Temporary Non-Agricultural Employment of H-2B Aliens in the United States

Federal RegisterFeb 21, 2012

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DEPARTMENT OF LABOR

Employment and Training Administration

20 CFR Part 655

Wage and Hour Division

29 CFR Part 503

RIN 1205-AB58

Temporary Non-Agricultural Employment of H-2B Aliens in the United States

AGENCY:

Employment and Training Administration, and Wage and Hour Division, Labor.

ACTION:

Final rule.

SUMMARY:

The Department of Labor (the Department) is amending its regulations governing the certification of the employment of nonimmigrant workers in temporary or seasonal non-agricultural employment and the enforcement of the obligations applicable to employers of such nonimmigrant workers. This Final Rule revises the process by which employers obtain a temporary labor certification from the Department for use in petitioning the Department of Homeland Security (DHS) to employ a nonimmigrant worker in H-2B status. We have also created new regulations to provide for increased worker protections for both United States (U.S.) and foreign workers.

DATES:

This Final Rule is effective April 23, 2012.

FOR FURTHER INFORMATION CONTACT:

For further information on 20 CFR part 655, Subpart A, contact William L. Carlson, Ph.D., Administrator, Office of Foreign Labor Certification, ETA, U.S. Department of Labor, 200 Constitution Avenue NW., Room C-4312, Washington, DC 20210; Telephone (202) 693-3010 (this is not a toll-free number). Individuals with hearing or speech impairments may access the telephone number above via TTY by calling the toll-free Federal Information Relay Service at 1-800-877-8339.

For further information on 29 CFR part 503 contact Mary Ziegler, Director, Division of Regulations, Legislation, and Interpretation, Wage and Hour Division, U.S. Department of Labor, 200 Constitution Avenue NW., Room S-3510, Washington, DC 20210; Telephone (202) 693-0071 (this is not a toll-free number). Individuals with hearing or speech impairments may access the telephone number above via TTY by calling the toll-free Federal Information Relay Service at 1-800-877-8339.

SUPPLEMENTARY INFORMATION:

I. Revisions to 20 CFR part 655 Subpart A

Statutory Standard and Current Department of Labor Regulations

Section 101(a)(15)(H)(ii)(b) of the Immigration and Nationality Act (INA or the Act) defines an H-2B worker as a nonimmigrant admitted to the U.S. on a temporary basis to perform temporary non-agricultural labor or services for which “unemployed persons capable of performing such service or labor cannot be found in this country.” 8 U.S.C. 1101(a)(15)(H)(ii)(b). Section 214(c)(1) of the INA requires DHS to consult with appropriate agencies before approving an H-2B visa petition. 8 U.S.C. 1184(c)(1). The regulations of the U.S. Citizenship and Immigration Services (USCIS), the agency within DHS which adjudicates requests for H-2B status, require that an intending employer first apply for a temporary labor certification from the Secretary of Labor (the Secretary). That certification informs USCIS that U.S. workers capable of performing the services or labor are not available, and that the employment of the foreign worker(s) will not adversely affect the wages and working conditions of similarly employed U.S. workers. 8 CFR 214.2(h)(6). On Guam, H-2B employment requires certification from the Governor of Guam, not the Secretary. 8 CFR 214.2(h)(6)(iii).

Our regulations, at 20 CFR part 655, Subpart A, “Labor Certification Process for Temporary Employment in Occupations other than Agriculture or Registered Nursing in the United States (H-2B Workers),” govern the H-2B labor certification process, as well as the enforcement process to ensure U.S. and H-2B workers are employed in compliance with H-2B labor certification requirements. Applications for labor certification are processed by the Office of Foreign Labor Certification (OFLC) in the Employment and Training Administration (ETA), the agency to which the Secretary has delegated her responsibilities as described in the USCIS H-2B regulations. Enforcement of the attestations made by employers in the course of submission of H-2B applications for labor certification is conducted by the Wage and Hour Division (WHD) within the Department, to which DHS on January 16, 2009 delegated enforcement authority granted to it by the INA. 8 U.S.C. 1184(c)(14)(B).

Under the 2008 H-2B regulations published at 73 FR 29942, May 22, 2008 (the 2008 Final Rule), an employer seeking to fill job opportunities through the H-2B program must demonstrate that it has a temporary need for the services or labor, as defined by one of four regulatory standards: (1) A one-time occurrence; (2) a seasonal need; (3) a peakload need; or (4) an intermittent need. 8 CFR 214.2(h)(6)(ii)(B). Generally, that period of time will be limited to 1 year or less, except in the case of a one-time occurrence, which could last up to 3 years, consistent with the standard under DHS regulations at 8 CFR 214.2(h)(6) as well as current Department regulations at § 655.6(b).

The 2008 Final Rule also employed an attestation-based filing model, in which the employer conducted its recruitment with no direct Federal or State oversight. Lastly, the 2008 Final Rule provided WHD's enforcement authority under which WHD could impose civil money penalties and other remedies.

On August 30, 2010, the U.S. District Court for the Eastern District of Pennsylvania in

Comité de Apoyo a los Trabajadores Agricolas (CATA)

Solis,

Civil No. 2:09-cv-240-LP, 2010 WL 3431761 (E.D. Pa. Aug. 30, 2010), invalidated various provisions of the 2008 Final Rule and remanded the rule to the Department to correct its errors. In the Notice of Proposed Rulemaking (NPRM) published March 18, 2011 (76 FR 15130), we proposed to amend the particular provisions that were invalidated by the Court, including specifying when H-2B employers must contact unions as a potential source of labor at § 655.44 and providing a new definition of full-time and a slightly modified definition of job contractor in § 655.5 and 29 CFR 503.4.

B. The Need for Rulemaking

The Department determined for a variety of reasons that a new rulemaking effort is necessary for the H-2B program. These policy-related reasons, which were discussed at length in the NPRM, include expansion of opportunities for U.S. workers, evidence of violations of program requirements, some rising to a criminal level, need for better worker protections, and a lack of understanding of program obligations. We accordingly proposed to revert to the compliance-based certification model that had been used from the inception of the program until the 2008 Final Rule. We also proposed to add new recruitment and other requirements to broaden the dissemination of job offer information, such as introducing the electronic job registry and requiring the job offer to remain open to U.S. workers for a longer period and closer to the date of need. We stated that these changes were necessary to ensure that there was

an adequate test of the U.S. labor market to determine whether U.S. workers are available for the jobs. Further, we proposed additional worker protections, such as increasing the number of hours per week required for full-time employment and requiring that U.S. workers in corresponding employment who perform the same jobs at the same place as the H-2B workers receive the same wages and benefits as the H-2B workers. We discussed how increased worker protections were necessary to ensure that the employment of H-2B workers does not adversely affect the wages and working conditions of U.S. workers.

Summing the present value of the costs associated with this rulemaking in Years 1-10 results in total discounted costs over 10 years of $10.3 million to $12.8 million (with 7 percent and 3 percent discounting, respectively).

Table 1—Summary of Costs and Transfers

[Millions of dollars]

Cost component

Transfers and costs by year

(millions of dollars)

Year 1 costs

Year 2-10 costs

Year 1-10 costs

Undiscounted:

Total Costs and Transfers—Low

$96.34

$94.73

$948.91

Total Costs and Transfers—High

131.38

129.76

1,299.26

Total Transfers—Low

93.37

933.71

Total Transfers—High

128.41

1,284.06

Total Costs to Employers

2.83

1.31

14.64

Total Costs to Government

0.14

0.05

0.56

Present Value—7% Real Interest Rate:

Total Costs & Transfers—Low

623.22

Total Costs & Transfers—High

853.20

Total Transfers—Low

612.89

Total Transfers—High

842.87

Total Costs

10.33

Present Value—3% Real Interest Rate:

Total Costs & Transfers—Low

786.05

Total Costs & Transfers—High

1,076.20

Total Transfers—Low

773.27

Total Transfers—High

1,063.42

Total Costs

12.78

Note:

Totals may not sum due to rounding.

Table 2—Summary of Estimated Cost by Provision

[Millions of dollars]

Cost component

Provision costs by year

(in millions of dollars)

Year 1 costs

Year 2-10 costs

Year 1-10 costs

Transfers:

Corresponding Workers' Wages—Low

$17.52

$175.18

Corresponding Workers' Wages—High

52.55

525.53

Transportation

61.33

613.28

Subsistence

2.81

28.09

Lodging

1.58

15.83

Visa and Border Crossing Fees

10.13

101.33

Total Transfers—Low

93.37

933.71

Total Transfers—High

128.41

1,284.06

Costs to Employers:

Read and Understand Rule

1.20

Document Retention

0.32

Additional Recruiting

1.04

10.36

Disclosure of Job Order

0.26

2.63

Other Provisions

0.014

0.14

Total Costs to Employers

2.83

1.31

14.65

Costs to Government:

Electronic Job Registry

0.14

0.05

0.56

Enhanced U.S. Worker Referral Period

Not

Total First Year Costs to Government

0.14

0.05

0.56

Total Costs & Transfers:

Total Costs & Transfers—Low

96.34

94.73

948.91

Total Costs & Transfers—High

131.38

129.76

1,299.26

Total Transfers—Low

93.37

933.71

Total Transfers—High

128.41

1,284.06

Total Costs

2.97

1.36

15.20

Note:

Totals may not sum due to rounding.

Includes the sum of: Elimination of Attestation-Based Model; Post Job Opportunity; Workers Rights Poster.

C. Overview of the Comments Received

We received 869 comments on the proposed rule. We have determined that 457 were completely unique including 8 representative form letters, 4 were duplicates, 407 were considered a form letter or based on a form letter, and 1 comment was withdrawn at the request of the commenter. Those comments that were received by means not listed in the proposed rule or that we received after the comment period closed were not considered in this Final Rule.

Commenters represented a broad range of constituencies for the H-2B program, including small business employers, U.S. and H-2B workers, worker advocacy groups, State Workforce Agencies (SWAs), agents, law firms, employer and industry advocacy groups, union organizations, members of the U.S. Congress, and various interested members of the public. We received comments both in support of and in opposition to the proposed regulation, which are discussed in greater detail below.

One commenter contended that we dismiss comments simply because they are similar in nature. This statement is incorrect. We read and analyzed all comments that we received within the comment period. For purposes of posting comments for the public to view, we posted all comments we deemed unique with at least one copy of a form letter so that there is an opportunity to see the concerns being addressed. All form letters are considered in the final count of comments received and we address them as required by the Administrative Procedure Act (APA) in this Final Rule. Another commenter argued that we did not allow enough time to comment on the proposed rulemaking. We disagree and believe that 60 days was enough time for the public to comment on the rulemaking. We note that the APA does not provide a specific time period during which agencies must accept public comments in response to proposed rules, see 5 U.S.C. 553, but the 60-day comment period that we provided during this rulemaking is consistent with the directive of Executive Order 13563, see Improving Regulation and Regulatory Review, 76 FR 3821-22 (Jan. 21, 2011). Moreover, in light of the Court's ruling in the

CATA

case invalidating some of the current regulations, we believe it was necessary to proceed as expeditiously as reasonable through the rulemaking process.

There were several issues which we deemed to be beyond the scope of the proposed rule. Some of these issues included general disapproval of any foreigners being allowed to work in the U.S., elimination of temporary foreign worker programs, activities and rules related to the H-2A program, and general foreign relations and immigration reform issues (including increasing or decreasing the number of available visas). Also beyond the scope of this rulemaking were the collective bargaining rights of H-2B workers, the wage methodology promulgated by the Wage Methodology for the Temporary Non-agricultural Employment H-2B Program, 76 FR 3452, Jan. 19, 2011 and the portability of visas.

Lastly, we received a large number of comments from the ski industry requesting an exemption from the regulations. Many of the commenters believed that because ski instructors require skills or experience, under the new rules they would be ineligible for the H-2B program. Generally, job positions certified under the H-2B program are low skilled, requiring little to no experience. We do recognize, however, that there are some occupations and categories under the H-2B program that may require experience and/or training. Employer applicants demonstrating a true need for a level of experience, training or certification in their application have never been prohibited in the H-2B program, given the breadth of the definition of H-2B under the INA. See 8 U.S.C. 1101(a)(15)(H)(ii)(b). We have determined that an exemption for the ski industry is not appropriate as the commenters presented no valid argument as to why exemption is necessary. There is nothing about the workers they seek to hire that prevents them from participating in the H-2B program. Ski resorts are fixed-site locations that run on a seasonal basis with standard operating procedures. We do not see a reason, nor was one presented, that prevents a ski resort from meeting all the recruitment requirements.

D. Elimination of the Attestation-Based Model

One of the overarching changes we made in the proposed rule was the elimination of the attestation-based model adopted in the 2008 Final Rule. We received comments supporting the elimination of the attestation-based model as well as opposing that change. Generally, commenters who supported our decision to revert to a compliance-based model focused on the Department's desire to reduce the susceptibility of the H-2B program to fraud and abuse. Several commenters expressed concern about the rise of criminal and civil prosecutions which they felt demonstrate abuse in the H-2 program. Most of the commenters cited our audit experience, as discussed in the NPRM, and agreed that this data alone should foreclose any debate on the necessity of ending the attestation-based model. One commenter specifically pointed out that changes in the 2008 Final Rule made it easier for unscrupulous employers and their agents to use H-2B visas for the illicit purpose of suppressing wages. This same commenter suggested that a return to a compliance-based model brings us back to the proper focus of administering the H-2B program in a manner that fairly balances the protection of workers with the desires of employers. Another commenter pointed out that the OFLC's experience of 2 years under the attestation-based model

is sufficient to demonstrate that the model cannot be retained without doing serious damage to the employment prospects and wages and working conditions of U.S. workers. Similarly, an advocacy group stated that many aspects of the attestation-based model deprive domestic workers of employment opportunities, adversely affect their wages and working conditions, and encourage, rather than curb, the well-documented fraud in the H-2B program.

Generally, commenters who advocated the retention of an attestation-based model encouraged us to use our current resources and enforcement authority to crack down on bad actors, rather than overhaul the program. A few commenters stated that we did not give the 2008 Final Rule and the attestation-based model sufficient time to be successful. Contrary to the comments supportive of a change, these commenters argued that our audit of a random sample of cases is misleading given that the NPRM does not disclose the number of cases audited and the details about the audit process and that all violations appear to be counted with equal weight. Another commenter believed that reverting to the compliance-based model would create extensive processing delays.

