Employing H-2A Workers Employing H-2A Workers in Kentuckyin Kentucky

Laura PowersLaura Powers

Extension Specialist, Tobacco Extension Specialist, Tobacco Labor Education and Financial Labor Education and Financial ManagementManagement

Laura.Powers@uky.eduLaura.Powers@uky.eduLast updated: May 2009

OutlineOutline

Changes for 2009Changes for 2009 Part I. Before employment can begin Part I. Before employment can begin Part II. During employmentPart II. During employment Part III. After employmentPart III. After employment Part IV. Government resourcesPart IV. Government resources

– Only if the farmer is applying for H-2A Only if the farmer is applying for H-2A workers themselves.workers themselves.

Text in Text in REDRED is a change for 2009 is a change for 2009

Changes for 2009Changes for 2009

Employer will need a Federal Employer Employer will need a Federal Employer Identification Number (FEIN)Identification Number (FEIN)

Attestation-based employer verificationAttestation-based employer verification– Employer will sign a form and submit along with h-Employer will sign a form and submit along with h-

2a application certifying various conditions of the 2a application certifying various conditions of the h-2a employmenth-2a employment

AdvertisementsAdvertisements– Two print advertisements; one in Sunday (or Two print advertisements; one in Sunday (or

equivalent circulation) paperequivalent circulation) paper– In other states defined as “expected labor supply”. In other states defined as “expected labor supply”.

Florida is one of Kentucky’s “labor supply states”.Florida is one of Kentucky’s “labor supply states”.– Increased efforts to ensure no displacement of U.S. Increased efforts to ensure no displacement of U.S.

workersworkers

Changes for 2009, Changes for 2009, continuedcontinued

No more “50% Rule”. Recruitment ends 30 No more “50% Rule”. Recruitment ends 30 days after start of contract.days after start of contract.

Increased efforts to contact former U.S. Increased efforts to contact former U.S. workers… document everything!!workers… document everything!!

TransportationTransportation– To be paid to/from port of entry and farm.To be paid to/from port of entry and farm.– No longer to/from worker’s homeNo longer to/from worker’s home

New methodology for calculating the AEWRNew methodology for calculating the AEWR Increased penaltiesIncreased penalties

Changes for 2009: ReferralsChanges for 2009: Referrals

State Workforce Agency will have list State Workforce Agency will have list of U.S. individuals that have been of U.S. individuals that have been referred to your job. referred to your job.

Must document attempts made by Must document attempts made by anyone referred to your job order and anyone referred to your job order and the result of that communication the result of that communication (refused job, was hired but did not (refused job, was hired but did not show up, no communication, etc)show up, no communication, etc)

Changes for 2009: ReferralsChanges for 2009: Referrals

Suggested process for domestic workers Suggested process for domestic workers applying for the job:applying for the job:– Ask them for the job order numberAsk them for the job order number– Have them complete an applicationHave them complete an application– You can choose to drug and alcohol screen You can choose to drug and alcohol screen

workers.workers.– Schedule and conduct an interviewSchedule and conduct an interview

Discuss with them the work requirements (as outlines in Discuss with them the work requirements (as outlines in the H-2a job order)the H-2a job order)

– Unless you have just cause for not hiring, you must Unless you have just cause for not hiring, you must hire the domestic worker over the H-2a workerhire the domestic worker over the H-2a worker

Part I. Before employment:Part I. Before employment:Who can request H-2A workers?Who can request H-2A workers?

A farmer can apply for H-2A workers A farmer can apply for H-2A workers themselves or have an agent apply for themselves or have an agent apply for themthem

If using an agent, they MUST be a If using an agent, they MUST be a certified Farm Labor Contractor (FLC).certified Farm Labor Contractor (FLC).– Some FLC’s provide this service at cost, Some FLC’s provide this service at cost,

and some will charge a feeand some will charge a fee– There are at least 11 FLC’s in Kentucky. There are at least 11 FLC’s in Kentucky.

Click here for a list..

Part I. Before employment:Part I. Before employment:Who can request H-2A workers?Who can request H-2A workers?

Employers must become certified through Employers must become certified through the National Processing Center the National Processing Center andand State State Workers’ Association (addresses are at end Workers’ Association (addresses are at end of presentation)of presentation)– Forms and instructions can be found at: Forms and instructions can be found at: http://

www.foreignlaborcert.doleta.gov/ Through the certification process, must show Through the certification process, must show

that not enough qualified and eligible U.S. that not enough qualified and eligible U.S. workers are available.workers are available.

