Do or die
If U.S. farmers don’t get labor relief soon, many are likely to go out of business.
Everyone agrees that the farm labor situation in the U.S. is in dire straits. What people can’t seem to agree on is what to do about it.
U.S. farmers depend on foreign labor, and in a post-September 11 world where the government is cracking down on illegal immigrants, the cost of hiring legal foreign workers is rising dramatically. The current program that legally brings foreign workers into the country, the H-2A program, is becoming prohibitively expensive, threatening to put farmers out of business.
Congress is considering reforming H-2A to expand the number of legal farm workers. One of the bills receiving a lot of attention is known as AgJOBS. Some believe this is a compromise worth passing that will bring immediate relief, while others believe it makes the farm labor situation far worse in the short and long term.
“The issue is extremely complicated; there are a lot of factors that play into how you’d reform the H-2A and get a bill that’s in play to address the issue,” says Jake Parker, national legislative director for the North Carolina Farm Bureau.
In the early 1990s, 31 percent of farm workers were U.S. born. By 1998, 81 percent were foreign born. Of the 1.6 million farm workers in the U.S. today, 1.2 million are undocumented. Even with the number of illegal workers in this country, there is a shortage of labor.
“This is a huge issue out here in Tennessee and Kentucky. We had a shortage of farm labor last season. Growers lost some tobacco last year because they didn’t have the labor to put it in the barns. If something isn’t done, it’s going to get worse,” says Charlie Finch of Burley Stabilization.
Agriculture is losing workers to other industries. “The number of existing illegal farm workers is shrinking as jobs in ... service, hospitality, landscaping, food processing and others one step above us pull from our pool. Worker shortages last season were reported in areas across the nation—as high as 20 percent in some areas. Some growers left crop in the field or had serious yield and marketability issues due to the shortage,” says Lee Wicker, a small tobacco grower and deputy director of the North Carolina Growers Association (NCGA), the largest H-2A program user in the nation.
The H-2A program
The program to legally bring workers in is called the H-2A temporary and seasonal guest worker program. This program currently provides only about 2 percent of the farm labor force, roughly 30,000 to 40,000 workers annually.
Why aren’t farmers using the H-2A program? “The new H-2A workers are not as familiar with tobacco, and it’s gotten very expensive. There’s a lot of red tape now that you have to go through. You have to start early and try to predict how many workers you’ll need. It’s becoming a handicap for farmers,” says Finch.
“Not to mention,” adds Parker, “the program is a magnet for lawsuits.”
The main driver of the cost of H-2A is the adverse effect wage rate, known as AEWR, which is determined by the U.S. Department of Labor. “The AEWR has been going up at a sharp rate every year for the past several years,” says Parker. The rate has increased 76 percent in the last 16 years. The AEWR today is $9.02 per hour, up 5.7 percent from $8.51 last year.
On top of the AEWR, growers have to pay for workers’ housing, transportation to and from the country of origin as well as within this country and fees for visas. They also have to pay fees to growers associations, which arrange the labor. Parker says it would be nearly impossible for most farmers to arrange labor by themselves because of the bureaucratic hurdles.
Farmers also end up paying fees to cover litigation costs, as the growers associations are continually being sued by worker advocacy groups. Since 1989, NCGA growers have been sued more than 30 times and have paid over $5 million in attorneys’ fees and settlement costs.
“These additional costs are not reflected in that $9.02 an hour. It’s probably $13-$14 an hour when you add in those costs,” says Parker.
Growers say immediate relief is needed. “We’re getting ready to hit the wall. There’s too much litigation, the wage rates are too high and there are too many bureaucratic bottlenecks. We’re struggling to get our workers visas and get them processed,” says Wicker.
AgJOBS was first introduced in 2001. The Agricultural Job Opportunity, Benefits and Security Act of 2007, S.340, was reintroduced in the Senate on Jan. 10, 2007, by Larry Craig (R-Idaho), Dianne Feinstein (D-Calif.) and the original co-sponsors. Chris Cannon (R-Utah) and Howard Berman (D-Calif.) introduced identical legislation, H.R. 371, in the House.
AgJOBS deals with two major issues—addressing undocumented workers and reforming the H-2A to be cost effective. The way in which the bill addresses these two issues is stirring up quite a bit of controversy.
Growers supporting the bill say it brings much-needed relief and believe that it’s the best deal they are going to get from Congress. Those opposed say it’s a Trojan horse that will result in more litigation and even higher wages in the long term.