We disagree with the commenters who asserted that increased enforcement authority is the answer to resolving concerns about the attestation-based model. Our enforcement authority is a separate regulatory component, regardless of the certification model we use. Our experience, as presented in the NPRM, indicates that despite the fact that the 2008 Final Rule contained elevated penalties for non-compliance with the program provisions, the results of the audited cases demonstrate that an attestation-based process does not provide an adequate level of protection for either U.S. or foreign workers.

Commenters who assert we did not give the 2008 Final Rule and its attestation-based model a chance to be successful undervalue the experience we have had over the last 2 years with the program. In making our decision to depart from the attestation-based model, we took into account not only the audits we conducted as described in the NPRM, but also the various comments and concerns raised by employers, advocates, and workers about compliance with the program. The attestation-based model of the 2008 Final Rule is highly vulnerable to fraud. Under that model, only after an employer has been certified and the foreign workers have come to the U.S. and begun working for the employer, is there a probability that the employer's non-compliance will be discovered or that the foreign worker(s) will report a violation. Only if an employer is audited or investigated will we learn of any non-compliance, even minor violations of program obligations, since the attestation-based model relies on the employer's attestations.

Consistent with our concerns about the attestation-based model, the Department's Office of Inspector General (OIG) issued an audit report on October 17, 2011 in which OIG identified the attestation-based model as a weakness in the H-2B program

. OIG found that the existing attestation-based application process did not allow for meaningful validation before application approval and hampered the Department's ability to provide adequate protections for U.S. workers in the H-2B applications OIG reviewed. OIG noted that the Department's proposed transition to a model requiring pre-approval review of compliance through documentation, as adopted in this Final Rule, would strengthen the program.

Program Design Issues Hampered ETA's Ability to Ensure the H-2B Visa Program Provided Adequate Protections for U.S. Forestry Workers in Oregon,

Office of the Inspector General of the U.S. Department of Labor, Report No. 17-12-001-03-321, Oct. 17, 2011.

http://www.oig.dol.gov/public/reports/oa/2012/17-12-001-03-321.pdf.

As to commenter concerns about the audit sample discussed in the NPRM, we reiterate that we conducted two rounds of audits of a random sample of cases, both of which resulted in an indication that many of the employers were not in compliance with the attestations they agreed to. These audits we reviewed were a random sample. Employers were not selected based on specific industries or occupations, nor were they selected based on compliance with specific provisions. The indication of employer non-compliance from those audits is not acceptable by our standards. Additionally, contrary to the commenter's claim that all violations were given equal weight, regardless of the type of violations or their consequences, our concern is that these audits evidenced a pattern of non-compliance with program obligations toward workers, regardless of the degree of such non-compliance. Moreover, the results of these audits showed the existence of deficiencies in the applications that would have warranted further action, the least of which would have included issuing a Notice of Deficiency, and affording the employer the opportunity to correct the deficiencies, before adjudicating the application. Again, under the attestation-based program model, we are not aware of the non-compliance before certification.

Furthermore, despite the fact that H-2B cases continue to be processed under the 2008 Final Rule, which some commenters said implemented an ideal balance between the attestation-based model and stronger enforcement authority, we still see evidence in the H-2B program of a rising number of criminal violations. In addition to the specific cases cited in the NPRM, there has been more recent evidence of employers and agents filing fraudulent applications involving thousands of requested employees for non-existent job opportunities. For example, according to the OIG's “Semiannual Report to Congress” (October 2010 until March 2011),

OIG investigations found that emerging organized criminal groups are using the Department's foreign labor certification processes in illegal schemes, and in so doing are committing crimes that negatively impact workers. The report further lists at least 4 examples of fraud committed by employers or their attorneys/agents in the H-2B program.

Semiannual Report to Congress,

Office of the Inspector General of the U.S. Department of Labor, Volume 65 (October 1, 2010 to March 31, 2011);

http://www.oig.dol.gov/public/semiannuals/65.pdf http://www.oig.dol.gov/public/semiannuals/65.pdf.

Lastly, while some commenters were concerned about the processing delays that may result from reverting to a compliance-based certification model, our focus in administering the H-2B program is to provide employers with a viable workforce while protecting U.S. and foreign workers. We will, however, continue to endeavor to process applications as efficiently and quickly as possible and in accordance with the timeframes set forth in the application processing provisions of this Final Rule.

In the NPRM, we solicited comments on maintaining the 2008 Final Rule or some modification of the attestation-based program design. While we have chosen to adopt the certification-based model described in the NPRM, we discuss below the responses to the specific questions presented in the NPRM:

1. What kind of specific guidance could the Department provide that would benefit a first-time (or sporadic) employer in the H-2B program to avoid mistakes in making attestations of compliance with program obligations?

We received several comments directly addressing this question, one of which asserted that the attestation-based model was straightforward and that non-compliance is attributable to a

willful choice made by the employer or its attorney/agent. Another comment, submitted by several employer advocacy groups, encouraged us to establish additional ongoing education programs throughout the U.S. and to provide a hotline to answer questions about basic programmatic issues. The comment suggested the hotline be supplemented by the Certifying Officer (CO) notifying employers of any technical issues while the

Application for Temporary Employment Certification

is pending. An employer also expressed frustration with its inability to communicate directly with us to seek immediate guidance on program processes and policies.

While we have established an email box (

tlc.chicago@dol.gov

) to which employers can submit questions about their applications, we continue to rely on those questions to easily identify recurring issues for which we may need to issue a Frequently Asked Question (FAQ) and/or guidance or provide additional training to staff. We also anticipate stakeholder educational efforts to help familiarize program users and others with the regulatory requirements and changes in the H-2B program. Where feasible and necessary, we will provide additional educational outreach through briefings and other types of guidance documents for the benefit of all employers.

2. What kind of guidance would benefit frequent users of the program with respect to repetitive errors in recruitment? What kind of guidance would be beneficial in avoiding errors in unique situations for these users?

One commenter suggested that we implement a three-strike policy to eliminate willful violators from the H-2B program. Another commenter, including several employer advocacy groups, encouraged us to establish additional ongoing education programs throughout the U.S. and suggested that employers document their attendance, which we should consider in mitigation of employer error in the application process. The commenter also recommended that we provide a hotline to answer questions about basic programmatic issues and publish at appropriate intervals a top 10 errors and issues list and a public notice on the OFLC's Web site indicating where the CO identifies a trend.

We believe that debarment and other program integrity measures are sufficient to eliminate willful violators from the H-2B program, and therefore, do not consider a three strike policy to be necessary. As to the request for a hotline, as stated above, we have established an email box to which employers can submit questions about the status of their applications; we believe this will be more accurate than a telephone line for receiving information and questions that can then be translated into public guidance as appropriate. We rely on such emailed questions and information to identify recurring issues for which we may need to publish an FAQ and/or guidance. We also draft FAQs and other guidance documentation at the recommendation of the COs, based on recurring trends and/or issues identified by them. In an effort to better provide information to the employer community, we will consider publishing guidance responsive to specific issues, such as a way to avoid common filing mistakes, once those have been determined under the re-engineered model. Lastly, we also plan to implement rollout activities and briefings to help familiarize program users and others with the regulatory requirements and changes in the H-2B program. Where we determine that more guidance is needed, we will provide additional educational outreach to the filing community and other interested parties.

3. Could pre-certification audits augment a post-certification audit in an attestation-based program model? If not, how would you propose the Department obtain information in the absence of supervised activity in order to arrive at certification while ensuring compliance with program obligations?

Several commenters stated that they would be supportive of more post-certification audits as long as we retain the attestation-based certification model. In asking this question, we were trying to gauge whether a pre-certification audit process would be a viable way to alleviate the obvious compliance problems that occur under the attestation-based certification model. One commenter believed that by adding a pre-certification audit process, we would only be contributing to the existing burden on the H-2B worker to report non-compliance without actually removing those employer applicants that continue to do poorly. Another commenter stated that a pre-certification audit process would imply that a review of the documentation will ensure compliance with program requirements. This same commenter believed that a pre-certification review cannot ensure that proper wages will be paid or that U.S. referrals will be properly considered for a job. The commenter also affirmed that the current enforcement scheme provides significant incentive for program users to comply based on audits after an attestation has been made. Lastly, one commenter claimed that asking a hypothetical question about possible changes in the program structure, such as pre-certification audits, without actually proposing language or procedures does not qualify as appropriate notice and would require us to issue a new NPRM.

As discussed above, we sought comments about possible alternatives related to retaining the attestation-based certification model. Based on the comments on the retention of the attestation-based certification model and pre-certification audits, we have decided not to retain the attestation-based model. Therefore, we no longer consider the pre-certification audit process alternative, which was tied to the concept of the attestation-based model, to be an option.

4. What additional sanctions could be taken against employers to ensure compliance with program requirements, given the potential for fraud in the H-2B program?

We received several comments on sanctions. We discuss issues involving sanctions in the preamble discussions of 29 CFR part 503 and §§ 655.72 and 655.73.

5. What other kinds of actions could the Department take to prevent an H-2B employer from filing attestations that do not meet program requirements?

We did not receive specific alternatives in answer to this question. Any other incidental alternatives received that relate to specific sections of the Final Rule have been discussed under the appropriate related provisions.

For the reasons discussed above, we are reverting to a compliance-based model under the H-2B program as proposed.

II. Discussion of Comments Received

A. Introductory Sections

We address below those areas in which we received comments. For specific provisions on which we did not receive comments, we have retained the provisions as proposed, except where clarifying edits have been made.

1. § 655.1 Scope and Purpose of Subpart A

The proposed provision informs program users of the statutory basis and regulatory authority for the H-2B labor certification process. This provision also describes our role in receiving, reviewing, adjudicating, and preserving the integrity of an

Application for

Temporary Employment Certification.

We are adopting the provision as proposed. We received several general comments relating to this section. One commenter stated that the scope and purpose was to pay the highest of all the prevailing wages and to make sure that H-2B workers are offered the same protections under the law as any other worker. Another commenter stated that the original scope and purpose was to find temporary workers or certify applications for foreign workers. These comments misunderstand our responsibility and the criteria that must be met before we certify an H-2B

Application for Temporary Employment Certification.

Under DHS' regulations at 8 CFR 214.2(h)(6)(iv), the purpose of these regulations is for the Secretary of Labor to determine that: (1) There are not sufficient U.S. workers who are qualified and who will be available to perform the temporary services or labor for which an employer desires to import foreign workers; and (2) the employment of the H-2B worker(s) will not adversely affect the wages and working conditions of U.S. workers similarly employed. It is through the regulatory provisions set forth below that the Department ensures that that the criteria for its labor certification determinations are met.

2. § 655.2 Authority of Agencies, Offices and Divisions in the Department of Labor

This section describes the authority and division of activities related to the H-2B program among the Department's agencies. The NPRM discussed the authority of OFLC, the office within ETA that exercises the Secretary's responsibility for determining the availability of U.S. workers and whether the employment of H-2B nonimmigrant workers will adversely affect the wages and working conditions of similarly employed workers. It also discussed the authority of WHD, the agency responsible for investigation and enforcement of the terms and conditions of H-2B labor certifications, as delegated by DHS. We are retaining this provision as proposed.

We received several comments from employer advocacy organizations on our authority to administer the H-2B labor certification program. These commenters alleged that Congress has not vested authority in the Department and that the statutory provision mandating consultation with other agencies does not necessarily give us the right to effectuate the requirements proposed under these regulations. We address this general assertion below; however, our authority for specific provisions of this Final Rule is addressed in the discussions of the sections containing those provisions.

Under the INA, Congress did not specifically address the issue of the Department's authority to engage in legislative rulemaking in the H-2B program but the legislative history of the Immigration Reform and Control Act (IRCA) specifically acknowledges the Department's practice

of issuing legislative rules,

see

H.R. Rep. No. 99-682, pt. 1, at 79-80, 1986 WL 31950, at **34. Since 1968, DOL has had regulations governing the H-2 non-agricultural program,

see

33 FR at 7570-71, and in enacting IRCA in 1986, Congress acknowledged DOL's rulemaking without withdrawing its authority to issue legislative rules,

see

H.R. Rep. No. 99-682, pt. 1, at 80. Ordinarily, when Congress adopts a new law incorporating sections of a prior law it is presumed to be aware of existing administrative regulations interpreting the prior law.

See Lorillard

Pons,

434 U.S. 575, 580-81 (1978). Moreover, when Congress re-enacts a statutory provision, an agency's prior long-standing administrative practice under that statutory provision is deemed to have received congressional approval.

Fribourg Nav. Co.

CIR,

383 U.S. 272, 283 (1966). In this case, Congress did more than re-enact the H-2 non-agricultural statutory provision, it expressly acknowledged DOL's rules governing the H-2 program.

See

H.R. Rep. No. 99-682, pt. 1, at 80. Thus, Congress approved of DOL's rulemaking authority in the H-2B program, and saw fit not to alter or further define DOL's practices, unlike the H-2A agricultural program.

Id.

Even if the legislative history does not resolve the issue of DOL's rulemaking authority, when the statute does not delegate rulemaking authority explicitly, such statutory ambiguities are implicit delegations to the agency administering the statute to interpret the statute through its rulemaking authority.

Arnett

CIR,

473 F.3d 790, 792 (7th Cir. 2007).

Congress expected DOL to ensure that employers using the H-2B program would not adversely affect similarly situated United States workers.

See

8 U.S.C. 1101(a)(15)(H)(ii)(b); H.R. Rep. No. 99-682, pt. 1, at 80. This involves policy-type determinations beyond disputed facts in a particular case,

see U.S.

Fla. E. Coast Ry.,

410 U.S. 224, 245-46 (1973), which renders DOL's use of legislative rulemaking more appropriate in the administration of the H-2B program than case-by-case adjudication,

see Ford Motor Co.

FTC,

673 F.2d 1008, 1009-10 (9th Cir. 1982). Given the type of global considerations confronting DOL in administering the program, it would defeat Congress's goals to conclude that DOL is only authorized to engage in case-by-case adjudication.

See USV Pharm. Corp.

Weinberger,

412 U.S. 655, 665 (1973). DOL's use of legislative rulemaking also comports with the judicial preference for filling in the interstices of the law through a quasi-legislative enactment of rules of general applicability.

See SEC

Chenery Corp.,

332 U.S. 194, 202 (1947). Courts encourage agencies to adopt legislative rules when seeking to establish norms of widespread application.

See Ford Motor Co.,

673 F.2d at 1009. Notice and comment rulemaking provides important procedural protections to the public, allows agencies to apprise themselves of relevant issues and views, and promotes predictability.

See Int'l Union

MSHA,

626 F.3d 84, 95 (DC Cir. 2010). Without the use of this process, the public would be deprived of important protections that are unavailable in case-by-case adjudication.

