[House Hearing, 113 Congress]
[From the U.S. Government Publishing Office]
EXAMINING THE ROLE OF LOWER-SKILLED GUEST WORKER PROGRAMS IN TODAY'S
ECONOMY
=======================================================================
HEARING
before the
SUBCOMMITTEE ON WORKFORCE PROTECTIONS
COMMITTEE ON EDUCATION
AND THE WORKFORCE
U.S. House of Representatives
ONE HUNDRED THIRTEENTH CONGRESS
FIRST SESSION
__________
HEARING HELD IN WASHINGTON, DC, MARCH 14, 2013
__________
Serial No. 113-10
__________
Printed for the use of the Committee on Education and the Workforce
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COMMITTEE ON EDUCATION AND THE WORKFORCE
JOHN KLINE, Minnesota, Chairman
Thomas E. Petri, Wisconsin George Miller, California,
Howard P. ``Buck'' McKeon, Senior Democratic Member
California Robert E. Andrews, New Jersey
Joe Wilson, South Carolina Robert C. ``Bobby'' Scott,
Virginia Foxx, North Carolina Virginia
Tom Price, Georgia Ruben Hinojosa, Texas
Kenny Marchant, Texas Carolyn McCarthy, New York
Duncan Hunter, California John F. Tierney, Massachusetts
David P. Roe, Tennessee Rush Holt, New Jersey
Glenn Thompson, Pennsylvania Susan A. Davis, California
Tim Walberg, Michigan Raul M. Grijalva, Arizona
Matt Salmon, Arizona Timothy H. Bishop, New York
Brett Guthrie, Kentucky David Loebsack, Iowa
Scott DesJarlais, Tennessee Joe Courtney, Connecticut
Todd Rokita, Indiana Marcia L. Fudge, Ohio
Larry Bucshon, Indiana Jared Polis, Colorado
Trey Gowdy, South Carolina Gregorio Kilili Camacho Sablan,
Lou Barletta, Pennsylvania Northern Mariana Islands
Martha Roby, Alabama John A. Yarmuth, Kentucky
Joseph J. Heck, Nevada Frederica S. Wilson, Florida
Susan W. Brooks, Indiana Suzanne Bonamici, Oregon
Richard Hudson, North Carolina
Luke Messer, Indiana
[Vacant], Staff Director
Jody Calemine, Minority Staff Director
------
SUBCOMMITTEE ON WORKFORCE PROTECTIONS
TIM WALBERG, Michigan, Chairman
John Kline, Minnesota Joe Courtney, Connecticut,
Tom Price, Georgia Ranking Member
Duncan Hunter, California Robert E. Andrews, New Jersey
Scott DesJarlais, Tennessee Timothy H. Bishop, New York
Todd Rokita, Indiana Marcia L. Fudge, Ohio
Larry Bucshon, Indiana Gregorio Kilili Camacho Sablan,
Richard Hudson, North Carolina Northern Mariana Islands
C O N T E N T S
----------
Page
Hearing held on March 14, 2013................................... 1
Statement of Members:
Courtney, Hon. Joe, ranking member, Subcommittee on Workforce
Protections................................................ 4
Prepared statement of.................................... 6
Walberg, Hon. Tim, Chairman, Subcommittee on Workforce
Protections................................................ 1
Prepared statement of.................................... 3
Statement of Witnesses:
Bauer, Mary, Southern Poverty Law Center..................... 19
Prepared statement of.................................... 21
Benjamin, Fred, chief operating officer, Medicalodges, Inc... 15
Prepared statement of.................................... 16
Musser, R. Daniel III, president, Grand Hotel, Mackinac
Island, MI................................................. 29
Prepared statement of.................................... 31
Reiff, Laura, principal shareholder, Greenberg Traurig;
chair, Business Immigration and Compliance Group on behalf
of the Essential Worker Immigration Coalition.............. 8
Prepared statement of.................................... 10
Additional Submissions:
Andrews, Hon. Robert E., a Representative in Congress from
the State of New Jersey:
Letter, dated March 18, 2013, from the National
Association of Home Builders (NAHB).................... 76
Bonamici, Hon. Suzanne, a Representative in Congress from the
State of Oregon:
Report, ``Program Design Issues Hampered ETA's Ability to
Ensure the H-2B Visa Program Provided Adequate
Protections for U.S. Forestry Workers in Oregon,''
dated Oct. 17, 2011, Internet address to............... 52
Hudson, Hon. Richard, a Representative in Congress from the
State of North Carolina, questions submitted for the record 78
Ms. Reiff, response to questions submitted for the record.... 79
Chairman Walberg:
Letter, dated March 13, 2013, from Associated Builders
and Contractors, et al................................. 54
Statement of the American Horse Council (AHC)............ 55
Letter, dated March 13, 2013, from the Center for Global
Development............................................ 57
Letter, dated March 14, 2013, from the Progressive
Solutions LLC.......................................... 59
Statement of the H-2B Workforce Coalition................ 61
Statement of ImmigrationWorks USA........................ 61
Joint statement of the Professional Landcare Network
(PLANET) and the American Nursery and Landscape
Association (ANLA)..................................... 63
Report, ``Migrant Spray Industry Report,'' October 2012.. 66
Statement of the American Hotel & Lodging Association.... 72
Letter [via email], dated March 13, 2013, from the
National Hispanic Landscape Alliance (NHLA)............ 74
Statement of Keesen Landscape Management, Inc............ 75
EXAMINING THE ROLE OF
LOWER-SKILLED GUEST WORKER
PROGRAMS IN TODAY'S ECONOMY
----------
Thursday, March 14, 2013
U.S. House of Representatives
Subcommittee on Workforce Protections
Committee on Education and the Workforce
Washington, DC
----------
The subcommittee met, pursuant to call, at 10:03 a.m., in
room 2175, Rayburn House Office Building, Hon. Tim Walberg
[chairman of the subcommittee] presiding.
Present: Representatives Walberg, Kline, DesJarlais,
Rokita, Courtney, Andrews, Bishop, Sablan, and Bonamici.
Staff present: Owen Caine, Legislative Assistant; Ed
Gilroy, Director of Workforce Policy; Benjamin Hoog,
Legislative Assistant; Nancy Locke, Chief Clerk/Assistant to
the General Counsel; Donald McIntosh, Professional Staff
Member; Brian Newell, Deputy Communications Director; Krisann
Pearce, General Counsel; Nicole Sizemore, Deputy Press
Secretary; Alex Sollberger, Communications Director; Alissa
Strawcutter, Deputy Clerk; Loren Sweatt, Senior Policy Advisor;
Mary Alfred, Minority Fellow, Labor; Tylease Alli, Minority
Clerk/Intern and Fellow Coordinator; John D'Elia, Minority
Labor Policy Associate; Brian Levin, Minority Deputy Press
Secretary/New Media Coordinator; Celine McNicholas, Minority
Senior Labor Counsel; Richard Miller, Minority Senior Labor
Policy Advisor; Megan O'Reilly, Minority General Counsel; and
Michele Varnhagen, Minority Chief Policy Advisor/Labor Policy
Director.
Chairman Walberg. Well, good morning. A quorum being
present, the subcommittee will come to order. Other committee
members will be arriving, but it is time to begin so we might
as well begin.
I would like to welcome our members and thank our witnesses
for being here this morning.
Legal immigration is a hallmark of this great country, my
family included. Families and individuals from around the world
have come to our shores in pursuit of freedom and opportunity.
President Reagan often referred to our nation as a
``shining city on a hill.'' For those who have followed its
light we have tried to provide a legal framework for entering
and residing inside the United States.
Such a framework is critical to protecting our national
interests and security. However, our immigration system is no
longer as strong and effective as it should be and reform is
complex and controversial, to say the least.
The Education and the Workforce Committee has long played
an important role in that debate overseeing policies such as
employment verification and temporary guest work programs. The
current debate is even more complicated due to the ongoing jobs
crisis plaguing our nation: 12 million Americans are searching
for work.
In my home state of Michigan nearly 9 percent of the
state's working population is without a job. It is an
improvement from where we were a few short years ago, but we
still have a long way to go before families and small
businesses fully recover from a recession.
To help our economy move forward we must ensure, first of
all, all American workers have the tools they need to compete
for good-paying jobs here at home. I am pleased the House will
consider this afternoon comprehensive job training reform
legislation which will help workers and job-seekers access to
the skills and education they need to get back to work.
Additionally, we must do all that is reasonably possible to
ensure employers are searching far and wide for American
workers. Guest worker programs include a number of provisions
intended to protect domestic workers. We can debate whether
those policies go too far or not far enough, but it is
imperative we continue to support our fellow citizens
struggling to find work.
We do realize, however, there are times when the supply of
domestic labor falls short of demand. For a variety of reasons
and despite their best efforts, some employers simply cannot
hire the workforce necessary to run their businesses. Guest
workers help fill that void.
The Immigration Nationality Act currently includes several
guest worker visa programs, such as the H-1B program for highly
skilled workers and the H-2B program for temporary non-
agricultural workers. The law allows foreign workers to be
admitted for a specific period of time and purpose. Under the
H-2B program specifically, guest workers can enter the United
States for up to 10 months and their stay can be extended up to
3 consecutive years.
An employer petitioning for guest workers must certify that
domestic workers are unavailable as well as demonstrate the
hiring of foreign workers will not harm the wages and
employment of Americans.
We will examine today whether these programs serve the best
interests of workers and employers. No doubt, that is a large
undertaking for one hearing and involves a number of important
questions.
For example, do limits on the number of visas issued each
year undermine the success of these programs? Will regulatory
proposals put forward by the administration make it easier or
more difficult for employers to obtain foreign labor?
Do we have the right tools in place to ensure protections
for American workers are adequately enforced? Do the current
temporary visa programs meet the long-term needs of employers
seeking lower-skilled workers?
It is difficult for any federal program or law to keep pace
with our dynamic economy. Shifting demographics can alter the
landscape of America's workplaces. New industries and
technologies constantly change how businesses provide goods and
services to consumers.
While such developments often improve our lives, they also
raise difficult questions that need to be addressed by
policymakers. I hope our hearing today will inform the debate
that is taking place nationwide.
Again, I would like to thank our witnesses for joining us.
And I will now recognize my distinguished colleague, Joe
Courtney, the senior Democratic member of the subcommittee, for
his openingremarks.
[The statement of Chairman Walberg follows:]
Prepared Statement of Hon. Tim Walberg, Chairman,
Subcommittee on Workforce Protections
Good morning. I'd like to welcome our members and thank our
witnesses for being with us today.
Legal immigration is a hallmark of this great country. Families and
individuals from around the world have come to our shores in pursuit of
freedom and opportunity. President Reagan often referred to our nation
as ``a shining city upon a hill.'' For those who have followed its
light, we have tried to provide a legal framework for entering and
residing inside the United States. Such a framework is critical to
protecting our national interests and security.
However, our immigration system is no longer as strong and
effective as it should be, and reform is complex and controversial. The
Education and the Workforce Committee has long played an important role
in that debate, overseeing policies such as employment verification and
temporary guest worker programs.
The current debate is even more complicated due to the ongoing jobs
crisis plaguing the nation. Twelve million Americans are searching for
work. In my home state of Michigan, nearly 9 percent of the state's
working population is without a job. It is an improvement from where we
were a few short years ago, but we still have a long way to go before
families and small businesses fully recover from the recession.
To help our economy move forward, we must first ensure all American
workers have the tools they need to compete for good paying jobs here
at home. I am pleased the House will consider this afternoon
comprehensive job training reform legislation, which will help workers
and job seekers access to the skills and education they need to get
back to work.
Additionally, we must do all that is reasonably possible to ensure
employers are searching far and wide for American workers. Guest worker
programs include a number of provisions intended to protect domestic
workers. We can debate whether those policies go too far or not far
enough, but it is imperative we continue to support our fellow citizens
struggling to find work.
We do realize, however, there are times when the supply of domestic
labor falls short of demand. For a variety of reasons and despite their
best efforts, some employers simply cannot hire the workforce necessary
to run their businesses. Guest workers help fill that void.
The Immigration Nationality Act currently includes several guest
worker visa programs, such as the H-1B program for highly-skilled
workers and the H-2B program for temporary non-agricultural workers.
The law allows foreign workers to be admitted for a specific period of
time and purpose.
Under the H-2B program specifically, guest workers can enter the
United States for up to 10 months and their stay can be extended up to
three consecutive years. An employer petitioning for guest workers must
certify that domestic workers are unavailable, as well as demonstrate
the hiring of foreign workers will not harm the wages and employment of
Americans.
We will examine today whether these programs serve the best
interests of workers and employers. No doubt that is a large
undertaking for one hearing and involves a number of important
questions.
For example, do limits on the number of visas issued each year
undermine the success of these programs? Will regulatory proposals put
forward by the administration make it easier or more difficult for
employers to obtain foreign labor? Do we have the right tools in place
to ensure protections for American workers are adequately enforced? Do
the current temporary visa programs meet the long-term needs of
employers seeking lower-skilled workers?
It is difficult for any federal program or law to keep pace with
our dynamic economy. Shifting demographics can alter the landscape of
America's workplaces. New industries and technologies constantly change
how businesses provide goods and services to consumers.
While such developments often improve our lives, they also raise
difficult questions that need to be addressed by policymakers. I hope
our hearing today will inform the debate that is taking place
nationwide.
Again, I'd like to thank our witnesses for joining us, and I will
now recognize my distinguished colleague Joe Courtney, the senior
Democratic member of the subcommittee, for his opening remarks.
______
Mr. Courtney. Well thank you, Mr. Chairman. And I
particularly want to compliment you for organizing this hearing
early in this Congress because there is no question that since
the election last November this issue has suddenly gotten a lot
more political momentum, and obviously we want to make sure
this subcommittee and our full committee are active and full
participants in any legislative efforts.
Mr. Chairman, we are meeting today to discuss the role of
low-skilled guest worker programs in our country. As I said,
this discussion comes at an important moment as we consider a
framework for comprehensive immigration reform.
Prior to the 2012 election, real, meaningful reform of our
nation's immigration policy seemed completely out of the
political realm of the possible. Sadly, the last major effort,
the DREAM Act, which was passed in the lame duck session in
2010, seemed to be the high watermark for this era. But
nonetheless, the election has really changed the political
dynamics surrounding this whole issue.
And we are seeing encouraging bipartisan agreements among
our Senate colleagues and an agreement on a set of shared
principles for reform between the U.S. Chamber of Commerce and
the AFL-CIO. I am deeply encouraged by this progress and agree
with the joint statement released by the chamber and the AFL
that today's effort at comprehensive immigration reform present
a historic opportunity for U.S. workers and businesses to work
together to fix a broken system.
I don't think there is a single member of Congress who has
casework in their district offices that cannot say that this
has just become an overwhelming volume of work, whether it is
family unification, whether it is work visas, tourist visas, J-
1, you name it. Again, the folks that work for us in our
district office feel every single day the dysfunctional system
that we have in place and it is time to fix it.
But the basic principles which have been issued, I think,
are important to state at the outset, which is first and
foremost, any work-based visa program for foreign workers must
protect employment opportunities for U.S. workers. It must also
prevent the exploitation of guest workers.
Today the national unemployment rate stands at 7.7 percent;
12 million U.S. workers are looking for jobs. And that is
probably understated, in terms of people who have just sort of
left the marketplace.
The unemployment rate in many of the industries that
utilize the largest number of H-2B visa guest workers programs
is even bigger. The February 2013 unemployment rate in the
construction trades was 15.7 percent; leisure and hospitality,
11.2 percent. That is almost 3 million U.S. workers just in
those two sectors alone looking for a job. We must ensure that
those workers have a meaningful chance at the jobs that are
available in these industries.
This morning we have the chance to examine the role of
lower-skilled temporary foreign worker program in our nation. I
hope that we consider what impact guest worker programs have on
wages and working conditions.
Are employers and industries that rely heavily on H-2B
workers paying a fair and competitive wage? Are there some jobs
that U.S. workers are simply unwilling or unavailable to
perform, or does reliance on guest worker programs create a
situation whereby the wages and demands of an industry make it
nearly impossible for American workers to take on those jobs
and put food on their family's table?
Earlier this week the Bureau of Labor Statistics determined
that the personal care home health aides are the fastest-
growing job classification in our country. On average, DOL
found that full-time workers in this field earn about $20,000 a
year. The hours are long, the work is physically and
emotionally challenging. That makes it difficult to maintain a
stable workforce.
The question to consider today is, will opening this type
of work to guest workers address any workforce shortage in a
way that is good for our nation's economy, good for U.S.
workers, and fair to the guest workers who end up in these
jobs?
Mr. Chairman, we have a responsibility to ensure that our
nation's immigration laws meet the needs of our country's
workers and employers. We also have a responsibility to our
nation's guest workers.
The reality is is that these workers perform difficult work
and enjoy few workplace protections. During the Bush
administration, DOL loosened the rules governing the H-2B
program. Employers merely had to attest that they have
attempted to recruit U.S. workers for open positions; they no
longer were required, in many instances, to demonstrate that
their recruitment efforts--their recruitment efforts or
coordinate with the state workforce agency.
The administration also adjusted the wage requirements,
putting downward pressure on wages in H-2B programs. Under the
common sense rules proposed by the Obama administration many of
these damaging changes were addressed.
Specifically, the wage rate reform rule would have
increased the wages paid to H-2B workers and similarly employed
U.S. workers by an average of $4.83 an hour. There is no
question that better wages would attract more U.S. workers to
these jobs and enable them to stay in these jobs. However, the
regulations remain tied up in litigation or are delayed by
appropriation riders.
I hope today's discussion is the start of a productive
debate on immigration reform--one that seeks to serve this
nation's workers and employers. What we don't need is a race to
the bottom here at home, with workers forced to compete for
lower and lower-wage jobs.
We need to be careful about how we administer any temporary
guest worker program to ensure that foreign workers are not
exploited and that U.S. workers have a shot at available jobs.
Anything less will undermine the jobs, wages, and working
conditions of U.S. workers and the guest workers laboring with
them.
I look forward to exploring these issues and hearing from
the witnesses.
Thank you, Mr. Chairman. I yield back.
[The statement of Mr. Courtney follows:]
Prepared Statement of Hon. Joe Courtney, Ranking Member, Subcommittee
on Workforce Protections
Mr. Chairman, today we are meeting to discuss the role of lower-
skilled guest worker programs in our economy. This discussion comes at
an important moment, as we consider a framework for comprehensive
immigration reform. Prior to the 2012 election, real, meaningful reform
of our nation's immigration policy seemed unlikely. However, today's
hearing comes in the wake of encouraging bipartisan agreements among
our Senate colleagues and an agreement on a set of shared principles
for reform between the Chamber of Commerce and the AFL-CIO. I am deeply
encouraged by this progress and agree with the joint statement released
by the Chamber and the AFL that today's efforts at comprehensive
immigration reform present a historic opportunity for U.S. workers and
businesses to work together to fix a broken system.
First and foremost, any work-based visa program for foreign workers
must protect employment opportunities for U.S. workers. It must also
prevent the exploitation of guest workers. Mr. Chairman, today the
national unemployment rate stands at 7.7 percent--12 million U.S.
workers are looking for a job. The unemployment rate in many of the
industries that utilize the largest number of H-2B guest workers is
even higher. The February 2013 unemployment rate for the construction
industry was 15.7 percent and in leisure and hospitality the
unemployment rate was 11.2 percent--that is almost 3 million U.S.
workers looking for a job. We must ensure that these workers have a
meaningful chance at the jobs that are available in these industries.
This morning, we have the chance to examine the role of a lower-
skilled temporary foreign worker program in our nation. I hope that we
consider what impact guest worker programs have on wages and working
conditions. Are employers in the industries that rely heavily on H-2B
workers paying a fair, competitive wage? Are there some jobs that U.S.
workers are simply unwilling or unavailable to perform? Or, does
reliance on guest worker programs help create a situation whereby the
wages and demands of an industry make it nearly impossible for American
workers to take those jobs and put food on their family's table?
Earlier this week, the Bureau of Labor Statistics determined that
personal care aides/home health aides are the fastest growing job
classifications in this country. On average, DOL found that full-time
workers in this field earn around $20,000 a year. The hours are long
and the work is physically and emotionally challenging. That makes it
difficult to maintain a stable workforce. The question to consider
today is, will opening this type of work to guest workers address any
workforce shortage in a way that is good for our nation's economy, good
for U.S. workers, and fair to the guest workers who may end up in those
jobs.
Mr. Chairman, we have a responsibility to ensure that our nation's
immigration laws meet the needs of our country's workers and employers.
We also have a responsibility to our nation's guest workers. The
reality is that these workers perform difficult work and enjoy few
workplace protections. During the George W. Bush Administration, the
Department of Labor loosened the rules governing the H-2B program.
Employers merely had to attest that they have attempted to recruit U.S.
workers for open positions, they no longer were required to demonstrate
their recruitment efforts or coordinate with state workforce agencies.
The Bush Administration also adjusted the wage requirements, putting
downward pressure on wages in the H-2B program. Under common sense
rules issued by the Obama Administration, many of the damaging changes
the Bush Administration made to the H-2B program were addressed.
Specifically, the wage rate reform rule would have increased the wages
paid to H-2B workers and similarly employed U.S. workers by an average
of $4.83 per hour. There is no question that better wages would help
attract more U.S. workers to those jobs and enable them to stay in
those jobs. However, the regulations remain tied up in litigation or
delayed by appropriations riders.
I hope today's discussion is the start of a productive debate on
immigration reform--one that seeks to serve this nation's workers and
employers. What we don't need is a race to the bottom here at home,
with workers forced to compete for lower and lower wage jobs. We need
to be careful about how we administer any temporary guest worker
program to ensure that foreign workers are not exploited and U.S.
workers have a shot at available jobs. Anything less will undermine the
jobs, wages, and working conditions of U.S. workers and the guest
workers laboring with them. I look forward to exploring these issues
and hearing from the witnesses. Thank you, Mr. Chairman.
______
Chairman Walberg. I thank the gentleman.
Pursuant to committee rule 7(c), all members will be
permitted to submit written statements to be included in the
permanent hearing record, and without objection, the hearing
record will remain open for 14 days to allow statements,
questions for the record, and other extraneous material
referenced during the hearing to be submitted into the official
record.
It is a privilege to introduce our witness panel this
morning. First, Ms. Laura Reiff is a co-managing shareholder of
the Greenberg Traurig law firm of McLean, Virginia. She is
testifying on behalf of the Essential Worker Immigration
Coalition.
Welcome.
Our second witness is Mr. Fred Benjamin, who is chief
operating officer at Medicalodges, Inc., in Coffeyville,
Kansas. Could use some coffee right now, maybe. That works. Mr.
Benjamin is testifying on behalf of the American Health Care
Association.
Thank you for being here.
Ms. Mary Bauer is the legal director at the Southern
Poverty Law Center in Montgomery, Alabama.
Thank you for joining us again.
And then it is a special privilege for me to introduce Mr.
Dan Musser, who is the president of the Grand Hotel in Mackinac
Island, Michigan.
Allowing personal privilege here, I certainly give a very
easy recommendation and advertisement for the Grand Hotel. If
you have not been there you haven't lived, to sit on the
longest porch in the world looking at some of the greatest
scenery in the Straits of Mackinac, on an island where the only
sound you will basically hear other than happy voices is the
clippety-clop of horses and carriages, since those are the only
transportation sources on the island. If you have missed it,
you have missed it and it is about time to take care of that.
Welcome.
Mr. Chairman? When you sit this----
Mr. Kline. [Off mike.]
Chairman Walberg. Oh, gee whiz. Don't you wish. [Laughter.]
Before I recognize each of you to provide your testimony
let me briefly explain our simple lighting system--much like
traffic lights. I am sure you understand that you will have 5
minutes to present your testimony.
When you begin the light in front of you will turn green;
when 1 minute is left, caution, a light yellow comes on; when
your time is expired the light will turn red, at which point I
ask that you would wrap up as quickly as possible to allow the
questions that will come that will allow you to expand on what
you have said, I am certain.
After you have testified members will each have 5 minutes
to ask questions of the panel with the same light source
available to them.
And so at this time I would recognize Ms. Reiff for your
presentation. Thank you.
STATEMENT OF LAURA FOOTE REIFF, CO-MANAGING SHAREHOLDER,
GREENBERG TRAURIG LLP, TESTYFYING ON BEHALF OF THE ESSENTIAL
WORKER IMMIGRATION COALITION
Ms. Reiff. Thank you, Chairman Walberg, and Ranking Member
Courtney, and distinguished members of the committee. Good
morning and thank you for the opportunity to testify before the
committee today.
My name is Laura Reiff and I am a partner at the law firm
of Greenberg Traurig. I also run the national immigration
practice for the firm, and I have been involved in immigration
legislative issues for the past 20-plus years.
I am also one of the founders and on the leadership team of
the Essential Worker Immigration Coalition, the business
coalition that has been put together on immigration reform. And
we have been working together to help effect immigration change
since 1999.
It is a privilege for me to be here today to discuss the
role of lesser-skilled worker programs as Congress wrestles
with comprehensive immigration reform issues.
It is very important to note that an overhaul of the
immigration policy to meet our national security and economic
needs is long overdue. It has been more than 26 years since the
last reform. It is really time for good public policy to take
center stage.
The Immigration Reform and Control Act was passed in 1986
when I was still in law school. It was designed to be a
solution to the broken immigration system.
The law included a new immigration legal program that
brought more than 3 million people out of the shadows and
granted them lawful status. There was also a plan to hold
employers accountable for hiring workers by asking them to
check the identity and work authorization of new hires, and as
a counterbalance to employer verification there were
antidiscrimination requirements passed to ensure that employers
didn't discriminate in hiring based upon citizenship or
national origin. This was supposed to be the solution in 1986.
The idea was good but things went dreadfully wrong over the
past two decades. The programs didn't work the way they were
envisioned.
Millions of foreign workers entered the U.S. in
questionable status and took jobs with U.S. employers. Most
employers did go through all the employment verification
processes but the new workers had documents to satisfy those
requirements.
Why didn't these foreign workers enter the U.S. legally or
why did they overstay their status and take jobs without
authorization? The answer is very simple: There was no
immigration program available to those foreign workers that
wanted to enter the U.S. lawfully.
What is needed now to correct this employment-based
immigration, this broken employment-based immigration system,
is a workable employment eligibility verification program for
employers, a functional temporary worker program that allows
employers to hire foreign workers when U.S. workers are not
available, and some sort of stabilization of the existing
foreign workforce that is embedded in the U.S. economy over the
last two decades.
Current visa programs don't address the problem, as the
chairman stated. We have an H-1B program, which is for
highlyskilled individuals with at least a bachelor's degree. We
have an H-2A program, which is for seasonal agricultural
workers. We have an H-2B program, which is for seasonal non-
agricultural workers. And then some other extraneous visa
programs, like the TN, Trade NAFTA program, which is for
professionals from Canada or Mexico.
These current visa programs--the H-1B has kind of been seen
as the model of a temporary worker program that should be used
for a new worker program. It is a program that is limited to 6
years.
Again, it has to--the individual must come in and be
sponsored by an employer. The employer must have a position
that requires an individual with a university degree. And the
program is capped at 65,000 numbers per year.
It is an arbitrary cap. That cap has been reached every
year over the past 10 years and it is anticipated that that cap
will be reached on April 1 of 2013 for the next fiscal year
2014 number of H-1B visas. That cap is the filing date is
coming up imminently.
The H-2B program has been a program for seasonal non-
agricultural workers, and you will hear from Mr. Musser today
about how that program works. It is not a program that fits the
needs of our economy. And it is not a program that deals with
full-time permanent employment.
H-2B visas are used in industries such as landscaping,
seasonal hospitality, fish processing and there is a cap on
that program as well--an arbitrary cap of 66,000.
These existing types of temporary worker programs do not
begin to meet all the needs of our complex U.S. economy. There
is no temporary worker program that addresses the huge gulf
between these programs and the complexities of the many
different kinds of jobs and skills that are out there.
Employers need a way to recruit foreign workers when they
cannot find a U.S. worker after rigorous recruitment, and
currently there are very few realistic mechanisms to accomplish
that.
Employers are experiencing persistent and recurring job
openings despite the downturn in the economy. Many positions
remain unfilled despite extensive recruitment efforts of U.S.
workers.
Some industries that have expressed concern: meat
processing, specialty construction employers, manufacturing,
restaurant and food service, hospitals, and you will hear today
about hotels and resorts and senior care medical facilities--
nursing homes.
We need to fill the program gap that was left in 1986. The
Essential Worker Immigration Coalition has worked together with
other advocates to come up with a new model, a model that we
think actually can work for a new worker program.
In contrast with other existing U.S. temporary worker
programs, under this new proposal employers would not sponsor
workers for visas and workers would not be tied to specific
jobs or specific employers. But workers would, rather, be able
to change jobs and work for any employer who is registered to
participate in a program.
I have put the full details in the testimony, but here are
a few quick highlights: it would be a two-track program;
employers would register for slots after doing rigorous
recruitment; employees would then be able to register for a
slot.
There would be complete portability. Employees would be
able to move between registered employers.
The cap would not be arbitrary; it would be flexible and
market-based, based on demand so that when employers needed
workers after testing the U.S. market they would be able to
bring workers in.
Wages would be the wages that would be paid to actually--to
similarly-situated U.S. worker or the prevailing wage,
whichever is higher. And we actually propose having a pretty
detailed monitoring system to make sure that employees that are
here are monitored while they are here and that their status is
checked so that there is a workable employment eligibility
verification system and a way to track employees when they are
here.
Chairman Walberg. We will look forward to plumbing the
depths further, but----
Ms. Reiff. So I thank you for allowing me to testify today,
and I am looking forward to answering questions.
[The statement of Ms. Reiff follows:]
Prepared Statement of Laura Reiff, Principal Shareholder, Greenberg
Traurig; Chair, Business Immigration and Compliance Group on behalf of
the Essential Worker Immigration Coalition
Chairman Walberg, Ranking Member Courtney, and distinguished
members of the Committee, good morning, and thank you for the
opportunity to testify today before the Committee. I am Laura Reiff,
the Co-Managing Shareholder of Greenberg Traurig, LLP's (``GT'') Tysons
Corner Office and Co-Chair of GT's Business Immigration and Compliance
Group. I focus my practice on business immigration laws and regulations
affecting U.S. and foreign companies, as well as related employment
compliance and legislative issues.
