportunity to comment on the contemplated changes, and has made the changes without explanation. Initially, DOL advised state workforce agencies that became involved in the administration of the program to calculate a single prevailing wage for any given occupation in the area of intended 8 employment.3 In 1995, DOL altered its methodology to determine the level of prevailing wages by creating multiple prevailing wages for each H-2B occupation. DOL initially divided each H-2B occupation into two skill levels—“entry level” (“Level I”) or “experienced level” (“Level II”)—and calculated a prevailing wage for each level.4 But in 2005, DOL went further in the “2005 Wage Guidance” and divided H-2B occupations into four skill and wage levels, “specialty occupations,” borrowing from a system that Congress created to calculate prevailing wages for the separate H-1B program dealing with the admission of skilled workers. The DOL effectuated these changes through guidance letters without public notice or seeking comment comparable to the procedure followed when rules are adopted in an APA formal rulemaking process. Prior to 2005, DOL required the use of wage rates established on the basis of government programs such as those under the Service Contract Act (“SCA”) or the Davis Bacon Act (“DBA”), but in March 2005, DOL changed its approach through the 2005 Wage Guidance, which, in the absence of a 3 See Department of Labor, General Administration Letter (GAL) 10-84, “Procedures for Temporary Labor Certifications in Non Agricultural Occupations” (Apr. 23, 1984). 4 See Department of Labor, “Interim Prevailing Wage Policy for Nonagricultural Immigration Programs” (May 18, 1995) available at http://wdr.doleta.gov/directives. 9 collective bargaining agreement (“CBA”), permitted the prevailing wage rate to be set using either private employer surveys or a Bureau of Labor Statistics Occupational Employment Statistics (“OES”) survey. Subsequently, on December 19, 2008, DOL adopted the “2008 Wage Rule,” which states: “the prevailing wage for labor certification purposes shall be the arithmetic mean . . . of the wages of workers similarly employed at the skill level in the area of intended employment.” 73 Fed. Reg. 78,020, 78,056 (Dec. 18, 2008) (codified at 20 C.F.R. § 655.10(b)(2)) (emphasis added). By specifying that a given prevailing wage is set “at the skill level” for the intended employment, the 2008 Wage Rule directs DOL to divide each H-2B occupation into four separate skill levels and calculate a prevailing wage for each level. 20 C.F.R. § 655.10(b)(2). The 2008 Wage Rule requires that, in the absence of a CBA, prevailing wage rates are to be determined on the basis of either a private employer survey or data derived from an OES survey. DOL did not seek comments on the use of the four-level wage methodology for determining prevailing wages when promulgating the 2008 Wage Rule. Even though DOL did not seek public comments on the use of this four-level methodology in the H-2B program prior to adopting these rules, interested parties submitted comments to it contending that use of “skill level” prevailing wages made no sense in the context of low-skill H-2B jobs and that their adoption resulted in wage depression. The comments also criticized DOL’s decision to permit the use of employer surveys when valid OES wage data was available for setting a prevailing wage because employer surveys would be used to undercut wages that would have been based on OES surveys to the 10 detriment of both American and foreign H-2B workers. 73 Fed. Reg. at 78,031; A386-409 (Low Wage Worker Legal Network July 2008 comments ETA 2008-0002-0088). DOL did not respond to those comments, instead continuing to set skill-level OES wages and evaluate employer surveys submitted pursuant to these regulations using the later-adopted 2009 Wage Guidance.5 The 2009 Wage Guidance established a methodology by which the OES survey data for an occupation would be manipulated mathematically to produce four different prevailing wages, one for each of four skill levels within an occupation.