La. Forestry Ass'n, Inc. v. Solis

• Decision Date: 20 August 2012
• Docket Number: Civil Action No. 11–7687.
• Citation: 889 F.Supp.2d 711
• Parties: The LOUISIANA FORESTRY ASSOCIATION, INC., et al., Plaintiffs, v. Hilda SOLIS, et al., Defendants, and Comité De Apoyo a Los Trabajadores Agrícolas, et al., Defendant–Intervenors.
• Court: U.S. District Court — Eastern District of Pennsylvania

889 F.Supp.2d 711

The LOUISIANA FORESTRY ASSOCIATION, INC., et al., Plaintiffs,
v.
Hilda SOLIS, et al., Defendants,
and
Comité De Apoyo a Los Trabajadores Agrícolas, et al., Defendant–Intervenors.

Civil Action No. 11–7687.

United States District Court,
E.D. Pennsylvania.

Aug. 20, 2012.

[889 F.Supp.2d 714]

R. Wayne Pierce, The Pierce Law Firm LLC, Annapolis, MD, Anthony B. Haller, Lauren A. Fox, Blank Rome LLP, Philadelphia,

[889 F.Supp.2d 715]

PA, Leon R. Sequeira, Seyfarth Shaw, Washington, DC, for Plaintiffs.

Geoffrey Forney, United States Department of Justice, Harry L. Sheinfeld, U.S. Dept of Labor, Washington, DC, for Defendants.

Clermont L. Fraser, Raleigh, NC, Meredith B. Stewart, New Orleans, LA, Sarah Rempel Claassen, Silas M. Shawver, Centro De Los Derechos Del Migrante Inc, Baltimore, MD, Arthur N. Read, Liz Maria Chacko, Friends of Farmworkers, Inc., Philadelphia, PA, D. Michael Dale, Northwest Workers' Justice Project, Portland, OR, Edward Tuddenham, Law Office of Edward Tuddenham, New York, NY, Mary C. Bauer, Southern Poverty Law Center, Montgomery, AL, for Defendant–Intervenors.

MEMORANDUM
LEGROME D. DAVIS, District Judge.

On January 19, 2011, the Department of Labor (“DOL”) issued a new regulation to govern the calculation of the minimum wage that a United States employer must offer in order to recruit foreign workers as part of the H–2B visa program (“the 2011 wage rule”). The H–2B visa program permits employers to recruit unskilled laborers from abroad to fill positions that no qualified United States worker will accept. The DOL predicts that the effect of the 2011 wage rule will be to raise the wages paid to H–2B workers and to United States workers recruited for the same jobs.

A group of associations representing employers in the logging and reforestation, hotel, carnival, sugar cane, and commercial crawfish industries (the “employer associations”) brought this suit to challenge the 2011 wage rule. Members of the employer associations make use of the H–2B visa program and therefore may face higher labor costs as a result of the new rule. The employer associations contend that the DOL lacks authority to make any legislative rules, including the 2011 wage rule, with respect to the H–2B visa program, and that the 2011 wage rule was issued in violation of the Administrative Procedure Act (“APA”), 5 U.S.C. §§ 701 et seq., and the Regulatory Flexibility Act (“RFA”), id. §§ 601 et seq.

Presently before the Court are cross-motions for summary judgment filed by the employer associations and the defendants—comprising the DOL, the Department of Homeland Security (“DHS”), and the Secretaries of both agencies (collectively, “federal defendants”). (Doc. Nos. 43, 115.) For the reasons that follow, the federal defendants' motion (Doc. No. 43) will be granted and the employer associations' motion (Doc. No. 115) will be denied.

I. Factual Background and Procedural History¹A. History of Rulemaking Related to the H–2B Visa Program

A single program—called the H–2 visa program, after its statutory section—formerly encompassed the recruitment of unskilled foreign workers for both agricultural and non-agricultural jobs. See Immigration and Nationality Act (“INA”), Pub.L. No. 82–414, § 101(a)(15)(H)(ii), 66 Stat. 163, 168 (1952) (creating H–2 visa program). The H–2 visa program was administered jointly by the Attorney General and the Secretary of Labor. Id.; Certification of Temporary Foreign Labor for Industries Other than Agriculture or

[889 F.Supp.2d 716]

Logging, 33 Fed.Reg. 7570, 7570–71 (May 22, 1968).²

During this period, the DOL issued regulations that governed the H–2 visa program, including its non-agricultural component. See33 Fed.Reg. at 7570–71. The regulations provided that a regional administrator would consider labor certification applications for temporary workers and would “issue them if he finds that qualified persons in the United States are not available and that the terms of employment will not adversely affect the wages and working conditions of workers in the United States similarly employed.” 20 C.F.R. § 621.3(a) (1968).

Congress bifurcated the H–2 visa program in 1986 into the H–2A program, for agricultural workers, and the H–2B program, for unskilled, non-agricultural workers. Immigration Reform and Control Act of 1986 (“IRCA”), Pub.L. No. 99–603, § 301(a), 100 Stat. 3359, 3411. The amended statute provided very little guidance as to the H–2B program. Its entire discussion of the program was, and remains, limited to altering the specialized definition of “nonimmigrant” alien to mean, in part, “an alien ... having residence in a foreign country which he has no intention of abandoning who is coming temporarily to the United States to perform [non-agricultural] temporary service or labor if unemployed persons capable of performing such service or labor cannot be found in this country.” Id. (codified as amended at 8 U.S.C. § 1101(a)(15)(H)(ii)(b)).