I am also one of the founders and a member of the leadership team
of the Essential Worker Immigration Coalition. The Essential Worker
Immigration Coalition (EWIC) is a coalition of businesses, trade
associations, and other organizations from across the industry spectrum
that support reform of U.S. immigration policy to facilitate a
sustainable workforce for the American economy while ensuring our
national security and prosperity.
Overview
It is a privilege for me to be here today discussing the role of
lower-skilled guest worker programs as Congress wrestles with
comprehensive immigration reform issues. It is very important to note
that an overhaul of our immigration policy to meet our national
security and economic needs is long overdue--it has been more than
twenty-six years since the last reform--it is time for good public
policy to take center stage.
The Immigration Reform and Control Act of 1986 was designed to be a
solution to a broken immigration system of the day. The law included a
new legal immigration program that brought more than 3 million people
out of the shadows and granted them lawful status. There was also a
plan to hold employers accountable for hiring workers by asking them to
check the identity and work authorization of new hires. As a counter
balance to employer verification, there were antidiscrimination
requirements passed to ensure that employers didn't discriminate in
hiring based upon citizenship and national origin.
This was to be the solution. The idea was good, but many things
went dreadfully wrong over the past two plus decades. The programs
didn't work the way they were envisioned. Millions of foreign workers
entered the U.S. in questionable status and took jobs with U.S.
employers. Most employers did go through an employment verification
process, but the new workers had documents to satisfy the requirements.
Why didn't these foreign workers enter the U.S. legally or overstay
their status and take jobs without authorization? The answer is
simple--there was no immigration program available to foreign workers
who wanted to enter the U.S. lawfully. What is needed to correct this
broken employment based immigration system is (1) a workable employment
eligibility verification program; (2) a functional temporary worker
program that allows employers to hire foreign workers when U.S. workers
are not available and (3) some sort of stabilization of the existing
foreign workforce that is embedded in the U.S. economy.
Current Visa Programs for Lesser Skilled Workers
Most foreign workers entering the U.S. to work enter under one of
the following categories: professionals, and executives or managers;
agricultural workers or seasonal non-agricultural workers.
Traditionally, the visa status used for technical professionals is the
H-1B. Canadian and Mexican professionals are eligible for expedited
visa and admission procedures pursuant to the North American Free Trade
Agreement (NAFTA) under a TN visa. An employer may sponsor an unskilled
worker for permanent residence, or greencard status, but this is
category is restricted to 10,000 visa numbers per year. Due to backlogs
in this category, it can take 10--15 years to actually enter the U.S.
in this category and for most employers that is not a realistic or
timely method to bring in workers.
The commonly used temporary worker programs in existence today are
the H-1B, the H-2B, TN and the H-2A programs. The H-2A agricultural
visa program has proven to be difficult to use and not responsive to
the realities of the agricultural workplace.
H-1B Visa--Temporary Specialty Worker Visa
The H-1B visa is available to nonimmigrants who are temporarily
employed in professional positions that qualify as ``specialty
occupations.'' A ``specialty occupation'' requires the theoretical and
practical application of a body of highly specialized knowledge, and
the attainment of a bachelor's degree--or its foreign equivalent--or
higher in a specific specialty as a minimum for entry into the
occupation in the United States.
The position to which the individual is transferred must be
professional. Professional positions include positions such as
engineer, computer systems analyst, financial analyst, attorney,
accountant, and many others; these are considered occupations for which
a bachelor's degree is the minimum requirement for entry. If the
employee has the equivalent of a U.S. bachelor's degree and an employer
requires his/her services in a professional position, the employee
should qualify for an H-1B temporary worker visa. H-1Bs visas are
employer and location-specific. The initial period of stay granted to
H-1B beneficiaries is three (3) years, with the option to extend their
status in three (3) year increments. At the end of the six (6) year
term, beneficiaries must spend one (1) full year outside the United
States before being permitted to re-enter in H-1B status.
All H-1B petitions must be filed by the employer. Prior to filing
an H-1B petition with the USCIS, the employer must first attest to the
Department of Labor that the alien will receive a salary commensurate
with the prevailing wage for U.S. workers in the same job category. The
employer must also make certain attestations to show that U.S. workers
are in no way disadvantaged by the hiring of the foreign national. The
employer must also attest that it offers its U.S. and H-1B workers the
same benefits. A notice of the filing and the attestations must be
posted internally along with the offered salary and the prevailing wage
for ten (10) consecutive days in two (2) conspicuous locations. The
employer is also required to obtain and maintain documentation to
support each of the Labor Condition Statements made on the Labor
Condition Application (``LCA'').
An employer must maintain a Public Access File (PAF) that is
accessible to interested and aggrieved parties, and kept separate from
personnel records. The PAF must be available at either the employer's
principal place of business or at the worksite within one (1) day after
the LCA is filed with supporting documentation
There is currently 65,000 H-1B visas allocated every fiscal year.
The cap has been reached well before the end of the fiscal year for the
past several years, meaning that new H-1B petitions are not available
until the next federal fiscal year (starting October 1). There are also
20,000 available visas per year for nonimmigrants who have earned a
Master's degree or higher from a U.S. institution.
Trade NAFTA ``TN'' Status
NAFTA has special provisions for Canadian and Mexican citizen
professionals who are offered a position in the U.S. The professional
visa status under NAFTA is called Trade NAFTA status or TN status. The
person must be coming to work in an occupation on the NAFTA list. A
Canadian citizen who fits within one of the TN occupational categories
may present documentation at the border in order to obtain a TN. If a
Canadian national does not fit within one of the given professions
identified in the NAFTA, he/she still may qualify for the standard H-1B
category for specialty occupations. Mexican nationals may qualify for
TN status. However, there is a limit of 5,500 Mexican TN visas per
year. In addition, Mexican nationals must first obtain a labor
condition attestation from the Department of Labor and be pre-approved
by the USCIS within the U.S. The process is similar to the process for
H-1B status.
H-2B--Seasonal Non-Agricultural Temporary Worker
The other major temporary worker program is the H-2B program. This
program is designed specifically to allow foreign nationals to work for
a sponsoring employer in a job that is only temporary in nature; for
example, to fill a seasonal job (but not in agriculture), to meet a
one-time project or need, to add additional staff during a time of
exceptionally high peak load, or to fill a position that is
intermittently used in the business. H-2B visas are used in industries
such as landscaping, seasonal hospitality (such as resort hotels,
restaurants and attractions), and seasonal construction, as well as to
meet specific needs in manufacturing, retail and other industries. The
cap on H-2B visas is 66,000 annually. The H-2B program helps supplement
the native-born workforce, but it cannot be used to fill all types of
jobs because of the seasonal nature of the visa. A company has to first
recruit and advertise for the opening in the U.S. The employer must
then obtain a temporary labor certification from the Department of
Labor, receive approval from the Department of Homeland Security, and
then request that the visa be issued through consular process of the
Department of State.
The existing types of temporary worker programs do not begin to
meet all of the complex needs of the U.S. economy. In sum, the H-1B
program is focused on higher-skilled immigrant workers, while the H-2B
program is limited to short-term, seasonal types of work, although it
allows for recruitment of lower-skilled workers. Furthermore,
particularly when viewed against a domestic economy of over 154 million
workers, the caps are simply unrealistic. There is no temporary worker
program that addresses the huge gulf between these programs and the
complexities of the many different kinds of jobs and skill levels.
Employers need a way to recruit foreign workers when they cannot find a
U.S. worker, and currently there are few realistic mechanisms to
accomplish that.
What are the Needs of our Economy and Business
The population of the U.S. as a whole will increase over the next
several decades. However, this population is aging, more educated and
participating at lower rates in the workforce. The demographic changes
caused by our aging workforce and the lower participation of the baby
boomers will have long lasting effects on our labor market.\1\ The
Bureau of Labor Statistics also has projected job growth, both in low-
skilled and high-skilled occupations. The BLS expects that between 2010
and 2020 the number of U.S. jobs will increase by 20 million.\2\
---------------------------------------------------------------------------
\1\ Bureau of Labor Statistics, Projection of the Labor Force to
2050. Monthly Labor Review, October 2012.
\2\ Bureau of Labor Statistics, Labor Force Projections to 2020.
January 2012.
---------------------------------------------------------------------------
Employers are experiencing persistent and recurring job openings.
Many positions remain unfilled despite extensive efforts to recruit and
retain U.S. workers. Some of the industries that have expressed concern
include: Meat Processing, Specialty Construction Employers;
Manufacturing; Restaurants and Food Service; Hospitals; and as you have
heard here today, Hotels and Resorts and Senior Care Medical
Facilities. Here is a short list of some of the positions that I am
aware of that are in need of workers.
Industry/Positions with Identified Needs:
Landscaping Industry
Landscape Laborer
Irrigation Technician
Crew Leader
Tree Surgeon Assistant
Manufacturing
Welders
Electricians
Health Care
Nurses
Certified Nursing Assistants
Licensed Practical Nurses
Construction Industry
First Line Supervisor/ Managers of Construction
Steel Workers and Structural Iron Workers
Brick mason and Block masons
Cement Mason and Concrete Finishers
Roofers
Hotel Industry
Baggage Porters and Bellhops
Hotel, Motel, and Resort Desk Clerks
Maids and Housekeeping Cleaners
Restaurant Industry
Food Service Manger
Chefs and Head Cooks
First-line Supervisors/ Managers of Food Prep & Servers
Cooks/Restaurants
Dishwasher
Cooks/Fast Food/Crew Member (non-managerial)
Other Positions
Carpenter
--Helper-Carpenter
Plumbers, Pipefitters and Steamfitters
--Helper-Plumber
Meat Processor
Housekeeping Cleaner
Truck Driver
EWIC Proposal for a Temporary Worker Program
We need to fill the program gap that was left in 1986 with a
supplemental worker program that can be used when U.S. workers cannot
be found. A visa program that allows employers from across the spectrum
to obtain workers from abroad should be established so that all
employers with worker needs that can't be filed by U.S. workers can
bring workers to this country through legal channels. Since 1999, EWIC
has supported new worker programs that meet business needs. EWIC has
worked with businesses and other advocates to develop a program that
fills this critical gap in our legal immigration system.
A critical element of a program is to supply the U.S. economy with
the workers it needs to recover from the downturn and grow in years
ahead. This visa program must give employers, not the government, the
primary say in which workers they need to staff their businesses and
give the labor market the primary say in how many workers enter the
country annually in a legal program. The marketplace can best make
these determinations. The most accurate way to measure whether
immigrant workers are needed is for employers to try--and either
succeed or fail--to hire U.S. workers. The enclosed Exhibit is the most
recent proposal for a new worker program.
As described above, of the many inadequacies of the existing legal
immigration system, few are as damaging--with worse consequences for
immigrants or for the U.S. economy--than the lack of a visa program for
less skilled immigrants seeking to enter the country legally and work
in the United States. EWIC developed a proposal to fill this void: a
provisional visa program designed to reflect market dynamics, expanding
in good times when U.S. labor needs intensify and contracting in
downturns when U.S. labor needs subside.
In contrast with other existing U.S. temporary worker programs,
under this proposal, employers would not sponsor workers for visas, and
workers would not be tied to specific jobs or specific employers, but
rather would be free to change jobs at will, working for any employer
who is registered to participate in the program. The following is a
short synopsis of the key program points:
TWO APPLICATION TRACKS. One track is for employers who demonstrate
they have tried and failed to find U.S. workers and are given
permission to hire less-skilled foreign workers for specific,
``registered jobs.'' The other track is for foreign workers who are
granted visas based on initial job offers, but then are free to change
jobs in the U.S., accepting work from any employer who has demonstrated
a labor need and been registered with the program.
COMPLETE PORTABILITY. The foreign worker is not tied to a specific
job for a specific employer but rather is free to work for any employer
who has tested the market and been registered with the program.
OCCUPATIONS COVERED. Any nonfarm, low-skilled job that does not
require a college degree as standard preparation, including year-round
employment.
DUAL INTENT. The initial visa is temporary: two years, renewable
twice. But just as high-skilled H-1B temporary visa holders can
eventually transition to permanent visas, so low-skilled workers in
this program can eventually earn the right to get in line for a green
card. Who can make the transition will be determined by an evaluation
of the newcomer's rootedness, assimilation and personal success in the
U.S.
LABOR MARKET TEST. Attestation-based with back-end audits. Before
they can be registered, employers must test the labor market, making a
good faith effort to recruit U.S. workers, and every two years, they
must reapply, demonstrating their continued labor need and keeping
their registration current.
NUMBER OF VISAS AVAILABLE. The number of visas issued each year
will float up and down in response to U.S. labor needs--need
demonstrated and quantified by the employer attestation process.
Employers who have tried and failed to find U.S. workers will attest to
their job openings and recruitment efforts. The government will approve
a given number of registered job openings, and the annual visa quota
will be adjusted to meet this demand using a mathematical formula.
WAGES. Participating foreign workers will receive the actual wage
paid to similarly situated U.S. workers in the same location OR an
agreed upon prevailing wage, whichever is greater. The prevailing wage
will be determined by any relevant collective bargaining agreement,
applicable Davis-Bacon and Services Contract Act requirements, the
Bureau of Labor Statistics-determined wage for that occupational
classification or a private wage survey that meets standards specified
by the Secretary of Homeland Security.
E-VERIFY and an ELLIS MONITORING SYSTEM. Movement of workers from
job to job will be tracked electronically by a government monitoring
system and through E-Verify, and the two systems will be coordinated.
A new temporary worker program to meet the needs of an expanding
economy will also enhance our national security and control over our
borders. When available jobs are filled (after recruitment in the
domestic labor pool) by legal foreign workers, there will no longer be
jobs to be filled by those who may come here illegally and thus, the
magnet that drives much illegal immigration will be eliminated. A
successful temporary worker program should bring these economic
migrants through lawful channels allowing the Border Patrol to focus on
the real threats coming across our border.
Conclusion
What is needed, and the challenge you face as legislators, is an
immigration system that reflects the needs of the economy. Picking an
arbitrary number of immigrants to be allowed into the U. S. and only
allowing some industries the workers needed at the expense of other
industries is not in our national interest. If we want the economy to
grow, we will need workers. When we can't find U.S. workers we need to
be able to hire foreign workers.
Immigration is a complex, complicated problem. It deserves more
than piecemeal solutions, more than a patchwork of regulation at
various levels of government. It deserves a thoughtfully reasoned
solution from the people who have true responsibility for immigration
law: Congress and the President. Thank you.
______
Chairman Walberg. Thank you. Your Swedish heritage gave you
a little less extra time there. I ask for forgiveness on that
one.
Mr. Benjamin, we recognize you for your 5 minutes of
testimony.
STATEMENT OF FRED BENJAMIN, CHIEF OPERATING OFFICER,
MEDICALODGES, INC., TESTIFYING ON BEHALF OF THE AMERICAN HEALTH
CARE ASSOCIATION
Mr. Benjamin. Good morning, Chairman Walberg, Ranking
Member Courtney, and distinguished members of the subcommittee.
I would like to thank you for holding this hearing to explore
the labor shortage facing our country and I especially
appreciate the opportunity to appear before you here today.
My name is Fred Benjamin and I am chief operating officer
of Medicalodges, a company that offers a continuum of health
care services and options which include skilled nursing care,
rehabilitation, assisted living, services for people with
developmental disabilities, intellectual disabilities, and
more. Medicalodges is a member of the American Health Care
Association, which in turn is a member of the Essential Worker
Immigration Coalition.
We are an employee-owned company and operate over 30
facilities in Kansas, Missouri, and Oklahoma and employ over
2,200 people. We have critical staffing needs. There are
chronic shortages throughout the nursing home community. It is
a daily struggle to find enough dedicated caregivers, yet we
are responsible for the lives of 1.5 million frail and elderly
citizens nationwide, and this is the fastest-growing segment of
our population.
The general causes of the shortage have been explored, but
we in the nursing industry are also confronted with chronic
underfunding through Medicare and Medicaid, which prevents us
from offering higher wages to--being paid to our workers; a
newly altered regulatory system that focuses on fines and
penalties; dramatically increased competition for caregivers
from all variety of health care delivery systems; annual
turnover rates nearing 100 percent; and an aging workforce.
We are almost completely dependent on the government for
payment for our services and do not have the ability to raise
our prices. Nearly 80 percent of our residents are
beneficiaries of the Medicare or Medicaid programs.
And while we do not have the ability to raise our prices,
we also have little ability to reduce our expenditures. The
government inspectsnursing homes every year to look for errors
in compliance with several hundred regulations and accompanied
by fines of up to $10,000 per day for noncompliance.
Dedicated caregiving staff that work in our facilities are
the unsung heroes of the American workforce. The job of caring
for the elderly and disabled is very demanding.
Because of the difficulty of the job and our inability to
increase wages or prices, long-term care has always been a
high-turnover industry. My company's turnover rate in the
lower-skilled categories is approximately 60 percent annually,
and that is significantly lower than most companies in the
industry.
For many the first reaction is, ``You are not paying
enough.'' That is simply not true.
At Medicalodges certified nurse's aides presently receive
an average of $11.50 per hour plus benefits, and these include
health insurance, participation in the company employee stock
ownership program, 401k, tuition reimbursement, vision, dental,
and more. We regularly review wage rates for competitiveness.
We need certified nurse's aides, licensed practical nurses,
and registered nurses to provide skilled services around the
clock in every facility. Vacancy rates for CNAs can approach 20
percent; for LPNs, 10 percent; and for RNs, 10 percent as well.
So what have we done to address these vacancies and
shortages? Well, historically I have hired extensively from the
welfare rolls. The nursing home industry in general has hired
over 50,000 welfare recipients in the last 3 years.
We have offered signing bonuses; we have set up tables in
grocery stores to recruit new employees; sent direct mail;
posted job openings in newspapers, communities, schools, and
even laundromats. We offer multiple incentives for recruitment,
yet it is still not enough.
So in conclusion, our labor shortage is our most pressing
operating problem. If we are to meet the expectations set for
us policymakers must act now and expand the pool of new staff.
I would like to present some solution options for you.
First, we need to increase the staff supply, and there are many
talented immigrants who are anxious to enter the caregiving
field yet are faced with insurmountable odds. Please give
special consideration to permitting new entry for immigrants
with skilled--with nursing skills, as well as increasing the
pool of unskilled labor.
We need a new immigration system--one that serves the
economic needs of the U.S. economy. If an American employer is
offering a job that an American citizen is not willing to take
we ought to welcome into our country a person who will fill
that job.
We struggle every day to ensure that the labor shortage
does not negatively affect the quality of care delivered in our
facilities. This is a difficult and highly complex balancing
act.
I urge you to take a broader look at the staffing crisis
and think about the frail and elderly populations we serve--our
parents, our grandparents, aunts, uncles, our neighbors and
yours--those special people who have given so much to us and
our country. We owe it to them to provide the best possible
care, don't we?
I am here to ask you: Who will care for them if this
critical situation is not addressed immediately?
Thank you. I am happy to answer any questions.
[The statement of Mr. Benjamin follows:]
Prepared Statement of Fred Benjamin, Chief Operating Officer,
Medicalodges, Inc.
Good Morning Chairman Walberg, Ranking Member Courtney, and
distinguished members of the Subcommittee. I'd like to thank you for
holding this hearing to explore the labor shortages facing our Country,
and I especially appreciate the opportunity to appear before you here
today. My name is Fred Benjamin, and I am the Chief Operating Officer
of Medicalodges, Inc., a company that offers a continuum of health care
options which include independent living, skilled nursing home care,
rehabilitation, assisted living, specialized care, outpatient
therapies, adult day care, in-home services, as well as services and
living assistance to those with developmental disabilities.
Medicalodges is a member of the American Health Care Association (AHCA)
which is a member of the Essential Worker Immigration Coalition
(EWIC)--a broad-based national coalition of businesses and trade
associations concerned about the shortage of semi-skilled and unskilled
labor.
Medicalodges was launched in 1961 when its first nursing home,
Golden Age Lodge, was opened in Coffeyville, Kansas by founding owners
Mr. and Mrs. S.A. Hann. The company grew through the 1960's with the
addition of eight nursing facilities. In 1969, Golden Age Lodges was
renamed Medicalodges, Inc. As new care centers were built or purchased,
the company expanded its products and services to include a continuum
of health care. In February, 1998 the employees of Medicalodges
acquired the company from its previous owners in a 100% Employee Stock
Ownership Trust transaction. Today, the company owns and operates over
30 facilities with operations in Kansas, Missouri and Oklahoma and
employs over 2200 people in the communities it serves.
I have served as the Company's Chief Operating Officer since May,
2009. I am honored to have served 30-years in this industry that
includes senior management roles in skilled and sub-acute care,
hospitals and other for-profit and not-for-profit ventures. I am also
currently serving as Chairman of the Board of the Kansas Health Care
Association, the leading provider advocacy group for seniors in Kansas.
Worker Needs are Critical and The Impact is More Profound in Skilled
Nursing Facilities
We have critical staffing needs. There are chronic shortages
throughout the nursing home industry. If you are in the business of
caring for our nations' elderly, whether you are for-profit, non-
profit, or government managed, it is a daily struggle to find enough
dedicated caregivers to care for the people in your charge. Let me tell
you a little about the state of nursing homes today.
We are different from other employers in many ways. We are
responsible for the lives of 1.5 million frail and elderly citizens
nationwide. And this is the fastest-growing segment of our population.
The general causes of the shortage have been explored. In addition
to the causes that affect employers of all types, the nursing home
industry is confronted with the following:
Chronic underfunding through Medicare and Medicaid which
prevents higher wages from being paid to our workers;
A newly altered regulatory system that focuses on fines
and penalties (often for failing to provide adequate personnel) instead
of the previous system where government employees were encouraged to
help centers meet the challenges they face;
Dramatically increased competition for caregivers from
assisted living centers, independent housing for the elderly, home care
centers and hospital based nursing homes--all of which seek the workers
we traditionally employed;
Annualized turnover rates of nearly 100% in our industry
among staff personnel, and now excessively high turnover rates among
our managers who are increasingly frustrated with overwhelming
paperwork, regulation, and underfunding;
Challenge of caring for infirm and often difficult
residents;
Mandated training and certification of most employees;
Need for dedicated and caring personalities;
Increasing age of workforce--with fewer young workers
entering long term care; this means that these young workers are
increasingly not choosing long term care as a profession of choice,
which is alarming as baby boomers age in greater numbers.
Government Dependence
We are almost completely dependent on the government for payment of
our services, and do not have the ability to raise our prices. Nearly
80% of the residents in our facilities are beneficiaries of the
Medicaid or Medicare Program. Of the remaining 20%, 17% are spending
their life savings until they are poor enough to qualify for Medicaid,
and only 3% have private insurance.
While we do not have the ability to raise our prices, we also have
little ability to reduce our expenditures. The government inspects
every nursing home every year to look for errors in compliance with
several hundred regulations. These measures by the government are
intended to root out providers of poor care--but as designed and
implemented, only focuses on fines and paperwork, and not on patient
care or quality measurement. If we are found lacking in any small way,
we can be subject to fines up to $10,000 per day or closure.
Furthermore, I would never reduce expenditures in a way that would have
a negative impact on quality of care. This puts me, and every other
nursing home operator, in a squeeze, and we are asking you for
understanding of our challenges and relief.
The Role of Caregiver
Dedicated caregiving staff that work in our facilities every day
and every night are the unsung heroes of the American workforce. The
job of caring for the elderly and disabled is one of the most demanding
jobs on many levels.
It is difficult physically to lift, turn, transport, position, and
keep up with our residents' care day and night. It is psychologically
demanding to work with our Alzheimer's residents who are often
confused, angry, scared, or lonely, and to make their days rewarding
and productive. It is emotionally draining to care for those in the
twilight of their lives, share their frustration and fears, and still
assure that they are getting the very best medical care we can provide.
Their needs must come first, and staff must learn to put their own
needs second to their residents. These are the residents that hospitals
cannot care for, whose families cannot care for them, and who are
dealing with multiple chronic illnesses.
Our dedicated staff do a very hard job for a wage that is as much
as we can pay, but never enough, in my opinion, for the service they
provide. Without these caregivers, our seniors will suffer.
The shortage of labor and difficulty in finding adequate levels of
staff on a daily basis, 24-hours each and every day of the year, is
cited as the number one reason prompting many of our existing workers
to leave our company and seek alternative employment. We lose some of
our best managers during this period of time when their skills and
compassion are crucially needed.
Because of the difficulty of the job, and our inability to increase
wages or prices, long term care has always been a high turnover
industry. My company's turnover rate in lower skilled categories is
approximately 60% annually--significantly lower than most companies in
the industry. We do focus on retention initiatives and employee
recognition and involvement. We have implemented dozens of programs,
and empowered our facilities to implement their own initiatives. We are
active in implementing total quality management techniques successfully
used by the best companies in America. Indeed, four of our facilities
were recently identified by US News and World Report as among the
``Best in America''.
How to Retain Workers
For many, the first reaction is ``You aren't paying enough.'' Let's
address that perception first. Most people think of nursing homes as a
minimum wage employer. This is simply not true. At Medicalodges,
certified nurse aides presently receive an average of $11.50 per hour,
plus benefits, which include health insurance, participation in the
company Employee Stock Ownership Program, 401k programs, vision, and
dental care. We regularly review wage rates to ensure that they are
competitive.
We are limited in our ability to compete with other employers
because of our inability to set the prices for the vast majority of our
services. Congress and our nation's Governors do that when establishing
Medicare and Medicaid rates. In this regard, the State of Kansas, like
many others has recently implemented a Managed Care approach to
Medicaid. What many Americans fail to realize is that Medicaid pays for
the long term care services received by 2 out of every 3 skilled
nursing patients.
In fact, national data underscores the tight margins within which
skilled nursing facilities operate. Recent data show that out of every
health care dollar earned, only 1.5 cents is profit. For Medicalodges,
after we pay property and real estate taxes, whatever is left goes to
only two places; our ESOP (employee pension fund) or back into our
facilities.
Secondly, our nursing centers are not factories. We cannot stop the
assembly line or reduce the services we provide to accommodate budget
cuts. The elderly we care for depend on us 24-hours, everyday, weekends
and holidays. If we have a staff vacancy, we must fill that vacancy.
Ms. Johnson will still need help getting dressed and eating in the
morning. Mr. Smith will need therapy to help him swallow and learn to
walk after a stroke. These services are not optional. We need certified
nurse aides (CNAs), licensed practical nurses (LPNs) and registered
nurses (RNs) to provide skilled services around the clock in every
facility. We provide services in both rural and urban locations.
Vacancy rates for CNA's can approach 20% for LPN's 10% and RN's 10%.
Addressing the Recruitment Problem
What has Medicalodges done to address the vacancies and shortages?
Historically, I have hired extensively from the welfare rolls. The
nursing home industry in general has hired over 50,000 welfare
recipients in the last three years. Most of them are single mothers
whom we train to become certified nurse aides, and put on a career path
in health care. This is the only career path that I know of that can
help take people from economically disadvantaged situations to the
middle class. Unfortunately, all too often they will complete their
training with us, and then be hired away by hospitals or other
providers who do not have to deal with our heavy reliance on
government-set payment rates.
Several states, including Wisconsin and Florida, have
taken steps to use federal funds to help support training programs
specifically targeted on meeting the labor needs of the long term care
industry.
In our profession, the residents' welfare must be top
priority. Hence, we perform criminal background checks on each
potential employee. This process significantly adds to costs, but
eliminates an estimated 10% of applicants from eligibility for hire,
and appropriately so.
We have offered signing bonuses of $1,500 for certified
nursing assistants--and even higher for licensed personnel.
We have set up tables in grocery stores to recruit new
employees, sent direct mail, posted job openings in communities,
schools, and even laundromats.
We offer multiple incentives for recruitment. We have
flexible scheduling, good benefits, recruitment bonuses, shift
differentials, float incentives, pay in-lieu of benefits, and many
other programs to attract the dedicated caregivers we need.
Every one of my facilities has a substantial recruitment
and retention function. We make great efforts to reduce turnover and
maintain a stable workforce through flexible scheduling, employee
appreciation efforts, mentoring programs, and much more. We even
involve our residents in interviewing candidates. Yet it is still not
enough.
Conclusion
Our labor shortage is our most pressing operating problem. The
labor shortage deprives us of the most valuable resource we have, our
caregivers. If we are to meet the expectations set for us, policymakers
must act now to expand access to new pools of staff and take steps to
encourage employment in long term care.
I would like to present solutions to you that will address our
staffing crisis:
Of course, I would like to increase staffing, and increase
wages. As I mentioned earlier, I am not able to do so, because Medicaid
and Medicare reimbursement levels do not allow me to. It is truly a
national shame that we invest so little in the care of our elder
population. These programs pay for more than 3 of 4 of all my
residents. And that ratio is fairly consistent throughout the field.
Please urge your colleagues in Congress to invest more in our nation's
elderly and fix these broken and underfunded programs. Enacting a wage
pass-through for Medicaid will assist providers to increase wages.
We need to increase staff supply, and there are many
talented immigrants who are anxious to enter the caregiving field, yet
are faced with insurmountable roadblocks. These talented caregivers
should be given the opportunity to make a living and make a difference
in their own lives and the lives of others. To increase the supply of
labor, please give special consideration to permitting new entry for
immigrants with nursing skills as well as increasing the pool of
unskilled labor. We need a new immigration system that serves the
economic needs of the U.S. economy. If an American employer is offering
a job that American citizens are not willing to take, we ought to
welcome into our country a person who will fill that job--especially a
job that has the capacity to improve the health and well being of a
vulnerable senior, or person with disabilities.
We struggle every day to ensure that the labor shortage does not
negatively affect the quality of care delivered in our facilities. This
is a difficult and highly complex balancing act that is currently
taking place in nursing centers across the country. I urge you to take
a broader look at this staffing crisis and think about the frail and
elderly population we serve--our parents, our grandparents, our aunts,
our uncles, our neighbors and yours--those special people who have
given so much to us and our country. We owe it to them to provide the
best possible care, don't we? I am here to ask you who will care for
them if this critical situation is not addressed immediately. Thank
You. I am happy to answer any questions that you may have.