“AgJOBS streamlines the application process of the H-2A program. It completely reforms the wages, offering a major rollback,” says David Rouzer, of the Rouzer Company, a government affairs consulting company. Rouzer, who recently worked for the USDA under the Bush administration, is working on behalf of a group of farmers to promote the bill. “AgJOBS is the product of years of arduous negotiations between agricultural employers, farm worker advocates and a bipartisan group of Congressional leaders. It represents a delicate balancing of the need of agricultural employers for a reliable, affordable supply of legal labor for seasonal agricultural jobs while providing benefits and protections for foreign farm workers.”
Wicker, who has been working in H-2A since 1994, disagrees. “This is a very complicated bill written by Rob Williams, one of the brightest legal minds in the country, who’s been suing the H-2A program since the 1960s.” He adds, “It’s very tricky. It’s a 100-page legal text that you’ve got to be a Harvard scholar to understand. It’s a devastating bill.”
The wage rate
Opponents of the bill say the wage relief isn’t good enough. Supporters say it will save millions.
“AgJOBS knocks the AEWR back to the 2002 rate of $7.53 an hour and freezes it for three years,” explains Parker. During those three years, Congress is supposed to conduct a study. At the end of that study, if Congress doesn’t enact changes to the AEWR, it will automatically jump 12 percent. Subsequently, the increase is capped at 4 percent per year.
Opponents think the cap is too high at 4 percent; they want a prevailing wage, like all other guest worker programs. They say the bill only gives growers three years of relief before the rates increase again.
“It doesn’t correct the wage problem,” says Wicker. “The bait, to get H-2A growers to support this unfair legislation, is a three-year wage freeze at $7.53 per hour in North Carolina. [In] year four, wages will go up almost 17 percent. By year six we will be well over $9 an hour and climbing steadily every year. The wage index will be a combination of the annual CPI-U increase plus 3.99 percent. There is an annual cap of 4 percent. Wage determinations will be completely divorced from agricultural wages.”
Rouzer, however, says the savings would be immense. “If AgJOBS passes this year, the wage would be $7.53. At this wage, most of the guys I’m representing would save half a million dollars each over a five- to six-year period. That’s the difference between staying in business or getting out.”
Wicker says these numbers are misleading. “You put the numbers up on a screen, and of course our growers are in such a desperate place, they want to believe it so badly. They want to reach up there and grab a half a million dollars right off the screen. But it’s a cruel hoax.” He adds, “What I tell farmers is that if you do save money, you better save it to pay lawyers and lobbyists because you’re going to get sued.”
Rouzer counters, “Even if you assume that to be true, at least three years buys them another opportunity to live to fight another day. A lot are looking at getting out immediately.”
AgJOBS allows for illegal workers to become citizens, which is another point of contention.
“There’s a provision that states that if you can prove you’ve worked in agriculture for 150 days in the last two years, you are eligible for a blue card,” explains Rouzer. “This takes the more experienced workers and provides them with an avenue to permanent resident status and then citizenship. Opponents of the bill call this amnesty. In my judgment, amnesty means you’re here illegal[ly] one day and legal[ly] the next, with no conditions attached. But this provision would require that you have to work in agriculture for at least three more years. Those workers who are eligible for blue cards have already contributed to the American economy, and they can stay only if they remain good citizens and continue to contribute to the American economy.”
He says that it is estimated that 500,000 out of the 1.2 million undocumented farm workers would not be eligible for a blue card, so they would have to return through H-2A. “They have two choices—they can stay in America and risk deportation or go home and come back through H-2A.”
Wicker says there are several problems with this program. Vague provisions for qualification would promote “rampant fraud just like in 1986.” Waivers on work requirements due to hardships with family and crop conditions mean some people will qualify without working. There’s no numerical cap on adjusting the number of family members who can become residents. “This is a massive amnesty program being misrepresented as H-2A reform.”
The program also mandates that money be allocated for advertising and promotion, and money be given to farm worker advocates, attorneys and unions, Wicker says. “Amnestied farm workers are no longer at-will employees. ‘At will’ means you can terminate them for no reason. Amnestied workers can only be terminated for ‘just cause.’ That creates more rights for amnestied farm workers than for American citizens. There is no definition for just cause in the legislation, which means the lawyers and judges will decide through litigation—litigation that the growers will be forced to pay for. Taxpayer-funded lawyers will represent the workers. Growers’ tax dollars will be used against them. It is un-American.”
