Labor Department to Replace USDA Survey in H-2A Wage Rule, Rates to Rise 12 Percent

The New Wage Formula

The U.S. Department of Labor will finalize a rule next week replacing the Agriculture Department's Farm Labor Survey with Bureau of Labor Statistics Occupational Employment and Wage Statistics data as the basis for H-2A visa wage rates, raising the adverse effect wage rate by an average of 12 percent across all states when it takes effect March 1, according to two Labor Department economists familiar with the rule. The rule will be signed by the acting secretary on Jan. 5 and published in the Federal Register on Jan. 9, the economists said, leaving employers less than two months to adjust recruitment contracts and payroll budgets.

The H-2A program allows agricultural employers to bring foreign workers to the United States for seasonal jobs when domestic workers are unavailable. Employers must pay the higher of the federal, state, or local minimum wage, the prevailing wage, or the adverse effect wage rate, which is designed to prevent the employment of foreign workers from depressing wages for U.S. workers. Under the current system, the Labor Department calculates the adverse effect wage rate using the USDA Farm Labor Survey, which collects wage data from farm employers each quarter. The new rule will use the Bureau of Labor Statistics Occupational Employment and Wage Statistics survey, which covers a broader sample of employers and job classifications.

The economists said the change will produce significant variation by state. Florida and Georgia will see increases of roughly 22 percent, while Washington will see an increase of about 7 percent. The national average increase will be 12 percent, and the department estimates the rule will transfer roughly $1.8 billion in additional wages to H-2A workers in the first year. The rule will apply to all H-2A job orders certified on or after March 1, including workers who are already in the United States if their contracts are renewed after that date.

The department's regulatory impact analysis projects that the higher wages will reduce the number of H-2A positions requested by employers by 4 to 6 percent over the next three years as some growers switch to mechanized harvesting or reduce acreage. The economists said the analysis also predicts modest increases in wages for domestic farmworkers in states with large H-2A populations because employers will need to raise pay to retain local employees. The rule includes a severability clause and a delayed effective date for certain sheepherding and range livestock positions.

Transition and Exemptions

The rule creates a transition period from March 1 through Sept. 30, 2026, during which employers may pay either the old USDA-based adverse effect wage rate or the new BLS-based rate, whichever is higher. Starting Oct. 1, all employers must use the BLS-based rate. The economists said the transition is intended to avoid disrupting contracts that were signed before the rule was announced and to give state workforce agencies time to update their certification systems. Employers with active contracts that run through the summer harvest season will not be required to increase wages midcontract.

Small farms with fewer than 25 full-time equivalent workers and annual sales below $750,000 will be allowed to use a reduced adjustment factor of 8 percent during the transition period. The rule also requires employers to reimburse inbound transportation costs for H-2A workers within 30 days of arrival, replacing the current requirement that employers pay at least 50 percent of the cost within the worker's first workweek. The economists said the reimbursement change will affect roughly 85 percent of H-2A employers because many currently delay the second half of reimbursement until the contract ends.

The rule will require employers to include the higher wage rate in job orders filed with state workforce agencies and to provide written notice to workers before they leave their home countries. The department will publish a revised ETA Form 790 and a new prevailing wage determination template on Jan. 12, the economists said. State workforce agencies will begin accepting job orders under the new system on Feb. 15, and the first wage determinations using BLS data will be issued on Feb. 20.

The Labor Department consulted with the Agriculture Department and the State Department during the review process. A USDA official familiar with the interagency review said Agriculture Secretary officials raised concerns about the timing of the change during the winter vegetable harvest but did not object to the substance of the rule. The State Department is preparing consular guidance for U.S. embassies in Mexico, Guatemala, and Honduras, where most H-2A workers are recruited, according to a diplomatic cable reviewed by The Alamo Post.

Industry Reaction and Outlook

A trade association official briefed on the plan said the National Council of Agricultural Employers, which represents farmers who use the H-2A program, expects to file a lawsuit challenging the rule by Jan. 13. The official said the group would likely file in federal court in North Carolina, where several large growers are headquartered, and would argue that the Labor Department failed to show that the Farm Labor Survey is unreliable. The lawsuit is also expected to claim that the department underestimated the rule's effect on specialty crop producers who rely heavily on hand harvesting.

A small-business owner in the sector, who runs an apple orchard in Adams County, Pennsylvania, and hires 38 H-2A workers each season, said the wage increase would force her to raise cider prices or reduce pruning hours. She said her labor contractor had quoted a 14 percent increase for the 2026 harvest and that she was already reviewing whether to plant fewer honeycrisp trees, which require more hand labor. She also said the new reimbursement rule would add roughly $18,000 in upfront transportation costs before any revenue from the fall harvest arrived.

Congressional aides said House Republicans may attach a provision to the Jan. 17 spending bill delaying the rule's effective date until Oct. 1, 2027, and requiring the Labor Department to keep using the USDA Farm Labor Survey until a new survey is developed. Senate Democrats have not said whether they would accept such a delay, but a Senate aide said the provision could become part of a broader immigration enforcement package. The White House Office of Management and Budget completed its review of the rule on Jan. 2, clearing the way for the Jan. 5 signature.

The outcome will shape the cost of food production in the United States and the flow of legal agricultural labor across the border. If the rule takes effect on March 1, consumers could see higher prices for berries, apples, and vegetables by late summer as producers pass along labor costs. If litigation or legislation delays the change, the H-2A program will continue under the USDA survey for at least another growing season. Watch for the Federal Register publication on Jan. 9, the trade association's court filing, the revised ETA Form 790 on Jan. 12, and any congressional action before the Jan. 17 funding deadline.