______
Chairman Walberg. Thank you, Mr. Benjamin.
Ms. Bauer, we now recognize you for your 5 minutes of
testimony.
STATEMENT OF MARY BAUER, LEGAL DIRECTOR,
SOUTHERN POVERTY LAW CENTER
Ms. Bauer. Good morning, and thank you for inviting me to
speak about guest worker programs in the United States. My
employer, the Southern Poverty Law Center, recently reissued
our report about the H-2 program. The report is entitled
``Close to Slavery'' and it is based upon the interviews with
thousands of guest workers and our experience representing tens
of thousands of these workers.
Put simply, the H-2B program has led to the systematic
exploitation of workers in the United States. This abuse and
exploitation has had a deleterious effect on the wages and
working conditions of U.S. workers laboring in industries that
employ H-2B workers.
Because of the many abuses in the H-2B program, this
program absolutely must not be the model for any new temporary
worker program in the future.
Guest workers are systematically exploited because the very
structure of the program places them at the mercy of a single
employer and provides them no realistic means for exercising
the few rights they have. Guest workers are typically required
to borrow large sums of money--as much as $20,000--to obtain
their jobs. They are forced to mortgage their futures to obtain
low-wage temporary jobs.
They are routinely cheated of wages. They are held
virtually captive by employers or labor brokers who seize their
documents. And they are often housed in squalid conditions.
H-2 workers can work only for the employer who filed a
petition for them to enter the country. The employer decides if
he can come; the employer decides how long he can stay; and the
employer holds all of the power over the most important aspects
of a worker's life.
As long as employers in low-wage industries can rely on an
endless supply of vulnerable guest workers who lack basic labor
protections they have little incentive to hire U.S. workers or
to make the jobs more appealing to domestic workers by
improving wages and working conditions.
A 2008 review of seven occupations using H-2B workers by
the Economic Policy Institute found that 98 percent of H-2B
jobs were set below the average wage rate in that occupation.
Astonishingly, the program does not prohibit the importation of
guest workers during periods of high unemployment. Indeed, the
unemployment rate in a locality or industry is not a
consideration for the Department of Labor in determining
whether to certify an H-2B application.
Under the program, employers are required to pay a
prevailing wage rate. The purpose of this wage is to ensure
that U.S. workers' wages are not depressed by an influx of
foreign workers but the current methodology for calculating the
prevailing wage rate is doing exactly the opposite by setting
the prevailing wage rate $4 to $5 lower than the average wage
for those occupations.
The Department of Labor itself determined that the current
wage rule degrades the wages of U.S. workers and in response
proposed a new rule that would better protect U.S. workers.
This new rule has been attacked by employers in the courts and
its implementation has been effectively blocked by Congress. A
more comprehensive set of regulations, designed to protect H-2B
and U.S. workers, has been enjoined by the courts as well.
The legal requirements for recruiting U.S. workers are
abysmally weak. In practice, recruiters and employers pay only
lip service, in many cases, to those requirements, preferring
to hire H-2B workers--workers who will be effectively
indentured to one employer during the term of their visa.
We have a more comprehensive set of recommendations in our
written comments and in our report than I can cover here in my
remarks. But at a minimum, Congress should insist that the DOL
regulations promulgated to protect workers be allowed finally
to go into effect.
The exploitative recruitment process that traps workers in
overwhelming debt must be reformed. And workers should be
permitted the right that all other workers have in our free
society--the right to walk away and find another job. Workers
must be given the opportunity to become permanent members of
our community over time and not be trapped, instead, as
permanent guests.
In conclusion, the abuses of these programs are too common
to blame on a few bad-apple employers. They are the foreseeable
outcome of a system that treats foreign workers as commodities
to be imported without affording them adequate legal
safeguards.
I thank you for the opportunity and wait for any questions
you might have.
[The statement of Ms. Bauer follows:]
Prepared Statement of Mary Bauer, Southern Poverty Law Center
Thank you for the opportunity to speak about guestworkers who come
to the United States as part of the H-2B program and about the U.S.
workers whose wages and working conditions are affected by the program.
My name is Mary Bauer. I am a Senior Fellow at the Southern Poverty
Law Center (``SPLC''). Founded in 1971, the Southern Poverty Law Center
is a civil rights organization dedicated to advancing and protecting
the rights of minorities, the poor, and victims of injustice in
significant civil rights and social justice matters. Our Immigrant
Justice Project represents low-income immigrant workers in litigation
across the Southeast.
During my legal career, I have represented and spoken with
literally thousands of H-2A and H-2B workers in many states. The SPLC
has represented tens of thousands of H-2A and H-2B guestworkers in
class action lawsuits. We also published a report in 2013 about
guestworker programs in the United States entitled ``Close to
Slavery,'' which I have attached to these comments as Exhibit I to my
written testimony.\1\
The report discusses in further detail the abuses suffered by H-2
guestworkers. It is based upon thousands of interviews with workers as
well as the research related to guestworkers and the experiences of
legal experts from around the country. As the report reflects,
guestworkers are systematically exploited because the very structure of
the program places them at the mercy of a single employer for both
their job and continued presence in the United States. It permits
workers to enter the United States. encumbered with overwhelming debt--
debt that they paid to get short-term, low paid work. It provides no
realistic means for workers to exercise the few rights they have.
Just as importantly, the appalling wages and working conditions
experienced by H-2B workers have a demonstrably depressive effect on
the wages and working conditions of U.S. workers in industries
employing H-2B workers. As long as employers in low-wage industries can
rely on an endless stream of workers, we should expect wages and
working conditions in those industries to drop. Our market economy is
premised on the idea that a shortage of workers will push the market to
increase wages to attract workers from other parts of the economy.
Introducing guestworkers undermines these market mechanisms,
artificially preventing wage increases that we would expect to see in a
healthy market sector. This problem is particularly acute when the
workers being introduced into the labor market are vulnerable
guestworkers who lack the basic labor protections available to U.S.
workers.
The government's H-2B program undercuts employers' incentive to
hire U.S. workers or make jobs more appealing to domestic workers by
improving wages and working conditions. Not surprisingly, many H-2
employers discriminate against U.S. workers, preferring to hire
guestworkers, even though they are required to certify that no domestic
workers are available to fill their jobs. It is well-documented that
wages for
U.S. workers are depressed in industries that rely heavily on
guestworkers. Astonishingly, the H-2B program does not prohibit the
importation of guestworkers during periods of high unemployment.
Indeed, the unemployment rate in a locality or an industry is not a
consideration for DOL in determining whether to certify an H-2B
application. The H-2B program allowed for the importation of 50,009
workers in 2012.\2\ In December 2012, there were 12.2 million Americans
looking for work.\3\
The H-2B (non-agricultural) guestworker program permits U.S.
employers to import human beings on a temporary basis from other
nations to perform work only when the employer certifies that qualified
persons in the United States are not available and the terms of
employment will not adversely affect the wages and working conditions
of similarly employed U.S. workers.\4\
Prospective H-2B employers must apply to DOL for a temporary labor
certification confirming that American workers capable of performing
the work are not available and that the employment of foreign workers
will not adversely affect the wages and working conditions of similarly
employed American workers. The H-2B program requires the employer to
attest to DOL that it will offer a wage that equals or exceeds the
highest of the prevailing wage, the applicable federal minimum wage,
the state minimum wage, or the local minimum wage to the H-2B worker.
The employer also must agree to offer terms and working conditions
typical to U.S. workers in the same geographical area.
In practice, the program is rife with abuses. The abuses typically
start long before the worker has arrived in the United States and
continue through and even after his or her employment here. A
guestworker's visa is good only so long as he works for the employer
who sponsored him. Unlike U.S. citizens, guestworkers do not enjoy the
most fundamental protection of a competitive labor market--the ability
to change jobs if they are mistreated.
If guestworkers complain about abuses, they face deportation,
blacklisting or other retaliation. Because H-2B guestworkers are tied
to a single employer and have little or no ability to enforce their
rights, they are routinely exploited. If this program is permitted to
continue at all, it should be substantially reformed to address the
vast disparity in power between guestworkers and their employers.
In the past several years, the DOL has proposed two sets of
regulations to better protect nonagricultural H-2 workers--one related
to wage rate guarantees and one more comprehensive set of regulations.
These regulations also would better protect the jobs and wages of U.S.
workers. Unfortunately for workers, neither set of regulations has gone
into effect; employers have filed multiple lawsuits challenging them
and Congress has effectively blocked implementation of the new wage
regulations. For workers, then, the abuses continue unabated.
It is virtually impossible to create a guestworker program for low-
wage workers that does not involve systemic abuse and thus erode the
wages and working conditions of U.S. workers. The H-2 guestworker
program should not be expanded in the name of immigration reform and
should not be the model for the future flow of workers to this country.
If the current H-2 program is allowed to continue, it should be
completely overhauled.
I. The H-2B Program Depresses Wages and Working Conditions for U.S.
Workers
As laid out in greater detail in Section II, the H-2B program
creates abuse and exploitation for H-2B workers--not because the
program attracts ``bad apple'' employers, but because the very
structure of the program lends itself to abuse. Because workers arrive
desperately in debt, can work only for their petitioning employer, and
are dependent upon that employer for their very right to enter or
remain in the United States, H-2B workers are incredibly vulnerable.
The abuses suffered by H-2B workers also have an impact beyond that
experienced by the guestworkers: they put profound downward pressure on
the wages and working conditions experienced by U.S. workers in
industries employing H-2B workers.
A. Wages for H-2B Workers Are Set Far Too Low, Driving Down
Wages for U.S. Workers
It is well documented that there are chronic wage and hour abuses
involving H-2B workers.\5\ Since 2004, SPLC has represented
guestworkers in obtaining settlements and judgments of approximately
$20,000,000. There can be no doubt that the impact of such pervasive
wage and hour violations is to depress wages in those industries.
Furthermore, since at least 2005, the prevailing wages paid to H-2B
workers has been set far below the median wages that are paid in the
applicable industries--again something that indisputably serves to
depress wages.
Under the law, H-2B workers are entitled only to the ``prevailing
wage'' for their work; there is no adverse effect wage rate for those
workers, as there is with H-2A workers. Of course, even though H-2B
workers are entitled to payment of prevailing wages and to employment
in conformity with required minimum terms and conditions as provided
for in the employer's labor certifications, federal law provides no
real remedy when these rights have been violated due to anemic staffing
at federal workplace enforcement agencies. For example, 1,100 DOL
investigators have the Sisyphean task of protecting a workforce of 135
million.\6\
The purpose of the prevailing wage is to ensure U.S. worker wages
are not depressed by the influx of foreign workers to the U.S. labor
market, but the current methodology for calculating the H-2B prevailing
wage rate is doing the exact opposite. In fact, under the current
methodology, the wages of H-2B workers are in some industries almost $4
to $5 lower than the average wage for those occupations, a situation
that inevitably places downward pressure on U.S. worker wages. A 2008
review of seven occupations using H-2B workers by the Economic Policy
Institute (EPI) found that 98% of H-2B jobs were set below the mean
(average) wage rate and that 64% of jobs were set below 75% of the
mean. EPI concluded that this would clearly adversely affect the wages
and working conditions of U.S. workers.\7\ Another EPI study looked at
crab picking and landscaping industries in Maryland and concluded that
``employers have been using the H-2B program as a way to degrade the
wages of U.S. workers.'' \8\ It found that H-2B crab-pickers and
landscapers were underpaid by $4.82 and $3.35 per hour, respectively.
DOL has also determined that the current H-2B wage rule degraded
the wages of U.S. workers, and a federal court ruled the 2008 wage rule
invalid.\9\ In response, DOL proposed a new rule that would better
protect U.S. worker wages. As discussed in Section IV, this new rule
has been attacked by employers in the courts, and its implementation
has been effectively blocked by Congress, largely due to the efforts of
a few vocal senators and representatives from states with industries
that rely heavily on H-2B workers.
When an industry relies on guestworkers for the bulk of its
workforce, wages tend to fall. Guestworkers are generally unable to
bargain for better wages and working conditions. Over time, wages
decline and the jobs become increasingly undesirable to U.S. workers,
creating even more of a demand for guestworkers.
B. Recruitment of U.S. Workers Is Weak at Best, and Often A
Sham
Theoretically, employers are allowed to hire H-2B workers only when
U.S. workers are not available for the job. In fact, the legal
requirements for recruiting U.S. workers are abysmally weak. In
practice, recruiters and employers often pay only lip service to those
requirements, preferring to hire H-2B workers--workers who will be
effectively indentured to one employer during the term of their visa.
The legal requirements for recruiting U.S. workers are few.
Employers are required to publish advertisements for two days in a
newspaper. They must also contact the local union as a recruitment
source if the employer is a party to a collective bargaining agreement
governing the job classification that is the subject of the H-2B labor
certification application. Employers must not reject U.S. applicants
for the job opportunity for which the labor certification is sought for
reasons other than ones that are lawful and job-related.
In practice, employers and recruiters make little effort in most
instances to locate U.S. workers. By the time they have decided to
apply for H-2B workers, they have typically made a business decision to
employ those H-2B workers rather than to employ U.S. workers. In a
recent report, the U.S. General Accounting Office (GAO) documented
instances of recruiters actively counseling prospective employers on
how to make jobs unattractive or unavailable to U.S. workers.\10\ In
one case reported by the GAO, a Texas recruiter suggested conducting
interviews before 7:00 a.m. and requiring drug testing prior to the
interview to weed out qualified American applicants. The recruiter also
suggested that current employees be fired for cause or induced to quit
prior to the employer filing a petition for U.S. workers to avoid
arousing DOL's suspicion. Another recruiter offered to provide ``good
excuses'' to help ``weed out'' prospective U.S. workers who might apply
for housekeeping jobs.\11\
H-2B workers are not eligible for unemployment compensation, making
them cheaper to employ than U.S. workers. Employers of H-2B workers
also save by not having to pay for benefits such as health care. In
addition to the lower wages employers pay H-2B workers, they have
powerful financial reasons to prefer foreign workers to Americans. And
they do.
The Palm Beach Post conducted an investigation into claims by
Florida employers that they had been unable to find U.S. workers to
take hospitality jobs even in localities where the unemployment rate
was well over 10% and higher still for unskilled labor.\12\ In the Palm
Beach Post investigations, an employer claimed to have worked with the
local government agency that helps Floridians file jobs, but that
agency denied any knowledge of the employer. That employer, Workaway
Staffing, was approved to bring in 810 H-2B employers. Its president,
William Mayville said H-2B workers were necessary because ``you don't
see Americans wanting to get into the hospitality industry.'' \13\
II. Guestworker Programs Are Inherently Abusive
When recruited to work in their home countries, workers are often
forced to pay enormous sums of money to obtain the right to be employed
at the low-wage jobs they seek in the United States. It is not unusual,
for example, for a Guatemalan worker to pay more than $5,000 in fees to
obtain a job that may, even over time, pay less than that sum. Workers
from other countries may be required to pay substantially more than
that. Asian workers have been known to pay as much as $20,000 for a
short-term job under the program. Unregulated foreign labor recruiters
in home countries make false promises to workers about the H-2B jobs
and visas. Only after the workers have paid high recruiting fees and
arrive in the United States do they learn the less rosy truth.
Because most workers who seek H-2 jobs are indigent, they typically
have to borrow the money at high interest rates. Guatemalan workers
routinely tell us that they have had to pay approximately 20% interest
per month in order to raise the needed sums. In addition, many workers
have reported that they have been required to leave collateral--often
the deed to a vehicle or a home--in exchange for the opportunity to
obtain an H-2 visa. These requirements leave workers incredibly
vulnerable once they arrive in the United States.
Guestworkers labor in a system akin to indentured servitude.
Because they are permitted to work only for the employer who petitioned
the government for them, they are extremely susceptible to being
exploited. If the employment situation is less than ideal, the worker's
sole lawful recourse is to return to his or her country. Because most
workers take out significant loans to travel to the United States for
these jobs, as a practical matter they are forced to remain and work
for employers even when they are subjected to shameful abuse.
Guestworkers routinely receive less pay than the law requires. In
some industries that rely upon guestworkers for the bulk of their
workforce--seafood processing and forestry, for example--wage-and-hour
violations are the norm, rather than the exception. These are not
subtle violations of the law but the wholesale cheating of workers. We
have seen crews paid as little as $2 per hour, each worker cheated out
of hundreds of dollars per week. Because of their vulnerability,
guestworkers are unlikely to complain about these violations. Public
wage and hour enforcement has minimal practical impact because
overstretched labor standards enforcement agencies can follow up on
only a small fraction of violations.
Even when workers earn the minimum wage and overtime, they are
often subject to contractual violations that leave them in an equally
bad situation. Workers report again and again that they are simply lied
to when they are recruited in their home countries. Another common
problem workers face is that they are brought into the United States
too early, when little work is available.
Similarly, employers often bring in far too many workers, gambling
that they may have more work to offer than they actually do. Because
the employers are not generally paying the costs of recruitment, visas,
and travel, they have little incentive not to overstate their labor
needs. Thus, in many circumstances, workers can wait weeks or even
months before they are offered the full-time work they were promised.
Given that workers bring a heavy load of debt, that many must pay for
their housing, and that they cannot lawfully seek work elsewhere to
supplement their pay, they are often left in a desperate situation.
Guestworkers who are injured on the job face significant obstacles
in accessing the benefits to which they are entitled. First, employers
routinely discourage workers from filing workers' compensation claims.
Because those employers control whether the workers can remain in or
return to the United States, workers feel enormous pressure not to file
such claims. Second, workers' compensation is an ad hoc, state-by-state
system that is typically ill-prepared to deal with transnational
workers who are required to return to their home countries at the
conclusion of their visa period. As a practical matter, then, many
guestworkers suffer serious injuries without any effective recourse.
The guestworker program appears to permit the systematic
discrimination of workers based on age, gender and national origin. At
least one court has found that age discrimination that takes place
during the selection of workers outside the country is not actionable
under U.S. laws.\14\ Thus, according to that court, employers may evade
the clear intent of Congress that they not discriminate in hiring by
simply shipping their hiring operations outside the United States--even
though all of the work will be performed in the United States.
Many foreign recruiters have very clear rules based on age and
gender for workers they will hire. One major Mexican recruiter openly
declares that he will not hire anyone over the age of 40. Many other
recruiters refuse to hire women for field work. Employers can shop for
specific types of guestworkers over the Internet at websites such as
www.labormex.com, www.maslabor.com, www.mexicanworkers.biz, or
www.mexican-workers.com. One website advertises its Mexican recruits
like human commodities, touting Mexican guestworkers as people with ``a
good old fashioned work ethic'' who are ``very friendly and easy to
work with.'' \15\
We have received repeated complaints of sexual harassment by women
guestworkers. Again, because workers are dependent upon their employer
to remain in, and return to, the United States, they are extremely
reluctant to complain even when confronted with serious abuse.
In order to guarantee that workers remain in their employ, many
employers refuse to provide workers access to their own identity
documents, such as passports and Social Security cards. This leaves
workers feeling both trapped and fearful. We have received repeated
reports of even more serious document abuses: employers threatening to
destroy passports, employers actually ripping the visas from passports,
and employers threatening to report workers to Immigration and Customs
Enforcement if those workers do not remain in their employment.
Even when employers do not overtly threaten deportation, workers
live in constant fear that any bad act or complaint on their part will
result in their being sent home or not being rehired. Fear of
retaliation is a deeply rooted problem in guestworker programs. It is
also a wholly warranted fear, since recruiters and employers hold such
inordinate power over workers, deciding whether a worker can continue
working in the United States and whether he or she can return.
When the petitioner for workers is a labor recruiter or broker,
rather than the true employer, workers are often even more vulnerable
to abuse. These brokers typically have no assets. In fact, they have no
real ``jobs'' available because they generally only supply labor to
employers. When these brokers are able to apply for and obtain
permission to import workers, it permits the few rights that workers
have to be vitiated in practice.
The lawsuit filed in March of 2008 against Signal International,
LLC by workers represented by the SPLC and others illustrates many of
the abuses H-2B workers face. In that case, hundreds of guestworkers
from India, lured by false promises of permanent
U.S. residency, paid tens of thousands of dollars each to obtain
temporary jobs at Gulf Coast shipyards only to find themselves
subjected to forced labor and living in overcrowded, guarded labor
camps. When the workers attempted to assert their federally-protected
rights, they were violently retaliated against, and forcibly almost
deported to India.
III. Virtually No Legal Protections Exist for H-2B Workers
Although this hearing is to focus on the H-2B program in the United
States, it is important to understand that the few legal protections
that exist for guestworkers are applicable only to H-2A (agricultural)
workers.
The H-2A Program
The H-2A program provides significant legal protections for foreign
farmworkers. Many of these safeguards are similar to those that existed
under the widely discredited bracero program, which operated from 1942
until it was discontinued amid human rights abuses in 1964.
Unfortunately, far too many of the protections--as in the discredited
bracero program--exist only on paper.
Federal law and DOL regulations contain several provisions that are
meant to protect H-2A workers from exploitation as well as to ensure
that U.S. workers are shielded from the potential adverse impacts, such
as the downward pressure on wages, associated with the hiring of
temporary foreign workers.
H-2A workers must be paid wages that are the highest of: (a) the
local labor market's ``prevailing wage'' for a particular crop, as
determined by the DOL and state agencies; (b) the state or federal
minimum wage; or (c) the ``adverse effect wage rate.''
H-2A workers also are legally entitled to:
Receive at least three-fourths of the total hours promised
in the contract, which states the period of employment promised (the
``three-quarters guarantee'');
Receive free housing in good condition and meals or access
to a cooking facility for the period of the contract;
Receive workers' compensation benefits for medical costs
and payment for lost time from work and for any permanent injury;
Be reimbursed for the cost of travel from the worker's
home to the job as soon as the worker finishes 50% of the contract
period. The expenses include the cost of an airline or bus ticket and
food during the trip. If the guestworker stays on the job until the end
of the contract or is terminated without cause, the employer must pay
transportation and subsistence costs for returning home; and
Be eligible for federally funded legal services for
matters related to their employment as H-2A workers.
To protect U.S. workers in competition with H-2A workers, employers
must abide by what is known as the ``fifty percent rule.'' This rule
specifies that an H-2A employer must hire any qualified U.S. worker who
applies for a job prior to the beginning of the second half of the
season for which foreign workers are hired.
The H-2B Program
The basic legal protections historically afforded to H-2A workers
have never applied to guestworkers under the H-2B program.
Though the H-2B program was created two decades ago by the
Immigration Reform and Control Act (IRCA) of 1986, prior to 2008, DOL
had not promulgated substantive labor regulations for the H-2B
program.\16\ As discussed in Section IV below, DOL promulgated new
regulations in 2011 and 2012 that better protect workers, but those
regulations have been enjoined by the courts and subject to
Congressional action prohibiting their enforcement.
While the employer is obligated to offer full-time employment
(currently defined as only 30 hours per week) that pays at least the
prevailing wage rate, none of the other substantive regulatory
protections of the H-2A program apply to H-2B workers. There is no free
housing. There is no access to legal services. There is no ``three-
quarters guarantee.'' And the H-2B regulations do not require an
employer to pay the workers' transportation to the United States.
Although H-2B workers are in the United States legally, they are
generally ineligible for federally funded legal services because of
their visa status. As a result, most H-2B workers have no access to
lawyers or information about their legal rights at all. Because most do
not speak English and are extremely isolated, it is unrealistic to
expect that they would be able to take action to enforce their own
legal rights.
Typically, workers will make complaints only once their work is
finished or if they are so severely injured that they can no longer
work. They quite rationally weigh the costs of reporting contract
violations or dangerous working conditions against the potential
benefits.
Historically farmworkers and other low-wage workers have benefited
greatly by organizing unions to engage in collective bargaining, but
guestworkers' fears of retaliation present an overwhelming obstacle to
organizing unions in occupations where guestworkers are dominant.
IV. DOL's Efforts to Better Protect U.S. and H-2B Workers Have Been
Stymied by Employers Seeking to Maintain the H-2B Program as a
Source of Cheap, Unregulated Labor
In 2011 and 2012, DOL proposed new regulations for the H-2B program
that provide increased protections for U.S. and H-2B workers. These
regulations would better shield U.S. worker wages from the depressive
effect of foreign labor, preserve U.S. workers' job opportunities, and
protect H-2B workers from the severe exploitation that is so prevalent
in the program. Unfortunately, due to efforts by business interest
groups, H-2B employers, and the Chamber of Commerce none of these
critical protections have ever been implemented.
A. The 2008 H-2B Regulations
Prior to 2008, DOL had not promulgated regulations that provided
substantive labor protections for H-2B workers and their U.S. worker
counterparts.\17\ In December 2008, President Bush's Department of
Labor published ``midnight'' regulations for the H-2B program.\18\
These regulations provided only minimal protections for H-2B workers
and lacked many of the fundamental legal protections afforded to H-2A
workers, such as reimbursement of the H-2B workers' transportation
costs to the United States and the ``three-quarters guarantee.'' The
2008 regulations also established a methodology for calculating the
wage that employers must pay to their H-2B workers (the prevailing
wage) that causes the very depressive effect on U.S. worker wages
Congress intended to avoid in requiring the H-2B prevailing wage.
In issuing the 2008 regulations, DOL failed to consider many of the
comments presented by migrant worker advocacy groups. In response,
shortly after the rules were implemented in January 2009, a coalition
of H-2B workers, U.S. workers, and worker advocacy organizations filed
a lawsuit in federal court (CATA v. Solis) challenging the 2008 H-2B
rules, alleging that DOL promulgated the rules in violation of the
Administrative Procedure Act (APA).\19\ On August 30, 2010, the court
in the Eastern District of Pennsylvania granted partial summary
judgment for the plaintiffs, ruling that several of the Bush
Administration DOL's H-2B regulations violated the APA. In order to
avoid a regulatory gap, however, the court chose not to vacate the 2008
rules. Rather, it ordered DOL to promptly promulgate new rules in
compliance with the APA.
Nearly three years after the court's order, however, the
invalidated 2008 regulations still govern the H-2B program today.
B. The 2011 H-2B Wage Rule
On January 19, 2011, DOL issued a new prevailing wage rule for the
H-2B program (``2011 wage rule'') in response to the CATA court order,
but also because DOL found the 2008 wage rule was adversely affecting
the wages of U.S. workers.\20\ Given that DOL's statutory and
regulatory mandate is to certify that an employer's importation of H-2B
workers will not adversely affect the wages and working conditions of
U.S. workers, DOL rightfully sought to replace a wage rule that was
doing exactly the opposite.\21\ Indeed, DOL found that the 2008 wage
rule sets a wage ``below what the average similarly employed worker is
paid,'' \22\ and, as a result, leads to underpayment of wages in nearly
96% of cases.\23\ In practical terms, this means that U.S. workers
would be less likely to take those jobs or would be required to accept
a job at a wage well below what the market has determined is the
prevailing wage for that occupation.
Shortly before the wage rule was set to go into effect in September
2011, H-2B employers and trade associations representing H-2B employers
filed lawsuits in federal courts in Florida and Louisiana (later
transferred to Pennsylvania) challenging the rule. The lawsuits both
allege that DOL issued the rule in violation of the APA and the
Regulatory Flexibility Act (RFA) and DOL lacks authority from Congress
to issue any legislative rules for the H-2B program.\24\ H-2B employers
also galvanized a group of vocal Senators and Representatives from
states with industries that rely heavily on H-2B workers to ensure the
new wage rule would not be implemented. This effort led to Congress
passing a series of appropriations bans and continuing resolutions that
effectively blocked the 2011 wage rule by prohibiting DOL from using
funds towards its implementation.\25\
In August 2012, the Louisiana Forestry court granted DOL's motion
for summary judgment, upholding the 2011 wage rule and ruling that DOL
has authority to issue rules for the H-2B program.\26\ Yet, because the
current Congressional ban on the new wage rule's implementation is in
effect until March 27, 2013, and employers have appealed the lower
court's decision to the Third Circuit Court of Appeals, the rule is
still not in effect and likely will not be implemented in the near
future. As a result, a wage rule that directly contravenes its
purpose--to protect U.S. worker wages--is still operative today,
resulting in the gross underpayment of wages to hundreds of thousands
of H-2B and U.S. workers with no end in sight.
C. The 2012 Comprehensive H-2B Rule
On February 21, 2012, DOL published new comprehensive regulations
for the H-2B program (``2012 Final Rule'') that would provide much
needed protections to U.S. and H-2B workers. The 2012 Final Rule
requires employers seeking to import H-2B workers to first engage in
more protracted and aggressive recruitment of U.S. workers, such as
posting the open jobs on a national job registry and giving U.S.
workers more time to apply for open positions. The new regulations also
prevent the exploitation of H-2B workers by providing important
protections to prevent human trafficking, debt servitude, fraud, and
charging of exorbitant fees by overseas recruiters. Unlike the 2011
wage rule, the majority of the 2012 Final Rule's provisions will have
little or no economic impact on employers that participate in the
program.
In April 2012, just days before the new regulations were scheduled
to go into effect, business interest groups, including the Chamber of
Commerce, and a few H-2B employers sought and won a nationwide
injunction in federal court in Florida that blocked DOL from
implementing the 2012 Final Rule.\27\ Similar to the employers'
challenges to the 2011 wage rule, this lawsuit alleges that DOL did not
comply with the APA and RFA when issuing the 2012 Final Rule and that
DOL does not have authority to issue any rules for the H-2B program.
DOL appealed the injunction to the Eleventh Circuit Court of Appeals,
and several amici submitted briefs in support of DOL's rulemaking
authority and the new rules, including Representative Peter DeFazio and
Senator Jeffrey A. Merkley, and labor unions UNITE HERE and PCUN. The
Eleventh Circuit's decision is pending. In the meantime, as a result of
the district court's injunction, the critical worker protections
provided by the 2012 Final Rule did not go into effect as planned and
may never go into effect.
