Federal appeals court in SPLC case affirms Labor Department’s ability to set fair wages for foreign guest workers, protects U.S. workers

A federal appeals court’s ruling today may lead to higher wages for foreign guest workers and will help prevent employers from undercutting U.S. workers by paying lower wages to foreign laborers.

The decision by the U.S. Third Circuit Court of Appeals affirmed a lower court’s ruling that found the U.S. Department of Labor has the authority to regulate the wages and working conditions of H-2B guest workers.

The decision also affirmed the department’s authority to regulate U.S. employers’ importation of H-2B guest workers – an important safeguard for U.S. workers in danger of being squeezed out of the labor market. The H-2B program provides low-skill workers for non-agricultural work.

“We are very happy that the court reaffirmed the Department of Labor’s authority to make rules for the H-2B program,” said Meredith Stewart, staff attorney for the Southern Poverty Law Center (SPLC). “This decision allows the department to protect the wages and working conditions of H-2B workers and prevent employers from depressing the wages of U.S. workers by hiring exploitable labor from other countries.”

The department has been regulating the program for decades, but U.S. employers and employer associations challenged its authority after the department issued a rule that would result in substantial wage increases for H-2B and U.S. workers.

In 2008, the department issued a package of regulations in the waning days of the Bush administration that threatened worker protections, including a provision that made it easier to replace U.S. workers with cheap and exploitable foreign labor. The court invalidated the wage rule the following year in a lawsuit filed by the SPLC – CATA v. Solis – on behalf of several farmworker organizations and a Mexican guest worker who would be harmed by the regulations. The court ordered the department to replace the rule.

In 2011, the department announced a new wage rule. It would ensure that employers pay their H-2B workers a wage that would not adversely affect the pay of U.S. workers. Employers and employer associations that use the H-2B guest worker program challenged the new rule in two separate lawsuits in September 2011. In 2012, a federal district court in Pennsylvania upheld the new 2011 wage rule. Today’s ruling is the resolution of the employers’ appeal of the district court’s decision.