Nat'l Petroleum Ref. Ass'n

FTC,

482 F.2d 672, 683-84 (1973).

In recent decisions, the Supreme Court has affirmed this approach by applying

Chevron

deference to an agency's construction of a jurisdictional provision in its organic statute.

See Coeur Alaska

Southeast Alaska Conserv. Council,

129 S. Ct. 2458, 2469 (2009);

United States

Eurodif,

129 S. Ct. 878, 888 (2009).

Importantly, the

CATA

decision recently held that the Department is not permitted to adopt an H-2B prevailing wage regime without engaging in legislative rulemaking.

See CATA I,

2010 WL 3431761, at *19 (E.D. Pa. Aug.30,2010). That decision specifically invalidated the Department's attempt to use guidance documents to announce the applicable prevailing wage methodology for H-2B employers, holding that doing so deprives the public of the opportunity to comment on important issues for the administration of the H-2B program.

Id.

Given the CATA decision's holding that the Department cannot use guidance documents to establish prevailing wage rates, without any legislative rulemaking authority, the Department would lack the authority to administer the H-2B program in a fair and predictable manner. Lastly, given Congress' delegation of enforcement authority under 8 U.S.C. 1184(c)(14)(B) to USCIS and the Department, it would be irrational to assume that Congress didn't intend for the Department to issue rules to define the terms of the H-2B program in the absence of statutory standards.

Cf.

Nat'l Ass'n of

Home Bds.

OSHA,

602 F.3d 464, 467 (DC Cir. 2010).

3. § 655.3 Territory of Guam

As in the 2008 Final Rule, under the proposed rule, the granting of H-2B labor certifications and the enforcement of the H-2B visa program on Guam continue to reside with the Governor of Guam, under DHS regulations. However, the NPRM proposed that we would determine all H-2B prevailing wages, including those for Guam. Recently, DHS, which consults with the Governor of Guam about the admission of H-2B construction workers on Guam, has determined that prevailing wages for construction workers on Guam will be determined by the Secretary. 8 CFR 214.2(h)(6)(v)(E)(v). DHS and the Department agree that it is more appropriate for OFLC to issue H-2B prevailing wages for all workers, including construction workers on Guam, because OFLC already provides prevailing wage determinations (PWDs) for all other U.S. jurisdictions. We therefore proposed that the process for obtaining a prevailing wage in § 655.10 also would apply to H-2B job opportunities on Guam. Employment opportunities on Guam accordingly would be subject to the same process and methodology for calculating prevailing wages as any other jurisdiction within OFLC's purview. We received no comments on this section and therefore are retaining the provision as proposed.

4. § 655.4 Special Procedures

The proposed rule maintained our authority to establish, continue, revise, or revoke special procedures that establish variations for processing certain H-2B

Applications for Temporary Employment Certification.

These are situations where we recognize that variations from the normal H-2B labor certification processes are necessary to permit the temporary employment of foreign workers in specific industries or occupations when U.S. workers are not available and the employment of foreign workers will not adversely affect the wages or working conditions of similarly employed U.S. workers. These variations permit those who would otherwise be unable to readily comply with the program's established processes to participate, such as by allowing itinerary employment for reforestation employers and certain employers in the entertainment industry. These special procedures permit us to accommodate the unique circumstances of certain classes of employers without undermining our essential responsibilities. We are retaining the proposed section with one minor clarification reminding the employer that it must request special procedures.

We also proposed that special procedures already in place on the effective date of the regulations will remain in force until we otherwise modify or withdraw them. A couple of commenters objected to the continuance of current special procedures because they had not participated in the process. We see no need to upset the settled expectations of the employers who have relied upon the special procedures for many years at least to the extent they do not conflict with these regulations. To the extent that the current special procedures are in conflict with these regulations, the regulations will take precedence. An example of a possible conflict would be the current special procedure provision which allows pre-certification to Canadian musicians who enter the U.S. to perform within a 50-mile area adjacent to the Canadian border for a period of 30 days or less. TEGL 31-05 Procedures for Temporary Labor Certification in the Entertainment Industry under the H-2B Visa program, May 31, 2006, available at

http://wdr.doleta.gov/directives/attach/TEGL/TEGL 31-05.pdf.

Since the Final Rule does not provide for pre-certification for any occupations, such exemption would no longer be allowed.

A few commenters requested that we revise the proposed language under this section from “the Administrator, OFLC may consult with affected employers and worker representatives” to “the Administrator, OFLC must consult with affected employers and worker representatives.” In addition, some commenters, including labor organizations and employees in the reforestation industry, recommended that we should present special procedures through a notice and comment period similar to an NPRM. Finally, a couple of commenters felt that the special procedures process violates the APA.

We decline to make the changes proposed by the commenters. We have complied with the procedural requirements of the APA by proposing this provision and soliciting public comments. See 5 U.S.C. 553. The purpose of the special procedures is to allow a particular group of employers with a need for H-2B workers to participate in the program by waiving certain regulatory provisions when the provisions cannot be reconciled with the operational norms of the industry and when the employers comply with industry-specific alternative procedures. Although we are not required to provide procedures for requesting a waiver, see

FCC

WNCN Listeners Guild,

450 U.S. 582, 601 (1981), the Department is committed to ensuring that the views of affected employers and worker representatives are considered. The process under which a special procedure is considered is in most cases initiated by an industry or group of employers presenting us evidence that demonstrates their occupations are unique and that application of certain provisions in the regulations cannot be reconciled with the operational norms of the industry. Before effectuating such procedures, we will consult with other employer and worker representatives as well as agencies within and outside the Department, as appropriate, to identify necessary revisions which will, at the same time, keep the integrity and principal concepts of the program intact. We also will continue to look to our program experts in OFLC and WHD and review industry data gathered from employers that have previously used the H-2B program. Additionally, while special procedures allow for necessary and specific variations to regulations, we expect employers to adhere to all other aspects of the regulations not addressed in the special procedures. The application of a special procedure by an employer or an industry in no way relieves an employer from its obligation to obtain an approved temporary labor certification from the Department before submitting a request for workers to USCIS.

5. § 655.5 Definition of Terms

a. Area of substantial unemployment. We proposed to add a definition of area of substantial unemployment to the H-2B program. The proposed definition reflected the established definition of area of substantial unemployment in use within ETA as it relates to Workforce Investment Act (WIA) fund allocations. We have retained the proposed definition of area of substantial unemployment without change.

Some commenters suggested alternative methods of defining an area of substantial unemployment. Several commenters contended that a different threshold percentage than 6.5 percent (

e.g.,

8 percent or 9 percent, the current national unemployment rate) or a different time period than 12 months (

e.g.,

3 months or the period of need requested) should be used to identify an area of substantial unemployment. One labor organization proposed more than a definitional alternative, suggesting that employers in areas with 5 percent or higher unemployment should be subject to an automatic legal presumption that there is no labor

shortage sufficient to support an H-2B application and that those employers' applications should be given a strict, high level review, including review by a senior official in Washington, DC.

The definition proposed in the NPRM and retained in the Final Rule is the existing definition of area of substantial unemployment within ETA. ETA uses this definition to identify areas with concentrated unemployment and focus WIA funding for services to facilitate employment in those areas. We proposed using this existing definition, and have chosen to retain it in the Final Rule, both as a way to improve labor market test quality and for the sake of operational simplicity. This existing definition provides the appropriate standard for identifying areas of concentrated unemployment where additional recruitment could result in U.S. worker employment. Also, the process of collecting data and designating an area of substantial unemployment using the existing definition is already established, as discussed in ETA's Training and Employment Guidance Letter No. 5-11, Aug. 12, 2011,

providing OFLC with a ready resource for identifying areas to focus additional recruitment. Finally, using this definition of area of substantial unemployment in the Final Rule enables an employer to check the list of areas of substantial unemployment ETA publishes to determine whether its job opportunity may fall within an area of substantial unemployment and, as appropriate, be subject to enhanced recruitment.

TEGL 5-11—Designation of Areas of Substantial Unemployment (ASUs) under the Workforce Investment Act (WIA) for Program Year (PY) 2012 has been added to the ETA Advisory Web site and is available at

http://wdr.doleta.gov/directives/corr_doc.cfm?DOCN=3069.

Adopting a legal presumption of the availability of domestic workers in areas with 5 percent or higher unemployment would significantly impact employers' access to the H-2B program and could not be viewed as a logical outgrowth of the proposal. Furthermore, while we appreciate the commenter's concern, we disagree with the approach suggested. We thoroughly review all applications submitted for all areas of intended employment. We consider enhanced recruitment requirements, as proposed in the NPRM, to be the most appropriate way to handle job opportunities in areas of substantial unemployment. Accordingly, we will retain the provision as proposed in the Final Rule.

b. Corresponding employment. The NPRM proposed to include a definition of corresponding employment and to require that employers provide to workers engaged in corresponding employment at least the same protections and benefits as those provided to H-2B workers (except for border crossing and visa fees which would not be applicable). The NPRM defined corresponding employment as the employment of workers who are not H-2B workers by an employer that has an accepted H-2B application in any work included in the job order (

i.e.,

the certified job duties in places of employment or worksite locations specified by the employer) or in any work performed by the H-2B workers during the period of the job order (anywhere the H-2B employer places H-2B workers outside the scope of the labor certification), including any approved extension.

For the reasons discussed below, the Final Rule modifies the corresponding employment definition by deleting the word “any” from before the word “work” in two places and inserting the words “doing substantially the same” instead. The preamble also clarifies and provides examples of what is and is not covered. The Final Rule also excludes from the definition of corresponding employment two categories of incumbent employees: (1) Those employees who have been continuously employed by the H-2B employer in the relevant occupation for at least the prior 52 weeks, who have worked or been paid for at least 35 hours in at least 48 of the prior 52 workweeks, and have averaged at least 35 hours of work or pay over the prior 52 workweeks, and whose terms and conditions of employment are not substantially reduced during the period of the job order. In determining whether the standard is met, the employer may take credit for any hours that were reduced because the employee voluntarily chose not to work due to personal reasons such as illness or vacation; and (2) those employees who are covered by a collective bargaining agreement or individual employment contract that guarantees an offer of at least 35 hours of work each week and continued employment with the H-2B employer through at least the period of the job order, except that the employee may be dismissed for cause.

Significantly, the Final Rule retains in the definition the requirement that “to qualify as corresponding employment, the work must be performed during the period of the job order, including any approved extension thereof.” Any work performed by U.S. workers outside the specific period of the job order does not qualify as corresponding employment. Accordingly, the Final Rule does not require employers to offer their U.S. workers (part-time or full-time workers) corresponding employment protections outside of the period of the job order. If, for example, a U.S. worker works year-round and is in corresponding employment with the H-2B workers during the period of the job order, the employer must provide corresponding employment protections during the time period of the job order but may choose

not to do so

during the time period outside of the job order.

There were many comments related to the proposed protections for workers in corresponding employment. Employee advocates, unions, and a member of Congress strongly endorsed the proposed provision, stating that it was essential to ensuring that the employment of H-2B workers does not adversely affect the wages, benefits, and working conditions of similarly employed domestic workers. They emphasized that it is important for corresponding workers to receive not just the prevailing wage, but all the other assurances and benefits offered to H-2B workers, such as transportation, the three-fourths guarantee, and full-time employment, in order to place U.S. workers on at least the same footing as foreign workers. These commenters noted that the principle that there should be no preference for foreign workers is fundamental to the INA, and that a corresponding employment requirement prohibits employer practices that would hurt the employment prospects of U.S. workers. They also emphasized that the proposed rule's assurance of equal protection was a significant improvement for domestic workers who have, in the past, been bypassed in favor of foreign workers. Thus, they stated that this protection is necessary to provide a meaningful test of whether there are U.S. workers available for employment. The employee advocates also stated that the proposed definition's broadening of the requirement to protect incumbent employees, rather than just those newly hired in response to the H-2B recruitment, is important because many employers employ some U.S. workers on a year-round basis, and they should not be employed alongside H-2B workers who receive greater pay, benefits, and protections. Similarly, an employee advocate specifically commended the proposed rule's coverage of situations where employers place H-2B workers in occupations and/or job sites outside the scope of the labor certification, which the commenter stated happens regularly. Thus, it asserted that protecting U.S. workers (including incumbent workers)

who are performing the same work as the H-2B workers is necessary to ensure that U.S. workers are not adversely affected by the presence of H-2B workers in the labor market. Finally, one union stated that this additional protection for U.S. workers would also protect H-2B workers, because U.S. workers would be empowered to assist in policing unscrupulous H-2B employers.

Employers, on the other hand, generally opposed the extension of protections to workers in corresponding employment. Some stated that they could not afford to provide the same terms and conditions of employment to corresponding workers, including paying the prevailing wage and guaranteeing three-fourths of the hours. For example, a golf course association stated that it would be financially impossible to provide the same wages and benefits to summer high school and college laborers as it provided to H-2B workers performing the same manual labor. Others stated that paying the prevailing wage to corresponding workers would not be problematic, but that they wanted to be able to continue to reward long-tenured employees (foreign or U.S.) or more skilled staff with higher pay than new workers, such as by providing a pay increase based upon years of service.

It appeared there was confusion about the impact of the corresponding employment requirement. Employers expressed concern because they have overlap in the job duties of various positions, with supervisors performing some of the same tasks as the workers they supervise. They believed that, if there is some slight nexus between what an H-2B workers does and what a higher-paid year-round worker does, the employer would have to pay all workers the higher wage. They stated that this requirement would compel changes to management techniques and eliminate or greatly reduce employers' flexibility to have employees perform whatever task is necessary to complete their work, thereby harming productivity. Employer representatives stated that the definition is so broadly worded (“any” work included in the job order or “any” work performed by the H-2B workers) that it would cover the entire workforce of many businesses. One firm gave the example of a large resort with roughly 2000 employees where senior management (including the resident manager, the director of food and beverage, and even the finance manager) clean rooms on a busy day; supervisors carry guests' luggage; managers in the restaurant clear tables; and managers on the golf course pick up trash or cut the grass. The firm wondered what the H-2B workers should be paid in this case and whether every employee is a corresponding employee who would be entitled to the three-fourths guarantee. Other employers assumed that their laborers would have to be compensated at the same rate as a supervisor if the supervisor occasionally performed some of their same tasks, such as mowing, because of a weather event, large golf tournament, or shortage of staff due to illness. An employer association stated that employers, such as restaurants, needed the flexibility to have a waitress serve as a cashier or hostess, or to have a dishwasher assist with food preparation or cooking, in order to get the work done and keep employees working throughout the day.

