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Federal regulations require that the minimum wage for H-2A employees is the highest of (1) the Adverse Effect Wage Rate (“AEWR”), (2) the prevailing hourly or piece rate, (3) the agreed upon collective bargaining wage rate, if applicable, or (4) the state or federal minimum wage. Often, the highest rate is the AEWR, a rate specifically set by the Department of Labor for each state as the minimum to be offered to H-2A workers.

On January 9, 2019, the California AEWR will increase from $13.18/hour to $13.92/hour and the Arizona AEWR will increase from $10.46/hour to $12.00/hour. The goal of the AEWR is to keep wages of similarly employed U.S. workers from being adversely affected by employers’ ability to hire labor from outside the country. There is much debate, however, as to whether the AEWR actually accomplishes that goal and whether the Department of Labor is actually testing for adverse effect whatsoever. On Monday, employer advocates filed a Temporary Restraining Order and Preliminary Injunction in the D.C. District Court to prevent the 2019 AEWR from taking effect. Read more about that effort here.

COUNSEL TO MANAGEMENT:

H-2A employers, please ensure that the applicable AEWR is paid to your H-2A employees. For more information regarding other states and their applicable 2019 AEWR, please click here. Should you have any questions regarding how this affects your company, please do not hesitate to contact the experts at The Saqui Law Group, a Division of Dowling Aaron Incorporated.

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