While the employer-driven attacks on DOL's new H-2B regulations
have completely derailed the implementation of long overdue protections
for U.S. and H-2B workers, the real implication of this litigation is
more concerning. The gravamen of the employers' claims in all three
lawsuits is that DOL lacks authority to issue any regulations for the
H-2B program. Given that DOL has been regulating the H-2 guestworker
programs for over forty years, the employers' sudden challenge to DOL's
authority is particularly transparent. Indeed, not until DOL proposed a
wage rule that will lead to fair wages that better approximate the
market wage for U.S. and H-2B workers across the country did DOL's
rulemaking authority become an issue for the employers. Clearly, the H-
2B employers do not just want less onerous regulation--they want no
regulation or regulations--like the 2008 Bush-era rules--that
overwhelmingly favor employers, even if those regulations do not
adequately effectuate the protections for U.S. workers that Congress
intended when creating the H-2B program.
V. Substantial Changes Are Necessary to Reform These Programs
The SPLC report ``Close to Slavery'' offers detailed proposals for
reform of the current guestworker programs. The recurring themes of
those detailed recommendations are that federal laws and regulations
protecting guestworkers from abuse must be strengthened; federal agency
enforcement of guestworker programs must be strengthened; and Congress
must provide guestworkers with meaningful access to the courts.
The SPLC recommends that Congress take the following actions:
Congress must finally allow the protective regulations
promulgated by DOL in 2011 and 2012 to go into effect. In doing so, it
should also make clear that DOL does have rulemaking authority under
the H-2B program.
Congress should enact protections to regulate the
recruitment of workers.
Congress should make clear that the systematic discrimination
entrenched in this program is unlawful. Congress should regulate
recruitment costs and should make employers responsible for the actions
of recruiters in their employ. Any such regulation must make the
employer who selects a recruiter responsible for the actions of that
recruiter. Doing so is the only effective means of avoiding the severe
abuses that routinely occur in recruitment. Holding employers
responsible for their agents' actions is not unfair: if those hires
were made in the U.S., there is no doubt that the employers would be
lawfully responsible for their recruiters' promises and actions. Making
the rules the same for those who recruit in other countries is fair,
and it is the only way to prevent systematic abuse.
Congress should also make H-2B workers eligible for
federally funded legal services. There is simply no reason that these
workers--who have come to the U.S. under the auspices of this
government sponsored plan--should be excluded from eligibility.
Congress should make the H-2B visa fully portable to other
employers, at least under some circumstances. For example, at a
minimum, Congress should create a means by which workers may obtain
visas when they need to remain in or return to the United States to
enforce their rights. Employers currently control workers' right to be
here. That means when workers bring suit, or file a workers
compensation claim, the employers have extraordinary control over that
process.
Congress should provide a pathway to permanent residency
for guestworkers who would choose to become full members of our
community.
Enforcement should include a private federal right of
action to enforce workers' rights under the H-2B contract.
Lastly, Congress should provide strong oversight of the H-
2B program. Congress should hold additional hearings on this issue
related to the administration of the guestworker programs.
A review of available evidence would amply demonstrate that this
program has led to the shameful abuse of H-2B workers and has put
downward pressure on the wages and working conditions offered to U.S.
workers. Congress must not allow that abuse to continue.
Conclusion
The H-2B program as it currently exists lacks worker protections
and any real means to enforce the few protections that do exist.
Vulnerable workers desperately need Congress to take the lead in
demanding reform. The goal of this subcommittee should be to make
effective protections for the wages and working conditions of American
workers that Congress intended in creating the H-2 program.
Continuation or expansion of the H-2B program thwarts that intention.
Thank you again for the opportunity to testify. I welcome your
questions.
endnotes
\1\ Close to Slavery was originally released in 2007, but was
updated and re-released in 2013.
\2\ Nonimmigrant Visas Issued by Classification FY 2008-2012,
available at http://www.travel.state.gov/pdf/FY12AnnualReport-
TableXVIB.pdf
\3\ Bureau of Labor Statistics, Economic News Release (2012),
available at http://www.bls.gov/news.release/empsit.t01.htm.
\4\ 8 U.S.C. Sec. 1101(a)(15)(H)(ii)(b); 8 C.F.R.
Sec. 214.2(h)(6)(iv)(A); 20 CFR Part 655.
\5\ See Close to Slavery, Chapter 5.
\6\ See Congressional Budget Justification, Wage and Hour Division,
FY 2013, available at http://222.dol.gov/dol/budget/2013/PDF/CBJ-2013-
V2-09.pdf.
\7\ Denise Velez, ``Wages for H-2B Workers Set Lower than the
Prevailing Wage'', available at http://www.epi.org/publication/
webfeatures--snapshots--20080813/ (last visited Aug. 13, 2008).
\8\ Daniel Costa, ``H-2B Employers and their Congressional Allies
Are Fighting Hard to Keep Wages Low for Immigrant and American
Workers'', available at http://www.epi.org/publication/2b-employers-
congressional-allies-fighting/ (last visited Mar. 11, 2013).
\9\ See Comite de Apoyo a los Trabajadores Agr!colas, et al., v.
Solis, et al., No. 09-240, 2010 WL 3431761, at *2 (E.D. Pa. Aug. 30,
2010) (``CATA''); 76 Fed. Reg. 3452 (Jan. 19, 2011).
\10\ U.S. General Accounting Office, Closed Civil and Criminal
Cases Illustrate Instances of H-2B Workers Being Targets of Fraud and
Abuse, available at http://www.gao.gov/products/GAO-10-1053, September
30, 2010.
\11\ Supra n.10, at 11.
\12\ John Lantigua, ``Use of Guest Workers in Palm Beach County
Draws Fire'' Palm Beach Post, July 11, 2011.
\13\ Id.
\14\ Reyes-Gaona v. NCGA, 250 F.3d 861 (4th Cir. 2001). For a
discussion of this case, see Ruhe C. Wadud, Note: Allowing Employers to
Discriminate in the Hiring Process Under the Age Discrimination in
Employment Act: The Case of Reyes-Gaona, 27 N.C.J. Int'l Law & Com.
Reg. 335 (2001).
\15\ See, e.g., Mexican Workers, www.mexican-workers.com/why-
foreign-workers.htm (last visited Jan. 28, 2013).
\16\ See Martinez v. Reich, 934 F. Supp. 232 (D. Tex. 1996)
\17\ Prior to 2008, the procedures governing certification for an
H-2B visa were established by internal DOL memoranda (General
Administrative Letter 1-95), rather than regulation.
\18\ 77 Fed. Reg. 78,020-01 (Dec. 19, 2008).
\19\ See CATA, 2010 WL 3431761 at *2, supra n. 8.
\20\ 76 Fed. Reg. 3452 (Jan. 19, 2011).
\21\ 8 U.S.C. Sec. 1101(a)(15)(H)(ii); 8 U.S.C. 1184(c)(1); 8
C.F.R. Sec. 214.2(h)(6)(iv)(A).
\22\ Id.; see also 75 Fed. Reg. 61,578, 61,580-81 (Oct. 5, 2010)
(``2010 NPRM'').
\23\ 76 Fed. Reg. at 3463.
\24\ See Louisiana Forestry Ass'n, Inc., et al. v. Solis, No. 11-
01623 (W.D. La. Sept. 7, 2011); Bayou Lawn & Landscape Servs., et al.
v. Solis, 3:11 cv445 (N.D. Fla. Filed Sept. 21, 2011).
\25\ Continuing Appropriations Resolution, 2013, H.J. Res. 117,
Public Law No. 112-175 (Sept. 28, 2012); Consolidated and Further
Continuing Appropriations Act, 2012, Pub. L. 112-55, Div. B, Title V,
Sec. 546 (Nov. 18, 2011); Consolidated Appropriations Act of 2012,
Pub. L. No.112-74, Div. F, Title I Sec. 110, 125 Stat. 786 (2011).
\26\ See Louisiana Forestry Ass'n, Inc., et al. v. Solis, No. 11-
7687, 2012 WL 3562451 (Aug. 20, 2012).
\27\ Bayou Lawn & Landscape Servs., et al. v. Solis, et al., No.
3:12-cv-00183 (N.D. Fla. filed Apr. 16, 2012).
______
Chairman Walberg. Ms. Bauer, thank you, as well.
I recognize Mr. Musser for your 5 minutes of testimony.
STATEMENT OF DAN MUSSER, PRESIDENT, GRAND HOTEL
Mr. Musser. Thank you, Mr. Chairman and members of the
subcommittee. I appreciate the invitation today to talk about
the critical need for foreign temporary seasonal H-2B worker
program for Grand Hotel and other seasonal businesses
throughout the country.
My name is Dan Musser. I am president at Grand Hotel on
Mackinac Island, Michigan. I am the third generation in my
family to own and operate this historic, seasonal, 385-room
summer resort.
We are known nationally and internationally as the world's
largest summer hotel. We are known for the beauty of our
location on Mackinac Island, our dramatic 660-foot front porch
that the chairman eloquently discussed earlier, and more
importantly, our friendly and unique hospitality.
Our exceptional service is widely recognized by many
national rating guides. For example, National Geographic
Traveler selected us as one of 150 properties that--with
location-inspired architecture, ambiance, amenities, eco-
stewardship, and an ethic of giving back to the community.
Grand Hotel is the largest employer of U.S. workers on
Mackinac Island. We employ 60 U.S. workers annually on a year-
round basis and 260 on a seasonal basis.
For many decades Grand Hotel's entire staff had U.S.
workers. Increasing opportunities for year-round hospitality
workers has made it impossible to fill all of our positions
with ready, willing, and able American workers. Without the H-
2B seasonal temporary workers we employ to supplement our U.S.
workforce we would eventually not be in business.
Since Grand Hotel first opened in 1887 it has been a
continuing challenge to find a stable, dependable workforce to
fill the 620 jobs required to maintain the high level of
service for which we are known. We are only open 6 months a
year. We are in an isolated location 300 miles north of
Detroit.
Operating year-round is not an option. There is no good way
to get to our island in the winter and very little to do there
if you were able to get across the frozen lake.
We are and always have been committed to staffing Grand
Hotel with U.S. workers. Each year we take a number of steps to
recruit U.S. workers for Grand Hotel, including running ads in
major papers in Michigan, the Great Lakes region; advertising
in seasonal resort areas that dovetail with ours; attending as
many job fairs; visiting culinary institutes around the
country; and partnering with Job Corps centers.
We are able to hire some college students, but increased
summer enrichment opportunities and the extended school year at
many colleges preclude them from remaining with us for the
entire season.
We have also tried several innovative programs, including a
service academy through which we worked with the state of
Michigan and the Educational Institute of the American Hotel
and Lodging Association, where we hired unemployed Michigan
citizens, guaranteed them a job the next summer, provided them
college-level hospitality courses throughout the summer. We
found that after helping them find jobs in resorts in another
part of the country in the winter and the additional college-
level classes that they did not return to us.
While these programs have not provided us the workforce we
need to provide Grand Hotel's service, we continue and will
continue to do everything in our power to find, recruit, and
maintain an American labor force.
About 40 years ago Grand Hotel began to look to foreign
workers to fill positions which we were finding no U.S.
citizens were available. Many of our H-2B workers--for example,
those from Jamaica--hold seasonal hospitality jobs in their
home countries. Some of them return year after year to Grand
Hotel because of the pay and working conditions that we offer
to all of our staff.
Most of the subsidizing housing we provide to our staff are
single rooms--some with private baths, some with shared baths,
and others are dormitory style. But we are proud of the
condition of our employee housing. And over the last 3 years we
have spent in excess of $1 million on improvements. We provide
three meals a day in our employee cafeteria and assist all of
our staff in many ways, including through the Mackinac Island
Community Foundation.
We are one of 70 Northern Michigan resorts and hotels that
utilize temporary seasonal foreign workers on the H-2B visa for
specific jobs. Our workforce during the summer is made up of
our U.S. workers and 300 or so temporary foreign workers.
Our American jobs depend on our H-2B workers. It would be
extremely difficult if not impossible for us to continue to
operate successfully without the H-2B worker. They are the
lifeblood of our seasonal business.
The potential closure of Grand Hotel would have a
devastating impact on Mackinac Island, Northern Michigan, and
the tourism industry in the state of Michigan. For example, in
the last 15 years we have reinvested in excess of $32 million
in capital expenditures that have created jobs for hundreds of
Michigan workers.
Grand Hotel is not that much different from the thousands
of small and seasonal businesses throughout the U.S. who have
been forced to turn to the H-2B program as a result of lack of
available Americans willing and able to work in temporary
seasonal positions. Like all business, Grand Hotel suffered
during the recent recession. The uncertainty about whether and
when the H-2B visa program could be dramatically changed by the
accommodation of the recent Department of Labor rules and H-2B
wage rates and new H-2B programmatic rules have created an
untenable climate for business planning.
Comprehensive immigration reform must maintain a viable
non-agricultural seasonal worker program along the lines of
existing H-2B program. The program should maintain current
protections for Americans and H-2B workers and not impose
costly burdensome requirements on employers who use the
program. The federal government should enforce the existing
protections.
The number of participants in the program should be market-
based so it can fluctuate based on need and the returning
worker exemption should be reinstated.
Comprehensive immigration reform should provide sufficient
resources for federal agencies to process H-2B applications in
a timely manner.
Thank you, Mr. Chairman.
[The statement of Mr. Musser follows:]
Prepared Statement of R. Daniel Musser III, President,
Grand Hotel, Mackinac Island, MI
Mr. Chairman and Members of the Subcommittee, I appreciate your
invitation to testify today about the critical need for a foreign
temporary, seasonal H-2B worker program for Grand Hotel and other
seasonal businesses throughout the U.S. My name is Dan Musser, I am
President of Grand Hotel on Mackinac Island, Michigan. I am the third
generation of my family to own and operate this historic, seasonal,
385-room summer resort. This is the 80th year that the hotel has been
under our stewardship and on July 10, 2012 we celebrated our 125th
birthday.
Grand Hotel is known nationally and internationally as the world's
largest summer hotel. We are known for the beauty of our location on
Mackinac Island, for our dramatic 660-foot front porch and, more
importantly, for our friendly and unique hospitality.
Our exceptional service is widely recognized by many national
rating guides; I have attached a brief listing of recent awards that
reflect our commitment to quality.
To give just a few examples:
The April 2008 issue of National Geographic Traveler
selected us as one of 150 properties in the U.S., Canada, Mexico and
the Caribbean Region with location inspired architecture, ambiance, and
amenities, eco-stewardship, and an ethic of giving back to the
community.
Travel & Leisure magazine annually lists us as one of the
500 best hotels in the world and their readers selected us as one of
the top 50 family friendly resorts in the U.S. and Canada.
Conde Nast Traveler rated us one of the top 100 resorts in
the United States and the number 4 northern resort in their list of top
125 golf resorts in the United States.
In honor of our anniversary, Michigan Governor Rick Snyder
proclaimed July 8-14 Grand Hotel week in the state of Michigan noting
our designation as a National Historic Landmark by the U.S. Department
of Interior and the ``world-class hospitality'' the Musser family and
Grand Hotel has provided over the past 125 years.
Grand Hotel is the largest employer of U.S. workers on Mackinac
Island. We employ 60 U.S. workers annually on a year round basis and
260 on a seasonal basis. For many decades, Grand Hotel's entire staff
was U.S. workers. Increasing opportunities for year-round hospitality
workers and other factors have made it impossible to fill all of our
positions with ready, willing, and able American workers. Without the
H-2B seasonal temporary workers we employ to supplement our U.S. work
force, we eventually would not be in business.
Since Grand Hotel first opened in 1887, it has been a continuing
challenge to find a stable, dependable work force to fill the 620 jobs
required to maintain the high level of service for which we are known.
The fact we are open only six months, our isolated location 300 miles
north of Detroit, and other factors make it difficult to develop a work
force needed to provide Grand Hotel level hospitality.
Operating year round is not an option. We are a seasonal summer
hotel. There is no good way to get to our island in the winter and very
little to do there if you were able to get across the frozen lake.
We are and always have been committed to staffing Grand Hotel with
U.S. workers. Each year we take a number of steps to recruit U.S.
workers for Grand Hotel.
We run ads in major papers in Michigan and the Great Lakes
region.
We advertise in seasonal resort areas that dovetail with
ours such as ski resorts in Colorado and Utah and warm weather resorts
such as Florida and Arizona.
We attend as many job fairs in as many colleges and
universities in Michigan and the Great Lakes region as we can.
We visit culinary institutions around the country.
We attend Michigan Works job fairs.
We list jobs on major Internet sites.
We promote on major media outlets in Michigan (radio,
print, electronics)
We have partnered with Job Corps Centers in Flint, Grand
Rapids and Detroit, Michigan and Golconda, Illinois.
We are able to hire some college students, but increased
opportunities for summer educational and enrichment activities for
college students has reduced the pool of available students. Further,
most college students' school schedules preclude them from remaining
with us for the entire season, which runs from April through mid-
November.
We have also tried several innovative programs. We created a
service academy through which we worked with the Michigan Employment
Security Commission to find unemployed Michigan Citizens who expressed
an interest in the hospitality field. We provided employment for the
summer and rotated them through different departments in the Hotel
during the course of the season. They also received college-level
classroom instruction provided by the Educational Institute of the
American Hotel and Lodging Association.
At the end of the season, they received accreditation from the
Institute, a guaranteed job the next summer with us, and with the
State's assistance found winter jobs at various resorts in Colorado,
Utah, Arizona and Florida. Unfortunately for us, those resorts offered
year-round employment. We found that after we had provided them an
education and experience in the hospitality industry and then found
positions for them with other resorts in other parts of the country
that offered year-round employment, we had virtually no returning
graduates.
We even tried a program where we recruited workers from homeless
shelters in metropolitan areas in southern Michigan. That was not
successful.
We had a somewhat successful program with the State with
individuals with certain limited physical and mental disabilities. We
hired a qualified full-time supervisor specially trained to work with
and live with these individuals to ensure integration to our working
community. In recent years, the State's role has diminished in this
regard and, therefore, our program as well. I am pleased to say that
our program enabled six of these individuals to become capable of
living on their own and several worked with us for over 20 years.
While these programs have not provided us with the work force we
need, we continue and will continue to do everything in our power to
find, recruit and retain as many U.S. workers as possible. In the
meantime, the quality of service we provide requires that we supplement
our professional, trained and dependable U.S. work force.
For many years, we recruited workers from Florida. But as Florida
turned into a year round vacation destination, those workers no longer
were available. The situation was particularly critical in the hotel
dining room, which is a key part of hotel operations.
About 40 years ago, Grand Hotel began to look to foreign workers to
fill positions for which we could not, despite extensive efforts, find
U.S. workers. Our H-2B workers come from several different countries.
Many of these workers hold seasonal hospitality jobs in their home
countries. For example, the Jamaican tourist season dovetails perfectly
with ours and Jamaica is an important source of H-2B workers for us.
Some of them return year after year to Grand Hotel because of the pay
and working conditions we offer to all staff, both domestic and
foreign. In 2012, of the 280 H-2B staff that worked with us,
approximately 250 or 90% were returning staff.
Under federal law, our wage rates are approved by both the Michigan
Employment Security Commission and the U.S. Department of Labor. Our
wage rates are based on Detroit-area wages.
We provide a variety of housing in communities on the island that
we subsidize for all staff. Most are single rooms; some with private
baths; some with shared baths with one other room and some dormitory
style. We are proud of the condition of our employee housing. In the
past 3 years, we have spent in excess of $1.1 million on improvements.
In addition to housing, we also provide three meals a day in our
employee cafeteria. It is important to note that our H-2B workers enjoy
workers compensation, just as our American workers. We also assist our
U.S. and H-2B workers in many ways. For example, in September of 1988,
Hurricane Gilbert caused $4 billion of damages to homes and crops in
Jamaica. It is estimated that 80% of the homes on the Island lost their
roofs. Several staff members returned to Jamaica early to take care of
their property and family and also report back to staff members who
stayed on Mackinac. Grand Hotel gathered food and supplies and sent a
trailer of these supplies to Jamaica to assist with the clean up.
In November of 2006, shortly after returning home to Jamaica, 11
year Waiter Garfield Slowly was seriously injured in an automobile
accident and his child was killed in the same accident. News of the
tragedy traveled quickly to Mackinac and Grand Hotel partnered with the
Mackinac Island Community Foundation to provide monetary help and
medical supplies.
$19,500 in aid was sent to support Garfield and his family over a
4-year period. This is one of many partnerships with the Mackinac
Island Community Foundation. My wife, Marlee, was on the founding Board
of Trustees for the Foundation and I still serve on the Board. Grand
Hotel provides office space free of charge and also paid the Directors
salary and benefits for 15 years. The Foundation is a resource for all
staff, U.S. and H-2B workers, and provides financial assistance for
medical and family emergencies, natural disasters and serious illness.
Grand Hotel makes special efforts to help its workers in other
ways. Each year, all staff is allowed to order bulk food items and
cleaning supplies through the hotel at a great discount.
These items are shipped within the U.S. or to their home countries
and used to support their extended families for the entire year. At the
beginning of each season, clothing donations are accepted from staff
and Mackinac Island residents and redistributed to the staff coming to
work in April. Much of our staff comes from a climate where warm
clothing and boots are not readily accessible. This program has
provided our staff with free clothing and boots for the past 8 years.
Grand Hotel also conducts activities to celebrate our multicultural
staff. Each year we recognize Mexican, Jamaican and Filipino
Independence Days through activities in our Employee Cafeteria and
through the entertainment offered in our outside restaurants. We also
help to sponsor football, soccer and cricket matches for the staff to
participate in and challenge each other. The staff appreciates the
recognition and everyone appreciates the opportunity to learn more
about the culture and customs of their co-workers.
We are one of 70 northern Michigan resorts and hotels that utilize
temporary, seasonal foreign workers on H-2B visas for specific jobs.
Our workforce during the summer is made up of our U.S. workers and 300
or so temporary foreign workers. Our American jobs depend on our H-2B
workers. It would be extremely difficult, if not impossible, for us to
continue to operate successfully without H-2B workers--they are the
lifeblood of our seasonal business.
The potential closure of Grand Hotel would have a devastating
impact on Mackinac Island, Northern Michigan and the tourist industry
in general.
Some relevant facts to consider are:
Grand Hotel has reinvested in excess of $32 million in the
past 15 years on capital expenditures. All construction was performed
by Michigan contractors.
During the past 15 years, an additional $25 million was
spent on normal and major repairs to the Hotel's properties.
On average, 600 individuals are employed at the Hotel each
year, with an annual payroll in excess of $14 million.
Grand Hotel spends in excess of $1.4 million annually for
State and Federal unemployment and FICA taxes.
The Hotel spends in excess of $1.4 million annually in
Michigan for professional services such as advertising, accounting and
other outside services.
Grand Hotel is not much different from the thousands of small and
seasonal businesses throughout the U.S. who have been forced to turn to
the H-2B program as a result of a lack of available Americans willing
and able to work in temporary seasonal positions. And it is not just
the hotel and resort industry that needs these workers.
Nearly every corner of the country uses seasonal temporary workers.
The industries include:
Seafood processors, shrimpers, crabbers, and fishermen
throughout the Gulf, Carolinas, Alaska, Northwest and Mid-Atlantic
states;
Hotels, restaurants, ski resorts and other important
tourist destinations throughout New England, the Mid-West and the
Rockies;
Quarries from New England to Colorado;
National Parks, including Grand Canyon, Sequoia, Yosemite
and others;
Forest industry in New England and the Southeast;
Theme parks and swimming pools in virtually every state;
and
Landscapers and landscape contractors across America.
Each year these employers go through great expense and trouble to
follow the law. The H-2B process consists of applications to four
separate Government agencies (State Workforce Agency, U.S. Department
of Labor, U.S. Department of Homeland Security and U.S. Department of
State), legal fees, Government filing fees and many other expenses.
Employers pay wages at levels that have been certified by the U.S.
Government to be high enough so that they will not adversely affect the
wages of similarly employed Americans. Employers are obligated to pay
transportation expenses to and from the property (according to DOL
guidance), and they must comply with the myriad rules and regulations
that govern the worksite of U.S. and foreign workers alike.
For seasonal employers, the H-2B returning worker exemption worked
well. Employers still willingly searched high and low for every
American they could find. But when they could not find Americans, the
fact that they could turn to workers who have worked for them in the
past ensured that they could stay in business. Most importantly, since
returning workers had already undergone extensive background security
checks (and have to undergo similar cheeks each time they apply to
enter the U.S.), employers could feel confident that they have helped
protect the security of our homeland. Moreover, in deciding to return
to work with the same seasonal employer, these H-2B workers signaled
that they were pleased with their working conditions and the wages they
were paid. The returning worker exemption was one of those rare ``win-
win-win-win'' situations: a win for workers (American and foreign); a
win for employers; a win for the United States of America; and a win
for the communities we serve. The returning worker exemption from the
annual cap on H-2B visas should be re-instated.
Like all businesses, Grand Hotel suffered during the recent
recession. Our recovery has been threatened by the recent U.S.
Department of Labor rules on H-2B wage rates and new H-2B programmatic
rules. Fortunately, Congress and the federal courts have so far blocked
implementation of these rules, but the uncertainty about whether and
when the H-2B visa program could be dramatically changed by
Administration action creates an untenable climate for business
planning.
Grand Hotel did not comment on the Department of Labor (DOL)
proposed wage rule issued on October 5, 2010. Although the proposed
rule was of concern to us, we determined that we could survive with the
new rule. DOL issued the final rule on January 19, 2011. It
artificially increases H-2B hourly wages by more than 50%. For many
seasonal employers who operate on thin profit margins, such a dramatic
increase in labor costs will drive them out of business or into
bankruptcy. This rule was slated to go into effect last year, but DOL
moved the implementation date to March 27, 2013 after Congress
prohibited DOL from spending any appropriations funding to implement
the rule.
According to DOL's own estimates, the rule will increase H-2B wages
by the following:
Landscaping services, $4.32;
Janitorial services, $5.81;
Food services and drinking places, $2.59;
Amusement, gambling, and recreation, $6.61;
Construction, $9.12; and
Forestry support, $1.23.
The actual cost to H-2B users is far greater than DOL's estimates
because DOL does not account for labor increases for similarly employed
American workers or more experienced American workers whose pay should
reflect the greater skill or experience level and be proportional to
the hourly wage earned by lesser skilled workers. It also does not
include additional payroll costs, workers compensation insurance,
overtime costs and other associated increases.
On February 21, 2012, DOL issued a final H-2B program rule that
would make the H-2B program more complicated for small seasonal
employers. The combination of the H-2B wage rule and the H-2B program
rule will make the H-2B program virtually unusable for many seasonal
businesses. The rules are based on the mistaken assumption that the H-
2B program is fraught with abuse. While this is not the case, DOL and
the Department of Homeland Security already have significant authority
to enforce against any employers that are not meeting their obligations
to their H-2B and U.S. workers. The DOL is currently enjoined by a
federal court from implementing the program rule.
I will highlight a few of the provisions in the Department of Labor
programmatic rule that are particularly burdensome:
Additional Recruitment Time
Increasing the amount of time during which U.S. workers must be
recruited from ten (10) days before filing the ETA-9142 to twenty-one
(21) days before the H-2B employer's need for the worker, is too short.
The end of the recruitment period must leave more time to shift
from the use of human resources manpower hours for recruitment and
compliance with H-2B rules to the use of manpower hours to actually
open the business. Typically, Grand Hotel's goal in recruiting H-2B
workers (to supplement the employment of the U.S. workers we are able
to recruit to fill various positions in our organization including
housekeepers, wait staff, kitchen helpers, and bellhops) is to have the
majority of recruitment completed by March 1. Our plan is to have
workers begin to arrive at the Hotel on April 1. The Hotel opens on May
1. We need time between completion of the long and expensive hiring and
recruitment process and the arrival of staff to begin the operational
side of our business, that is, to prepare training plans, housing,
uniforms, and scheduling. Our guests expect to experience Grand Hotel's
high level of service on our opening day.
Areas of Substantial Unemployment Definition
An ASU is defined in the rules as ``a contiguous area with a
population of at least 10,000 in which there is an average unemployment
rate equal to or exceeding 6.5% for the twelve (12) months preceding
the determination of such areas made by the ETA.'' We believe that the
benchmark for an ASU, for purposes of requiring additional recruitment,
should not be based on the annual unemployment rate, but the timeframe
of need. For example, Grand Hotel is located in Mackinac County, which
has an annual unemployment rate of 11.5%, but this is to be expected in
a summer vacation area when during the summer months the unemployment
rate for all but one month is lower than the national average as
delineated below:
------------------------------------------------------------------------
Annual-2012 11.5%
------------------------------------------------------------------------
January....................................................... 23%
February...................................................... 23.5%
March......................................................... 21.6%
April......................................................... 14.1%
May........................................................... 6.1%
June.......................................................... 4.5%
July.......................................................... 4.2%
August........................................................ 3.8%
September..................................................... 3.6%
October....................................................... 4.3%
November...................................................... 11.9%
December...................................................... 17.9%
------------------------------------------------------------------------
We also believe that the ASU threshold should not be an arbitrary
figure of 6.5%, but should be based on the national employment rate,
which is currently 7.7%.
Additional Recruitment Required for an ASU is Unreasonable
and may be Counterproductive
The DOL's regulation would require employers to engage in
additional recruitment activities, including but not limited to
contacting community-based organizations in ASUs to ensure that
unemployed U.S. workers, who may be capable of (and desirous of)
performing the job duties, are afforded maximum access to those
opportunities, is unreasonable in many circumstances and based on
faulty logic. The DOL's intention of requiring additional recruitment
is predicated on its belief that more recruitment will result in more
opportunities for U.S. workers.
It is our view that this position is based on faulty reasoning
because many employers, including Grand Hotel, already conduct
significant recruitment far above that which is required under previous
DOL regulations, and which has absolutely not resulted in the hiring of
additional U.S. workers, even during the last few years of increased
nation-wide unemployment. The requirement by the DOL to have employers
conduct additional recruitment if employers are located in an ASU,
could actually result in employers conducting only the DOL-ordered
additional recruitment, which might actually result in the placement of
fewer advertisements. Grand Hotel is located in an ASU, but because we
are committed to hiring as many U.S. workers as possible, we are
already placing many more advertisements than could be required by the
DOL under its rules.
For example, in 2012, Grand Hotel conducted the following
recruitment in order to find staff in the U.S. for our available
positions:
Advertisements
Lansing State Journal; Detroit News
Detroit Free Press; Grand Rapids Press; Sault Evening News; St.