If you have hired a FLC, they be your primary If you have hired a FLC, they be your primary contact for becoming certified. They will contact for becoming certified. They will handle the paperwork.handle the paperwork.

Part I. Before employment: Part I. Before employment: Job Requirements for H-2AJob Requirements for H-2A

Job must be seasonal or temporary in length Job must be seasonal or temporary in length (no more than 10 months)(no more than 10 months)

Employer must guarantee ¾ of the workdays Employer must guarantee ¾ of the workdays in the contract. Known as the “Three-Fourths in the contract. Known as the “Three-Fourths Rule”. Rule”.

The job will pay at least the greater of the The job will pay at least the greater of the following: following:

– July 2009 Federal Minimum wage ($7.25/hour)July 2009 Federal Minimum wage ($7.25/hour)– Adverse Effect Wage Rate (Varies by county)Adverse Effect Wage Rate (Varies by county)– Prevailing wage rate in the area ($8.00 per hour for Prevailing wage rate in the area ($8.00 per hour for

tobacco topping, cutting and housing)tobacco topping, cutting and housing)– Most Ky counties will pay $8/hr for tobacco topping, Most Ky counties will pay $8/hr for tobacco topping,

cutting and housing and $7.25 for all other activitiescutting and housing and $7.25 for all other activities– Dept of Labor will inform you of your payrateDept of Labor will inform you of your payrate– For the new AEWR, go to For the new AEWR, go to

www.flcdatacenter.com/www.flcdatacenter.com/

Part II. During Employment:Part II. During Employment:Record KeepingRecord Keeping

Maintain records of contact made Maintain records of contact made with referrals.with referrals.

Provide the job contract to each Provide the job contract to each worker by the first workday. worker by the first workday.

Maintain accurate and required Maintain accurate and required payroll records.payroll records.

– Must include hours worked as well as Must include hours worked as well as hours offered to work on pay stubshours offered to work on pay stubs

Pay correct wages in a timely fashion Pay correct wages in a timely fashion (at least two times per month) (at least two times per month)

Part II. During Employment:Part II. During Employment:Record Keeping: TaxesRecord Keeping: Taxes Income, Medicare and Social Security taxes Income, Medicare and Social Security taxes

are not withheld on H-2A workersare not withheld on H-2A workers Some Kentucky Counties require that local Some Kentucky Counties require that local

tax is withheldtax is withheld Federal Unemployment Taxes (FUTA) are not Federal Unemployment Taxes (FUTA) are not

withheld on H-2A workerswithheld on H-2A workers– However, the wages paid to H-2A workers are However, the wages paid to H-2A workers are

including in the calculation to determine the including in the calculation to determine the farmer’s FUTA liability.farmer’s FUTA liability.

Submission of 1099-MISCSubmission of 1099-MISC

Part II. During Employment:Part II. During Employment:Record Keeping: PayRecord Keeping: Pay

Include a wage statement to each worker with the Include a wage statement to each worker with the paycheck, including:paycheck, including:

– The basis on which the worker is paid (hourly or piece-The basis on which the worker is paid (hourly or piece-rate)rate)

If piece-rate, the number of piece-rate units earnedIf piece-rate, the number of piece-rate units earned If piece-rate, must average to be at least the minimum If piece-rate, must average to be at least the minimum

required hourly payrequired hourly pay

– Number of hours worked Number of hours worked andand total number of hours total number of hours offered to workoffered to work

– Total pay period earningsTotal pay period earnings– Specific amounts withheld and the purpose of each Specific amounts withheld and the purpose of each

(other than if taxes are required, withholdings are not (other than if taxes are required, withholdings are not recommended)recommended)

– Net payNet pay Wage statement should be signed by worker (to Wage statement should be signed by worker (to

verify they received a paystub.verify they received a paystub.

Part II. During Employment:Part II. During Employment:HousingHousing

Must be provided free of charge to all Must be provided free of charge to all workers under the contact that cannot workers under the contact that cannot reasonably return home each workday.reasonably return home each workday.

Must remain in compliance with applicable Must remain in compliance with applicable safety and health standards.safety and health standards.