In the two decades following IRCA's enactment, the DOL issued, without notice and comment, a series of letters governing the determination of prevailing wages for H–2B labor certification purposes.³ These letters charged the state workforce agencies that partner with the DOL with making prevailing wage determinations for H–2B occupations. Initially, the state workforce agencies used the methodologies of the Davis–Bacon Act (“DBA”), 40 U.S.C. §§ 276a et seq., and the McNamara–O'Hara Service Contract Act (“SCA”), 41 U.S.C. §§ 6701 et seq. (formerly 41 U.S.C. §§ 351– 358), to determine prevailing wages if no collective bargaining agreement was in place. See Interim Prevailing

[889 F.Supp.2d 717]

Wage Policy for Nonagricultural Immigration Programs, Gen. Admin. Ltr. No. 4–95, at 1–2 (1995). When no DBA or SCA wage rate was available, the state workforce agencies used wage surveys conducted by state employment security agencies or other published wage surveys. See id. at 2.

By the mid–1990s, the DOL had begun to consider “skill levels” in determining the prevailing wages for H–2B occupations. Initially, the DOL classified H–2B employment opportunities as either “entry level” (“Level I”) or “experienced level” (“Level II”). Gen. Admin. Ltr. No. 4–95, supra, at 5–6. In 1998, the DOL began to use data from the Bureau of Labor Statistics' Occupational Employment Statistics (“OES”) program to set prevailing wages if a DBA or SCA wage determination was not available. See Prevailing Wage Policy for Nonagricultural Immigration Programs, Gen. Admin. Ltr. No. 2–98, at 1 (1997). The DOL continued to break its prevailing wage determinations into two skill levels based on the job description provided by the employer. Id. at 5.

The H–1B Visa Reform Act of 2004 created a four-tier system to be used for determining prevailing wages in the “specialty occupations” covered by the H–1B visa program based on the skill level required for the job. Pub.L. No. 108–447, div. J, tit. IV, § 423, 118 Stat. 2809, 3353–54 (codified at 8 U.S.C. § 1182(p)(4)). In a 2005 letter, the DOL applied the four-tier system of the H–1B Visa Reform Act to the H–2B visa program. Mem. to SWA Adm'rs from Emily Stover DeRocco, Asst. Sec'y for Emp't & Training, Revised Prevailing Wage Determination Guidance (May 17, 2005). The 2005 letter also made the OES program the main source of data for establishing prevailing wages in the absence of a collective bargaining agreement. Id. Like its predecessors, the 2005 letter was issued without notice and comment.

In 2008, the DOL promulgated, through notice-and-comment rulemaking, regulations to govern the labor certification process for the H–2B visa program (“the 2008 wage rule”). SeeLabor Certification Process, 73 Fed.Reg. 78,020 (Dec. 19, 2008) (codified at 20 C.F.R. part 655). These regulations codify various aspects of the 2005 guidance. The 2008 wage rule provides that, in the absence of a collective bargaining agreement, “the prevailing wage for labor certification purposes shall be the arithmetic mean ... of the wages of workers similarly employed at the skill level in the area of intended employment” using OES data. 20 C.F.R. § 655.10(b)(2). ⁴ In applying the 2008 wage rule, the DOL uses the four-tier system set out in the 2005 guidance letter.

B. Legal Challenge to the 2008 Wage Rule

Organizations representing foreign and United States workers impacted by the H–2B program filed a challenge in this Court in 2009 to various aspects of the 2008 wage regulation. See Comité de Apoyo a los Trabajadores Agrícolas v. Solis ( “CATA” ), No. 09–240, 2010 WL 3431761 (E.D.Pa. Aug. 30, 2010). The case was assigned to Judge Louis H. Pollak.⁵ In an opinion issued on August 30, 2010, Judge Pollak held that the DOL had violated the APA by importing into the H–2B program

[889 F.Supp.2d 718]

a skill-level methodology derived from the H–2A program without ever explaining its reasons for doing so. Id. at *25. Judge Pollak also concluded that the four-tier wage structure set out in the 2005 letter was itself a legislative rule, which had not been subject to notice and comment and was therefore invalid. Id. Out of concern that vacating the four-tier skill-level methodology would create a regulatory gap, Judge Pollak left the 2008 wage rule in place, but ordered the DOL to promulgate a replacement regulation within 120 days of the date of his opinion. Id. Almost two years later, the 2008 wage rule remains in effect.

C. The 2011 Wage Rule

The wage rule that is the subject of the present challenge was promulgated as a replacement for the invalidated 2008 wage rule. On October 5, 2010, the DOL issued a notice setting forth a proposed rule governing prevailing wage determinations related to the H–2B program. SeeWage Methodology for the Temporary Non–Agricultural Employment H–2B Program, 75 Fed.Reg. 61,578 (Oct. 5, 2010) (hereinafter, “Proposed Rule”). In its notice, the DOL stated that it was concerned that the four-tier skill-level methodology did not produce “the appropriate...