Ignace News
Mackinac Island Town Crier; Traverse City Record; Eagle Petoskey
News Review
Job Fairs (to which Grand Hotel sends recruiters)
Michigan State University; Northwestern Michigan College; Northern
Michigan University
Advertisements in the following College Areas
Grand Rapids Community College; Henry Ford Community College;
Schoolcraft College
Northwood University; Kent State University
Electronic Media
Craig's List; Monster.com
Michigan Talent Bank, also known as Pure Michigan Talent Connect
(which is used by Grand Hotel throughout the 7 month period during
which the hotel is in operation, which in turns makes referrals from
local Michigan employment offices in St. Ignace and Cheboygan)
Grand Hotel Website found at www.grandhotel.com (on which job
openings are listed year round. When the website became operational,
the number of applications jumped from 600 to 1,600, and did not result
in the hiring of more U.S. workers who could work the entire contract
period.)
Other Recruitment
At various seasonal resorts in Utah, Colorado and Florida
Cheboygan & Presque Isle Annual Job Fair hosted by Michigan Works;
Gerald R. Ford, Flint, Detroit, and Golconda Job Corps Center
Ubuntu Institute (founded by Nelson Mandela's grandson)
We are very excited about our new relationship with the Outbound
Programme of the Ubuntu Institute. The Outbound programme is designed
for youth and adults from Southern Africa (SADC) and provides
internships, learnerships, and training opportunities for unemployed
graduates from disadvantaged communities in Southern Africa for a
period of 6-12 months. The programme is largely focused on Tourism and
Hospitality, one of the fastest growing economic sectors in most
Southern African countries. The participants of this programme,
referred to as ``Ubuntu Institute fellows'' travel to the United States
and Canada to gain work experience at some of the most distinguished
companies in the world. We have not yet been approved for Ubuntu
Institute Fellows for this season and we are hopeful some of these
Fellows will be joining us on Mackinac Island this summer.
As a result of our sustained recruitment efforts in 2012, we
received 1,665 applications from U.S. workers for various positions at
the Hotel, including but not limited to the positions for which we
sought H-2B workers, and of these 1,665 applications, only 358 or 21%
were available for our full season.
Finally, we believe that permitting the DOL to require employers to
contact community-based organizations based on a determination that a
particular employer is located in an ASU places an undue burden on the
DOL, which would have to become familiar with the area's community-
based organizations. This might result in hasty and un-researched
determinations by the DOL, and ultimately will not result in the net
hiring of additional U.S. workers. Grand Hotel is familiar with
community-based organizations on the Island and in surrounding areas,
including St. lgnace, Mackinaw City and Cheboygan, and advertisements
with and referrals from those organizations have not proven to be very
fruitful. In addition, the rule gives the DOL far too much discretion
in supplanting its wisdom for the wisdom of an employer that has been
in existence in Mackinac County for over 120 years and which fully
understands the local labor market.
Recommendations for Comprehensive Immigration Reform:
Comprehensive immigration reform must maintain a viable
non-agricultural seasonal worker program along the lines of the
existing H-2B program.
The program should maintain current protections for
American and H-2B workers and not impose costly burdensome requirements
on employers who use the H-2B program. The federal government should
enforce existing protections.
The number of participants in the program should be
market-based, so it can fluctuate based on need, and the returning
worker exemption should be re-instated. Returning workers have
demonstrated that they will comply with the rules of the program. The
number of workers desiring to return confirms that most employers treat
their H-2B workers fairly.
The current H-2B requirement that an H-2B worker cannot
leave a sponsoring employer until the successor employer's USCIS
petition has been approved should be maintained. Sponsorship of an H-2B
worker is a costly and time-consuming process for a short season.
H-2B employers should not be vulnerable to losing a worker the day
before the date of need.
Immigration reform should provide sufficient resources for
federal agencies to process H-2B applications in a timely manner.
Thank you, Mr. Chairman.
Grand Hotel Recent Awards
AAA Four Diamond Rating
Rated by a AAA field inspector as an excellent property displaying
a high level of service and hospitality.
The Greatest Hotels in the World
Travel & Leisure Magazine, January 2011--The annual guide to the
500 best hotels in the world. The list contains the hotels that
received the highest rating in the Travel & Leisure reader survey along
with opinions and advice of its editors and reporters.
Top 100 Readers' Choice Award
Conde Nast Traveler, November 2011--Voted by readers as one of the
top 100 resorts in the United States.
World's Best Awards
Travel & Leisure Magazine, August 2011--Voted by readers as an
essential index of the places you want to go in the United States and
Canada.
Top 125 Golf Resorts
Conde Nast Traveler, April 2011--Chosen by thousands of readers as
a property that marries outstanding golf with fantastic lodging,
dining, and service for the avid or casual golfer. Grand Hotel was
ranked 4th in the top northern U.S. golf resorts category.
Silver Sage Award
Spa Magazine, 2011 Readers Choice--Selected by readers as one of
the top resort/hotel spas in the Midwest.
TripAdvisor 4.0 Rating
July 2011--Grand Hotel received the 2011 Certificate of Excellence
from TripAdvisor acknowledging the most powerful recommendation--the
endorsement of guests.
Gold Key Award
Meetings & Conventions Magazine, September 2010--Selected by
readers of M&C who based their votes on overall professionalism and
quality of property. Experienced meeting planners selected their
winning properties based on strict industry criteria including staff
attitude, quality of meeting rooms, quality of guest service, food and
beverage service, and recreational facilities.
10 Best All-Inclusive Family Resorts
FamilyVacationCritic.com--Selected number four in the U.S. and
Caribbean in a September, 2010 rating based on setting, activities,
food, and overall experience for families.
T+L World's Best Hotels For Families
Travel & Leisure Family Magazine, September 2011--Selected by
readers as one of the 50 best family-friendly resorts in the United
States and Canada.
Best of MidAmerica
Meetings Focus MidAmerica, August 2012--Selected by readers of
Meetings Focus MidAmerica magazine as one of the top properties in the
Midwestern United States.
Stay List
National Geographic Traveler, April 2008--Nominated by travel
experts and seasoned travelers and then selected as one of 150
properties in the U.S., Canada, Mexico and the Caribbean Region with
location-inspired architecture, ambience, and amenities, eco-
stewardship, and an ethic of giving back to the community.
Top 10 Historic Hotels
June 2009--Selected by AAA property inspectors as one of their
favorite historic hotels.
Award of Excellence
Wine Spectator, August 2010--Recommended as a restaurant where a
fascinating wine experience is part of the dining experience. Wine
lists are judged by the number of selections, quality of wines chosen,
depth of vintages, compatibility with the restaurant menu, inventory,
and how easy the lists are to use.
56 Hotels We Love
National Geographic Traveler, September 2004--Named one of the
American hotels that deliver a unique experience and a lasting
impression.
Award of Excellence
Corporate & Incentive Travel, November 2006--Recognized by
subscribers as a resort that has superior staff service, excellence in
accommodations and meeting facilities, trouble-free food and beverage
functions, smooth set-ups and arrangements for social functions,
exceptional ambiance, and convenient and accessible location.
Inner Circle Award
Association Meetings Magazine--Voted by readers as one of the top
hotels in the country for meetings.
Planners' Choice Award
Meeting News Magazine--Recognized as one of the best in the
industry by conference and convention planners based on the quality of
facilities and services provided.
Golden Links Certified
Corporate Meetings & Incentives--Certified by an advisory panel as
an outstanding facility for golf and meetings.
Excellence in the East Award
Meetings East Magazine--Chosen by readers as one of the top 56
properties in the Eastern and Midwestern United States and Canada. The
properties were selected based on the quality of meeting space, guest
rooms, staff, service, food and beverage, amenities, activities, and
value from properties that they have used within the last two years.
Playful Travel Award
Nick Jr. Magazine--Chosen by top family travel experts and editors
from Nick Jr. Magazine as well as two
Nickjr.com online surveys as a hotel that offers the best
facilities and products to suit the needs and tastes of Nick Jr.
families. It is accessible, affordable, and accommodating and offers
unique features that make kids feel special and make parents feel cared
for and comfortable.
Best of the Midwest
Midwest Living Magazine--Featured as one of the top 37 Midwest
resorts selected by the editors of Midwest Living in the Best of the
Midwest 2006 edition.
Top 25 Around the World
Gourmet Magazine--Selected by Gourmet Magazine as the top hotel in
the Midwest and one of the top 25 hotels in the world, in the May 1997
issue.
Greens of Distinction
Corporate & Incentive Travel, 2008--In recognition of outstanding
golf facilities and service for corporate meetings and incentive travel
programs as a result of a subscriber survey.
______
Chairman Walberg. I thank you and each of the witnesses
this morning.
I recognize myself for my 5 minutes of questioning.
Mr. Musser, I detect that there may be a second negative of
air conditioning. Not only has it encouraged the expansion of
federal government's staying around longer here in Washington,
but I am sure it has made it somewhat difficult by opening
opportunities in tourist spots other than in Michigan and in
the North.
Let me ask you a question. Critics of guest worker programs
argue that American workers would fill temporary jobs if they
were better able to access information about the positions.
Grand Hotel, as you have described, does extensive outreach to
connect with American workers, yet you still have to turn to
foreign workers.
Can you further describe some of your recruitment efforts,
and do they go beyond the requirements of the H-2B program?
Mr. Musser. Thank you, Mr. Chairman. And yes, our
recruitment efforts do go beyond the requirements. Quite
frankly, I would like to hire all Mackinac County residents if
I could, but unfortunately, there are just not enough willing
to do the job.
We have, in the past, run buses to Detroit to homeless
shelters. In addition to the program I outlined in my
testimony, we have tried a variety of programs and will
continue to do that. The most recent is Job Corps, which is--we
have found some good American staff through that, and we will
continue to do those.
But unfortunately, you know, we are in this isolated
location 300 miles away from the, you know, the largest
population base in our state. We are difficult to get to even
in the summer, and the idea of individuals leaving their life,
if you will, for 6 months--packing up and coming to this
isolated location is not a reality, or at least in the numbers
that we need to operate.
And I think that as far as the foreign nationals that we do
bring in, it is important to note that last year, for example,
of the 260 or so H-2B workers we had, 90 percent were
returning. So if our wages weren't good and the type of work
environment that we work hard to create wasn't good, I don't
think those individuals would be returning.
Chairman Walberg. Your testimony highlights that the Labor
Department's new H-2B rules would threaten your ability to
fully recover from the recent recession. Explain a little bit
in more detail why you say that.
Mr. Musser. The costs are problematic. Some of the
suggested changes, such as the requirement to accept an
individual up to 21 days prior to the need--or the date of
starting work is difficult.
If we play by the rules and we do everything in our power
to find Americans and then are not able to do it and we are
able to bring an H-2B worker, if we are told up to, you know, 3
weeks prior to our opening date that we have to remove that
person it is very difficult to reasonably plan for the season
and get the crew up to speed and ready for the summer. And then
to go through the process again is not realistic to find, if
that American doesn't work out, to find an H-2B person to
replace him or her.
So the costs and also the timeframes are two areas of
difficulties.
Chairman Walberg. Reality gets in the way.
Mr. Musser. Yes.
Chairman Walberg. Ms. Reiff, your testimony suggests that
there should be a lower-skilled guest worker program that does
not tie visa-holder to a single employer. Can you elaborate for
us on the benefits of that approach?
Ms. Reiff. The idea is that employers in the lesser-skilled
areas would be able to actually recruit for positions, show
that--do extensive recruitment, show that they couldn't find
U.S. workers for particular positions--let's say they are LPNs
or CNAs--and then they would register within the system and be
identified as an employer that was not able to find X number of
workers. Workers, then, that were looking for that type of work
overseas would have access to a database to show--or through a
foreign recruiter to show that they also qualified for that
position. So it was kind of a willing worker, willing employer
kind of matching database.
The employer would then be able to get a visa, come in, be
registered with that employer, be tracked through a monitoring
system, and if the employee decided to leave they could go to
another registered employer. So they would be able to leave if
they decided that they didn't want to be there. But that
employer would still be registered for those particular slots
and would be able to recruit another worker, whether it is a
U.S. worker or somebody from overseas.
Chairman Walberg. Okay. Thank you.
My time is expired.
I now recognize the ranking member, my good friend, Mr.
Courtney.
Mr. Courtney. Thank you, Mr. Chairman.
Just to sort of follow up on that point, I mean, your
testimony, Ms. Bauer, really was focused a lot on, you know,
some real horror stories of people who were sort of trapped
under the existing system with an employer and nowhere else to
go. I mean, the sort of reform that you were sort of describing
in terms of more portability--maybe I just was kind of curious
to have you comment on--on whether or not that would improve
that obvious problem that your center has identified, and the
reports, and actually the GAO also identified.
Ms. Bauer. Well, maybe. And maybe it will make an
improvement. But I think it is not a panacea, particularly as
described in this proposal, because workers would still have to
go to a registered employer; they wouldn't be free to go find a
job more generally. Our experience is that that is very
difficult for workers to access those jobs and to find a job in
the timeframe that is appropriate.
I think more importantly, those jobs would still remain as
jobs that would then be available to, presumably, additional
guest workers who would come in, and paid under the prevailing
wage rate or paid less than the average wage rate, which would
have a depressive effect on U.S. wages and working conditions.
Mr. Courtney. Right. I mean, the wage issue, which again, I
think you did a nice job sort of walking us through that, I
mean, that certainly is something that needs to be looked at.
But, I mean, the AFL-U.S. Chamber joint statement, which again,
I think we have got to embrace whatever sort of traction we can
get around this town, you know, when opposing forces are
coming--trying to come together, I mean, did actually
specifically say that this present system that, again, locks
people into one employer should be reformed. And, you know, I
think that is encouraging.
Again, how you do it I guess is really the trick here. And,
what is your response to her observation?
Ms. Reiff. Well, I think--there are a lot of negotiations
going on right now but I think it was very important to the
labor union side to have this portability and the workers being
able to vote with their feet. It is also very important for
employers who recruit and can't find U.S. workers to be able to
have that open slot if they do--if our foreign worker that
comes in actually leaves and goes to another employer.
So, for us, I think it is really--it was a big concession
to say that portability should be from day one, but we also
need to have those slots still open because there is still an
open position. That is not to say that a U.S. worker wouldn't
fill that position, but it should still be in the database as a
position that is open until it is filled. And I think we are on
the same page with the unions on that issue.
Mr. Courtney. Right.
And, you know, you mentioned database. I mean, it seems
that for, you know, a smart reform, you know, we need a system
that actually is better, in terms of just helping American
workers--we did a job fair in New London County last summer,
which we had 33 employersthat was the good news--some in health
care, some in hospitality, some in defense--that had openings.
We had 1,500 people in the pouring rain an hour or 2 before we
opened the doors.
And, you know, it was clear that even though some of these
employers had been advertising, the system is really still
weak, you know, in terms of people knowing what is out there.
And it seems like a reform is going to have to do better, as
far as data being available, again, to U.S. workers, in my
opinion, at this time of recession. It is so obvious that there
is a need there. But also, as the--if we do have a reform,
there has got to be a way for people to, you know, know what is
going on out there.
Ms. Reiff. Absolutely. And----
Mr. Courtney. But that is not the case now, right?
Ms. Reiff. Well, there are different--we don't have a
temporary worker program right now aside from the seasonal non-
agricultural worker program, so we don't really know exactly
how the lesser-skilled--semi-skilled folks--now, this goes all
the way up to less than a bachelor's degree--the scope of the
program, from ``no skill'' all the way up to ``could be an
RN,'' because RNs don't necessarily need to have a 4-year
bachelor's degree.
There has to be ways--we have listed out many different
ways to recruit these types of workers. It could be job fairs;
it could be in ethnic media; it could be in many different
ways. It could be sitting outside the grocery stores. But there
are many different ways that we have identified in conjunction
with our counterparts on the other side that could adequately
test the labor market.
But yes, our workers--our employers want to hire U.S.
workers. We want to exhaust the U.S. workforce first and then
reach out to the foreign workers.
Mr. Courtney. Right.
I yield back.
Chairman Walberg. Thank the gentleman.
Against my better judgment, and after what Indiana did
unfairly to Michigan the other night, I will show grace and
recognize my good friend from Indiana for his 5 minutes of
questioning.
Mr. Rokita. Well, thank you for that grace, Reverend--I
mean Chairman--I mean both.
Good morning, everyone. Thank you for your testimony. It
has given me several questions to think about and ask you
about, but only 5 minutes so I will try to get right to it.
I want to draw out the idea of numerical limits. If I
understood the testimony correctly--I will just go right down
the row--I want to have you cap--summarize your testimony. Do
you believe in numerical limits? Do you not? If they are
arbitrary, what is a better--what is not arbitrary? Should
there be limits at all?
Ms. Reiff? Thank you.
Ms. Reiff. Numerical limits are arbitrary currently. The H-
2B program and the H-1B program have set limits that are really
not--how do we put this--they were not thoughtfully put
together, they are just there--65,000 for H-1B, 66,000 for H-
2B.
What we see is a program--a new program that takes into
account the market needs, and when----
Mr. Rokita. And who decides what the market needs are? What
would you use?
Ms. Reiff. It is probably a combination of things, but
basically demand and----
Mr. Rokita. As defined by who and what?
Ms. Reiff. Demand probably defined by employers and the
testing of the market.
Mr. Rokita. What kind of employers? The ones that belong to
the Chamber of Commerce, or NFIB, or what?
Ms. Reiff. I am not speaking for the Chamber of Commerce
here, but----
Mr. Rokita. That wasn't my question.
Ms. Reiff. It would be a test of the market. After you have
done a sufficient test of the market and you can show that----
Mr. Rokita. Who is you? Department of Labor?
Ms. Reiff. Well, it would be the agency that is charged.
Right now the Department of Labor----
Mr. Rokita. Thank you.
Ms. Reiff [continuing]. Looks at the labor certification
application----
Mr. Rokita. Very good.
Ms. Reiff [continuing]. So yes.
Mr. Rokita. Thank you.
Mr. Benjamin, same kind of question.
Mr. Benjamin. Sir, I don't pretend to be an expert in all
the different rules. I can tell you that I live at the ground
level, and what that means to me is I have a 24/7/365
responsibility to care for the elderly. And I just want some
help to bring new workers in.
Mr. Rokita. Yes. So as an aside, let's take a specific
question I had for you. Your testimony notes that foreign
workers interested in the health care field currently face,
``insurmountable roadblocks.'' Elaborate on that, please.
Mr. Benjamin. Just being able to get them to come in with
the limits that are out there currently.
Mr. Rokita. These caps I am talking about?
Mr. Benjamin. Caps, yes, sir.
Mr. Rokita. Okay. Any other roadblocks?
Mr. Benjamin. Sometimes there are cultural roadblocks, and
we deal with those in our orientation process. We try very
carefully. We let our residents be involved, for example, in
the interview process with people that are going to take care
of them.
Mr. Rokita. Okay. Thank you.
Ms. Bauer, did you want to comment on the 65,000 and
66,000?
Ms. Bauer. Well, the--in the H-2B program the cap has not
been reached since 2008, so we are not filling the 66,000 slots
that are available.
Mr. Rokita. But would you agree it is arbitrary
nonetheless?
Ms. Bauer. It is not related to changes in the economy but
it is certainly clear that in the last several years we haven't
needed more workers than that because we haven't filled those
slots.
Mr. Rokita. But would you support a supply-demand kind of
scenario that Ms. Reiff was talking about?
Ms. Bauer. Not with a program that is structured as the
programs are currently structured, we would not support that.
Mr. Rokita. And along those same lines, Ms. Bauer, do you
think that a sovereign nation has a duty to its citizens or a
right of some kind to have an immigration policy that exists
solely to serve economic interests of the nation?
Ms. Bauer. No. I think there is a moral component to the
conditions that we allow people to work under in the United
States, and there will always be an endless supply of people
from other countries who are willing to come here and consider
it even a good deal to make one or two dollars an hour and to
suffer under what we might regard as appalling circumstances,
but is that really how we want to structure the work of our
nation?
Mr. Rokita. I would say, shouldn't it be the people's
decision to make? We are not forcing them here are we? They are
coming here freely. I would like to think that people in this
country and in this world can make better decisions for
themselves than you can for them.
Ms. Bauer. It may be a good decision for an individual
person.
Mr. Rokita. Okay.
Ms. Bauer. I don't dispute that.
Mr. Rokita. Thank you. Let me get--because I am running out
of time, let me get to Mr. Musser.
You have seen the line of questioning. Can you comment on
any of it?
Mr. Musser. Yes. In regards to H-2B, I think that the
returner worker exemption that had been in place is the answer.
You know, that speaks to the individual that is not trying to
somehow sneak into our country through the H-2B program. It
speaks to the individual that has been vetted before and is not
a security concern to our country. It is the, you know, it is
the individual that apparently does like our wages and our
housing and the things that we do and wants to come back. So I
think that addresses the cap issue.
Mr. Rokita. Thank you, sir, very much.
Mr. Chairman, the gentleman from Michigan with poor
basketball skills, I yield back.
Chairman Walberg. Grace will be remembered.
I thank the gentleman.
And now I am pleased to recognize my friend from New
Jersey, Mr. Andrews.
Mr. Andrews. Thank you, Mr. Chairman. Thanks for the
approach to this issue. It is very important for our country.
And I join Mr. Courtney in saying I am very hopeful and
optimistic we will have comprehensive immigration reform this
year. Our country needs it.
Ms. Reiff, the core of your argument is that there is an
undersupply of labor for--to fill necessary jobs in the United
States, and--but the unemployment statistics show that in the
construction industry, for example, those who identify their--
Americans who identify their last job as construction is a 15.7
percent unemployment rate; hospitality is 11.2 percent.
The AFL-CIO-Chamber principles say that Americans should
have first crack at available jobs. Do you subscribe to that
agreement?
Ms. Reiff. Absolutely. Yes----
Mr. Andrews. And you say in your testimony that there
should be ``rigorous recruitment by employers who want to take
advantage of the H-2B program.'' I want to flesh out with you
what we mean by rigorous recruitment of Americans--rigorous
recruitment----
Ms. Reiff. Are you talking about the H-2B program or the
new worker program?
Mr. Andrews. Well, I am talking about your proposals. You
know, the proposals you made----
Ms. Reiff. Okay. The proposal for the new guest worker
programs.
Mr. Andrews. Yes. It talks about a rigorous attempt to
recruit Americans before you could use the new program, as I
understand.
Ms. Reiff. Absolutely.
Mr. Andrews. Okay.
Ms. Reiff. The--go ahead.
Mr. Andrews. I would assume that in reading a GAO report
from 2010 you would agree that the following pieces of evidence
are not consistent with rigorous recruitment: One employer
required American applicants to run with a 50-pound bag to show
they were fit for a certain kind of work, which was not
terribly related to the work, as I understand it. An Oregon
forestry employer placed ads for open positions in newspapers
in California and Washington but not in Oregon for the work
that was supposed to be done there. Kansas City Star expose
reported by the GAO says that one employer scheduled interviews
with U.S. workers for 6 p.m. on Christmas Eve to see--does that
sound like rigorous recruitment to you?
Ms. Reiff. No, and I am wondering what they are recruiting
for. Because again, we don't have this temporary worker program
in place at this point.
Mr. Andrews. Well, no, they were recruiting for openings in
the hospitality industry and in the construction and the
forestry industry, and to meet the requirement to show you had
tried to recruit U.S. workers this is what they did. What do
you think rigorous recruitment would look like? Tell me what an
employer would have to do to establish that burden.
Ms. Reiff. Well, there are many different things that
recruiters can do, and in some of our negotiations with the--in
the current comprehensive reform debate we have come up with
lists of probably 26 different things that could be considered
rigorous recruitment, so----
Mr. Andrews. Could you share a couple with us that you
think----
Ms. Reiff. Job fairs, high school job fairs, ethnic media,
radio ads, Internet recruitment, going to different perhaps
union halls, community centers, different ways of recruiting.
There are many different things that are--probably would be
considered a little bit archaic in the current----
Mr. Andrews. Do you think that definition should be
codified in regulations, or issued as guidance, or how do you
think employers should know what the ground rules are to meet
the burden of vigorous recruitment?
Ms. Reiff. I think the ground rules should be very clear
and it should be identified how many forms of recruitment and
how that recruitment is conducted. And I think most of the
employers, at least the ones you have seen here and part of our
coalition, do over and above what is codified right now in
terms of recruitment for H-2B and for the permanent residence
process.
Employers--good actor employers--want to hire U.S. workers.
They don't want to----
Mr. Andrews. Do you think that there is a critical error--
shortage of needed workers in the construction field in the
United States today?
Ms. Reiff. Overall? At a 30,000-foot----
Mr. Andrews [continuing]. In construction.
Ms. Reiff [continuing]. At a 30,000-foot level, probably
not. However, I am not--I don't represent the construction
industry. I am talking on behalf of the Essential Worker
Immigration Coalition and people in my practice. We have found
situations where there are specialty construction occupations
where you cannot find----
Mr. Andrews. I understand.
Mr. Benjamin, I want to ask you a question.
Mr. Benjamin. Yes, sir.
Mr. Andrews. You say that one of the problems in running
your facilities--and I know what a challenge it is, ``chronic
underfunding in Medicare and Medicaid.'' There is discussion of
a proposal that would reduce Medicaid spending by about 18
percent under the next 10 years from $4.1 trillion projected
down--well, the cut is $756 billion.
If that cut went into effect would that make your job
easier or harder in running your nursing home?
Mr. Benjamin. Thank you for asking that question, sir. It
would make my job all but impossible.
Mr. Andrews. The numbers I cited are from the Ryan budget,
which was approved by the House Budget Committee last night and
will be on the floor of the House next week. Do you think it is
unwise to cut Medicaid by 18 percent?
Mr. Benjamin. I can't understand where we would be able to
save that kind of money. As I mentioned, we are price-takers,
not price-makers. We take the rates that the states--that are,
as you know, are already embattled, and governors all over the
country are having difficulty in funding their states.
Mr. Andrews. Thank you. As you say, someone who works from
the ground up, I think, has given us some very valuable insight
on a budget that the House will vote on next week. Thank you.
Mr. Benjamin. Thank you.
Chairman Walberg. I thank the gentleman.
And it would be hoped that we could certainly find
significant savings in dealing with waste, fraud, and abuse,
and I was--I am certain that Mr. Benjamin would not recognize
that problem in the sense of supporting it, so--let me now
recognize my good friend from Tennessee, Dr. DesJarlais?
Mr. DesJarlais. Thank you, Mr. Chairman.
Thank you all for being here today.
Let me ask, Ms. Reiff, what is the average wage that you
offer for most jobs that you are trying to hire--or that are
competing with American jobs?
Ms. Reiff. It is quite a range because the scope goes from
lesser-skilled--unskilled individuals all the way up to people
that may have a 2-year associate's degree or more.
Mr. DesJarlais. Just an average, can you----
Ms. Reiff. Could be $27, $28 an hour at some levels. It
could be----
Mr. DesJarlais. And you are having a hard time filling
those jobs with American workers?
Ms. Reiff. Believe it or not, yes.
Mr. DesJarlais. Okay.
Mr. Benjamin, what is your average wage for the people that
you are having trouble finding American workers for?
Mr. Benjamin. For certified nurse's aides the average wage
is about $11.50 an hour. For licensed practical nurses the
rate--average rate is about $16.50 per hour. For RNs it is in
excess of $20.
Mr. DesJarlais. Okay.
Mr. Musser?
Mr. Musser. About $10 an hour.
Mr. DesJarlais. $10 an hour.
Do you find that there is a competitor against finding
American worker--who is your biggest obstacle to finding
American employees to do these jobs, or what is your biggest
obstacle, in terms of applicants?
Mr. Musser. Well, in our case it is location and the fact
that we are closed for more than half the year, and----
Mr. DesJarlais. So there are no workers that are willing to
come out there that are maybe single that don't have families.
That has been----
Mr. Musser. Some. And we certainly encourage and do
everything we can to find those individuals. And our experience
with the American workforce is that in general if we get you
for two seasons we get you for about a decade. But the
challenge is getting them to Mackinac, getting them to accept
leaving their home for half the year or more than half the year
to come to us.
Mr. DesJarlais. Okay, that is good.
How about, do you find anybody that is standing in the way
of finding American workers, or what might be?
Mr. Benjamin. Well, we have--about half of our facilities
are in rural locations, so that is a locational disadvantage of
substantial nature.
Mr. DesJarlais. Well, folks, I am going somewhere with
this. I guess I will try to get us there quicker.
I have a lot of nursery workers in Tennessee that hire
seasonal workers, and they have tried to get American workers
to come out. We have unemployment rates that exceed the
national level.
And it seems what I am hearing from them and actually a lot
of businesses just around the district that aren't ag-related
or construction are saying that they can't compete against the
unemployment rates. If the job is not $10 to $14 an hour you
can't get people to come off unemployment to take those jobs.
And are you finding that or are you----
Mr. Benjamin. We don't hire seasonal workers. We have 24/7/
365 responsibility.
Mr. DesJarlais. Okay. All right.
And then how about working with local colleges, vocational
schools. Are we reaching out to them saying, hey, we need
workers here; we can't find workers; we are having to get
immigrant workers? What are you doing to encourage that type of
cooperation?
Mr. Benjamin. We have relationships with a variety of local
community colleges and many of those individuals, part of their
training is that they have to do an internship, and we gladly
cooperate with them because we--they are a ready source of
labor for us.
Mr. DesJarlais. And, Ms. Reiff, did you have something to
add to that?
Ms. Reiff. A lot of our employers offer in-house training
to U.S. workers. We reach out to vocational schools, to high
schools, do all kinds of recruiting to try to get people into
the workforce. We do prison-to-work if possible, welfare-to-
work, refugee programs, reaching out all over the place looking
for the U.S. workers to take the--a lot of these jobs are just
very, very demanding and difficult. Being an LPN or a CNA is a
very demanding job and it takes a special person to deal with
those.
Mr. DesJarlais. Okay.
Well, it seems that there might be a little more incentive
if it wasn't so easy to get 99 weeks of unemployment that
Americans would take these jobs. And I understand there has
been studies, I know in the agriculture area, where they have
advertised for American workers, they have had big job fairs,
they will get 3,000 applicants and maybe three will actually
show up for work and less than that make it through the day.