– Non-compliance fines are levied on a per worker Non-compliance fines are levied on a per worker basis and multiplied by total number of workers basis and multiplied by total number of workers

– These fees have increased for 2009 and beyond.These fees have increased for 2009 and beyond. A written statement of the terms and A written statement of the terms and

conditions of occupancy must be posted at conditions of occupancy must be posted at the housing site. the housing site.

If water is from a well, cistern or spring, it If water is from a well, cistern or spring, it must be tested annually.must be tested annually.

Part II. During Employment:Part II. During Employment:TransportationTransportation

Employer must repay the cost of transportation Employer must repay the cost of transportation and daily subsistence pay and daily subsistence pay from the port of entry from the port of entry to the farm.to the farm.

Must provide transportation from the housing to Must provide transportation from the housing to the work site at no cost for those workers whose the work site at no cost for those workers whose housing is also provided for by the employer.housing is also provided for by the employer.

Must pay for transportation for the worker’s Must pay for transportation for the worker’s return return to the port of entry/consulateto the port of entry/consulate at the end of at the end of the contract period. the contract period.

Vehicles used for transportation must meet Vehicles used for transportation must meet applicable laws and regulations.applicable laws and regulations.

KY law does not require that H-2a workers have a KY law does not require that H-2a workers have a KY Driver’s license KY Driver’s license ifif they have a valid driver’s they have a valid driver’s license in their home country and that country is license in their home country and that country is a part of the Geneva Compact. However, your a part of the Geneva Compact. However, your insurance company may.insurance company may.

Part II. During Employment:Part II. During Employment:MealsMeals

Must provide three meals per day or provide at Must provide three meals per day or provide at no cost to the worker, centralized, reasonably-no cost to the worker, centralized, reasonably-equipped kitchen facilities where workers can equipped kitchen facilities where workers can prepare their own meals.prepare their own meals.

Employer can charge a fee if three meals a day Employer can charge a fee if three meals a day are provided (and costs are documented). are provided (and costs are documented).

– The fee can be no more than $9.90 per day, The fee can be no more than $9.90 per day, without receipts and no more than $39 per day without receipts and no more than $39 per day with receiptswith receipts

– This charge must be listed in the job contract This charge must be listed in the job contract given to the workers at the recruitment point.given to the workers at the recruitment point.

Subsistence must also be provided, at no cost, Subsistence must also be provided, at no cost, on the arrival and return trips to and from the on the arrival and return trips to and from the place of work.place of work.

Part II. During Employment:Part II. During Employment:Workers Compensation Workers Compensation InsuranceInsurance Workers Compensation (WC) Insurance Workers Compensation (WC) Insurance

must be provided at no cost to the must be provided at no cost to the worker. worker.

If on a joint contract, farmers can work If on a joint contract, farmers can work together on WC insurance.together on WC insurance.

For WC insurance, talk to your local For WC insurance, talk to your local insurance agent, Kentucky Employers insurance agent, Kentucky Employers Mutual Insurance (Mutual Insurance (www.kemi.com) or ) or go to go to http://labor.ky.gov/workersclaims/

WC must cover all workers, whether H-WC must cover all workers, whether H-2A or not and is based on total payroll2A or not and is based on total payroll

Part II. During Employment:Part II. During Employment:Misc.Misc.

Must provide all necessary tools and Must provide all necessary tools and supplies needed to complete the job supplies needed to complete the job at no cost to the worker.at no cost to the worker.

Part II. During Employment:Part II. During Employment:Termination of EmploymentTermination of Employment

If caused by an “Act of God” and the If caused by an “Act of God” and the contract cannot reasonably be fulfilled, contract cannot reasonably be fulfilled, employer can terminate the contract.employer can terminate the contract.– Employer must provide ¾ of the contract Employer must provide ¾ of the contract

benefits up to termination of the contract, benefits up to termination of the contract, including payment of the ¾ rule and including payment of the ¾ rule and transportation and subsistence transportation and subsistence back to back to port of entryport of entry. .

Employer must reimburse worker full Employer must reimburse worker full amount of deductions for amount of deductions for transportation and subsistence transportation and subsistence expenses to the place of employmentexpenses to the place of employment

Part II. During Employment:Part II. During Employment:Termination of Employment Termination of Employment (cont)(cont) If worker leaves or is fired for cause If worker leaves or is fired for cause

before 50% of job contract is completed, before 50% of job contract is completed, then employer is not responsible for then employer is not responsible for transportation and subsistence during the transportation and subsistence during the arrival trip to the farmarrival trip to the farm

Employer must notify the KY Office of Employer must notify the KY Office of Employment & Training and your agent (if Employment & Training and your agent (if working with a FLC) of all rejections, working with a FLC) of all rejections, terminations, and resignations of U.S. and terminations, and resignations of U.S. and /or foreign workers in the H-2A program./or foreign workers in the H-2A program.

