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Dec 7, 2018

H-2B Reform: A Christmas Miracle

Amy Jill Novak

A tentative bi-partisan deal has been struck to reform the H-2B program, in effect doubling the number of allotted visas per fiscal year from 66,000 to 132,000. Permanent cap is essential to provide certainty for US seasonal businesses who have suffered economically in the past few years from their inability to obtain workers due to cap issues. Visa requests peaked at almost 130,000 in 2007 before dipping to fewer than 45,000 in 2009, then rising to between 83,000 and 85,000 in 2016 and 2017. However, there is a price to pay for the cap increase, and that price is the new requirement that all H-2B employers perform strict checks on all workers hired since 2012. Employers would have a year to verify new hires' work authorization through E-Verify, the government's system for checking workers's identity. Employers would also be required to re-verify the remainder of their workforce, starting with workers hired on or after June 15, 2012. If any employer finds an undocumented worker as part of this background check process, he/she will be able to hire another H-2B worker instead.

Senator Grassley, the Chairman of the Judiciary Committee, has taken the lead in this negotiation, which has been a crucial change to previous years' attempts to negotiate cap relief for small businesses. He had been a vocal critic of the program in years' past. Perhaps the country's low unemployment (3.8%) rate contributed to his change of heart. The goal is to ensure businesses have the workers they need while at the same time shore-ing up the integrity of the program ensuring a legal workforce.   

The following are the specific terms of the bill:

- Permanent cap will increase from 66,000 to 132,000;

- Cap exempt visas within specified SOC codes for workers performing work that directly supports the reconstruction or restoration of physical property and infrastructure or debris clean up and removal related to natural disasters in declared disaster states;

- H-2B employers will be required to participate in the federal E-Verify program for all employees hired no later than one year after enactment of legislation AND within 3 years of enactment ALL hires made on or after October 1, 2012. For each worker who fails E-Verify, the employer may replace the worker with a cap exempt H-2B worker for up to three years.  The worker would count against the cap after the third year;

- Increase the anti-fraud fee from $150 to $350 per petition;

- Establishment of a Department of Labor electronic jobs registry. The Department of Labor will collect a fee from H-2B employers to pay for this registry.

The following provisions go into effect in fiscal year 2020: 

- Allocation of visas is changed from current bi-annual allocation to quarterly allocation (Oct-Dec 14%, Jan-Mar 45%, Apr-Jun 39% and Jul-Sept 2%);

- All H-2B employers with dates of need in a quarter will apply to the Department of Labor at the same time regardless of their start date in the quarter.  Employers who have received an approved visa petition in at least three of the last five years (compliant seasonal employers, or CSE) shall receive priority status for the available visas.  No less than 15% of the visa categories shall go be distributed to new entrants to the program.  If either of the visa categories (new entrants, CSEs) are oversubscribed, visas shall be allocated on a proportional basis;

- If either visa category is not exhausted during a given quarter, visas shall be transferred to the other category. If visas remain, visas shall roll over to the exit quarter. 

If you have had difficulty obtaining workers in the past due to cap issues, contact our office for a consultation. We will help you find a solution and gladly answer any questions regarding terms or future provisions the H-2B program reform.

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