They are just not willing to do that job.
So I think we have a big problem here in the federal
government by enabling people to not do the work. And I know
you said $27 an hour, so we are looking $50-some-thousand a
year. I mean, that is unbelievable that we can't find people to
take those jobs.
I did want to yield a few seconds to my colleague, Mr.
Rokita.
Mr. Rokita. Thank you, Dr. DesJarlais.
Mr. Benjamin, going back to the Medicare line of
questioning----
Mr. Benjamin. Yes, sir.
Mr. Rokita [continuing]. Are you aware that the state of
Rhode Island recently received a waiver which capped their
Medicaid funding for a whole 5 years in exchange for being
relieved from nearly all the Medicaid laws, and they put their
Medicaid patients--the poor that the Medicaid program is
supposed to serve--in a managed care and they didn't need any
more money? Yes or no?
Mr. Benjamin. I am sorry. I didn't understand the question.
Mr. Rokita. Are you aware of the Rhode Island waiver?
Mr. Benjamin. Yes, sir.
Mr. Rokita. Okay. Are you aware that in the state of
Indiana we have a Healthy Indiana plan that is the product of a
waiver that in exchange for being released from all the--most
of the Medicaid rules and regulations we were able to cover
40,000 more truly poor people without adding a cent more to the
budget of either our state or federal line items?
Mr. Benjamin. I am aware of those programs.
Mr. Rokita. Okay. Thank you very much.
My time is expired.
Chairman Walberg. Gentleman's time is expired.
I now recognize a gentleman who understands the beauty of
islands, Congressman Sablan.
Mr. Sablan. Thank you very much, Mr. Chairman, and thank
you for conducting today's hearing. I think it is an issue that
we all need to start addressing.
When I am asked what is the two best things that Congress
has ever done for the place I am from, and one is to approve
the permanent political status relationship we have with the
United States, and the second thing that Congress has ever
done--the best--second-best thing, I think, is the
federalization of immigration system law in the Mariana
Islands.
Because, Ms. Bauer, testifying--listening--sitting here
listening to you testify, I thought you were just talking about
me--my--where I am from. Because we had a guest workers program
that is just out of whack. We have our government and big time
companies hiring big guns here in D.C. to just continually
delay this, and when it was over we found, left with a mountain
of nasty--listen, things that I have been spending going on 5
years now trying to correct parts of it, and, because that is
for us a wall of shame and it is really hard to do, but.
And, Ms. Bauer, what is the average--what is the amount
of--the salary pay for H-2 workers--I mean, H-2 for--H workers
in the country?
Ms. Bauer. Well, that varies by locality and industry. I
would say that what is particularly relevant is that the salary
paid to H-2B workers has been estimated to be as much as $4 to
$5 dollars less than the average wage in the industry and in
the locality, so that H-2B employers are able to pay less than
the average wage. In landscaping that difference has been
estimated at about $3 per hour; in seafood processing, more
than $4 an hour.
So that is certainly part of the story when we talk about
the inability to attract U.S. workers. And the other side of
that, of course, is the current recruitment requirements.
Mr. Sablan. Thank you.
What we need to do here--and this is why I am very grateful
to the chairman for bringing this issue up and early is, I do
understand that we need to strike a balance between the needs
of employers and the--to prevent the exploitation of workers.
Again, I am a micro--could somebody say the English word? I am
a small example--I am the example of what can happen with a
system run amuck.
But the key word here is a balance. That is critical to all
of this. I don't like the attestation, because employers do get
away with that. I still don't understand whether it is back
home--and I come from an island so I can't run away from anyone
who wants to see me. They know where--that hole I have lunch
at, and--but we--I don't understand why we have unemployment of
U.S. workers and yet continue to have a need to bring in
workers from third countries.
And I don't call--from where I come from I don't call them
guest workers because some of them have been there for 25
years, and I don't call them foreign workers because they are
as much a part of our community as anyone else. So I still
cannot comprehend whether it is home, where I meet with
employers and I meet with workers and I meet with--or here,
when we have unemployment at going on 8 percent per, you know,
national, and yet you are--some of you are telling us your here
that we can't find able and willing workers?
But you can't find them if you advertise for 2 days in the
paper because these people don't have jobs and probably can't
afford to read the paper. We--but we need to strike--I do
understand that a balance.
And, Mr. Musser, for those of your customers who come to
you in the winter and they need a place in the summer, there is
a--we have islands out there. Beautiful place, too.
But no, seriously, this is an important issue that we need
to address and I am also very, very happy going on 5 years now
that CIR--comprehensive immigration reform is being addressed
by this Congress and we are--last night somebody said that we
should get it done by August 1st. I look forward to August 1st.
Thank you very much, Mr. Chairman.
Chairman Walberg. I thank the gentleman, and we will take
that under advisement.
I am now pleased to recognize Ms. Bonamici, from the other
end of the country.
Ms. Bonamici. Thank you very much, Mr. Chairman. I apology
for being slightly out of breath. I am participating in a
markup in another committee.
I wanted to reiterate the comments of my colleagues about
the importance of comprehensive immigration reform, and I am
certain that others who have listened to this testimony today
would agree that this is yet another example of why we need
comprehensive immigration reform.
I want to follow up on the question that Mr. Andrews asked
earlier that brought attention to what happened in my home
state of Oregon.
And, Ms. Bauer, in 2011 the Department of Labor inspector
general reported that the forest contractors in Oregon working
on thinning projects under ARRA were able to bring in foreign
nationals under the H-2B program even though there was double-
digit unemployment in the counties where the work was being
done, and it was stated earlier that the advertising for those
jobs was done in other states.
The report, which I would ask be entered in the record, Mr.
Chairman----
[The report, ``Program Design Issues Hampered ETA's Ability
to Ensure the H-2B Visa Program Provided Adequate Protections
for U.S. Forestry Workers in Oregon,'' dated Oct. 17, 2011, may
be accessed at the following Internet address:]
http://www.oig.dol.gov/public/reports/oa/2012/17-12-001-03-321.pdf
______
Chairman Walberg. Without objection.
Ms. Bonamici. Thank you, Mr. Chairman.
Because of the current system that allows for self-
attestation regarding efforts to recruit U.S. workers a group
of loggers was able to avoid having to interview U.S. workers
for available work and the inspector general's report found
that most Oregonians were not even aware that the jobs were
available. As it was stated, they advertised outside of Oregon.
In fact, some of the employers actually discouraged the few
U.S. workers they interviewed and then, of course, the foreign
nationals were brought in to do the work.
Ms. Bauer, as your testimony noted, there is the Department
of Labor's 2012 final rule to protect workers in the H-2B
program. This is being challenged and the case is now pending
before the 11th Circuit Court of Appeals, and two of my
colleagues from Oregon--both Senator Jeff Merkley and
Representative Peter DeFazio have filed amicus briefs in this
litigation.
So could you talk a little bit about what the rule would
have accomplished had it been in place in this Oregon
situation? Would the abuses have been prevented?
Ms. Bauer. Well, as you noted, the--those regulations would
have required a certification process, which does involve
greater oversight by the U.S. Department of Labor. But it also,
I think, maybe as importantly, requires far more rigorous
recruitment of United States workers.
The current system allows for the advertising of these
jobs--2 days in a newspaper 120 days before the job starts. In
the world of low-wage workers, that is not a reasonable way to
recruit workers for low-paid temporary jobs.
We also see employers fighting against the regulations that
would--that would produce an online national registry of these
jobs so people could find out about them and determine whether
they are good jobs and might be a good fit. Right now it is
virtually impossible, because of the--some of the issues you
raised in terms of where the advertisement takes place and when
the advertisement takes place, for people to find out about
these jobs. The----
Ms. Bonamici. Thank you.
And I read Mr. Musser's testimony from the beautiful
Mackinac Island and heard about some of the efforts that he is
taking, but certainly not all the employers are taking those
efforts. So there has been some suggestion in the testimony
today that an employer's self-attestation should be the basis
for a guest worker program. Is that a sound way of approaching
this policy?
Ms. Bauer. In our view, no. And let me explain just a
little bit of what the certification will kind of weed out that
the attestation process doesn't. Primarily, the difference in
terms of the process and the oversight is that the people who
were--the applications that were weeded out under the
certification process were applications that had jobs that were
permanent, and that was the largest number of applications for
H-2B workers that were weeded out by certification that people
described them as temporary but the DOL looked at them and
said, ``No, these are good, permanent jobs.'' And attestation
doesn't allow for that kind of review until after the fact.
Ms. Bonamici. Thank you.
And my time is about to expire, but we have talked about
comprehensive immigration reform, but until we can do that,
what needs to be done to make it clear that the Department of
Labor does have the legal authority to issue rules under the H-
2B program?
Ms. Bauer. Well, we believe the Department of Labor does
have that authority, but because a court has indicated that
there is less clarity than that court would prefer, we believe
that it would be appropriate for Congress to make it abundantly
clear that they intended the Department of Labor to have rule-
making authority.
Ms. Bonamici. Thank you very much.
And my time is expired. I yield back. Thank you, Mr.
Chairman.
Chairman Walberg. I thank the gentlelady.
And I thank each member of the panel for taking the time to
be with us today and adding the expertise and experience that
you brought with.
I now recognize my friend, the ranking member, Mr.
Courtney, for any closing comments.
Mr. Courtney. Thank you, Mr. Chairman.
Again, I just want to reference at the close here the,
again, the positive signal that the AFL and the Chamber issued
recently in terms of their, you know, joint commitment to try
and reform and improve this system. And what the statement said
in a--just a small portion of it here is, ``our challenge is to
create a mechanism that responds to the needs of business in a
market-driven way while also protecting the wages and working
conditions of U.S. and immigrant workers. Among other things,
this requires a new kind of worker visa program that does not
keep all workers in a permanent temporary status, provides
labor mobility in a way that gives American workers a first
shot at available jobs, and that automatically adjusts as the
American economy expands and contracts.''
I thought that was a very nice way to sort of summarize,
you know, what the end game should be here for Congress, and I
want to thank the witnesses for their great testimony today
because I think it is going to help us guide and direct our way
to reach that goal, which again, two sides which normally don't
agree on much are already expressing an historic commitment to
achieve.
So thank you, Mr. Chairman, for holding this hearing.
Chairman Walberg. I thank the gentleman and am impressed
the attorney with the--that you are with the brevity that you
carry on here in committee, and that is a good thing and I will
try to follow suit even though I am a pastor by training.
I want to thank the panel again for taking the time to be
here. Your experience, your passion with what you do and who
you care for, the jobs you provide, the service you provide is
much appreciated.
This is an issue and I would concur with both sides of the
rostrum here that immigration is a huge issue that we have to
address. And what type of reform, we have to address.
And I want to make sure that this subcommittee and our
committee plays a key part in making sure that areas that we
have purview over and responsibility for are addressed in
proper ways that have reality, that meet needs, and as much as
possible don't make more problems. We don't need that.
We want to encourage the American dream. We want to
encourage people like my grandmother, grandfather brought my
father and his brother over from Sweden in the early 1900s, and
grandfather and family who helped to build the skyline of
Chicago, and a grandmother who cared for the needs of people in
Glencoe and the North Shore of Chicago.
And, Mr. Benjamin, I know you, having grown up in Glencoe,
understand what that is.
But Grandma was just delighted, as an immigrant, to clean
houses, take care of the needs of those people, because her two
sons went to Glencoe High School, the same place the wealthy
and others went to and gave her the opportunity to share that
dream with her children. How she was cared for, I don't know.
She never said. But she was delighted for the opportunity of
the American dream to be part of her life.
We want that to continue. Immigration expands our country--
its creativity, its resourcefulness, and the whole melting pot
aspect.
It also spurs those of us who have had the privilege to be
American citizens and to grow up here, to be born here, to be
all we can be as well, and we certainly want our objective in
dealing with H programs--H-2B specifically today, and others,
to foster that great experience that this country offers and
must continue to offer, as well as the creativity and the
strength and resolve of people who yearn to use that in
responsible ways to expand what this country can be, as well,
to the rest of the world.
And so we will continue looking at this, and I appreciate
comments from both sides of this rostrum on our way forward. We
will consider that, and ultimately, to have the opportunity to
do good work.
I would like also, in conclusion, to enter for the record a
letter from representatives of the construction industry who
are not in front of us but wanted to have their comments
brought forward on this issue, as well as letters from
landscaping and hotel and lodging industries, the Center for
Global Development, ImmigrationWorks USA, and the H-2B
Workforce Coalition.
[The information follows:]
March 13, 2013.
Hon. Tim Walberg, Chairman; Hon. Joe Courtney, Ranking Member,
Subcommittee on Workforce Protections, U.S. House of Representatives,
2181 Rayburn House Office Building, Washington, DC 20515.
Dear Chairman Walberg and Ranking Member Courtney: The undersigned
construction associations represent thousands of employers and hundreds
of thousands of workers in all facets of construction-from home
building, to road construction, to heavy industrial production, to
specialty trade contractors and material suppliers. Together, we
believe that in order to be successful in fixing America's broken
immigration system, any viable remedy must do four things: strengthen
our national security, create a role for employers in an employment
system that functions in a fair, efficient and workable way, address
the realities of future workforce needs in the less-skilled sectors,
and find a reasonable, rational way of dealing with the current
undocumented population in the United States.
As the economy recovers, companies in the construction sector will
face more acute shortages of qualified workers-both craft professionals
and laborers. Even in recent years during a slow economy, our members
have experienced difficulty in finding workers. For decades, the
immigrant workforce has played a vital role in the growth and
sustainability of our industry, and we are proud to note that for many
legal immigrants, jobs in the construction sector have provided them
with a key opportunity to gain a foothold in the American middle class.
Unfortunately, current immigration laws-which all but ignore the needs
of sectors that utilize less-skilled immigrant workers-
disproportionately affect construction companies because of their
fluctuating work needs.
A major deficiency in the 1986 immigration law was its lack of a
legal program to address the issue of a pathway for foreign workers to
enter the United States to work. Because the 1986 law did not create a
legal system, foreign workers drawn to the United States' dynamic
economy came into the country illegally. Congress attempted to resolve
this deficiency in 1990, when it created the H-2B classification for
low-skilled non-agricultural workers. The program, however, is
seriously flawed and unable to meet the market's needs. The program is
capped at a mere 66,000 visas per year and is not market-based, which
means by definition the supply almost never matches demand.
To resolve this problem going forward, any future immigration law
must include a new market-driven program to provide a legal path for
foreign workers to enter the United States when the economy needs them,
with fewer entering when the U.S. economy contracts.
A successful future guestworker program must include:
An annual visa cap that fluctuates based on a demand-
driven system that reflects the real economic needs of the nation;
An opportunity for employers to petition for an approved
slot that allows them to hire visa-holding foreign workers, and replace
those workers if/when they move onto another approved job slot;
A time period for job slot approvals, and approved visas,
that reflects a long enough time period to ensure that the training
investment made by employers is not lost;
A program that requires employers to treat these legal
foreign workers in the same manner as U.S. workers-with all of the same
benefits, workforce protections and wage rates as similarly-situated
workers at the same location; and
A dual-intent process that allows some foreign workers who
have demonstrated a commitment to their jobs and their communities to
choose to petition for a change of status to a permanent legal status
in the United States, while also incentivizing most foreign workers to
return to their home country at the end of their visa period.
We have a unique opportunity before us to reform our immigration
policies to enhance our security, protect our economy, and continue our
heritage as a welcoming country of immigrants. We urge you to continue
working together to craft a reasonable and balanced approach to
addressing America's immigration problems in a way that resolves the
issue for the long-term. We look forward to working with you, and with
the Senate and the Administration, to craft and support immigration
reform legislation that can be considered and passed by Congress this
year.
Thank you for your consideration of our views.
Respectfully,
Associated Builders and Contractors,
Associated General Contractors,
Leading Builders of America,
Mason Contractors Association of America,
National Association of Home Builders,
National Roofing Contractors Association.
______
Prepared Statement of the American Horse Council
The American Horse Council (AHC) appreciates the opportunity to
submit testimony concerning the H-2B temporary non-agricultural worker
program and the ``Role of Lower-Skilled Guest Worker Programs in
Today's Economy.''
The AHC is a Washington-based association that represents the horse
industry before Congress and the federal regulatory agencies. The AHC
includes over 120 equine organizations representing all horse breeds
and virtually every facet of the horse industry, including horse
owners, breeders, veterinarians, race tracks, horse shows, trainers,
rodeos, farriers, breed registries, horsemen's associations, state
horse councils and commercial suppliers.
Despite substantial efforts to recruit and train U.S. workers,
horse industry owners, trainers, and competitors must use the H-2B
worker program to bring aliens into the country as temporary, non-
immigrant workers. Without these foreign workers, the horse industry
could not continue to operate as it does now.
The horse industry, in all its segments of racing, showing,
recreation and work horses, involves 9.2 million horses, nearly 2
million horse owners, has a $102 billion impact on the U.S. economy and
supports 1.4 million full-time jobs. It involves agriculture, sport,
entertainment, gaming, recreation and exercise, all built on the
breeding, training, use and enjoyment of horses and horse activities.
The racing and showing segments of the industry are particularly
dependent on the H-2B program. The horse racing industry has a $26.1
billion economic impact and supports 380,826 jobs. The horse show
industry has a $28.7 billion economic impact and supports 380,416 jobs.
The workers provided by the H-2B program are a small portion of horse
industry workers, however they play a vital role within the industry.
Most H-2B workers in the industry are directly responsible for the
care of the horses upon which the entire horse industry is dependent.
Without these workers to care for the industry's horses, many American
jobs provided by and supported by the horse industry could be in
jeopardy.
Caring for horses is not an easy job. It is hard, dirty work, with
often erratic hours. Many owners, trainers, and competitors simply
cannot find enough Americans willing to take these jobs, as grooms and
stable attendants. Many horse industry participants have reported they
have not had a single American apply for these jobs in several years.
Furthermore, these jobs are not really unskilled. They require
knowledge and understanding of horses, an understanding most Americans
no longer have. Many H-2B workers have extensive experience with
horses. Often the same H-2B workers have been returning to working for
the same employers year after year.
In January 2009, the Bush Administration issued a new rule
governing the H-2B program. That rule made major changes to the H-2B
program by implementing an ``attestation-based'' labor process in place
of the previous ``labor certification'' process. This change among
others was intended to make the H-2B program more usable and efficient
while still providing protections for American and foreign workers. We
have heard from many horse industry employers that while it is not
perfect the H-2B program under the 2009 rule is working and serving
it's intend purpose.
Unfortunately, the Department of Labor (DOL) finalized a new H-2B
wage rule on January 19, 2011. This rule artificially increases the
wages rates for H-2B workers far above current market based wage rates.
Congress realized the adverse impact this rule would have on businesses
and has to date prevented it from being implemented. Furthermore, the
DOL then finalized a new H-2B rule that would roll back most of the
provisions of the 2009 Rule that made the H-2B program more usable and
efficient and will add new and burdensome requirements. This rule would
make the program vastly more costly, complicated and would make the
program unusable for many horse industry employers. The DOL has been
prevented from implementing this rule by a federal court in Florida
that issued a temporary injunction against it.
The AHC believes Congress must permanently block the DOL from
implementing either of these new H-2B rules. Horse industry employers
who are forced to utilize H-2B workers are very often small businesses.
They will be hard pressed to absorb any increase in costs these rules
could force upon users of the program.
The reality in the horse industry is that most Americans are unable
or unwilling to take the jobs foreign workers usually fill. These
foreign workers make up a small portion of all the workers employed and
supported by the horse industry. However, without these foreign
workers, the horse industry could not function and the hundreds of
thousands of Americans jobs would be lost.
Horse industry employers use the H-2B program because they have to,
not by choice, because American workers are not seeking these jobs. In
the current economic conditions any changes to the H-2B program that
increase the cost of an already costly system could be devastating to
those employers who rely on H-2B workers. Most horse industry employers
who use the H-2B program also employ American workers in other
capacities and support many other jobs. If current users of the H-2B
program are no longer able to afford to participate the jobs of many
Americans employed by the horse industry will be put at risk.
It is absolutely vital for of the horse industry to have access to
a functioning, efficient and cost effective foreign temporary non-
agriculture worker program to meet its labor needs. In light of recent
DOL rulemaking, the AHC believes it will be up to Congress to make sure
the H-2B program can serve its intended purpose of providing seasonal
employers with a legal means to hire workers when no U.S. workers can
be found.
The AHC appreciates this opportunity to submit testimony to the
committee. If the committee would like any additional information
regarding temporary worker programs and the horse industry, please
contact us.
______
Michael A. Clemens, Ph.D., Senior Fellow,
Center for Global Development, 1800 Massachusetts Ave NW,
Washington, DC, March 13, 2013.
Hon. Tim Walberg, Chairman; Hon. Joe Courtney, Ranking Member,
Subcommittee on Workforce Protections, U.S. House of Representatives,
2181 Rayburn House Office Building, Washington, DC 20515.
Dear Chairman Walberg and Ranking Member Courtney:
Foreign Workers Benefit Massively from Guest Work Opportunities:
Unequivocal Findings of Economic Research
Leading development economists find that authorized guest workers
typically draw massive economic benefits from their work, relative to
their best alternatives. They migrate voluntarily, pass on large
benefits to their families and home countries, and almost universally
return home when guest work programs are well designed. Expanding
opportunities for authorized guest work reduces the exploitation of
migrant workers by competing directly with the black market for labor.
The Center for Global Development is a non-partisan, independent,
and non-profit think tank dedicated to reducing global poverty and
inequality through rigorous research. This submission briefly
summarizes the latest research by myself and other economists regarding
the effects of guest work on guest workers.
Authorized guest work is the economic opportunity of a lifetime.
Authorized guest workers are the opposite of `cheap labor'. Workers
who migrate with a guest work visa raise the value of their labor, and
therefore their earning power, enormously. Almost all have no other way
to raise the value of their labor to anywhere near the same degree.
First, authorized guest workers' labor would be much cheaper, and
they would therefore earn less, if they instead worked in the black
market for labor. Today's typical seasonal workers with an H-2 visa
earn well above minimum wage; unauthorized workers routinely earn below
minimum wage doing the same task.
Second, guest workers' labor would be even cheaper--vastly
cheaper--if they could not migrate at all. In a 2008 paper, my co-
authors and I estimate that low-skill workers from Mexico, Guatemala,
and Haiti who work temporarily in the United States experience life-
changing increases in earning power, between 300% and 1,000% or more,
depending on the country of origin.\1\ No other economic opportunity of
this magnitude exists for almost all of these workers, anywhere.
It is incorrect to suggest that participation in authorized guest
work programs is typically coercive. My research on the largest US
employer of authorized seasonal agricultural guest workers shows that
about 4 out of 5 hires each year are repeat hires.\2\ The Independent
Agricultural Workers Center in Yuma, Arizona, which places about 1,000
authorized Mexican guest workers at US farms each year, has a waiting
list of over 7,000 Mexicans, hoping for the chance to work legally US
farms. Most already have experience working in the United States on
identical tasks.\3\
---------------------------------------------------------------------------
\1\ Michael A. Clemens, Claudio Montenegro, and Lant Pritchett.
2008. ``The Place Premium: Wage Differences for Identical Workers
across the U.S. Border''. Working Paper 148, Center for Global
Development. The referenced estimates assume that authorized guest
workers remit 60% of their earnings to their home country.
\2\ I analyze internal records of the North Carolina Growers
Association, the largest single employer of H-2A seasonal agricultural
workers, in a forthcoming study from the Partnership for a New American
Economy and the Center for Global Development.
\3\ Michael A. Clemens. 2012. ``This Beats Most Aid by Miles--And
It's a Migrati on Non-Profit''. Views from the Center, Center for
Global Development.
---------------------------------------------------------------------------
The vast majority of today's guest workers choose voluntarily to
participate in the program based on firsthand experience of its
extraordinary benefits. What is certainly harmful to low-skill foreign
workers is the absence of flexible legal channels for US firms to hire
them, particularly in non-seasonal sectors.
Authorized guest workers also pass on very large benefits to their
families and communities back home. A rigorous evaluation found that
the overseas families of authorized guest workers in New Zealand
experienced large increases in household consumption, child schooling,
and community infrastructure--making this program ``among the most
effective development policies evaluated to date.'' \4\ I have surveyed
the families of Filipinos doing authorized guest work in South Korea in
a rigorously controlled study, and I find that they experience dramatic
increases in purchasing power, especially for children's education, and
decreased indebtedness.\5\ In a forthcoming paper I survey the families
of authorized Indian guest workers in the United Arab Emirates, finding
similar massive, positive effects of having a household member, working
abroad earning over four times what he could earn at home.
---------------------------------------------------------------------------
\4\ John Gibson and David McKenzie. 2010. ``The Development Impact
of a Best Practice Seasonal Worker Policy: Newzealand's Recognised
Seasonal Employer (RSE) Scheme''. Working Papers in Economics 10/08,
University of Waikato, Department of Economics.
\5\ Michael A. Clemens and Erwin R. Tiongson, ``Split Decisions:
Family Finance When a Policy Discontinuity Allocates Overseas Work'',
Policy Research Working Paper 6287, World Bank.
---------------------------------------------------------------------------
Guest workers do return home when programs are well designed.
Problems with guest work programs two generations ago--braceros in
the United States and Gastarbeiters in Germany--remain a common point
of reference. But just as telephone technology has changed since the
1950s, the design of guest work programs has changed as well. Canada
and New Zealand now have successful and popular programs for authorized
agricultural guest work that are large relative to the size of their
economies.
Smart design of guest work programs is critical to their success.
In New Zealand, much less than one percent of authorized guest workers
fail to return home as promised. This is attributable to key design
features such as minimum employment guarantees for complying repeat
participants, targeting remote farms, and creating incentives for
employer cooperation in monitoring.\6\
It is a myth that all workers who come to work in the United States
wish to do so permanently. In fact, circular migration has been
integral to US history. Frequent movement back and forth across the
border is a generations-old tradition not just for today's Mexican
migrants,\7\ but for many Southern European migrants to the United
States over a century ago.\8\
---------------------------------------------------------------------------
\6\ Department of Labour. 2010. Final Evaluation Report of the
Recognised Seasonal Employer Policy. Government of New Zealand.
\7\ Douglas S. Massey, Jorge Durand, and Nolan J. Malone, eds.
2003. Beyond Smoke and Mirrors: Mexican Immigration in an Era of
Economic Integration. Russell Sage Foundation.
\8\ Dino Cinel. 2002. The National Integration of Italian Return
Migration: 1870--1929. New York: Cambridge University Press.
---------------------------------------------------------------------------
What clearly deters return migration, as numerous studies have
shown, is harsh measures to stop unauthorized migration without
creating channels for authorized movement such as opportunities for
authorized guest work.\9\ Because there is no legal channel for
migration, enforcement-only policies lead many unauthorized migrants to
fear that they will lose the future option to work in the United States
if they return home.
---------------------------------------------------------------------------
\9\ See papers by Fernando Riosmena and by Belinda Reyes in: Jorge
Durand and Douglas S. Massey. 2004. Crossing the Border: Research from
the Mexican Migration Project. Russell Sage Foundation.
---------------------------------------------------------------------------
The real alternative to authorized guest work--black market
employment--is much more exploitative of foreign workers.
To analyze the impact of temporary guest worker programs on
migrants, it is only relevant to analyze guest work relative to
migrants' alternatives, which would be to stay home or come to the US
as undocumented migrants. It is irrelevant to compare the benefits of
guest work to the benefits of legal permanent residence or US
citizenship.
In the absence of a guest worker program, workers hoping to migrate
to the United States have only two options: participate in the black
market for migrant labor and increase their earning potential, or, to
remain at home. Neither of these serves the interest of low-skill, low-
income foreign workers.
To be concrete: in 2006, the US Senate passed a bill that, if it
had been signed into law, would have created 200,000 visas for low-
skill authorized guest work. Because those 200,000 slots for authorized
guest workers were not created in 2006, almost all of those 200,000
people, who would have migrated each year, have done one of two things:
they have either come as undocumented migrants without any legal
protections at all, or they have--against their will and despite
employers' desire to hire them--been unable to work in the United
States. These have been the genuine alternatives for potential US guest
workers in the past; and it is the harsh conditions experienced by
these groups--unauthorized migrants and non-migrants--that is the
relevant point of comparison for the lives of authorized guest workers.
Recommendations
Congress should determine the size and scope of a US guest
worker program by balancing the needs of US workers and US employers.
No serious economic research supports the notion of limiting the size
or scope of a US guest worker program in the interest of current or
potential guest workers. Guest workers and their families benefit
massively from authorized guest work opportunities, far more than from
any real alternative available to most of them.
Guest work programs are not doomed to fail. The world has
moved on from guest work programs of two generations ago, and today's
world has examples of successful, popular guest work programs with
almost universal return rates. Careful design of the program is key to
this success.
The real-world alterative to guest work visas, in any
substantial numbers, is either unauthorized migration, which increases
earnings but provides no legal protection, or staying at home without
the opportunity to pass on large benefits to their families and home
communities. Given these alternatives, a well-designed guest worker
program is in the best interests of the potential migrants.
______
March 14, 2013.
Hon. Tim Walberg, Chairman, Subcommittee on Workforce Protections,
U.S. House of Representatives, 2181 Rayburn House Office Building,
Washington, DC 20515.
Dear Chairman Walberg: In conjunction with the Subcommittee's
hearing entitled ``Examining the Role of Lower-Skilled Guest Worker
Programs in Today's Economy,'' I appreciate the opportunity to provide
information to the committee about the importance of the H-2B program
to our company, our U.S. workforce, and our community.
I am Vice President and Operations Manager for Progressive
Solutions LLC. Our company is headquartered in the small rural town of
Marshall, Arkansas, located deep in the heart of the Ozark Mountains.
Our business is fairly unique. We perform low volume selective stem
back pack herbicide application for a number of clients, including for
electric utilities to control brush growing under electrical lines. We
provide our services to clients in more than 20 states throughout the
Southeast, Midwest and Mid-Atlantic areas of the U.S. with the
assistance of more than 300 seasonal H-2B employees that supplement our
permanent U.S. workforce.