Part II. During Employment:Part II. During Employment:AbandonmentAbandonment

If an h-2a worker abandons the job, If an h-2a worker abandons the job, the employer must contact the SWA the employer must contact the SWA and Department of Homeland Security and Department of Homeland Security of the abandonment. If using an of the abandonment. If using an agent, the agent can do this for you.agent, the agent can do this for you.

Failure to do so could result in having Failure to do so could result in having to pay wages to the abandoning to pay wages to the abandoning worker up to completion of the ¾ worker up to completion of the ¾ Guarantee.Guarantee.

Part II. During Employment:Part II. During Employment:Workers’ RightsWorkers’ Rights

Employers must:Employers must:– Allow workers to testify and exercise their Allow workers to testify and exercise their

rights if they have the need to do so. rights if they have the need to do so. – Permit Department of Labor (DOL) Permit Department of Labor (DOL)

investigations of your businessinvestigations of your business Conducted by the Wage and Hour Division of DOLConducted by the Wage and Hour Division of DOL

– Provide accurate information to DOL Provide accurate information to DOL officialsofficials

– Comply with all federal, state and local Comply with all federal, state and local employment-related laws and regulations employment-related laws and regulations

– Comply with the Fair Labor Standards ActComply with the Fair Labor Standards Act

Part III. After Employment Part III. After Employment

Employers must maintain payroll and all Employers must maintain payroll and all other records for at least three years.other records for at least three years.

Employers can request specific workers. Employers can request specific workers. If a grower wants to employ a particular If a grower wants to employ a particular H-2A worker he/she must have the H-2A worker he/she must have the worker’s name, date of birth and phone worker’s name, date of birth and phone numbernumber

Must pay for transportation for the Must pay for transportation for the worker’s return worker’s return to the port of entry (no to the port of entry (no longer the worker’s home) longer the worker’s home) at the end of at the end of the contract period. the contract period.

Part IV. Government Part IV. Government ResourcesResources This is needed only if the farmer is applying This is needed only if the farmer is applying

for H-2As themselves and not hiring a FLC.for H-2As themselves and not hiring a FLC. In Kentucky, applications (Form ETA 750) to In Kentucky, applications (Form ETA 750) to

become certified for H-2A workers should be sent become certified for H-2A workers should be sent to the to the Chicago Processing Center:Chicago Processing Center:

Chicago Processing CenterChicago Processing CenterU.S. Department of Labor, Employment and U.S. Department of Labor, Employment and

Training AdministrationTraining Administration844 N. Rush Street844 N. Rush Street12th Floor12th FloorChicago, IL 60611Chicago, IL 60611Phone: (312) 886-8000Phone: (312) 886-8000Fax: (312) 353-3352 Fax: (312) 353-3352

Part IV. Government Part IV. Government Resources (cont.)Resources (cont.) This is needed only if the farmer is This is needed only if the farmer is

applying for H-2As themselves and not applying for H-2As themselves and not hiring a FLC.hiring a FLC.

An application must also be send to the An application must also be send to the Kentucky Workforce Office, located at:Kentucky Workforce Office, located at:– Kentucky Department of Workforce InvestmentKentucky Department of Workforce Investment

Office of Employment and Training Office of Employment and Training Foreign Labor CertificationForeign Labor Certification275 East Main Street 2WA275 East Main Street 2WAFrankfort, KY 40621Frankfort, KY 40621Phone: (502) 564-7456Phone: (502) 564-7456Fax: (502) 564-7459Fax: (502) 564-7459

ConclusionsConclusions

There are several items that farmers There are several items that farmers need to be aware of when employing H-need to be aware of when employing H-2A workers. However, the employment of 2A workers. However, the employment of H-2A workers is not difficult if managed H-2A workers is not difficult if managed appropriately.appropriately.

You have a right to be heard!! Stay up to You have a right to be heard!! Stay up to date with reforms and contact your date with reforms and contact your elected representatives and farm elected representatives and farm organizations with your concerns (or your organizations with your concerns (or your praises!).praises!).