Therefore, some employer representatives suggested that the rule should limit the definition to work in the occupation listed in the job order. They stated this would avoid a situation where all U.S. workers who dig holes and plant bushes would be viewed as corresponding employees if the H-2B job order was for a supervisory landscaper with knowledge of irrigation systems and plant species but the supervisor occasionally helped to dig or plant. These commenters also suggested that the Department limit the rule's scope to those U.S. workers who are newly hired by the employer on or after the beginning of the job order period, rather than extending it to workers employed prior to the employment of H-2B workers. Some employer commenters suggested that the Department delete the word “any” from before the word “work.” Other commenters questioned whether the Department has the legal authority to impose the requirement.

After carefully considering all of these comments, the Department has decided to modify the definition of corresponding employment to delete the word “any” from before “work” in two places and insert the words “substantially the same,” and to exclude two categories of incumbent employees: (1) Those who have worked in the relevant job continuously for the H-2B employer for at least the prior 52 weeks, have averaged at least 35 hours of work or pay over those 52 weeks and have received at least 35 hours of work or pay in at least 48 of the 52 weeks, as demonstrated by the employer's payroll records and whose terms and conditions of employment are not substantially reduced during the job order period (an employer may take credit for those hours that were reduced due to an employee's voluntary leave); and (2) those who are covered by a collective bargaining agreement or individual employment contract that guarantees at least 35 hours of work each week and continued employment with the H-2B employer at least through the end of the job order period. Incumbent employees who fall within one of these categories may have valuable terms of employment, including job security and benefits, that neither H-2B workers nor other temporary workers have. This may account for wage differentials between these incumbents and those who are entitled to the H-2B prevailing wage, as well as other differences in terms and conditions of employment.

The Final Rule continues to include other workers within the definition of corresponding employment as proposed in order to fulfill the DHS regulatory requirement that an

H-2B Petition

will not be approved unless the Secretary certifies that the employment of the alien will not adversely affect the wages and working conditions of similarly employed U.S. workers. 8 CFR 214.2(h)(6). As the NPRM explained, Congress has long intended that similarly employed U.S. workers should not be treated less favorably than temporary foreign workers. For example, a 1980 Senate Judiciary Report on Temporary Worker Programs stated that U.S. employers were required to offer domestic workers wages equal to foreign workers as a prerequisite for labor certification. See Congressional Research Service: “Report to the Senate Committee on the Judiciary: Temporary Worker Programs: Background and Issues, 53 (1980)”; see also H.R. Rep. No. 99-682, pt. 1 at 80 (1986) (“The essential feature of the H-2 program has been and would continue to be the requirement that efforts be made to find domestic workers before admitting workers from abroad. A corollary rule, again preserved in the bill, is that the importation of foreign workers will not be allowed if it would adversely affect the wages and working conditions of domestic workers similarly employed”). Current § 655.22(a) reflects this principle, in part, by requiring that the terms and conditions of offered employment cannot be less favorable than those offered to H-2B workers. Thus, the current regulation provides for equal treatment of workers newly hired during the current 10-day H-2B recruitment process.

The current regulation, however, does not protect U.S. workers who engage in similar work performed by H-2B workers during the validity period of the job order, because it does not protect any incumbent employees. Therefore, for example, a U.S. employee hired three months previously performing the

same work as the work requested in the job order, but earning less than the advertised wage, would be required to quit the current employment and re-apply for the same job with the same employer to obtain the higher wage rate offered to H-2B workers. This would be disruptive for the employer and could create an additional administrative burden for the SWAs with respect to any workers being referred through them. It also puts too high a premium on employees understanding their rights under the regulations, and feeling secure enough—rare in low-wage employment—to quit a job with the expectation of being immediately rehired. Therefore, the Final Rule does not require incumbent employees to jump through this unnecessary hoop; U.S. workers generally would be entitled to the wage rates paid to H-2B employees without having to quit their jobs and be rehired.

There are only two categories of incumbent U.S. employees who would be excluded from the definition of corresponding employment. The first category covers those incumbents who have been continuously employed by the H-2B employer for at least the 52 weeks prior to the date of need, who have averaged at least 35 hours of work or pay over those 52 weeks, and who have worked or been paid for at least 35 hours in at least 48 of the 52 weeks, and whose terms and conditions of employment are not substantially reduced during the period of the job order. The employer may take credit for any hours that were reduced because the employee voluntarily chose for personal reasons not to work hours that the employer offered, such as due to illness or vacation. Thus, for example, assume an employee took six weeks of unpaid leave due to illness, and the employer offered the employee 40 hours of work each of those weeks. In that situation, the employer could take credit for all those hours in determining the employee's average number of hours worked in the prior year and could take credit for each of those six weeks in determining whether it provided at least 35 hours of work or pay in 48 of the prior 52 weeks. Similarly, if the employer provided a paid day off for Thanksgiving and an employee worked the other 32 hours in that workweek, the employer would be able to take credit for all 40 hours when computing the average number of hours worked and count that week toward the required 48 weeks. In contrast, assume another situation where the employer offered the employee only 15 hours of work during each of three weeks, and the employee did not work any of those hours. The employer could only take credit for the hours actually offered when computing the average number of hours worked or paid during the prior 52 weeks, and it would not be able to count those three weeks when determining whether it provided at least 35 hours of work or pay for the required 48 weeks.

The second category of incumbent workers excluded from the definition of corresponding employment includes those covered by a collective bargaining agreement or individual employment contract that guarantees both an offer of at least 35 hours of work each week and continued employment with the H-2B employer at least through the period of the job order (except that the employee may be dismissed for cause). As noted above, incumbent employees in the first category are year-round employees who began working for the employer before the employer took the first step in the H-2B process by filing an

Application for Temporary Employment Certification.

They work 35 hours per week for the employer, even during its slow season. The Department recognizes that there may be some weeks when, due to personal factors such as illness or vacation, the employee does not work 35 hours. The employer may still treat such a week as a week when the employee worked 35 hours for purposes of the corresponding employment definition, so long as the employer offered at least 35 hours of work and the employee voluntarily declined to work, as demonstrated by the employer's payroll records. Thus, these workers have valuable job security that H-2B workers and those hired during the recruitment period or the period of the job order lack. Such full-time, year-round employees may have other valuable benefits as well, such as health insurance or paid time off. Similarly, employees covered by a collective bargaining agreement or an individual employment contract with a guaranteed weekly number of hours and just cause provisions also have valuable job security; they may also have benefits beyond those guarantees provided by the H-2B program. These valuable terms and conditions of employment may account for any difference in wages between what they receive and what H-2B workers receive. Therefore, these U.S. workers are excluded from corresponding employment only if they continue to be employed full-time at substantially the same terms and conditions throughout the period covered by the job order, except that they may be dismissed for cause.

The Final Rule's inclusion of other workers within the definition of corresponding employment is important because the current regulation does not protect U.S. workers in the situation where an H-2B employer places H-2B workers in occupations and/or at job sites outside the scope of the labor certification, in violation of the regulations. For example, if an employer submits an application for workers to serve as landscape laborers, but then assigns the H-2B workers to serve as bricklayers constructing decorative landscaping walls, the employer has bypassed many of the H-2B program's protections for U.S. workers. The employer has deprived them of their right to protections such as domestic recruitment requirements, the right to be employed if available and qualified, and the prevailing wage requirement. The Final Rule guards against this abuse of the system and protects the integrity of the H-2B process by ensuring that the corresponding U.S. workers employed as bricklayers receive the prevailing wage for that work.

The current regulation also does not protect U.S. workers if the employer places H-2B workers at job sites outside the scope of the labor certification. For example, an employer may submit an application for workers to serve as landscape laborers in a rural county in southern Illinois, but instead assign its H-2B workers to work as landscape laborers in the Chicago area. Because the employer did not fulfill its recruitment obligations in Chicago, U.S. workers were not aware of the job opportunity, they could not apply and take advantage of their priority hiring right, and the prevailing wage assigned was not the correct rate for Chicago. Such a violation of the employer's attestations results both in the absence of a meaningful test of the labor market for available U.S. workers and U.S. workers being adversely affected by the presence of the underpaid H-2B workers. The Final Rule's definition of corresponding employment ensures that the employer's incumbent landscape laborers who work where the H-2B workers actually are assigned to work will receive the appropriate prevailing wage rate; paying the proper wage to such workers is necessary to protect against possible adverse effects on U.S. workers due to wage depression from the introduction of foreign workers. Therefore, adoption of the definition of corresponding employment in the Final Rule is necessary to allow the Department to fulfill its mandate from DHS to provide labor certifications only in appropriate circumstances.

On the other hand, it is important to clarify that the corresponding employment requirement does not apply in the way that a number of employer commenters feared it would apply. Employers expressed concern that, if a supervisor or manager picked up a piece of trash on a golf course, planted a tree, or cleared a dining room table (the duties of its H-2B workers), all its employees who performed such work would be entitled to the higher wage rate paid to the supervisor. This concern is misplaced because this is not what the definition of corresponding employment requires. Under the Final Rule, a U.S. employee who performs work that is either within the H-2B job order or work actually performed by H-2B workers is entitled to be paid at least the H-2B required wage for that work. However, as the employer commenters recognized, the supervisor already is earning more than the H-2B workers. The corresponding employment requirement does not impose obligations in the opposite direction. Thus it does not, for example, require an employer to bump up the wages it pays to its landscape laborers to the supervisor's wage rate simply because the supervisor performed some of their landscaping laborer duties. Of course, if the H-2B certification was for a landscaping supervisor, and one of its laborers actually worked as a supervisor (perhaps because the supervisor was away on vacation for a week or was out sick for a day or two), then that laborer would be entitled to the H-2B prevailing supervisory rate for those hours actually worked as a supervisor. The laborer would not be entitled to the supervisory wage rate on an ongoing basis after the worker has returned to performing laborer duties.

Employers also expressed concern about how the corresponding employment provision would affect their flexibility in assigning workers different tasks. It is the employer's obligation to state accurately on the

Application for Temporary Employment Certification

the job duties that their H-2B workers will perform and to comply with the terms of their labor certifications by limiting the H-2B workers to those duties. This will maximize the employers' flexibility with regard to their U.S. employees. For example, if a restaurant receives a labor certification based on its temporary need for dishwashers, and it limits its H-2B employees to such duties, the restaurant may freely assign any of its U.S. workers to other jobs as needed, such as cashiers, servers and cooks. If the restaurant had previously used both its H-2B and U.S. workers interchangeably in various jobs, it must plan more carefully in the future in order to comply with the terms of its certification.

Nevertheless, in order to address employer concerns that the proposed definition of corresponding employment (“any work included in the job order” or “any work performed by the H-2B workers”) was so broadly worded that it would encompass the entire workforce of a company, the Final Rule deletes the word “any” in both places and uses the term “substantially the same” instead. The Department did not intend for the word “any” to indicate that occasional or insignificant instances of overlapping job duties would transform a U.S. worker employed in one job into someone in corresponding employment with an H-2B worker employed in another job. The following explanation is intended to provide clarity regarding when work is substantially the same that it should be considered corresponding employment. We note that the Wage and Hour Division has considerable enforcement experience under a number of statutes in determining the extent to which employees who are assigned to one type of work actually perform other types of work and that employers are generally familiar with these analyses.

Where the U.S. worker is performing “either substantially the same work included in the job order or substantially the same work performed by the H-2B workers * * * during the period of the job order, including an approved extension thereof,” the U.S. worker is in corresponding employment and entitled to the H-2B prevailing wage if it is higher than the worker currently receives. This includes situations where the U.S. worker performs the same job as the H-2B worker as well as those situations where the U.S. worker regularly performs a significant number of the duties of the H-2B worker for extended periods of time, because that worker's job is substantially the same as the H-2B worker's job. The U.S. worker in both situations is in corresponding employment and thus entitled to the higher H-2B prevailing wage.

Because the definition of corresponding employment also applies to “work performed by H-2B workers,” it is important to note that corresponding employment can also arise where H-2B worker is assigned to perform a job that significantly deviates from the job order; effectively making the H-2B worker perform a different job than was stated in the labor certification. If this violation causes the H-2B worker to regularly perform a job for extended periods of time that U.S. workers perform, then the U.S. workers performing the same job are in corresponding employment. If the prevailing wage for that job is higher than the wages the U.S. workers earn, then the U.S. workers are entitled to the higher wage.

An issue of corresponding employment will arise if the employer assigns the H-2B worker to work at a different worksite(s) or place(s) of employment than the worksite(s) or place(s) of employment listed in the certified application. U.S. workers at the new, non-certified location may be performing the same or substantially the same job as the H-2B worker. Deviating from the labor certification in this manner and moving an H-2B worker to the non-certified place of employment will cause the U.S. workers who perform the same work to be deemed to be in corresponding employment. They will be entitled to the H-2B prevailing wage if it is higher than what they currently earn.

Finally, employers expressed their interest in continuing to reward their experienced employees with higher wage rates than those paid to new workers. The H-2B program does not prohibit such higher wage rates for an employer's experienced employees. Of course, an employer must offer at least the same terms and conditions of employment to its U.S. workers in corresponding employment as it offers, plans to offer, or will provide to its H-2B workers. So if an employer rewards an H-2B worker with extra pay and/or benefits based on the H-2B employee's previous work experience, the employer must offer and provide at least the same extra pay and/or benefits to U.S. workers in corresponding employment with same or similar level of previous work experience. Employers can and should indicate the additional pay amounts based upon years of experience on any

Application for Temporary Employment Certification,

and properly advertise and recruit for those positions.

c. Full-time. The Department proposed to change the definition of full-time from 30 or more hours of work per workweek to 35 or more hours of work per week. This proposal was precipitated by the District Court's decision in

CATA

Solis,

2010 WL 3431761 (E.D. Pa. 2010), invalidating the 2008 Final Rule's 30-hour definition. The Department stated in its NPRM that a 35-hour workweek was more reflective of empirical data, was consistent with other temporary work programs, and would comport with H-2B employment relationships that the

Department has encountered during its limited enforcement experience. In addition, the Department solicited comment for an alternative definition of 40 hours, noting that the December 2010 Bureau of Labor Statistics (BLS) Current Population Survey (CPS) found that the average workweek for employees who consider themselves full-time was 42.4 hours per week.

Bureau of Labor Statistics,

Labor Force Statistics,

Table A-24; Persons at work in agriculture and related nonagricultural industries by hours of work, Dec. 2010.

http://www.bls.gov/web/empsit/cpseea24.htm.