We work in a difficult outdoor environment. Workers are organized
into crews and walk up to 10 miles per day, often over rough terrain
and in adverse weather conditions. Our work is performed seasonally, as
we can only treat brush when leaves are on the trees--typically late
spring to early fall. The work is migratory in nature, with work in any
particular area lasting just two to four weeks, and crews having to
move locations frequently. It is not unusual for a crew to work at 6-10
locations over a 6 month period, often in three or more states.
In our experience, the difficult nature of the work, the seasonal
aspect, and the migratory movements of the crews make this job
unappealing to most U.S. workers. Despite aggressive recruitment of
U.S. workers each year and the hiring of any able-bodied U.S. worker
interested in the job, U.S. workers comprise less than 1% of our
migrant workforce. And we pay wages for this work that far exceed the
minimum wage. We estimate that within our industry, over 95% of the
people performing this work (approximately 2000) are H-2B workers. In
fact, this labor intensive work was really never performed by a U.S.
labor force because this herbicide application work is so closely
related to reforestation work, which is also highly dependent upon H2B
workers.
Over the years, the herbicide application work performed as part of
reforestation efforts has also been utilized in other forestry and
forestry-like settings. Before ``back pack application'' of herbicide
was developed, the control of brush in other forested and overgrown
areas, including under electric utility lines, was primarily done using
heavy machinery or by helicopters spraying herbicide. Our company's
method of clearing bush by, for example, spraying each individual stem
that might grow into the electric line and cause an outage, is the most
environmentally safe and cost-effective way to tackle the problem of
invasive vegetation. This is a critically important role that we
perform for utility companies to help ensure they are able to maintain
electric reliability. Over 90% of the utilities in states where we
operate, rely on migrant crews to help manage their right of ways.
Our company has over 50 U.S. employees that manage our H-2B crews,
and perform sales or administrative tasks that keep our company
running. We are one of the largest employers in our community and use
the services and products of many local and regional businesses. This
year alone we will purchase over 30 additional trucks to transport our
workers; adding to our existing fleet of 116 company-owned vehicles.
We have been using H-2B workers for over 20 years, and many have
been with our company almost that long. The vast majority of our
workers return year after year and new workers are typically family
members of those who work for us. We have never used the services of
recruiters in Mexico. In fact, many of our current employees tell us
they have several relatives who would be willing to accept work with us
because of their desire to find safe and legal employment in the U.S.
Few, if any of our employees, have expressed any desire to stay
permanently in the U.S. Rather, they are happy to come to the U.S. on a
temporary visa for 6 months of work and then return to their families
with the money they have saved during their employment. They use their
earnings to improve and enrich their families, farms, and communities
in their homeland.
Over the past several years, navigating the administration process
to obtain H-2B workers has been extraordinarily difficult, burdensome,
and costly. We have spent hundreds of thousands of dollars in legal and
administrative fees just to get through the overly bureaucratic process
that is the H-2B program. Twenty years of documented history shows that
there are virtually no U.S. workers interested in doing this job, yet
every year, we begin the year not knowing if we will be able to have H-
2B workers certified by the Department of Labor. The stress and
uncertainty causes great harm to our company, our employees who depend
on us for their livelihood, and our vendors who provide over 12 million
dollars in goods and services to our company.
If implemented, the DOL's proposed new wage rule and new program
rule (currently on hold because of a court order) will cause
irreparable harm to all H-2B employers and to our U.S. workforce.
Additionally, we continue to face difficulties with the DOL that
specifically affect our industry. Recently, DOL has suddenly taken a
new position wherein they are attempting to prevent us from employing
H-2B workers at multiple worksites, despite the fact that the very
nature of our work is migrant and requires work at multiple worksites.
In fact, that is the basis of our entire company and we have been
approved by DOL to perform work in that manner for as long as we have
been in the H-2B program.
DOL has traditionally processed our workers under forestry-related
job codes and allowed us to apply for workers under the Department's
``special procedures'' for forestry-related work. In recognition of the
unique work requirements of migrant employers, which are different from
fixed site employers, the special procedures allow an employer to file
an application that includes multiple work locations where work will be
performed along a tentative itinerary. Recently, and inconsistently,
the DOL has arbitrarily determined that we should not perform work in
this manner. Instead, they have at times suggested that we should be
classified as something like a groundskeeper, which would mean that
rather than filing a few applications per year, we would be forced to
file nearly a hundred separate applications for each and every separate
piece of land where we will work. Aside from the bureaucratic nightmare
of so much paper, that process would be logistically impossible because
our work crews are constantly on the move and government paper
processing, which requires weeks and months, would never be able to
keep up. Working in migratory patterns based on weather and working on
an itinerary is an essential aspect of the services we provide. Thus
far, we have been able to continue our operations, but after several
years of correspondence and meetings with the DOL, these issues are
still not definitively resolved.
We are prepared to meet with the DOL in good faith with hopes of
finding a solution to this problem, but we are concerned about the lack
of progress and all of the other uncertainty that surrounds the H-2B
program. Our company and our industry, is dependent upon a workable H-
2B program that provides a stable regulatory environment appropriate to
the work we perform. Many businesses like ours provide employment and
security to many, without negatively impacting the U.S. labor market.
We hope that members of the Committee will keep these concerns in mind
as they consider immigration reform legislation--and particularly the
need for a workable lower-skilled guestworker program--during this
Congress.
For the committee's reference, I have attached a copy of a report
describing the type of work performed by our industry. Thank you for
your consideration.
Sincerely,
Michael Economopoulos.
______
H-2B WORKFORCE COALITION
Protecting American Workers Through a
Stable and Reliable Seasonal Workforce
www.h2bworkforcecoalition.com
principles for comprehensive immigration reform
About the H-2B Program
The H-2B program is essential for seasonal businesses that
cannot fill temporary jobs with American workers despite intensive
recruitment efforts. Seasonal non-agricultural industries that use the
H-2B program include seafood processing, food processing, horse
training, restaurants, hotels, forestry, landscaping, carnivals and
amusement parks, and stone quarries. Because the program is expensive,
time-consuming and involves four government agencies, employers only
turn to the program if they are unable to find legal local workers.
The H-2B program is important to American workers whose
year round positions are reliant upon seasonal laborers during peak
seasons. In companies that use the H-2B program, both American full
time and H-2B temporary seasonal workers are well compensated; often
well above the federal minimum wage and the prevailing wage.
For H-2B workers, the program provides well-paying
seasonal jobs that allow them to provide for their families and still
maintain their homes in their native countries. Many of these workers
voluntarily return to the same employer year after year.
The H-2B program is important to the U.S. economy. Without
access to a legal source of seasonal labor, employers will be forced to
lay off American workers, scale back on vehicle, equipment and supply
purchases and perhaps even close their businesses.
Immigration Reform Principles
Immigration reform must maintain a viable seasonal worker
program along the lines of the existing H-2B program for non-
agricultural workers.
Immigration reform should maintain the current protections
for American and H-2B workers and not impose costly burdensome new
requirements on employers who use the H-2B program such as those
created under the temporarily blocked Department of Labor wage
methodology and program rules.
Wage rates required to be paid to H-2B and similarly
employed American workers shall be based on economic realities and
local markets. Wage rates should not be based on arbitrary formulas
that are well above wage rates paid in the local labor market.
The H-2B returning worker exemption should be re-instated
and there should be an expedited process for consular visa processing
for H-2B returning workers.
The number of participants in the program should be
market-based, allowing the number of participants to fluctuate up or
down based on economic needs.
Immigration reform should provide sufficient resources for
federal agencies to process H-2B applications in a timely manner.
States should have an appropriate role in program administration.
H-2B applications should not be released to the public to
protect the confidential business information submitted by employers
and to prevent the businesses from being harassed by outside
organizations.
The Coalition supports strong enforcement of all the
program rules, including the increased security procedures at US State
Department consulate offices. Employers will continue to notify
officials when they become aware of workers that may have not complied
with the terms of their visas.
______
Prepared Statement of ImmigrationWorks USA
What's the most important piece of comprehensive immigration reform
you never heard of? It's fixing the legal system so it works for the
future--for immigrants and for the U.S. economy.
Many Americans think reform is about the 11 million unauthorized
immigrants already living in the United States. Many have been here for
years and have put down roots. We're not going to deport them--not even
the harshest restrictionists think that's practical. Nor are most
likely to go ``home'' voluntarily, no matter how difficult we make
their lives with tough enforcement. For the overwhelming majority,
America is home by now. And they are sure to be the most contentious
issue as the immigration debate heats up in months to come.
But most contentious is not the same as most important.
What most people don't stop to ask: what created this problem in
the first place? Exactly what is it about the broken immigration system
that produced this vast underground world of workers and families--a
population the size of Ohio?
The root cause: for less-skilled foreigners who want to come to
work legally in the United States, there is no ``line'' to get in or
wait in--no visas available for workers like them.
The two existing programs for low-skilled temporary workers are for
seasonal labor only: farmhands, landscaping crews, summer and winter
resort workers. There are virtually no permanent visas for less skilled
workers. So there simply is no avenue for an uneducated Mexican unless
he has family members living legally in the U.S. who can sponsor him
for a family visa.
Many, if not most, of the 11 million already here would have
preferred to enter the country legally if that were possible. But they
and others like them have no lawful option.
This wouldn't be a problem if we didn't need immigrant workers. But
we do. And we're going to need them increasingly as the economy
recovers.
This isn't because American workers are somehow lacking or
inadequate. On the contrary, for the most part, it's because Americans
are doing better than in decades past. We're becoming better educated
and aspiring to the kinds of jobs for which our better educations
prepare us.
In 1960, half of the native-born men in the labor force were high
school dropouts happy to do physically demanding, low-skilled work.
Today, less than 10 percent of the native-born men in the labor force
are high school dropouts. And meanwhile, far from shrinking, the demand
for low-skilled labor is growing over time. In 1955, for example, 25
cents of every dollar spent on food was spent in a restaurant. Today,
the figure is nearly 50 cents. And one of the fastest-growing
occupations in America is home health aide.
But very few Americans with high school diplomas aspire to careers
as busboys or home health aides. And they shouldn't--their educations
equip them to do more productive work, making better wages and
contributing more to the economy.
U.S. demand for immigrant workers eases somewhat in a down
economy--and far fewer workers want to come to the U.S. when jobs are
scarce. But even then, we still need some foreign labor, and those
workers need a legal way to get here.
The lesson for policymakers: whatever program we create needs to be
flexible, growing in good times to accommodate rising labor needs and
shrinking in down times when demand subsides.
To be clear, the goal of reform is not to increase the overall
number of unskilled immigrants entering the country.
What's needed is to end illegal immigration by creating ways for
needed workers to come legally--creating worker visas and establishing
a program that allows employers who can't find enough willing and able
Americans to connect easily and quickly with lawful immigrants.
This is not just an economic imperative. Without it, there can be
no successful immigration law enforcement.
Even the best, most effective enforcement is no match for the
dynamism of the U.S. economy. As long as there are jobs available,
foreigners will want to come to work here. And if we want to prevent
them from coming illegally, we need to create lawful alternatives.
Finding a solution for the 11 million unauthorized immigrants
already in the country addresses the mistakes of the past but fixes
nothing going forward. Unless we create ways for the immigrants of the
future to enter legally, we're going to find ourselves in exactly the
same predicament a decade or two down the road--wondering what to do
about 10 or 20 million unauthorized immigrants living among us but
beyond the rule of law.
The only way to prevent this: a legal immigration system that
works--not just an answer for the 11 million and tougher enforcement,
but a way for the workers we need to keep the economy vibrant and
competitive to enter the country and work legally.
ImmigrationWorks USA is a national federation of employers working
to advance better immigration law. The network links major
corporations, national trade associations and 25 state-based coalitions
of small to medium-sized business owners concerned that the broken
immigration system is holding back the nation's economic growth. Their
shared aim: legislation that brings America's annual legal intake of
foreign workers more realistically into line with the country's labor
needs.
Why business needs immigrant workers
On March 1, 2013, ImmigrationWorks sponsored a briefing for
congressional staffers: a panel of employers from across the U.S.
explaining their reliance on immigrant workers. Panelists included a
Georgia restaurateur, a manager of Colorado vacation rentals, a senior
vice president at a large Midwest hospital and the vice president of a
Maryland construction company. They explained the kinds of jobs
available at their businesses, the wages they offer, how they try to
hire Americans and how immigrants help them keep their operations
running and contributing to the economy.
``Employers who hire immigrants believe the most important piece of
the immigration puzzle is fixing the system so it works for the future.
That means creating a way for the high- and low-skilled immigrants we
need to keep the economy vibrant and competitive to enter the U.S
legally and work.''
Moderator Tamar Jacoby, President,
ImmigrationWorks USA.
``Most Americans apply for front-of-the-house positions. The few
who do apply for jobs as cooks and dishwashers usually last only a few
days and then quit. Back-of-the-house jobs are very tough--slippery
floors, hot fryers and a fast pace all day long. We rely on immigrants
to fill our back-of-the-house jobs.''
Tad Mitchell, Owner,
Six Feet Under restaurants.
``We can't find enough Americans to fill jobs in housekeeping,
dietary and other departments in the hospital. If it weren't for the
Bosnian refugees, we wouldn't have a housekeeping department.''
Joe LeValley, Senior vice president of planning and
advocacy,
Mercy Health Network.
``We place job ads in the paper and on the internet. We go to job
fairs and prisons to find ex-offenders who are willing to work. But we
cannot find enough American workers. Nearly 80 percent of our 1,500
workers are immigrants. It's hard to find qualified workers. The job is
labor intensive and the working conditions are tough--it's cold in
winter and hot in the summer. We work early and late.''
Otto Girr, Vice president of human resources,
Miller & Long Concrete Construction.
``There has been a dramatic shift in our workforce. Thirty years
ago, our workers in housekeeping were all Americans. Today they are all
Hispanic. No American has applied for a housekeeping job at my company
for more than 15 years. Even in the downturn, we've placed ads in the
paper for jobs paying $17 an hour and no one applies.''
Dale Bugby, Owner,
Vail Resort Rentals.
``The EB-5 investor visa application is 4,000 pages. It's extremely
difficult and you get the feeling after a few months that the
government is trying to discourage you from obtaining the visa. Many
people don't apply because the administrative process is too onerous.''
Nicholas Logothetis, Board member and senior advisor,
The Libra Group.
______
Prepared Joint Statement of Sabeena Hickman, CAE, CMP, Chief Executive
Officer, Professional Landcare Network (PLANET); and Michael V. Geary,
CAE, Executive Vice President, American Nursery and Landscape
Association (ANLA)
Chairman Walberg, Ranking Member Courtney, and members of the
Subcommittee on Workforce Protections, thank you for the opportunity to
provide comments on the H-2B program, which is crucial to the landscape
industry. The Professional Landcare Network (PLANET) is the national
trade association representing more than 100,000 landscape industry
professionals, who create and maintain healthy, green living spaces for
communities across America. PLANET members are committed to the highest
standards in industry education, best practices and business
professionalism. Many of PLANET's professionals have attained the
status of becoming Landscape Industry Certified, achieving the greatest
level of industry expertise and knowledge.
Founded in 1876, the American Nursery & Landscape Association
(ANLA) is the national trade association of the vertically-integrated
nursery and landscape, or ``green'' industry. ANLA membership comprises
over 10,000 affiliates that grow nursery and greenhouse plants, sell
lawn and garden products, design, install, and care for landscapes, and
sell supplies to the industry. Typical members include growers, garden
center retailers, horticultural distributors, landscape professionals,
and suppliers to the industry. A number of firms are engaged in more
than one of these operations.
The H-2B program provides a vital and legal source of seasonal
labor for the landscape industry and other industries that cannot fill
their labor needs with American citizens. Employers who turn to the H-
2B program do so as a last resort. The landscape industry is one of the
major users of this program because the industry requires numerous
workers during the busy spring and summer seasons. Employers are unable
to attract significant numbers of American workers for these labor-
intensive, short-term, seasonal jobs. Because of the seasonal nature of
the industry, traditional sources of manual labor, such as college
students, are not available, and the heavy machinery used in the
business prohibits companies from hiring high school students. Before
they even apply for H-2B workers, companies go through an intensive
recruitment period in an attempt to hire Americans and must prove that
they cannot find Americans to take the jobs. They would gladly hire
American workers if they could.
The landscape industry is a large contributor to the U.S. economy.
The industry is composed mostly of small businesses, the engine that
drives the U.S. economy. According to the Economic Impacts of the Green
Industry in the United States publication by the University of Florida
and Texas A&M University, the economic impacts for the U.S. Green
Industry in 2007 were estimated at $175.26 billion (Bn) in output,
1,949,635 jobs, $107.16 Bn in value added, and $53.16 Bn in labor
income (these values are expressed in 2007 dollars). The largest
individual sector in terms of employment and value-added impacts was
landscaping services (1,075,343 jobs, $50.3 Bn). When the landscape
industry cannot get the H-2B workers it needs, the economic losses have
a multiplier effect to suppliers and other jobs throughout the economy.
According to 2007 estimates, approximately 2,800 landscape
companies participate in the H-2B program and spend about $77.28
million annually just on landscape equipment. In addition, they spend
approximately $115.36 million annually on fleet vehicles, $2.8 million
on payroll services, $6 million annually on computers, $4.3 million
annually on tires, and $13.6 million on cell phones and wireless
radios. Without the H-2B workers, not only will these landscape
companies suffer, supplier companies will feel the economic downturn as
well.
According to the U.S. Department of Labor Bureau of Labor
Statistics, grounds maintenance workers held about 1.3 million jobs in
2010. Employment of grounds maintenance workers is expected to grow
about 20 percent between 2010 and 2020. Grounds maintenance workers
will have among the largest numbers of new jobs (around 254,600) arise
over this 10-year period. There will be an increased need to fill these
jobs. The H-2B program is the only legal way that employers can fill
these seasonal jobs.
Unfortunately two pending Department of Labor (DOL) regulations
would make the program virtually unusable for seasonal employers.
Further, the program contains an arbitrary 66,000 cap (33,000 for each
half of the fiscal year) on the number of H-2B workers permitted to
work in the United States each year. As the economy begins to recover,
this low cap could threaten to shut many landscape companies out of the
program, as was the case in 2007 and 2008 when Congress allowed the H-
2B returning worker exemption to expire and the economy was still
strong. A workable H-2B program is vital for seasonal employers and
their permanent American workers whose jobs require the support of
seasonal laborers.
For the H-2B workers, the program allows workers to provide for
their families in their home countries and contribute to the economic
development of their communities. Further, the returning workers have
proven repeatedly that they will not overstay their visas by returning
to their native countries promptly after the completion of their
seasonal work assignments.
H-2B workers are well compensated and receive the same wages as
Americans would if they applied for and accepted these jobs. The U.S.
Department of Labor surveys companies in the geographic area of the
employer to see what the industry currently pays workers doing similar
jobs and thus sets a minimum variable wage rate per hour. This
prevailing wage is always well above the federal minimum wage. Further,
many companies pay their employees even more than is required by the
Department of Labor.
Unfortunately, DOL has targeted the H-2B program, and by extension
those law-abiding employers that are forced to utilize it, for virtual
elimination with punitive rules. A January 19, 2011 DOL rule seeks to
artificially increase wage rates for the H-2B workers well above
rational economic levels. According to DOL's own estimates, the rule
will increase H-2B wages in the landscape industry by $4.32 per hour.
The actual cost to employers will be much higher than DOL's estimate
since DOL fails to account for wage increases for similarly employed
American workers or more experienced American workers whose pay should
reflect their greater skill or expertise level. The DOL estimate also
does not include additional payrolls costs, workers compensation
insurance, overtime costs and other associated increases. Luckily,
Congress has blocked this rule from taking effect through fiscal 2012
appropriations legislation and subsequent continuing resolutions. We
hope Congress will continue to block the regulation after the current
continuing resolution expires on March 27.
DOL promulgated another harmful rule on March 18, 2011 that would
make the program even more costly and complicated. The rule was so
egregious that a federal court in Florida issued a temporary injunction
against it. In addition, both the Senate Committee on Appropriations
and the House Committee on Appropriations approved legislation during
the 112th Congress that would have blocked the rule from being
implemented, but Congress adjourned without passing that appropriations
bill. We urge Congress to prevent the implementation of this rule,
along with the wage rule.
It is clear that the intent of these rules is to ensure that the H-
2B program is made unusable, threatening America's seasonal businesses
and their full-time employees. In these challenging economic times, the
U.S. economy can ill afford the severe economic impacts associated with
the loss of American jobs and commerce that are supported by the
landscape industry and other seasonal industries that use the H-2B
program.
DOL has suggested that these rules are necessary because of
employers who abuse the program. However, there is no evident to
support the allegation of widespread program abuse. Many landscape
contractors have been using the program for more than five years. They
are good employers who use a lawful program and treat their workers
well, as is evidenced by the fact that the same H-2B employees return
year after year. As companies grow, these workers often refer relatives
and friends to the employer. For fiscal year 2007 through fiscal year
2012 there were 377,256 visas issued by the State Department under the
H-2B program; yet the allegations made about systemic program abuse
relate to only a few specific employers. There will always be a few bad
individuals who abuse federal programs. They should be fully prosecuted
under the law. ANLA and PLANET support the strong enforcement of
program abuses.
Most landscape industry businesses assist their H-2B workers with
finding places to live, transportation to work, and other living
necessities for roughly 10 months. Many rent or own apartments for
their employees, provide free English language classes, and a means of
transportation to stores, churches, and more. Our industry uses these
workers year after year, so they want them to be successful in their
jobs and have positive experiences. After their first year of the job,
returning workers often refer friends and relatives to the employer
because of their positive experiences and the great opportunity that
the H-2B program provides.
Further, the H-2B program is expensive. Employers only turn to the
program after exhausting efforts to find and retain American workers.
An H-2B employer has to pay a $325.00 application fee, a $150.00 anti-
fraud fee, and a $1,225 premium processing fee (all do so they are not
put at the end of the line of applications) to U.S. Citizenship and
Immigration Service. The cost for newspaper advertising for local
workers can average around $600.00. Because of the paperwork involved
and the need to find workers, the large majority of employers hire a
company to help them with processing. This fee can range from $3,000 to
$5,000. So an employer can spend between $5,070 and $8,470, which does
not include any other expenses spent on the specific employees.
Further, these employers are paying both the American and H-2B workers
prevailing wages, which are often well above the minimum wage. While
incurring these expenses, H-2B employers are sometimes competing
against companies that do not pay these fees and wages because they do
not share their commitment to retaining a legal workforce.
As Congress debates immigration reform legislation, we urge you and
your colleagues to preserve a workable H-2B program free from an
arbitrary cap that restricts economic growth and free from the types of
regulations that the Department of Labor has promulgated. Wage rates
should be based on economic realities and local markets and not
arbitrary formulas well above wage rates in the local labor market. We
also encourage the re-instatement of the H-2B returning worker
exemption with the number of participants in the program being market-
based allowing for much need flexibility.
In addition, we support the development of a non-seasonal temporary
worker program for businesses whose labor need are non-seasonal. While
most landscape industry jobs do have a seasonal component, there are
some areas of the country where landscaping can be done year-around.
Further, some seasonal employers may have a few year-round positions
that they cannot fill will American workers.
In conclusion, ANLA and PLANET urge Congress to pass legislation
continuing to prevent the US Department of Labor from implementing its
wage methodology beyond March 27, 2013, as well as legislation
preventing DOL from implementing the H-2B program rule. We would also
like to see Congress address the arbitrary H-2B cap by re-instating the
H-2B returning worker exemption and allowing the number of H-2B workers
admitted to the U.S. each year to be based on market demand rather than
an arbitrary cap. If the DOL regulations are allowed to go into effect,
small businesses, American workers, H-2B workers, and the overall U.S.
economy will suffer. The U.S. economy cannot afford the severe economic
impacts associated with the implementation of these regulations.
Further as the economy grows, Congress must address the H-2B cap so
that small and seasonal businesses will have access to the H-2B workers
they need to grow and create additional American jobs.
______
utility sprayer alliance [october 2012]
Migrant Spray Industry Report
General Information and History of the Migrant Spray Industry
Note: Although we believe the industry information presented is
generally consistent throughout the continental United States, our
facts are derived primarily from direct experience and research in the
``Greater South Eastern United States'' as depicted.
The Migrant Spray Industry is an offshoot and evolution of the
migrant reforestation industry (see attachment ``Low Volume Backpack
Application--A Short History'').The practices employed by migrant spray
crews did not exist commercially until the mid-1980s and was born out
of a combination of new low volume backpack herbicide application
technology and an available workforce capable of performing this
migrant and labor intensive task (H-2B forestry workers). Prior to the
development of this industry, vegetation management was performed with
heavy machinery, helicopters or other nonselective application methods.
In the last decade, low volume backpack application has become the
primary means of controlling brush on electric utility rights of ways
and has become an essential method used by utility companies to ensure
electric reliability. The attached document, ``The Importance of
Backpack Herbicide Treatments for Integrated Vegetation Management
Programs,'' describes in detail the unique and beneficial aspects of
migrant spray operations. In summary, these benefits include:
The selective spraying of individual undesirable target
species that pose a hazard or danger of nuisance
The preservation of species that are endangered, are
beneficial as pollinators, establish wildlife habitat, and are
competitors to undesirable vegetation
Increased safety and low impact on the environment with
substantially reduced amount of product applied, as compared to other
vegetation management methods
More effective and efficient compliance with governmental
regulations, including FERC, NERC and the Clean Water Act.
Improved cost effectiveness of utility operations, which
benefits consumers
According to recent study commissioned by an Arkansas Electric
Cooperative and conducted by an independent engineering firm, the
projected cost savings by using an Integrated Vegetation Management
Program as compared to traditional mechanical methods was expected to
be over $50 million dollars. Document attached.
Electric Utilities Rely on Migrant Sprayers
More than 80% of all Electric Utility Companies within the Greater
South Eastern United States use low volume backpack application by
migrant sprayer crews as a major part of their vegetation management
program. These crews perform the same type of work using the same
workforce as is used in vegetation management on forest lands, other
rights of way, industrial sites and public use areas. More than 2000 H-
2B workers are employed by fifteen or more Forestry and Utility Spray
companies that annually treat more than 1,000,000 acres for electric
utilities.
Electric Utility Companies fall into two broad categories:
Large transmission companies deliver electricity to distribution
companies via high voltage electric lines across multi-state areas.
Although most of these companies are investor owned, one of the
largest, The Tennessee Valley Authority, is a government agency. It
operates over 16,000 miles of line across 7 states and serves over
9,000,000 people. TVA alone treats over 60,000 acres annually using
spray contractors who employ H-2B workers.
Private companies of similar size include Duke Energy, the Southern
Company, American Electric Power, Inc. and others. These companies are
regulated by the Federal Energy Regulatory Commission (FERC) and the
North Regulatory Electric Reliability Corporation (NERC) who mandate
brush control specifications to maintain electric reliability across
the U.S and North America.
Distribution companies deliver electric power to individual
customers. In the Greater South Eastern Region, the majority of these
companies are Rural Electric Cooperatives (REC), which are not-for-
profit entities owned and managed by the members they serve. Typically,
an REC will serve multiple rural counties or regions within a state.
There are also investor owned and municipal entities that provide
electricity and contract brush clearing and spraying to companies that
utilize H-2B workers.
The Logistics Associated with Electric Utility Spray Contracts
Although utilities typically establish general annual plans for
treating vegetation along specific power lines, many factors can affect
the timing and substance of the utility's decisions, including:
ongoing surveys of vegetation growth, and analysis of what
lines are in most need of treatment
budget availability, which is often determined by the
revenue from electric sales in the previous year or fiscal quarter
mandated treatments to meet FERC and NERC compliance
local weather conditions
obtaining approval from Public Service Commissions or
other governing bodies
The final decision about what specific areas will be treated is
frequently not made by the utility until shortly before the work is to
start.
Although some utility companies negotiate their work with a
preferred vendor or have multi-year contracts in place, a majority of
utilities put their intended work out for bid and contract with a
vegetation management company on an annual basis. It is not unusual for
final contracts to be awarded to vendors just prior to the commencement
of work. It is also not unusual for the scope of work to be changed
(increasing or decreasing application areas) after the contract has
been awarded in response to the factors described above.
Typically, a utility company does not impose a strict time frame
defining the when the work is to be accomplished, other that it must be
performed during the ``growing season,'' which may range from April to
October, depending on geographical location and seasonal weather
conditions. There are many times, however, when weather dictates when
the work can and cannot be performed. Drought, rain, flooding, late or
early frosts all impact the growing season and can affect and alter
work schedules.
The Difficult Nature of the Work
Migrant spraying is labor intensive work that requires workers to
walk up to 10 miles per day, regardless of whether the application
takes place on forested land, along roads, trails, or rights-of-way.
The work is almost exclusively conducted in remote locations far from
major roads or towns. Because the vegetation removal occurs during the
growing season in the southeastern U.S., the weather is typically hot
and humid. The worker must cover this rough terrain carrying a backpack
sprayer that weighs as much as 35 pounds, identify target species and
apply herbicide. Workers also frequently carry and operate other hand
and power tools to remove vegetation.
The Seasonal and Migrant Nature of the Work
Low volume foliar application can only be performed during the
growing season and by its nature is a seasonal activity. Typically the
work takes place over 8-10 months, depending on geography and weather.
Depending on the type of treatment, application can occur at different
times during the year. On a calendar-year basis, application of pre-
emergent or early post-emergent herbicides typically begins in late
winter/early spring (February-March) depending on the locale and
application needs. There are some dormant stem treatments that can take
place either late fall/early winter (October-November). However, the
overwhelming majority of work performed by Migrant Sprayers consists of
post-emergent herbicide application occurring from the spring through
the fall.
Decisions by utility companies about what power lines to spray, the
selection of contractors through the bid process, and changes to the
scope of work due to weather, budgets or mandates make advanced
scheduling with precision impossible. Spray crews must be flexible in
order to respond to these variables and serve the utility industry.
Large transmission utility companies may have work in multiple
states, with power lines spanning hundreds of miles, requiring the
movement of crews to different locations multiple times during
performance of the contract. Larger regional distribution utilities may
cover a wide geographical area and require similar movement. Contracts
with smaller distribution utilities can often be performed from a
single location, but a typical contract only lasts a few weeks and the
crew then moves to another location to perform work on another
contract. A typical crew might move locations a dozen or more times
across several states performing work on several contracts during a
single season.