Rouzer says the adjustment of status program is critical to creating bipartisan support for AgJOBS and therefore enabling the bill to be enacted. He also says this provision is important for agriculture as well; farm families do not need to lose their most experienced workers to deportation. There is no one else to fill those jobs.
The litigation aspect of AgJOBS is complicated. Supporters say it will bring relief to growers, while opponents believe they’ll be sued even more.
Wicker says, “The legislation expands worker protections and provides for more private rights of action (lawyer-speak for the lawyers getting more things to sue over) … There will be more lawsuits in federal court, which is slower and more expensive to defend. That is why the lawyers love this bill. H-2A workers can sue over housing, transportation reimbursement, wages, benefits, material terms offered in your H-2A application, 3/4 guarantee (contract hours), and motor vehicle insurance and safety requirements. They can sue without regard to amount, and there is a three-year statute of limitations.”
Rouzer disagrees, saying the bill moves these lawsuits out of state courts, which should help diminish the litigation. “Judges at the federal level are better equipped to handle immigration law; federal judges generally have a better understanding of immigration law. Plus, the bill language provides the employer the opportunity to go to mediation first, and mediation is often where frivolous lawsuits are revealed for what they are.”
He adds, “Damages available to workers under the federal right of action are limited to actual economic damages or actual violations of what growers expressly promised in writing. Statutory damages are not available (i.e. payments for paperwork violations, torn screens or dirty dishes), as they are under the MSPA [Migrant and Seasonal Workers Protection Act]. In essence, they are prohibited from suing a grower on non-economic issues.”
Likelihood of passing
The real question is whether this bill could pass Congress. Rouzer anticipates that comprehensive immigration reform, which will likely include AgJOBS, will be considered by the full Senate sometime before the end of June. If the Senate passes a bill by the end of June, he expects the House to follow suit in July. “[The] AgJOBS bill will probably be the vehicle that will address the issue. There’s no denying in the short term it’ll provide relief to anyone involved in that program,” says Parker. He says that if the AgJOBS bill is to pass, then Congress needs to move quickly because people will soon start paying attention to the presidential campaign.
Rouzer believes that the chances are good for a comprehensive immigration bill to pass the Senate. “Certainly all the pieces are in place to get it enacted this year, and it’s probably the only thing that Congress can agree on.
“The big picture is that AgJOBS has such strong bipartisan support from the majority of agriculture across the country and the worker advocacy groups. The Ted Kennedys and Dianne Feinsteins—the liberals—are on board as well as the Larry Craigs (a conservative from Idaho) and Mel Martinez. The citrus, nursery, fruit and vegetable growers are on board; California is big time in favor of it. There is a very strong coalition of support. The Republicans and Democrats who have been working to put together the comprehensive bill view AgJOBS as the primary engine that will propel it across the finish line.”
Wicker, however, does not believe the bill will pass. “In my opinion, immigration reform is not likely this year. Further, Congress will not pass any piecemeal legislation like AgJOBS for specific industries. Immigration is one of the toughest issues Congress faces, and they will not do it one painful fight at a time. Our industry has one opportunity to get this right. Once the Democrats secure an amnesty for farm workers, growers’ complaints about an un-
workable H-2A program will fall on deaf ears. It will be at least 2028 before we can try again.”
He is encouraging farmers to fight against AgJOBS and for other bills, such as the Saxby Chambliss, that he says offer better H-2A reform. “I tell farmers that they can’t rely on lobbyists to carry their message. They’re going to have to get involved; they need to go to D.C. and make some noise. If they don’t, everything we know about agricultural commodities is going to change.”
Rouzer’s message to farmers is, “They should be in touch with members of Congress. They need to study AgJOBS, take an honest look at it, and see if, in their judgment, it’s better than what they have today. And if it is, then they need to get out and support it. I don’t see how they can’t agree that it’s better than the status quo.”
Parker says the bill may not be ideal, but it may be the most likely to pass Congress. He says this is a similar dynamic to the buyout situation. Growers wanted a higher buyout price but realized that if they didn’t give in, then a buyout would probably never happen. “You’re not going to get a perfect bill at the end of the day,” says Parker. “This is probably indicative of the old notion that nobody’s happy when you pass a bill.”