Several trade associations and private businesses supported retaining the 2008 Final Rule's standard of 30 hours per workweek, citing the difficulties of scheduling work around unpredictable and uncontrollable events, particularly the weather. A number of those commenters suggested that full-time employment should be determined not in each individual workweek, but by averaging workweeks over the length of the certified employment period. Two trade associations and a private business claimed that increasing full-time to 35 hours per workweek would decrease employer flexibility and/or increase costs. Comments from several trade associations and a professional association stated that a 35-hour workweek would be burdensome in combination with other aspects of the proposed rule, particularly the three-quarter guarantee. Finally, one private business commented that the definition of full-time should be determined by industry standards.

A private business, a private citizen, a research institute, two unions, and a number of worker advocacy groups commented that a definition of full-time as 40 hours per workweek is preferable to 35, arguing that the higher standard is more representative of typical full-time jobs. Several of these commenters referred to the CPS findings cited by the Department. Two H-2B worker advocacy groups asserted their experience indicated that long hours are standard in many industries employing H-2B workers and, therefore, a 40-hour definition would be more representative of H-2B job opportunities. Another union and a research institute, in their support of a 40-hour standard, noted that the H-1B visa program also defines full-time as 40 hours per workweek. Finally, a private business, a union, a research organization, and two advocacy organizations argued that establishing a 40-hour standard is more protective of U.S. workers than a 35-hour standard, as more U.S. workers are likely to consider jobs that offer 40 hours of work. One union suggested changing the definition to 37.5 hours per workweek, arguing that this was a common measure.

In accord with the District Court's decision in

CATA

Solis,

the Department has continued to carefully consider relevant factors in determining the hours threshold for full-time, including national labor market statistics, empirical evidence from a random sample of approved applications, and other employment laws. All available evidence suggests that the existing definition of 30 hours or more per workweek is not an accurate reflection of full-time employment. According to the May 2011 Employment Situation report published by BLS, the average number of hours worked per week for employees who consider themselves full-time was 42.7.

Another BLS publication, the Current Population Survey, uses a 35-hour threshold to define full-time employment. Employer practices also strongly suggest that the existing definition of 30 hours is not reflective of actual employer practices: in a randomly selected sample of 200 Applications that the Department certified or partially certified in 2009 and 2010, more than 99 percent reflected workweeks of at least 35 hours. This finding is consistent with the Department's enforcement experience: the vast majority of Applications that are the subject of investigations are certified for 35 or more hours per week. Under another similar nonimmigrant visa program the Department regulates, H-2A program for agricultural workers, full-time is defined as 35-hours per week.

Bureau of Labor Statistics,

Employment Situation,

Table A-24: Persons at work in agriculture and related and in nonagricultural industries by hours of work, May 2011.

http://www.bls.gov/web/empsit/cpseea24.htm.

The Department recognizes that there is no universally-accepted definition of full-time employment and, without such a standard, must determine a reasonable floor of hours per week below which a job is not considered full-time and therefore ineligible for inclusion in the H-2B program. After careful consideration, the Department has decided to retain the proposed definition of at least 35 hours per week, which more accurately reflects full-time employment expectations than the current 30-hour definition, will not compromise worker protections, and is consistent with other existing Department standards and practices in the industries that currently use the H-2B program to obtain workers.

Though a 40-hour threshold, as some commenters pointed out, would be more consistent with the BLS-reported average of workweek of nearly 43 hours, an average level, by definition, accounts for both higher and lower values. The average includes, for example, hours worked by exempt managerial and professional employees who are not entitled to overtime and who tend to work longer hours. The Department observes that it is entirely likely that the average calculation includes employment relationships in which both the employer and the workers consider full-time to be 35 hours of work per week. This assertion is borne out by some

Applications for Temporary Employment Certification

currently being filed with ETA that request such a weekly schedule.

The Department's decision to define full-time as 35 or more hours does not conflict with worker advocacy groups' claims that many H-2B jobs require 40 or more hours per week. The 35-hour floor simply allows employers access to the H-2B program for a relatively small number of full-time jobs that would not have been eligible under a 40-hour standard. H-2B employers are and will remain required to accurately represent the actual number of hours per week associated with the job, recruit U.S. workers on the basis of those hours, and pay for all hours of work. Therefore, the employer is obligated to disclose and offer those hours of employment—whether 35, 40 or 45, or more—that accurately reflect the job being certified. Failure to do so could result in a finding of violation of these regulations.

d. Job contractor. We proposed to amend the definition of job contractor to resolve concerns raised by the U.S. District Court for the Eastern District of Pennsylvania in

CATA

Solis,

2010 WL 3431761, about our adoption of language in the 2008 Final Rule that states a job contractor “will not exercise any supervision or control in the performance of the services or labor to be performed other than hiring, paying, and firing the workers.” The Court found that our explanation that we adopted this language to “make clear that the job contractor, rather than the contractor's client, must control the work of the individual employee,” 73 FR 78020, 78024, Dec. 19, 2008, “did precisely the opposite—it clarified that it is the contractor's client who `must control the work of the individual employee.' The explanation is therefore not rationally connected to the change, which will accordingly be invalidated as arbitrary.”

CATA,

2010 WL 3431761 at *16.

The proposed definition of job contractor included the phrase “will not exercise substantial, direct day-to-day supervision or control.” This addition further clarified that an entity exercising

some limited degree of supervision or control over the H-2B workers would still be considered a job contractor, while an entity exercising substantial, direct day-to-day supervision or control over the H-2B workers would not be considered a job contractor. For the reasons stated below, we have decided to amend the definition as proposed to include the phrase supervision and control rather than supervision or control.

While some commenters contended that the

CATA

decision was flawed and urged us to use existing enforcement mechanisms rather than change the definition, other commenters welcomed the additional language clarifying that an employer exercising substantial, daily supervision and control would not be considered a job contractor. A specialty bar association suggested that since an employer's status as a job contractor determines an employer's eligibility to use the H-2B program under the NPRM, we should provide more concrete examples of employers that we would or would not consider to be job contractors.

While we appreciate the bar association's suggestion, given the infinite variety of business arrangements employers can make with other employers for the provision of labor or services, it is impossible to provide a definitive list of types of employers that would or would not be deemed job contractors. However, the following examples may be instructive for illustrating the differences between an employer that is a job contractor and an employer that is not. Employer A is a temporary clerical staffing company. It sends several of its employees to Acme Corporation to answer phones and make copies for a week. While Employer A has hired these employees and will be issuing paychecks to these employees for the time worked at Acme Corporation, Employer A will not exercise substantial, direct day-to-day supervision and control over its employees during their performance of services at Acme Corporation. Rather, Acme Corporation will direct and supervise the Employer A's employees during that week. Under this particular set of facts, Employer A would be considered a job contractor. By contrast, Employer B is a landscaping company. It sends several of its employees to Acme Corporation once a week to do mowing, weeding, and trimming around the Acme campus. Among the employees that Employer B sends to Acme Corporation are several landscape laborers and one supervisor. The supervisor instructs and supervises the laborers as to the tasks to be performed on the Acme campus. Under this particular set of facts, Employer B would not be considered a job contractor. Note that the provision of services under a contract alone does not render an employer a job contractor; rather, each employment situation must be evaluated individually to determine the nature of the employer-employee relationship and accordingly, whether the petitioning employer is in fact a job contractor.

We believe that our discussion of reforestation employers in the NPRM also may help to further clarify the definition of job contractor. As described in the NPRM, a typical reforestation employer, such as those who have historically used the H-2B program, performs contract work using crews of workers subject to the employer's on-site, day-to-day supervision and control. Such an employer, whose relationship with its employees involves substantial, direct, on-site, day-to-day supervision and control would not be considered a job contractor under this Final Rule. However, if a reforestation employer were to send its workers to another company to work on that company's crew and did not provide substantial, direct, on-site, day-to-day supervision and control of the workers, that employer would be considered a job contractor under this Final Rule.

Some commenters asserted that a job contractor's degree of supervision does not change the fact that its need for workers is permanent. These commenters appear to misunderstand our objective in proposing to prohibit job contractors from participating in the H-2B program. The NPRM created an irrebuttable presumption that a job contractor's need for workers is inherently permanent. The implementation of that determination necessitates that we create a definition of job contractor. Only after a job contractor is identified through the definition can we conclude that the entity's need is permanent.

One commenter asserted that the language “where the job contractor will not exercise substantial, direct day-to-day supervision or control in the performance of the services or labor to be performed other than hiring, paying and firing the workers” created a loophole for job contractors to artificially increase their level of supervision in order to avoid being labeled job contractors. Another commenter was concerned that an employer performing contracts on a year-round basis with on-site supervised crews would avoid being designated a job contractor based on its level of supervision. Both suggested removing the supervision or control language from the definition. While we are concerned about job contractors artificially changing their business model to circumvent a job contractor designation, we believe that the permanency of such an employer's need will be evident and addressed during the registration and application processes. Moreover, we believe that retaining the supervision and control language in the definition is essential to continuing to provide access to employers with legitimate temporary needs who perform contracts for services (

e.g.

reforestation or landscaping). Therefore, we will not alter the definition of job contractor in such a way as to bar all employers that perform contracts for services.

A specialty bar association contended that the phrase “substantial, direct day-to-day supervision or control” is ambiguous and will lead to confusion and uncertainty. The commenter asserted that the word “or” could lead to proof of either supervision or control enabling an employer to avoid designation as a job contractor and suggested that the word substantial adds to interpretive difficulty. Contrary to the commenter's reading, we intended supervision or control to prevent an employer which did not exercise both supervision and control from avoiding designation as a job contractor. In order to resolve this ambiguity, we have changed “or” to “and” in the Final Rule. We believe the use of the word substantial is important because some job contractors do exercise minimal levels of supervision and control, for example, by sending a foreman to check that a crew is working. We have retained the rest of the definition without change because, as discussed above, we believe the language is essential to distinguishing between employers who perform contracts for services and employers who fill staffing contracts. The Final Rule now states that job contractors do not exercise substantial, direct day-to-day supervision and control in the performance of the services or labor to be performed other than hiring, paying and firing the workers.

e. Other definitions. As discussed under § 655.6, we have decided to permit job contractors to participate in H-2B program where they can demonstrate their own temporary need, not that of their clients. The particular procedures and requirements that govern their participation are set forth in § 655.19 and provide in greater detail the responsibilities of the job contractors and their clients. Accordingly, we are adding a definition

of employer-client to this Final Rule to define the characteristics of the employer that is served by the job contractor and the nature of their relationship.

We also proposed to define several terms not previously defined in the 2008 Final Rule, including job offer and job order. We proposed definitions for job offer and job order to ensure that employers understand the difference between the offer that is made to workers, which must contain all the material terms and conditions of the job, and the order that is the published document used by SWAs in the dissemination of the job opportunity. In response to comments about the definitions of job offer and job order, we have retained the definition of job offer without change but have revised the definition of job order to indicate that it must include some, but not all, of the material terms and conditions of employment as reflected in modified § 655.18 which identifies the minimum content required for job orders.

Some commenters expressed concern that both the definition of job offer and the definition of job order require the employer to include all material terms and conditions for the job opportunity. The commenters contended that since employment contracts typically incorporate employee handbooks and other documents by reference, it would be difficult, if not impossible, to draft a document that contains all material terms and conditions. In addition, the commenters argued that including such extensive content would infringe on an employer's legitimate business interest in maintaining the confidentiality of employment terms and subject employers to exorbitant fees when the document was used in mandatory advertising. We agree that including all material terms and conditions for the job opportunity in the job order and advertising would be difficult, if not impossible, as well as a dramatic departure from how employers hire for these positions. Accordingly, we have amended the definition of job order so that it now reads “[t]he document containing the material terms and conditions of employment * * *” rather than “[t]he document containing all the material terms and conditions of employment * * *” and “including obligations and assurances under 29 CFR part 503 * * *” and we have amended § 655.18 to reflect the minimum content requirements for job orders. We also removed the phrase “on their inter- and intra-State job clearance systems” as unnecessary. The definition of job offer remains unchanged and requires an employer's job offer to contain all material terms and conditions of employment.

We also proposed revising the definition of strike so that the term is defined more consistently with our 2010 H-2A regulations. We are retaining the proposed definition without change. Some worker advocacy organizations supported the revised definition, appreciating that the definition recognizes a broad range of protected concerted activity and clearly notifies employers and workers of their obligations when workers engage in these protected activities. Other commenters, representing employer concerns, opposed the revised definition, finding it too broad. These commenters contended that the proposed definition includes minor disagreements not rising to the level of what the commenters or prior regulatory language would consider a strike and that the definition covered an employer's local workforce, rather than just the H-2B position. Some commenters requested a return to the language of the 2008 Final Rule, arguing that the proposed definition rejects our longstanding position limiting the admission of H-2B workers where the specific job opportunity is vacant because the incumbent is on strike or being locked out in the course of a labor dispute. These commenters were concerned that two workers could claim to have a dispute and, thereby, prevent the employer from using the program.

Given our desire to align the definition of strike in this Final Rule with the definition in the 2010 H-2A regulations, we have decided to retain the definition as proposed. As we explained in the preamble to the 2010 H-2A Final Rule at 75 FR 6884, Feb. 12, 2010, we believe narrowing the provision as recommended by commenters would unjustifiably limit the freedom of workers to engage in concerted activity during a labor dispute.

6. § 655.6 Temporary Need

We proposed to interpret temporary need in accordance with the DHS definition of that term and of our experience in the H-2B program. The DHS regulations define temporary need as a need for a limited period of time, where the employer must “establish that the need for the employee will end in the near, definable future.” 8 CFR. 214.2(h)(6)(ii)(B). The Final Rule, as discussed in further detail below, is consistent with this approach.

Also, consistent with the definition of temporary need, we proposed to exclude job contractors from participation in the H-2B program, in that they have an ongoing business of supplying workers to other entities, even if the receiving entity's need for the services is temporary. The proposal was based on our view that a job contractor's ongoing need is by its very nature permanent rather than temporary and therefore the job contractor does not qualify to participate in the program. As discussed below, we have revised the proposed provisions in the Final Rule.

a. Job Contractors. We received a number of comments on our proposal to eliminate job contractors from the H-2B program. We received some comments related to the definition of job contractor and how we will identify a job contractor. Those comments related to the definition of job contractor rather than the nature of a job contractor's need. Specifically, commenters from the reforestation industry expressed concerns over being classified as job contractors. These comments are addressed in the discussion of § 655.5.

A number of commenters expressed support for the elimination of job contractors, agreeing that job contractors' need is permanent and that the job openings are actually with a job contractor's employer-client, rather than with the job contractor. A worker advocacy organization asserted that the proposed approach, ensuring that the program is reserved for temporary job openings and excluding job contractors whose need is inherently permanent, was consistent with Congressional intent with respect to the program. One commenter expressed support for the changes in the proposed rule which reflected the court's ruling in

CATA

Solis

and which prohibited job contractors from filing in the program if their clients did not also submit an application to the Department.