Historical H-2B Certification of Migrant Sprayers
For over two decades the Department of Labor (DOL) had been
processing H-2B applications for migratory workers that perform
vegetation removal with DOT Job Code 459.67-010 Title: LABORER, BRUSH
CLEARING (any industry).
When DOL switched to using O*NET for job classifications,
applications for these workers were often processed with the O*NET Code
45-4011, Forestry and Conservation Worker.
Under either code, however, DOL processed H-2B applications for
these migrant workers on an itinerary pursuant to TEGL 27-06, Forestry-
related Special Procedures, regardless of whether the brush clearing
activities were performed on tree plantations or along rights-of-way,
trails, roads, or railroad tracks. In addition, these employers that
operated under TEGL 27-06 also complied with the Migrant and Seasonal
Agriculture Worker Protection Act (MSPA) requirements applicable to
forestry workers.
However, in recent years when some employers requested prevailing
wage rates for this work under the 45-4011 job code, the DOL sometimes
returned wage rates for 37-3012 job code, Pesticide Handlers, Sprayers,
and Applicators, Vegetation.
Some employers who then submitted applications for H-2B workers
using the 37-3012 job code provided by DOL were subsequently certified
under the Forestry-related Special Procedures without question. These
employers submitted master applications, itineraries and proof of MSPA
compliance. But other employers certified with the 37-3012 job code for
the same work were not permitted to work on an itinerary pursuant to
the Forestry-related Special Procedures and thus were not required to
comply with MSPA.
Still other employers applying with 37-3012 job code provided by
DOL for work that included utility right-of-way spraying were provided
the option by DOL to utilize TEGL 27-06, if the employer provided
additional information about the work itinerary and evidence of
compliance with MSPA.
Currently a portion of the industry is working under the 45-4011
code, while others work under the 37-3012 code. Of those working under
the 37-3012 code, some are working pursuant to TEGL 27-06, while others
are not. Regardless of the Department's inconsistent processing and
guidance, however, this work is still migratory in nature even if the
employer is not operating on an itinerary.
Rarely, if ever, would an employer have only one contract in a
growing season to remove brush in just one localized area. That
arrangement would not be a sustainable business model because of the
significant capital investment required to perform this work. There is
limited work available in any particular localized remote area and that
work only lasts for a few weeks, at most. Thus, it would impossible for
a vegetation removal company to stay in business for long if it
performed only one contract for a few weeks each year. The very nature
of this business requires scheduled movement from one contract to the
next throughout the growing season in order to provide the maximum
amount of work for the company and its U.S. and foreign employees.
Job Categories Associated with Migrant Spraying
Within the industry, there are typically 4 categories of workers
associated with vegetation removal that includes spraying. Below are
brief sample descriptions of each position category from the lower
skill level to the higher skill level:
Migrant Sprayer / Laborer / Groundsman--An entry level, labor
intensive position. No experience or minimum education necessary but
must be able to identify species of vegetation and apply herbicide
properly after training period. Wears backpack and removes brush
through various means, including spraying.
Team Leader / Senior Groundsman--A minimum one year experience or
equivalent education is required. Employee must have valid driver's
license and good driving record to transport workers. Mixes herbicide
with supervision, supplies herbicide mixture to sprayers, keeps spray
equipment in working order, and maintain daily records. Employee works
under direct supervision of Crew Foreman.
Crew Foreman--Experience as a Team Leader or equivalent education
or work history. Responsible for the oversight of two to four Teams
(multiple teams make up a crew) with each team typically comprised of a
Team Leader and five or more Sprayers/Laborers/Groundsmen. Supervises
all aspects of field operations, maintains detailed reporting, and
performs other tasks at the direction of a Manager.
Manager--Typically requires formal education or related experience
and licensing pursuant to State and/or Federal requirements. Manager is
responsible for the oversight of multiple Crews. Manager must possess
good communication skills to deal with public and customers. Ensure
that crews meet quality/safety standard and complies with applicable
State and Federal regulations relating to herbicide application.
Sample Job Descriptions
Although there is presently no O*NET job description for this
position, the actual job encompasses virtually the entire description
of 45-4011, and could be said to also include a few of the tasks from
37-3012. The following hybrid descriptions would fairly describe how
these jobs operate in practice.
1. Sample Job Description of Migrant Sprayer
Under supervision, perform manual labor necessary to clear
vegetation, including applying herbicides through sprays, granules, or
other chemical application on target trees, shrubs, weeds, vines or
grasses on areas such as utility rights of way, highway roadsides, rail
road rights of way, forested areas, woodlands, industrial sites,
wetlands, and rangelands to control unwanted (target) vegetation. May
also use other hand tools to cut, kill or remove vegetation.
This is a seasonal position beginning in spring and ending in the
fall, lasting approximately 8-10 months, based on seasonal conditions.
Work is typically 5 to 6 days per week, with some overtime may be
required based on weather conditions, crew schedules and contract
provisions.
Sample of job titles: Brush Clearer, Forestry Worker, Utility
Sprayer, Herbicide Applicator, Spray Technician, Laborer, Ground
Crewman
minimum requirements for migrant sprayer
Must be 18 years old
No minimum education required
Must successfully complete one week training session or
have previous equivalent experience
May require State or Federal certification with company to
provide paid training to pass certification tests
Must be physically able to perform outdoor work
--Carry approximately 35 pounds (back pack) and traverse difficult
terrains (steep, rocky, brushy) walking up to 10 miles per day
--Be able to work in adverse weather conditions (primarily hot and
humid)
--After two weeks be able to meet minimum production standards
--Safely operate tools and equipment, including power tools
Must be able to travel with crew to various multi-state
locations continuously during spray season
primary tasks for migrant sprayer
Identify target vegetation and spray proper amounts of
herbicide on leaves and/or bark.
Use machete to treat target vegetation too tall or large
to spray with backpack, by making cuts in trees at specified intervals
and spraying proper amounts of herbicide mix in cuts with spray bottle.
Check equipment to ensure that it is operating properly.
Fill backpacks with premixed herbicide mixture.
Work in coordination with crew to ensure proper coverage
of assigned areas.
Take all precautions necessary to prevent spray drift and/
or damage to all non-target species or areas
Follow all guidelines, procedures and training to maintain
a safe operation and prevent injury or damage to self, other persons
and/or the environment
Clean and store equipment properly at end of work day.
primary tools & equipment for migrant sprayer
Backpack sprayer
Machete
Spray Bottle
Personal Protective Equipment that may include gloves,
glasses, uniforms, or other equipment
secondary tasks for migrant sprayer
Cut or remove vegetation using brush saws, chain saws or
other hand tools
Use power sprayers to treat target brush with proper
amounts of herbicide mixture
Connect and pull hoses associated with power sprayers
Start motors and engage pumps on power sprayers
Clean, service and maintain power sprayer, pumps, motors
and related equipment
secondary tools and equipment for migrant sprayer
Chain saws
Brush saws
Power sprayers
knowledge, abilities and skills for migrant sprayer
After training, worker must have the ability to identify
target species
After training, worker must have the ability to identify
non-target areas
Worker must be able to follow basic instructions
After training, worker must be able to operate and
maintain basic hand tools associated with job, including power tools
Worker must have the manual dexterity to operate tools
Job requires worker to be dependable, responsible and
reliable for fulfilling job obligations
This is an entry level, manual labor activity for which all
necessary knowledge, ability and skill can be reasonably achieved
during an initial one week training period and an additional two weeks
of on the job training.
additional information regarding specific industry tasks
Worker's primary task is to selectively spray, cut, treat or
otherwise remove unwanted vegetation, referred to as ``target
vegetation'', while preserving desirable vegetation that is
environmentally, commercially, aesthetically or otherwise beneficial.
For electric utility companies, workers will selectively control
tall growing vegetation that will interfere with electric lines and
affect electric reliability or otherwise impede access on rights of
ways while not damaging low growing shrubs, grasses or other desirable
vegetation, beneficial for wildlife and the environment.
On highway roadsides, workers will selectively control brush and
tall growing weeds that create safety hazards by obstructing view,
while preserving beneficial low growing grasses that prevent erosion.
In natural areas, rights of way, forests, rangelands, wetlands and
on other sites, workers will selectively control invasive species and
noxious weeds that pose a hazard to the ecology.
On forested land, workers will selectively control those weed and
tree species that adversely impact the growth of desirable timber.
On all sites and in all industries, non-target areas shall include
1. Agricultural crops
2. Fruit trees, ornamentals, and other vegetation in maintained
yards unless specifically instructed otherwise
3. Any area not specifically permitted on the herbicide label or by
State or Federal Regulation
4. Residential or public use areas unless specifically instructed
otherwise
2. Job Description for Migrant Sprayer Team Leader
In addition to the job description for Migrant Sprayer, a Migrant
Sprayer Team Leader shall perform the additional tasks and possess the
additional knowledge, abilities and skills as listed below:
minimum requirements for migrant sprayer team leader
Have, obtain, and maintain a valid driver's license and
meet DOT driving requirements
Must have and maintain a good driving record
Have, obtain, and maintain a valid FLCE license
Successfully complete Driver Safety Training course
Minimum one year's experience as Migrant Sprayer or
equivalent
Must be physically able to perform job functions
primary tasks for equipment for migrant sprayer team leader
Transport assigned crew to designated work locations
Mix pre-set herbicide mixtures for application
Keep Migrant Sprayers supplied with herbicide mixture
throughout the day
Communicate with crew and provide information as requested
Follow mapped locations to determine daily spray routes
Assist foremen with daily application reports, crew time
logs and additional information as needed
Maintain vehicle in safe, working order
primary tools & equipment for migrant sprayer team leader
Cell phone and/or two way radio
Herbicide mixing equipment
Company vehicle
knowledge, abilities and skills for migrant sprayer team leader
Must be able to maintain/complete various forms required
for daily herbicide application reports and for daily driving logs
required by US Department of Transportation
Must be able to read and follow a map
Ability to receive instructions from foreman and relay to
crew
Must be able to administer first aid
3. Job Description for Migrant Sprayer Crew Foreman
In addition to the job description for Migrant Sprayer and Migrant
Sprayer Team Leader, a Migrant Sprayer Crew Foreman shall perform the
additional tasks and possess the additional knowledge abilities and
skills as listed below:
minimum requirements
Must be able to effectively communicate with customers,
office staff and teams
Must be able to manage multiple Teams (Crews)
Must have basic knowledge of math
Must be computer literate
Must be able to operate independently when not directly
supervised by manager
primary tasks
Complete electronic daily and weekly reporting
Coordinate Crews, assign map segments to Team Leaders
Maintain herbicide inventories at job sites
Provide on-site training to Crews as needed
Perform quality control and safety audits, maintain
quality and safety standards and compliance with applicable State and
Federal Regulations
primary tools & equipment for migrant sprayer team leader
Computer and GPS Equipment
knowledge, abilities and skills
Must be able to create work schedule and meet production
standards based on weather, holidays, customer demand, regulatory
requirements, and other factors
Must have critical thinking skills to use logic and
reasoning to solve problems
Must have basic knowledge of tools and products used in
connection with job
Existing Job Description for Governmental Agency
As previously discussed in this report, one of the largest
utilities in U.S., the Tennessee Valley Authority (TVA), is a
governmental entity and relies on Migrant Sprayers for vegetation
management. Immediately following are pages extracted from TVA's
contract specifications relating to employees performing brush clearing
and spraying along TVA's rights of way.
Summary of Key Points About Migrant Spray Industry
The migrant spray industry is an evolution of the reforestation
industry and began about 2O years ago. Many migrant spray companies
also perform spraying on forestry land and use the same work force and
brush control techniques regardless of whether the work is performed on
rights-of-way, roadsides, or in forests.
Almost all migrant spray work is performed by H-2B workers. These
workers did not replace an existing U.S. workforce doing the same type
of work. Prior to the availability of a migrant work force, right-of-
way brush clearing was done mechanically with heavy equipment or
helicopters.
Migrant spray work is now an essential part of Integrated
Vegetation Management programs implemented by utility companies to
maintain electric reliability. Hand application of herbicide is more
effective and environmentally friendly than the outdated mechanical
methods.
In just the Greater South Eastern United States, we estimate that
there are more than 15 companies employing more than 2000 H-2B workers
performing migrant spray work for utility customers. Almost all of the
companies that perform this work also perform more traditional forestry
related work including tree planting, pre-commercial thinning, as well
as forestry spraying for site preparation and herbaceous weed control.
The Department of Labor has been certifying employers with H-2B
workers performing migratory brush clearing, including right-of-way
spraying, on itineraries for over two decades. Until recently, these H-
2B applications have been approved for the job title Brush Clearer (45-
4011) exclusively under the Forestry-related Special Procedures
outlined in TEGL 27-06. In the last few years, however, some employers
have been instructed by DOL to submit H-2B applications for this work
under the job title Sprayer (37-3012). Some of these ``sprayer''
applications have been processed under TEGL 27-06 and others have not.
Utilities that hire companies with migrant sprayers typically do
not make final decisions about where vegetation management work will be
located until just prior to the work beginning. Even then, weather,
budgets, governmental mandates and other factors often change tentative
work schedules. Typically there is no specific start or end date
mandated by utility companies, other than the general dates associated
with the spraying season, spring through fall. Because of the remote
locations where the work takes place and the limited amount of work in
any specific geographic area, this work is migratory in nature and must
be completed along an itinerary.
______
Prepared Statement of Shawn McBurney, Senior Vice President,
Governmental Affairs, American Hotel & Lodging Association
On behalf of the American Hotel & Lodging Association and our
members throughout the United States, thank you for allowing me to
comment on an acute problem in our industry--the ability to locate and
hire lower-skilled workers.
Serving the hospitality industry for more than a century, AH&LA is
the sole national association representing all sectors and stakeholders
in the lodging industry, including individual hotel property members,
hotel companies, student and faculty members, and industry suppliers.
AH&LA's membership ranges from the smallest independent properties
to the largest convention hotels with a high degree of franchising and
independent ownership. Every hotel or motel in our country is unique
due to factors that include size, type, location, services offered,
clientele, ownership, and status as an independent or chain affiliate.
Background on Lodging Industry
In 2011, the lodging industry generated $137.5 billion in total
revenue, supported 1.8 million jobs, and represented 1% of U.S. GDP.
The leisure and hospitality sector is the fifth largest employer in the
United States and with the lodging industry alone poised to add 141,000
jobs in the next 7 years according to the U.S. Bureau of Labor
Statistics (BLS).
The hospitality sector serves as a top 10 industry in 48 out of 50
states providing employment, investment, and opportunity and leading
economic recovery with 12 consecutive quarters of growth and providing
job creation in every region of the country.
We are proud that the lodging industry offers career growth
potential for our employees where they can rise from entry level to
management without the need for a college diploma.
Lodging Industry Recruitment and Retention Efforts
The lodging industry invests heavily in attracting and retaining
more employees. For more than 60 years, the American Hotel & Lodging
Educational Foundation (AH&LEF) has been the primary source of
financial support for industry-related scholarships and maintains
school-to-career and workforce development initiatives. The Foundation
awarded $7.4 million in scholarships to hospitality management students
with $514,500 being awarded in 2012 alone.
Hoteliers spend considerable time, money and resources attempting
to fill the jobs they are creating. They advertise in local papers,
attend job fairs, work with community-based organizations, canvas job
centers, and recruit at military bases, high schools, and colleges. The
industry is a leader in both the welfare-to-work and school-to-work
efforts, and AH&LA has partnered with prominent organizations to
promote careers in lodging.
Despite the generous pay and growth potential the lodging industry
offers, many jobs in lodging go unfilled due to the growth of our
industry and workers seeking employment in other sectors of the
economy.
Lodging employers can legally bring in some temporary workers from
abroad through educational and other visas, but not nearly enough to
fill all their vacancies. Neither option provides a long-term solution
to our worker shortage.
Experience with H-2B Program
While worker shortages are common among hotels throughout the
country, the problem is most acute in seasonal properties. This is
especially true for many resorts. The ability to keep their doors open
and retain their full-time employees is contingent upon making enough
money during their peak season to offset the rest of the year when
their business is slow.
During their busy seasons, they must supplement their permanent
staffs with temporary seasonal employees. In order to fill these
positions, they spend thousands of dollars and hundreds of hours in
aggressive recruitment. Unfortunately, there are not enough American
workers available to fill those positions despite generous pay and
benefits offered.
At one time, employers could rely on college students and other
individuals who would accept temporary jobs on a seasonal basis. That
is no longer the case, however. School and seasonal scheduling has
changed--properties have lengthened their seasons into spring and fall,
while school years have lengthened, making students simply unavailable.
In addition, many students no longer prefer to work in traditional
``summer'' positions.
As a result of this dramatic decline in workers willing to accept
temporary positions, many hoteliers have been forced to turn to the
federal government's H-2B worker program as a final option to find
short-term workers.
Although it is a complex, time-consuming and expensive process that
requires employers to navigate through three separate federal and one
state government agency, seasonal employers have turned to the program
because their season, and therefore their entire business, depends on
the ability to fill temporary seasonal jobs.
Needs in Immigration Reform
Due to the unique nature of seasonal businesses, a new temporary
worker program should be crafted that retains the H-2B visa program as
a distinct category of visas.
A seasonal hotelier may spend hundreds of hours and thousands of
dollars to secure a worker under the H-2B program after efforts to find
American workers were unsuccessful. The job the H-2B worker fills may
only last approximately four months. That represents a very large
investment for a very short-term worker.
Further, if the H-2B program was eliminated and seasonal employers
were required to seek workers through a new program that offered
positions with multi-year employment, those seasonal jobs would be much
less attractive to those workers in comparison, resulting in a more
severe worker shortage for seasonal hoteliers.
Given the necessity of the program and the success of the previous
H-2B cap exemption policy, Congress should approve a permanent
reinstatement of that cap exemption.
Most immediately, the two rules issued by the U.S. Department of
Labor (DOL), one on January 19, 2011 and the other on March 18, 2011
should be permanently blocked by Congress. Those two rules would make
the H-2B program virtually unusable, if they are allowed to be
implemented, many seasonal businesses will be forced to close and lay
off their full-time American workers.
A new lower-skilled temporary worker program is necessary to
address the worker shortages that hoteliers throughout the country are
experiencing (and which will become worse as the economy recovers).
A new program should be established to allow hoteliers to be
certified as being unable to find American workers for their available
positions and eligible to hire temporary foreign workers through the
new program.
Unlike the H-2B program, those positions should be able to be
filled for up to two years by a temporary worker, with the option of
having that visa renewed. This will permit hoteliers to secure the
workers they need and provide some stability in their workforces for
non-seasonal properties.
Hotels are in the hospitality business. Hospitality cannot be
outsourced or automated. Employees remain the lifeblood of our
businesses and it is critical that a legal process is created so that
there is access to foreign workers when no Americans are available.
Thank you very much for allowing us to comment on this vitally
important issue to our industry.
______
[Via Email],
The National Hispanic Landscape Alliance (NHLA),
March 13, 2013.
Hon. Tim Walberg, Chairman, Subcommittee on Workforce Protections,
Committee on Education and the Workforce, U.S. House of
Representatives, Washington, DC.
Dear Chairman Walberg: We appreciate the opportunity to submit this
statement for the record, and thank The House Subcommittee on Workforce
Protections for holding a hearing to examine the role of lower-skilled
guest worker programs in today's economy. The National Hispanic
Landscape Alliance (NHLA) is a member-based trade association that
advances the interests of the more than 500,000 Hispanic families that
depend upon the landscape industry for their livelihood. The landscape
industry in the US conservatively accounts for $18.75 billion, or 3% of
total US Latino household income.
It is our view that the current calamity of an estimated 11 million
undocumented migrants serves as de facto proof that the nation suffers
from unmet labor needs and is critically lacking of an adequate system
to address those needs in an orderly manner. It is our hope that in
considering the testimony provided, members will gain a greater
understanding of the fact that creating the jobs Americans want and are
able to fill requires the availability of sufficient workers to fill
the jobs Americans do not want and are not able to fill.
This truth is plainly evident to us in the landscape services
industry where hard-to-fill seasonal needs, that are met by H-2B visa
holders, enable firms to grow and expand the number of higher-level
fulltime year-round positions to which American workers aspire, and
which Hispanic-Americans due to their linguistic and cultural
competencies are especially well suited to fill. We are therefore
advocates of a flexible, employment-driven immigration system that is
responsive to workplace needs and supportive of economic growth.
Such programs should require employers to demonstrate the need for
supplemental labor in a manner similar to that required of employers
that utilized the H-2B program prior to the temporarily blocked new
Department of Labor wage screening interested foreign workers. We
further propose that the size of such visa programs should be
determined by workplace needs, as measured by employer ability to
demonstrate insufficient workforce supply rather than by caps that are,
at best, established using lagging economic data.
A few years ago, one of our member companies committed a filing
error and was not certified for the H-2B visa program that year. Unable
to fill 48 seasonal positions with foreign workers, and unwilling to
hire undocumented immigrants, this employer hired more than 1,300
workers during a nine month period in an attempt to keep the 48
positions filled with US workers. Not only did the high turnover result
in great strains of his human resources and training staff, the quality
of his work suffered to the extent that a number of customers were
lost, and the firm was force to reduce the size of its operations the
following year and terminate year-round positions.
We regret efforts by the U.S. Department of Labor (DOL) to burden
the H-2B program with a series of rules that would render the program
unusable and thus penalize the reputable companies that rely on the
program to expand their operations, and the employees that would
benefit from such growth. Thankfully, Congressional action has blocked
the implementation of some of those new rules and court action has
blocked implementation of the others.
In our view, the goals of the DOL can best be advanced through the
development of an exemplary H-2B employer recognition program. We
believe that such a program modeled after the successful OSHA Voluntary
Protection Programs (VPP) which recognize the outstanding efforts of
employers and employees who have achieved exemplary occupational safety
and health, would help raise the bar for practices by many H-2B
employers by publicizing the actions of some of the best.
In closing, we'd like to recommend that the H-2B program should
remain as a distinct seasonal program in any reform, and that the
program be improved by facilitating the year after year renewal of
workers returning for subsequent seasons. Know that we welcome any
opportunity to be of assistance in this matter.
Sincerely,
Ralph Egues, Jr.,
Executive Director.
______
Prepared Statement of Keesen Landscape Management, Inc.
KLM has been a leading provider of commercial landscape maintenance
services to the Denver metro area since 1972, with peak employment
levels of about 220-240 employees. We have been utilizing the H-2B
program since the mid-1990's and were one of the first companies in
Colorado to do so. During our peak season, approximately 35% of our
workforce consists of H-2B workers. All of our employees have been
certified through the E-verify program.
The H-2B program is exceptionally expensive and complicated to use;
indeed it would be cheaper and easier to use American labor to fill our
seasonal labor positions if it was available. But even at the bottom of
the job market when unemployment was at its highest point nationally,
we were able to fill only a small fraction of the positions needed in
order for our company to service its contracts. In 2011 we had a need
for 95 seasonal laborers. We were able to fill just 11 spots with
American workers. None of these workers lasted more than 45 days on the
job and most lasted just a couple of days to a couple of weeks. They
were paid the prevailing wage determined by the Department of Labor
which was around $9.19 per hour, the same as our H-2B workers. This is
the minimum wage we are required to pay an H-2B worker or an American
worker that applies for a position we are requesting seasonal labor
for. For 2013, the prevailing wage is $9.36 and we need approximately
100 workers. Our efforts to recruit through the newspaper, word of
mouth, advertising on our company vehicles and through the state
workforce agency netted exactly 1 application. This person did not
respond to our attempts by phone or mail to schedule an interview.
Because of the program's myriad of regulations and tight
application timeframes, we use a company that is well-versed in cutting
though the red tape associated with obtaining temporary workers on an
H-2B visa. They navigate the 4 government agencies and masses of
paperwork that must be filed each year in order for us to get our
approximately 85 seasonal workers that will work from March through
November. We begin that process in mid-summer the year prior to the
time we will need these workers the following March.
For all of the frustration and cost associated with the H-2B
program, there are a great number of benefits derived from this
relationship by both the employer and the H-2B workers. We receive
reliable, trained workers who eagerly come back to work for us year
after year. Indeed, they are like family to us. We cater in lunches and
cook breakfast for them as a small way to say thank-you. The workers
receive the benefit of job protections, such as worker's compensation
and a safe work environment, which may not be available to them in
their home country. The local and national economy benefits through
increased orders for supplies, equipment and vehicles. And while they
are here, they pay taxes on their earnings. They receive fair pay for a
job that allows them to provide for their families back home. Those
same families that are waiting to greet them when they return to their
home country at the end of their visa. This unique relationship helps
us keep quality levels high for our customers and allows us to remain
competitive in a tight economy where many of our competitors have
chosen to cut corners and may not always employ workers that are able
to pass the rigors of the E-verify program. Our American workers, most
of whom are managers or supervisors that work directly with or manage
these H-2B work crews, are not employable if we do not have a trained
and reliable source of labor. Their jobs are directly dependent on
these H-2B workers.
Perhaps the most important benefit derived from this program,
though, is the certainty that it provides to us in terms of knowing
that we will have available labor to service our contracts with our
customers. This is critical to our ability to plan annually how much
new work we can take on. Our employment of our American workers, our
orders of supplies and equipment from our vendors--all of this is
dependent on having a reliable, trained source of labor. And that is
exactly what the H-2B program provides to us. Could it be less costly
and more streamlined to use? You bet. But at this point it is far
superior to the only other two options we would have if it were not
available. The first option includes drastically cutting back the
number of annual contracts we perform, thereby reducing the number of
full-time, year around American workers that we employ and resulting in
drastic cuts in orders to our vendors for supplies, equipment, and
American-made trucks and trailers. Our other option is to throw in
the towel and succumb to the pressures of trying to remain competitive
in a system that seems to reward those who choose to circumvent the
laws and seemingly seeks to punish the ones doing their very best to
play by the rules.
This issue is about small businesses and the jobs they create which
allow them to employ America workers. A guest worker program is not a
luxury. It is a basic business necessity critical to their survival and
the continued employment of their American workers. I hope that message
was communicated loud and clear today.
______
Chairman Walberg. Without objection, so ordered. I thank
them for their valuable input on these important issues.
There being no further business before this committee, the
committee stands adjourned.
[A submission from Hon. Robert E. Andrews, a Representative
in Congress from the State of New Jersey, follows:]
Government Affairs,
National Association of Home Builders (NAHB),
March 18, 2013.
Hon. Robert Andrews, 2265 Rayburn House Office Building, Washington, DC
20515.
Dear Congressman Andrews: On behalf of the more than 140,000
members of the thank you for expressing interest in the health of the
construction industry at the Workforce Protections Subcommittee hearing
on lower-skilled guest worker programs on March 14, 2013. You
questioned a witness from Greenberg Traurig, LLP on the current state
of the industry, and while we appreciate and support the witness's
testimony, I want reiterate the witness's own words that she does not
represent the construction community. I also want to correct an
inaccuracy from the witness's response: the residential construction
community is, in fact, facing worker shortages at present.
In March 2013, NAHB's Economics Department conducted a robust
membership survey to determine the current needs and concerns of the
membership at large. More than half of the builders reported that labor
shortages over the past six months have caused them to pay higher wages
or subcontractor bids to secure projects, and consequently, raise home
prices. 46 percent of the builders surveyed experienced delays in
completing projects on time. 15 percent of respondents had to turn down
some projects, and nine percent lost or cancelled sales as a result of
recent labor shortages. The Job Openings and Labor Turnover Survey data
from the Bureau of Labor Statistics show that the month of January had
the second highest number of unfilled positions in the last seventeen
months.
Residential construction is facing tangible worker shortages--
worker shortages that are impeding the housing recovery. Recognizing
your strong support of the industry, I want to reiterate the importance
of the housing industry to the economy at large. Housing construction
and the value of housing-related services currently account for
approximately 15% of Gross Domestic Product. The construction of 1,000
single-family homes generates 3,050 jobs in construction and
construction--related industries, approximately $145.4 million in
wages, and more than $89.2 million in federal, state and local tax
revenues and fees. It is therefore critical that Congress work to
enhance, and not impede, the recovery effort.
NAHB works diligently to address the continuing need for skilled
labor within the nation's borders. In partnership with NAHB and Job
Corps, the Home Building Institute (HBI) is a national leader for
career training and job placement in the building industry. HBI's Job
Corps training programs are national in scope but implemented locally,
using proven models that can be customized to meet the workforce needs
of communities across the United States and internationally. It
prepares students with the skills and experience they need for
successful careers through pre-apprenticeship training, job placement
services, mentoring, certification programs, textbooks and curricula.
With an 80 percent job placement rate for graduates, HBI Job Corps
programs provide services for disadvantaged youth in 73 centers across
the country.
Yet, NAHB believes strongly that the nation should implement a new
market-based visa system that would allow more immigrants to legally
enter the construction workforce each year. Despite our efforts to
recruit and train American workers, our industry faces a very real
impediment to full recovery if work is delayed or even cancelled due to
worker shortages. A new, workable visa program would complement our
skills training efforts within the nation's borders, and fill the labor
gaps needed to meet the nation's housing needs.
For these reasons, NAHB is a member of the Essential Worker
Immigration Coalition (EWIC), which advocates for the creation of a new
program that will supply the U.S. economy with needed workers,
replacing an illegal flow with a legal flow. We believe that a
successful future guest worker program must include an annual visa cap
that fluctuates based on a demand-driven system that reflects the real
economic needs of the nation. This program would have a dual-intent
process that allows some foreign workers who have demonstrated a
commitment to their jobs and their communities to choose to petition
for a change of status to a permanent legal status in the United
States, while also incentivizing most foreign workers to return to
their home country at the end of their visa period. The program would
also require employers to treat these legal foreign workers in the same
manner as U.S. workers--with all of the same benefits, workforce
protections and wage rates as similarly-situated workers at the same
location.
I hope this information is helpful. If you have any additional
questions about the health of the residential construction industry,
NAHB's door is open to you and your staff for further discussion.
Sincerely,
James W. Tobin III.
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[Questions submitted for the record and their response
follows:]
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[Whereupon, at 11:23 a.m., the subcommittee was adjourned.]