Other commenters generally supported the elimination of job contractors from the program as a way of protecting workers from trafficking and forced labor. One commenter also asserted that the elimination of job contractors will prevent circumstances where the H-2B workers are left without sufficient work or pay while in the job contractor's employ and where H-2B workers, who may be willing to work for less pay or in worse conditions, compete with similarly situated U.S. workers.

Another commenter offered support for the prohibition on job contractors due to the difficulty in holding them accountable for program violations, either because they disappear at the threat of litigation or because they have so little money that they are judgment-proof when they violate employment and labor laws. This commenter

reasoned that the job contractors act as a shield for the employers who actually employ the workers and indicated that the proposed change to the regulations would stem violations of laws by both contractors and the employers who work in concert with them.

On the other hand, one commenter asserted that the bar on job contractors should not be complete because to the extent that any one job contractor does not have a year-round need and routinely does not employ workers in a particular occupation for a specific segment of the year, its needs are seasonal. This commenter argued that the standard for rejection from the H-2B program should be definitively permanent, not potentially permanent, with respect to whether or not a job contractor's need is permanent. Job contractors should be afforded the same opportunity as all other employers to prove they have a temporary need for services or labor. Relying on

Matter of Vito Volpe,

91-INA-300 (BALCA 1994), this commenter indicated that any need that does not constitute “permanent full-time work, such as where the occupation is one where employers have seasonal layoffs each year, the position is temporary.”

As discussed in the NPRM, a person or entity that is a job contractor, as defined under § 655.5, has no individual need for workers. Rather, its need is based on the underlying need of its employer-clients, some which may be concurrent and/or consecutive. However, we recognize the validity of the concern raised by the commenter that we should exclude from the program only those who have a definitively permanent need for workers, and that job contractors who only operate several months out of the year and thus have a genuine temporary need should not be excluded. Therefore, we are revising § 655.6 to permit only those contractors that demonstrate their own temporary need, not that of their employer-clients, to continue to participate in the H-2B program. Job contractors will only be permitted to file applications based on seasonal need or a one-time occurrence. In other words, in order to participate in the H-2B program, a job contractor would have to demonstrate, just as all employers seeking H-2B workers based on seasonal need have always been required: (1) If based on a seasonal need that the services or labor that it provides are traditionally tied to a season of the year, by an event or pattern and is of a recurring nature; or (2) if based on a one-time occurrence, that the employer has not employed workers to perform the services or labor in the past and will not need workers to perform the services in the future or that it has an employment situation that is otherwise permanent, but a temporary event of short duration has created the need for a temporary worker.

For a job contractor with a seasonal need, the job contractor must specify the period(s) or time during each year in which it does not provide any services or labor. The employment is not seasonal if the period during which the services or labor is not provided is unpredictable or subject to change or is considered a vacation period for the contractor's permanent employees. For instance, a job contractor that regularly supplies workers for ski resorts from October to March but does not supply any workers outside of those months would have its own temporary need that is seasonal.

Limiting job contractor applications to seasonal need and a one-time occurrence is appropriate, as it is extremely difficult, if not impossible, to identify appropriate peakload or intermittent needs for job contractors with inherently variable client bases. The seminal, precedent decision in

Matter of Artee,

18 I. & N. Dec 366, Interim Decision 2934, 1982 WL 190706 (Comm'r 1982), established that a determination of temporary need rests on the nature of the underlying need for the duties of the position. To the extent that a job contractor is applying for a temporary labor certification, the job contractor whose need rests on that of its clients has itself no independent need for the services or labor to be performed. The Board of Alien Labor Certification Appeals (BALCA) has further clarified the definition of temporary need in

Matter of Caballero Contracting & Consulting LLC,

2009-TLN-00015 (Apr. 9, 2009), finding that “the main point of

Artee

* * * is that a job contractor cannot use [solely] its client's needs to define the temporary nature of the job where focusing solely on the client's needs would misrepresent the reality of the application.” The BALCA, in

Matter of Cajun Constructors, Inc.

2009-TLN-00096 (Oct. 9, 2009), also decided that an employer that by the nature of its business works on a project until completion and then moves on to another has a permanent rather than a temporary need.

The limited circumstances under which job contractors may continue to participate in the H-2B program would still be subject to the limitations provided in the

CATA

decision, which resulted in the Department no longer being able to accept H-2B labor certification applications from job contractors if the job contractor's employer-clients also did not submit labor certification applications. Section 655.19 sets forth the procedures and requirements governing the filing of applications by job contractors.

The Department understands that in some cases the use of a job contractor may be advantageous to employers. However, the advantages provided to employers by using job contractors do not overcome the fact that many job opportunities with job contractors are inherently permanent and therefore such job contractors are not permitted to participate in the program. We recognize that by taking this position the result may be that some employers who have been clients of such job contractors, and who have not previously participated in the program, may now seek to do so. In the proposed rule, the Department encouraged employers to submit information about their changed circumstances as a result of the proposal to bar job contractors from the program, including the potential costs and savings that may result. The Department did not receive any comments from employers describing or quantifying the cost of the elimination of job contractors from the program to aid in the Department's estimation of the economic impact of this proposal.

One commenter was concerned that job contractors would get around this prohibition by representing employers as agents. Agents, by their role in the program, have no temporary need apart from the underlying need of the employer on whose behalf they are filing the

Application for Temporary Employment Certification.

When considering any employer's

H-2B Registration,

the Department will require that employer to substantiate its temporary need by providing evidence required to support such a need. The Department does not anticipate an issue with this type of misclassification.

b. Change in the Duration of Temporary Need. In addition to proposing to bar job contractors from the H-2B program based on their underlying permanent need for the employees, we proposed to define temporary need, except in the event of a one-time occurrence, as 9 months in duration, a decrease from the 10-month limitation under the 2008 Final Rule. As also discussed in the NPRM, this definition is more restrictive than, yet still consistent with, the DHS definition of temporary need, in which the “period of time will be 1 year or less, but in the case of a one-time event could last up to 3 years.” 8 CFR 214.2(h)(6)(ii)(B). We

are adopting this provision in the Final Rule as proposed.

We received a number of comments on this proposal. Most commenters supported the clarification of the temporary need standard. Two such commenters recommended a further reduction in the duration of temporary need to no more than 6 months. In support of their proposal, these commenters suggested that half a year is a reasonable amount of time for an employer to have an unskilled temporary foreign worker, because there are currently millions of unemployed unskilled U.S. workers seeking employment across the country. These commenters hoped that shortening the certification periods for H-2B workers will compel employers to increase recruitment of U.S. workers (because they will have to recruit more often), which better achieves the statutory mandate not to use H-2B labor unless “unemployed persons capable of performing such service or labor cannot be found in this country.” 8 U.S.C. 1101(a)(15)(H)(ii)(b).

Other commenters opposed the proposal to change the maximum duration of temporary need from 10 months to 9 months. One commenter, who conducted a private survey of H-2B employers, indicated that 32 percent of its respondents indicated that curtailing the temporary work period to 9 from 10 months will have a severe effect on their bottom line. The remainder of respondents indicated moderate to no effect. This commenter indicated that some industries reported greater effects than others; those primarily concerned over the shorter season included: Landscaping, seafood processing, ski resorts, summer resorts, and forestry. As reported by this commenter, for some of these industries, a shorter season would mean less time for training and quality control, decreased revenues and loss of permanent full-time employees. Another commenter concurred that the adoption of a 9-month limit would have a devastating impact on many types of businesses, ranging from hospitality and food service to landscaping and numerous others. This commenter raised concerns about a significant drop in participation in the program by nearly a third of the businesses currently using the H-2B program and predicted substantial effects on the economy, including upstream ripple effects. In contrast to commenters who called for a yet shorter duration, most of these commenters agreed that they would not be able to use the H-2B program if we define a temporary need as less than 9 months.

Another commenter asserted that the standard for temporary need should be the employer's actual need (up to 1 year, or up to 3 years for one-time events) and not an arbitrary time period defined by the Department under the guise of ensuring the integrity of the program. Supporting the retention of a 10-month standard, this commenter challenged our reasoning for reducing the duration of seasonal, peakload, or intermittent need, including referring to the discussion under the 2008 Final Rule which indicated that a period of need in excess of 1 year may be justified in certain circumstances. Finally, an association of employers and temporary workers argued that temporary need should not be generally quantified because it is industry-specific and suggested that each employer should be able to argue that its need is temporary and consistent with the definition of seasonal or peakload.

DHS categorizes and defines temporary need into four classifications: seasonal need; peakload need; intermittent need; and one-time occurrence. A one-time occurrence may be for a period of up to 3 years. The other categories are limited to 1 year or less in duration. See, generally, 8 CFR 214.2(h)(6)(ii)(B).

We believe that the proposed time period is an appropriate interpretation of the one year

or less

limitation contained in the DHS regulations. Allowing employers to file seasonal, peakload or intermittent need applications for periods approaching a year (364 days is less than 1 year) would be inconsistent with the statutory requirement that H-2B job opportunities need to be temporary. The closer the period of employment is to one year, the more the opportunity resembles a permanent position. For instance, it would be difficult, if not impossible, to distinguish between a permanent job opportunity and one in which the work begins on March 1st and ends on February 20th, only to begin again on March 1st. We believe that a maximum employment period of 9 months definitively establishes the temporariness of the position, as there is an entire season in which there is simply no need for the worker(s). Where there are only a few days or even a month or two for which no work is required, the job becomes less distinguishable from the permanent position, particularly one that offers time off due to a slow-down in work activity. Recurring temporary needs of more than 9 months are, as a practical matter, permanent positions for which H-2B labor certification is not appropriate. The current approach that permits temporary certifications for periods up to 10 months encompasses job opportunities that we believe are permanent in nature and not consistent with Congressional intent to limit H-2B visas to employers with temporary or seasonal needs. However, we recognize that some employers may have a legitimate temporary need that lasts up to 9 months, and for that reason, we decline to reduce the duration of temporary need to 6 months. A job opportunity that does not exist in the winter months would likely be considered seasonal. We believe that the 9-month limitation that fairly describes the maximum scope of a seasonal need should also be applied to peakload need since there is no compelling rationale for creating a different standard for peakload.

While we recognize the impact that a movement from 10 months, which had been previously acceptable, to 9 months will have an adverse impact on some employers, the impact is not relevant to our legal obligation to protect the wages and working conditions of U.S. workers. The Department previously relied on the standard articulated in

In the Matter of Vito Volpe Landscaping,

91-INA-300, 91-INA-301, 92-INA-170, 91-INA-339, 91-INA-323, 92-INA-11 (Sept. 29, 1994), which stated that a period of 10 months was not permanent. The Department may adopt through notice and comment rulemaking a new standard that is within our obligation to administer the program. See

United States

Storer Broadcasting,

351 U.S. 192, 203 (1956);

Heckler

Campbell,

461 U.S. 458, 467 (1983). We have determined that 9 months better reflects a recurring seasonal or temporary need and have accordingly proposed a new standard which has been adopted in this Final Rule. Recurring temporary needs of more than 9 months are, as a practical matter, permanent positions for which H-2B labor certifications are not appropriate. The majority of H-2B employer applicants will not be affected by this change. According to H-2B program data for FY 2007-2009, 68.7 percent of certified and partially certified employer applicants had a duration of temporary need less than or equal to 9 months, while 31.3 percent of certified or partially certified applicants had a duration of temporary need greater than 9 months. Many seasonal businesses experience “shoulder seasons,” which are periods of time at the beginning and end of the season when fewer workers are needed. Therefore, we anticipate that employers will be able to meet their labor needs during the short additional period they

must cover of the shoulder seasons with U.S. workers and, therefore, will not be impacted by the change from the 10-month standard.

Similarly, we have determined that limiting the duration of temporary need on a peakload basis would ensure that the employer is not mischaracterizing a permanent need as one that is temporary. For example, since temporary need on a peakload basis is not tied to a season, under the current 10-month standard, an employer may be able to characterize a permanent need for the services or labor by filing consecutive applications for workers on a peakload basis. To the extent that each application does not exceed the 10 months, the 2-month inactive period may correspond to a temporary reduction in workforce due to annual vacations or administrative periods. Increasing the duration of time during which an employer must discontinue operations from 2 months to 3 will ensure that the use of the program is reserved for employers with a genuine temporary need. Similarly, a 9-month limitation is appropriate for ensuring that the employer's intermittent need is, in fact, temporary. In addition, under the Final Rule, each employer with an intermittent need will be required to file a separate

H-2B Registration

and

Application for Temporary Employment Certification

to ensure that any disconnected periods of need are accurately portrayed and comply with the 9-month limitation.

With respect to one commenter's assertion that we have acknowledged in the 2008 Final Rule that temporary need may last longer than 1 year in some circumstances, the definition of a one-time occurrence as lasting up to 3 years is consistent with DHS regulations and is intended to address those limited circumstances where the employer has a one-time need for workers that will exceed the 9-month limitation.

With respect to the commenter's concern regarding the potential economic impact of the shorter standard on the operations of businesses and the drop in program participation, the Department has accounted in both the NPRM and this Final Rule for the potential drop in program use. Employers participating in the H-2B program must demonstrate that they have a temporary need for the labor or services to be performed which they are unable to meet with U.S. workers. In interpreting the DHS standard for defining temporary need, the Department has struck a balance between ensuring that each position certified will comport with the regulatory requirements and accommodating an employer's legitimate need to fill its job opportunities in cases where United States workers are not available.

c. Peakload need. In addition to re-defining the duration of temporary need, we expressed concern in the NPRM that certain employers who lack the ability to demonstrate temporary need on a seasonal basis may mischaracterize a permanent need as a short-term temporary need which would fit under the peakload need standard. We used as an example the landscaping industry in which the off season is primarily a product of the absence of H-2B workers rather than a reduction in the underlying need for the services or labor. In that context, we sought comments and ideas from the public on the factors or criteria that we should consider in determining whether the employer has a genuine peakload need based on short-term demand. In addition, we requested input on whether we should limit these occurrences to those resulting from climactic, environmental or other natural conditions, or on limiting short-term demand to 6 months.

We received several comments on this proposal. The majority of commenters opposed the restriction of the peakload need standard. One commenter indicated that approximately a quarter of all H-2B applications are filed for landscaping employment, and that the employer's underlying need may well depend on the location of the company and the climate in that location. This commenter suggested that these employers should not be precluded from program participation by virtue of where they are located, and requested that we retain our peakload need definition as proposed.

In response to commenters' suggestions, we have concluded that no commenters offered a practical rationale indicating that a 6 month limitation would be more effective at curbing the issue of misclassifying the nature of the employer's need, rather than a 9 month limitation but we received a large number of comments noting that such a change would have an unintended consequence of effectively barring at least one sustaining industry—landscaping—from the program. With respect to another commenter's suggestion that we estimate short-term demand in relation to the number of temporary workers on a peakload basis as a percentage of the employer's total workforce, we note that such a suggestion is not operationally feasible.

One commenter responded to the request for comments on establishing criteria for distinguishing genuine peakload need from a permanent need. The commenter proposed the application of a specific criterion, namely: a limitation of peakload need to 6 months, defining short-term demand in relation to the percentage of temporary workers on a peakload basis as a percentage of the employer's total workforce. This commenter proposed concrete numbers of workers and percentages based on the numbers of workers employed by the employer, indicating that such an approach ought to preclude employers that conduct year-round activities constituting permanent need from using the H-2B program.

Having considered all comments on this proposal, we have determined to retain the provision as proposed. We thank the commenters for their valuable suggestions; however, we have determined that this regulation, as proposed, better meets our program mandate than any of the suggested alternatives.. Therefore, we are retaining this provision as proposed.

d. One-Time Occurrence. In addition to barring job contractors, and reducing the duration of the seasonal/peakload need to 9 months, we proposed an interpretation of a one-time occurrence to be consistent with DHS regulations under which such an occurrence could last up to 3 years. We received a number of comments on this proposal.

The majority of commenters opposed the apparent expansion of this requirement. One commenter indicated that while the reduction in the duration of seasonal/peakload need to 9 months was a notable improvement, the 3-year one-time occurrence provided employers with a loophole. This commenter referred to the H-2B definition under section 101 of the INA to indicate an inconsistency. Other commenters suggested that we institute an across the board 9-month limitation to the duration of temporary need. Many of the commenters opposing this proposal referred to average durations U.S. workers stay in their jobs, noting that the duration was typically less than 3 years and thus that our proposal was inconsistent with labor market information.

Other commenters addressing the needs of the construction industry indicated that the standard for proving a temporary need based on a one-time occurrence would be difficult to meet under the definition, in that the employer must establish that [1] it has not employed workers to perform the services or labor in the past and that it will not need workers to perform the services or labor in the future, or [2] it has an employment situation that is

otherwise permanent, but a temporary event of short duration has created the need for a temporary worker. These commenters expressed concern that construction contractors will not able to pass the first test unless the project for which the H-2B worker is hired is the only project they ever work on, because they invariably use the same types of workers. As to the second alternative, they argued that the construction industry consists primarily of short-term and intermittent work and therefore does not qualify under this test. Another commenter opposing the change in the definition for consistency with DHS regulations indicated that in crafting its definition DHS relied on an example from the construction industry which was not an accurate portrayal of the way in which that industry operates. Another commenter opposing the 3-year standard for one-time occurrences indicated that circumstances where an employer will be able to comply with the requirements for meeting the standard may be rare.

We proposed to define temporary need consistent with DHS regulations, so that both agencies make consistent decisions on applications/petitions. The majority of commenters asserted that our reliance on DHS regulations, in this instance, is misplaced. These commenters focused on the examples relied upon by DHS in the preamble to its 2008 regulations at 73 FR 78104, Dec. 19, 2008 to explain the operation of the 3-year, one-time occurrence. Although we adopt the DHS regulatory standard, we acknowledge, as DHS did, that it did not intend for the 3-year accommodation of special projects to provide a specific exemption for the construction industry in which many of an employer's projects or contracts may prove a permanent rather than a temporary need. Therefore, we will closely scrutinize all assertions of temporary need on the basis of a one-time occurrence to ensure that the use of this category is limited to those special and rare circumstances where the employer has a non-recurring need which exceeds the 9 month limitation. For example, an employer who has a construction contract which exceeds 9 months may not use the program under a one-time occurrence if it has previously filed an

Application for Temporary Employment Certification

identifying a one-time occurrence and the prior

Application for Temporary Employment Certification

requested H-2B workers to perform the same services or labor in the same occupation.

For all of the reasons articulated above, we are retaining the standard for a one-time occurrence as proposed.

7. § 655.7 Persons and Entities Authorized To File

In the NPRM, we proposed to designate the persons authorized to file an

H-2B Registration

or an

Application for Temporary Employment Certification

as the employer, or its attorney or agent. The proposed provisions also stressed the requirement that the employer must sign the

H-2B Registration

Application for Temporary Employment Certification

and any other required documents, whether or not it is represented by an attorney or agent. We did not receive comments on this proposal. Therefore, the provision is retained as proposed.

8. § 655.8 Requirements for Agents

In the NPRM, we noted that we have long accepted applications from agents acting on behalf of employers in the H-2B program, but that in administering the H-2B program, we have become concerned about the role of agents in the program and whether their presence and participation have contributed to program compliance problems. We proposed that if we were to continue to accept applications from agents, that the agents be required, at a minimum, to provide copies of current agreements defining the scope of their relationships with employers and that where an agent is required under the Migrant and Seasonal Agricultural Worker Protection Act (MSPA) to have a Certificate of Registration, the agent must also provide a current copy of the certificate which identifies the specific farm labor contracting activities that the agent is authorized to perform. The Final Rule adopts this provision as proposed. We also invited the public to provide ideas and suggestions on the appropriate role of agents in the H-2B program. We specifically sought comments on whether we should continue to permit the representation of employers by agents in the H-2B program, and if so, whether any additional requirements should be applied to agents to strengthen program integrity.

Based on the comments we received, we have concluded that agents should be permitted to continue to represent employers in the H-2B process before the Department and file

Applications for Temporary Employment Certification

on their behalf. To assist in verifying the scope of the agent's relationship with the employer, we will also require agents to provide copies of their agreement with the employer as well as the MSPA Certificate of Registration, where applicable. We are collecting the agreements and will be reviewing them as evidence that a bona fide relationship exists between the agent and the employer and, where the agent is also engaged in international recruitment, to ensure that the agreements include the language required at § 655.20(p) prohibiting the payment of fees by the worker. We do, however, also reserve the right to further review the agreements in the course of an investigation or other integrity measure. We therefore remind the public that a certification of an employer's application that includes such a submitted agreement in no way indicates a general approval of the agreement or the terms therein.

A few commenters suggested that agents be barred from filing applications on behalf of H-2B employers. At least two commenters, both trade organizations, suggested that agents create a problematic level of separation between employers and their obligations under the H-2B program.

An overwhelming number of commenters, however, stated that while disreputable agents may exist, bona fide agents are critical to the employers' ability to maneuver through the H-2B application process and requirements. Many of these commenters reiterated our own statistics for FY 2010, showing that that only 14 percent of employers filed applications without an agent and that 38 percent of these cases were denied. These commenters argued that we should continue to allow agents to file applications on behalf of H-2B employers. These same commenters, however, expressed an interest in program integrity and therefore agreed with the proposal to require agents to provide copies of their agreements with employers, to verify the existence of a relationship. Some commenters suggested that the agent(s) should be permitted to redact confidential proprietary business information before providing such agreements. Again, we are requiring agents to supply copies of the agreements defining the scope of their relationship with employers to ensure that there is a bona fide agency relationship and maintain program integrity. The requirement, however, in no way obligates either the agent or the employer to disclose any trade secrets or other proprietary business information. The Final Rule only requires the agent to provide sufficient documentation to clearly demonstrate the scope of the agency relationship. In addition, under this Final Rule, we do not presently plan to post these agreements for public viewing. If, however, we do so in the future, we will continue to follow all applicable legal and internal procedures for complying with Freedom of Information Act (FOIA) requests to

ensure the protection of private data in such circumstances.

One commenter, a trade organization, suggested that the proposed requirement that agents provide a copy of their MSPA Certificate of Registration, if required under MSPA, may be confusing since H-2B is viewed as non-agricultural, in contrast with the H-2A program, which is for agricultural labor and services. This commenter recommended that we provide a list of those businesses to which this additional requirement applies.

Several commenters also suggested that, in addition to receiving agent-employer agreements we should: limit the tasks in which agents can engage to those not involving the unauthorized practice of law or for which no payment is received, in accordance with DHS' regulations; make such agreements publicly available; maintain a public list of the identity of agents who represent employers in the labor certification process; require mandatory registration for agents; hold employers strictly liable for the actions and representations of their agents; and lastly, enhance enforcement mechanisms to combat fraud.

After evaluating all the comments, we have decided to continue to permit agents to participate in the Department's H-2B labor certification program. Their importance to employers, as reflected in numerous comments, outweighs any value gained by their exclusion. We remain interested in furthering program integrity; while we are not prepared to accept any of the specific requirements on agents suggested by commenters at this time, we have clarified in § 655.73(b) that an agent signing ETA Form 9142 may be debarred for its own violation as well as for participating in a violation committed by the employer. Some of the commenters' ideas, such as requiring agents to be registered with the Department to participate in the program would require additional government resources which are currently limited, while other ideas are not deemed necessary at this time, such as making the agreements publicly available. We believe that the Department will be able to preserve program integrity by collecting such agreements to ascertain the validity of and scope of the agency relationship and, where the agent is also engaged in international recruitment, to ensure they include the contractual prohibition against charging fees language required at § 655.20(p) prohibiting the payment of fees by the worker. Such action, in combination with the enforcement mechanisms and compliance-based model adopted by this Final Rule, will resolve many of the expressed concerns without requiring the expenditure of additional resources. However, as stated under § 655.63, we reserve the right to post any documents received in connection with the

Application For Temporary Employment Certification

and will redact information accordingly.

Lastly, in response to commenters that urged us to hold employers strictly liable for the actions of the agents, we remind both agents and employers that each is responsible for the accuracy and veracity of the information and documentation submitted, as indicated in the ETA Form 9142 and Appendix B.1, both of which must be signed by the employer and its agent. As discussed under § 655.73(b), agents who are signatories to ETA Form 9142 may now be held liable for their own independent violations of the H-2B program. As to the commenter's suggestion that we provide additional examples of H-2B occupations subject to MSPA guidelines, we believe that employers or individuals working in affected industries are already aware of their obligations under MSPA, including the requirement to register.

9. § 655.9 Disclosure of Foreign Worker Recruitment

We proposed to require an employer and its attorney and/or agent to provide a copy of all agreements with any agent or recruiter whom it engages or plans to engage in the international recruitment of H-2B workers. We also proposed to disclose to the public the names of the agents and recruiters used by employers and their attorneys and/or agents participating in the H-2B program. We received several comments, all of which agreed with the proposal to provide information about the recruiter's identity. We have expanded this section in the Final Rule to better reflect the obligation therein. For example, we revised the Final Rule to specify that the requirement to provide a copy of the written contract applies to agreements between the employer or the employer's attorney or agent and that the written contract must contain the contractual prohibition on charging fees, as set forth in § 655.20(p). Where the contract is not in English and the required contractual prohibition is not readily discernible, we reserve the right to request further information to ensure that the contractual prohibition is included in the agreement.

Several commenters requested that we strengthen the section by requiring the employer to also provide the identity and location of the foreign labor recruiter's sub-recruiters or sub-agents and to expand the provision to include verbal agreements, as such informal arrangements with foreign recruiters are not uncommon. We agree that in addition to bolstering program integrity by aiding in the enforcement of certain regulatory provisions, collecting the identity and location of persons hired by or working for the recruiter or its agent to recruit or solicit prospective H-2B workers—effectively acting as sub-recruiters, sub-agents, or sub-contractors—will bring a greater level of transparency to the foreign recruitment process that will assist the Department, other agencies, workers, and community and worker advocates in understanding the roles of each participant and the recruitment chain altogether. This requirement advances the Department's mission of ensuring that employers comply with overall H-2B program requirements, and do not engage in practices that adversely affect the wages and working conditions of U.S. workers. See 8 U.S.C. 1184(c)(14).

We have therefore added paragraph (b) of this section in the Final Rule, requiring that employers and their attorneys or agents provide the identity (name) of the persons and entities hired by or working for the recruiter or recruiting agent and any of the agents or employees of those persons and entities, as well as the geographic location in which they are operating. We interpret the term “working for” to encompass any persons or entities engaged in recruiting prospective foreign workers for the H-2B job opportunities offered by the employer, whether they are hired directly by the primary recruiter or are working indirectly for that recruiter as a downstream recruiter in the recruitment chain. We expect employers, and their attorneys or agents, as applicable, to provide these names and geographic locations to the best of their knowledge at the time the application is filed. We expect that, as a normal business practice, when completing the written agreement with the primary recruiting agent or recruiter, the employer/attorney/agent will ask who the recruiter plans to use to recruit workers in foreign countries, and whether those persons or entities plan to hire other persons or entities to conduct such recruitment, throughout the recruitment chain.

As mentioned above, the public disclosure of the names of the foreign labor recruiters used by employers, as well as the identities and locations of persons or entities hired by or working for the primary recruiter in the recruitment of H-2B workers, and the agents or employees of these entities, will provide greater transparency to the H-2B worker recruitment process. By

providing us with this list, which we will make public, the Department will be in a better position to enforce recruitment violations, and workers will be better protected against fraudulent recruiting schemes because they will be able to verify whether a recruiter is in fact recruiting for legitimate H-2B job opportunities in the U.S. We intend to use this list of foreign labor recruiters to facilitate information sharing between the Department and the public, so that where we believe it is appropriate, we can more closely examine applications or certifications involving a particular recruiter or its agent identified by members of the public as having engaged in improper behavior. Additionally, information about the identity of the international recruiters will assist us in more appropriately directing our audits and investigations.

To reiterate the overall requirements of § 655.9 in the Final Rule, § 655.9(a) requires employers or their agents or attorneys, as applicable, to provide us with a copy of all agreements with any foreign labor recruiter, and those written agreements must contain the required contractual prohibition on the collection of fees, as set forth in § 655.20(p). The requirement in § 655.9(b) to disclose to the Department the identities and locations of persons and entities hired by or working for the foreign labor recruiter and any of the agents or employees of those persons and entities who will recruit or solicit H-2B workers for the job opportunities offered by the employer encompasses all agreements, whether written or verbal, involving the whole recruitment chain that brings an H-2B worker to the employer's certified H-2B job opportunity in the U.S.

Several commenters erroneously assumed the agreements between the employer and the foreign recruiter would be made public. The NPRM provided for obtaining the agreements and sharing with the public the identity of the recruiters, not the full agreements.

As stated above, we intend to collect the submitted agreements for the purpose of maintaining a public list of recruiters involved with H-2B workers. At the time of collection, we will review the agreements to obtain the names of the foreign recruiters and to verify that these agreements include the contractual prohibition against charging fees language required at § 655.20(p) prohibiting the payment of fees by the worker. We may also further review the agreements in the course of an investigation or other integrity measure. We therefore remind the public that a certification of an employer's application that includes such a submitted agreement in no way indicates a general approval of the agreement or the terms therein.

Several commenters agreed that the disclosure of the identity of the foreign recruiters is helpful and badly needed, but suggested that it is not enough. One commenter, an individual, suggested that if an employer is paying a recruiter to locate foreign workers, that employer should also pay for a U.S. recruiter to locate U.S. workers. We did not impose such a requirement. This Final Rule, as discussed below in further detail, contains several recruitment steps the employer must conduct, aimed at providing U.S. workers ample opportunity to learn about and apply for these jobs.

Other commenters suggested that we should institute a mandatory registration or licensing system, that we should require recruiters to make themselves subject to U.S. jurisdiction, or that employers should be held strictly liable for recruitment violations. While we appreciate these suggestions, we will not implement them because we neither have the resources nor the authority to do so. However, we will continue to implement enforcement and integrity measures to decrease potential fraud in the H-2B program.

B. Prefiling Procedures

1. § 655.10 Prevailing Wage

We proposed a modified process for obtaining a prevailing wage designed to simplify how an employer requests a PWD. The proposed rule required employers to request PWDs from the National Prevailing Wage Center (NPWC) before posting their job orders with the SWA and stated that the PWD must be valid on the day the job orders are posted. We encourage employers to continue to request a PWD in the H-2B program at least 60 days before the date the determination is needed. After reviewing comments on the proposed prevailing wage process, we are adopting the provisions as proposed, with one amendment.

Several labor and worker advocacy groups supported the proposed process for obtaining a PWD. One, while agreeing that we should require employers to test the U.S. labor market using a currently valid PWD, suggested that we should also require employers to pay any increased prevailing wage that is in effect for any time during the certified period of employment. The commenter cited the Court's ruling in

CATA

and the requirement in the H-2A program requirement that an employer pay a higher adverse effect wage rate (AEWR) when a new, higher AEWR becomes effective during the period of employment as its basis for the suggestion.

Since this concept of paying any increased prevailing wage that is in effect for any time during the certified period of employment was not contained in the NPRM and the public did not have notice and an opportunity to comment, we cannot adopt the commenter's suggestion in this Final Rule.

Some labor and worker advocacy groups suggested that removing the last sentence of proposed paragraph (d), which exempts employers operating under special procedures, would clarify the proposed regulatory language on prevailing wages for multiple worksites. We agree and have removed the sentence in the Final Rule. We issue special procedures through TEGLs which detail the variances permitted for occupations covered by the special procedures.

Some commenters noted that existing special procedures will require updating, given this rule and the Prevailing Wage Final Rule. We agree that we will need to update existing special procedure guidance to reflect organizational and regulatory changes; however, those updates will be issued through new Training and Employment Guidance Letters (TEGLs) rather than within this rule, where appropriate. Until such time as new TEGLs are issued, we will continue to honor the special procedures that were in place before the effective date of the new regulations.

A number of commenters expressed concern about the application of the new prevailing wage methodology to workers in corresponding employment. We address these comments in the larger discussion of corresponding employment at § 655.5.

As discussed in the NPRM, this rulemaking does not address or seek to amend the prevailing wage methodology established under the H-2B Wage Final Rule. Comments related to the new prevailing wage methodology fall outside the scope of this rulemaking.

2. § 655.11 Registration of H-2B Employers

We proposed to bifurcate the current application process into a registration phase, which addresses the employer's temporary need, and an application phase, which addresses the labor market test. We proposed to require employers to submit an

H-2B Registration

and receive an approval before submitting an

Application for Temporary Employment Certification

and conducting the U.S. labor market test. The proposed registration required

employers to document the number of positions the employer desires to fill in the first year of registration; the period of time for which the employer needs the workers; and that the employer's need for the services or labor is non-agricultural, temporary and is justified as either a one-time occurrence, a seasonal need, a peakload need, or an intermittent need, as defined by DHS in 8 CFR 214.2(h)(6)(ii)(B) and interpreted in § 655.6. If approved, we proposed that the registration would be valid for a period of up to 3 years, absent a significant change in conditions, enabling an employer to begin the application process at the second phase without having to re-establish temporary need for the second and third years of registration. We have retained the proposed registration process in the Final Rule, with one minor change related to Requests for Information (RFIs) and other clarifying language that if and when the

H-2B Registration

is permitted to be filed electronically, the employer must print and sign it to satisfy the original signature requirement.

a. Method of registration. Many commenters voiced support for the proposal to bifurcate the application process and shift the temporary need and bona fide job opportunity review to the registration process described in the NPRM. Some commenters supported bifurcation believing that the registration process will provide more time for OFLC to thoroughly review an employer's intended use of the program and temporary need. Others supported the registration process, asserting that the 3-year registration validity and removal of employers without legitimate temporary need will result in a more efficient process, better program oversight, better protection for workers, and greater visa availability for employers with legitimate temporary needs. Still other commenters believed that the registration would help prevent visa fraud. These comments were consistent with our reasoning, as articulated in the NPRM.

Other commenters opposed the registration process. Some industry organizations and employers feared that the addition of a registration step will make the application process more cumbersome and time-consuming and some urged us to use increased enforcement activities rather than program restructuring to accomplish our stated goals. We view the proposed separation of the temporary need evaluation process from the labor market test process as an opportunity to fully evaluate an employer's intended use of the H-2B program without sacrificing overall program efficiency. We have found that evaluating temporary need is a fact-intensive process which, in many cases, can take a considerable amount of time to resolve. Separating the two processes will give OFLC the time to make a considered decision about temporary need without negatively impacting an employer's ability to have the workers it needs in place when needed. In addition, we anticipate that many employers, with 3 years of registration validity, will enjoy a one-step process involving only the labor market test in their second and third years after registration, which will allow the Department to process these applications more efficiently. We disagree that enforcement alone can ensure program integrity; we believe the move from an attestation-based model to a compliance-based model, the bifurcation of application processing into registration and labor market test phases, and enforcement activities all contribute to program integrity. We appreciate and understand stakeholder concerns about transition to a new registration process and will make every effort to ensure that the transition does not adversely impact processing by announcing the procedures by which we will implement the registration process. We have accordingly added a regulatory provision to allow for the transition of the registration process through a future announcement in the

Federal Register

, until which time the CO will adjudicate temporary need through the application process.

One commenter expressed concern that DHS and the Department of State (DOS) each also review temporary need and that the three agencies differ in approach, resulting in inconsistent findings related to temporary need. We understand that, throughout the H-2B process, an employer must interact with multiple government agencies, each with different responsibilities related to the H-2B program. However, while each may perform different functions, the definition of temporary need is consistent across all relevant agencies, and we seek to minimize differences by participating in inter-agency communication designed to align the agencies' H-2B processing efforts.

One specialty bar association asserted that the new registration process is a departure from previous practice and that we are exceeding our authority by adjudicating temporary need in the registration process, effectively removing USCIS from the process and assuming an adjudicatory role that Congress did not intend. We disagree. We have a longstanding practice of evaluating temporary need as an integral part of the adjudication of the

Application for Temporary Labor Certification;

the bifurcation of the application process into a registration phase and a labor market test phase shifts the timing of, but does not change the nature of, our review. See Matter of Golden Dragon Chinese Restaurant, 19 I. & N. Dec. 238, 239 (Comm'r 1984). Moreover, following lengthy discussions, DHS and the Department both issued companion H-2B final rules in 2008. 73 FR 78020, Dec. 19, 2008; 73 FR 78104, Dec. 19, 2008. These final rules left our evaluation of temporary need in place and shifted administrative review of the

Application for Temporary Labor Certification

from DHS to the Department. The bifurcation of the application process simply represents a timing shift, not a change, in our longstanding review of temporary need and bona fide job opportunity issues.

b. Timing of registration. We proposed to require employers to file an

H-2B Registration

no fewer than 120 and no more than 150 calendar days before the date of initial need for H-2B workers. The Final Rule retains this provision with minor clarification.

Several commenters supported bifurcation of the application process as a means of enabling employers to conduct recruitment in the U.S. labor market closer to the date of need. We agree and anticipate, as these commenters do, that recruitment closer to the date of need should provide a more accurate reflection of actual labor market conditions.

Other commenters feared that the addition of a registration step will make the application process more time-consuming. Commenters expressed concern that, without timelines or deadlines on registration processing, an employer cannot be sure it will have time to complete Department, DHS, and DOS processing and receive the requested workers before its date of need. One commenter alleged that we sought to hide registration processing time outside the application processing time counted against our 60-day processing guideline.

Our timeline for processing applications in the new two-step process is sensitive to these concerns. The proposed registration window (

i.e.,

120 to 150 days before the employer's anticipated date of need) provides enough time for processing the registration before an employer may submit an

Application for Temporary Employment Certification

(

i.e.,

75 to 90 days before the employer's anticipated date of need) to assure that the adjudication of the

Application for

Temporary Employment Certification

will not be delayed. In addition, many employers will not have to repeat the registration process for the next 2 years. The registration timeframe also reflects our understanding that some employers may have difficulty accurately predicting their need more than 5 months in advance. The registration window seeks to balance both processing time and accuracy concerns. We anticipate an employer's overall processing time to decrease significantly when the bifurcated process goes into effect.

For consistency with other provisions under the Final Rule and clarification of the process therein, this provision has been slightly revised to add reference to the exception to the filing time requirement of the

H-2B Registration

where it is filed in support of an emergency filing under § 655.17.

c. Registration process. The proposed rule authorized the CO to issue one or more RFIs before issuing a Notice of Decision on the

H-2B Registration

if the CO determined that he or she could not approve the

H-2B Registration

for various reasons, including, but not limited to: An incomplete or inaccurate ETA Form 9155; a job classification and duties that do not qualify as non-agricultural; the failure to demonstrate temporary need; and/or positions that do not constitute bona fide job opportunities. We retained the proposed provisions in the Final Rule, with one amendment.

One employer suggested we remove the word “normally” from paragraph (g) of this section to establish a definitive timeframe for RFI issuance. We agree and have removed “normally” from paragraph (g) of this section in the Final Rule.

Another employer suggested that we should not permit the CO to issue an unlimited number of RFIs. In order to provide the CO with flexibility to work with employers seeking to resolve deficiencies and secure registration approval, we will retain the provision as proposed.

One commenter suggested limiting 3-year registration validity to employers with recurring predictable seasonal and peakload needs, while requiring one-time or intermittent need employers to re-register every year. We find that this concern is sufficiently accommodated in the regulation as written, which provides the CO with discretion over the validity period of registrations approved. The CO may approve a registration for a period up to 3 consecutive years, taking into consideration the standard of need and any other factors in the registration.

d. Registration content. Under the proposed rule, supporting documentation was to accompany the

H-2B Registration,

including documentation showing the number of positions the employer desires to fill in the first year of registration; the period of time for which the employer needs the workers; and that the employer's need for the services or labor is non-agricultural, temporary and justified as either a one-time occurrence, a seasonal need, a peakload need, or an intermittent need, as defined by DHS in 8 CFR 214.2(h)(6)(ii)(B) and interpreted in § 655.6. We are adopting the proposed provision of the NPRM without change.

One commenter suggested that we include a basic recruitment effort requirement at the time of registration to show need for the program. We do not believe requiring recruitment prior to registration filing is consistent with our purpose in separating the application process into a registration step and a labor market test. Recruitment efforts close to an employer's period of need are most likely to result in an accurate labor market test, while recruitment far in advance of the employer's period of need is unlikely to yield valid recruitment results. The Final Rule retains recruitment requirements during the application process, which is closer to the employer's date of need.

One commenter encouraged us to include a bona fide employer check, in order to eliminate fraud by fictitious employers. The commenter suggested requiring Federal Employer Identification Number (FEIN) documentation and a certificate of good standing from the company's State of formation (in the case of a corporation or a limited liability company) or comparable document for a sole proprietorship (

e.g.,

certified payrolls and confirmation of a bank account form a financial institution) as well as disclosure of beneficial owners. We agree with the importance of allowing only bona fide employers access to the H-2B program and will verify business existence at the time of registration to protect program integrity. We will perform the initial business existence verification and, if questions arise, will request additional documentation of bona fide existence through the RFI process already contained in the Final Rule.

Some labor and advocacy groups suggested making registration information available to the public, for both transparency and information purposes, as well as to permit public input on registrations before adjudication. Comments related to transparency and community interest in publicly available information have been addressed in the larger discussion of public disclosure. While we anticipate continuing to receive information and concerns from the public informally, which OFLC takes under consideration during its review, we cannot permit the public to formally participate in the adjudication process. It would present serious operational burdens, and as a result it would become difficult to complete the registration process in a timely fashion. Finally, we anticipate that the various provisions of this Final Rule will result in improved employer compliance, resolving some of the underlying concerns.

e. Registration documentation retention. We proposed requiring all employers that file an

H-2B Registration

to retain any documents and records not otherwise submitted proving compliance with this subpart for a period of 3 years from the final date of applicability of the

H-2B Registration,

if approved, or the date of denial or withdrawal. We have retained this requirement in the Final Rule.

We received few comments on this provision. One worker advocacy organization expressed support for the registration documentation retention requirement, believing the requirement will improve protections for U.S. workers, while another commenter suggested that a 5-year retention requirement would be better than 3 years in preserving evidence for criminal prosecution. We believe the 3-year retention requirement is sufficient to address our interests in upholding program integrity and, as with any document retention requirement, if an employer is involved in a proceeding in which documents are relevant, the time for retaining the documents is tolled.

One State bar association expressed concern about our discussion in the NPRM about requiring retention of documentation related to an

H-2B Registration

so that we could, potentially, use a prior year's registration, even if withdrawn, as a factor in evaluating current temporary need. The commenter argued that there are many legitimate business reasons why an employer's situation could change following denial or withdrawal of a registration. We understand that, in some situations, circumstances may change and legitimately affect the nature of an employer's need for workers. We also expect that employers who accurately document their need when submitting a registration will be able to articulate the change, if requested. We will not deny an employer's

H-2B

Registration

where the employer documents a change in circumstances and the

H-2B Registration

otherwise complies with program requirements.

f. Registration of job contractors. As discussed in the preamble to § 655.6, we are continuing to permit job contractors to participate in the H-2B program where they can demonstrate their own temporary need and not that of their employer-clients, and that this temporary need is seasonal or a one-time occurrence. Accordingly, we have made several edits to reflect the requirement that job contractors provide documentation that est

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