H-2B Immigration Insurance Policy: Laws are changing!

Kyle is solo this week! He talks about a proposed rule change for the H-2B visa and how your business can secure an immigration insurance policy. Don't miss out on Kyle's expertise and opinions this week!

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Produced & Edited By: Drew Tattam

Transcript

So, what we're gonna talk about today is some proposed legislation that I think, gonna keep coming up here for H-2B. This, this was proposed last year during the omnibus time. That's usually when they do these things, cuz you know, getting an individual bill through Congress is very difficult.

And so, what they do is during omnibus, which is at the end of the year, they usually stick in all of these bills. And the tailwind behind this one is the reason that I'm discussing it so early, I think that this one actually has some real shot of getting through. it also has some long-term implications for a lot of our clients.

A lot of our clients are in agricultural construction, so they use the H-2A program. There's a lot of efforts right now to remove construction occupations from the H-2A program. Thankfully the Department of Labor has not been one of the aggressors in the actual removal of construction, although I think that that's because they really want to be able to, so they've changed some rules.

They've changed the wage rate methodology, every time I see proposed legislation for H-2A, it always excludes construction occupations, which then has another domino effect here, and so it's important that any of our H-2A construction clients are paying particularly close attention to this, and, and the people that rely on them.

I see this every time I see proposed H-2A legislation, which actually happens to come up at similar times as the H-2B legislation through the omnibus process. And so, one of the concerns that I would have is that in some year, the H-2A legislation gets approved the same year as H-2B and the employers that have been utilizing H-2A to serve that function are just outta money. So, that, that's a that's a concern that I have and that's, that's part of what we're doing here, is we're trying to look forward for you so that you don't have to worry about that, and that you have some assurances that you have access to the labor that you rely on.

Uh, this is also important for a lot of other people. If you're someone that uses H-2B, I'll just tell you my initial responses, to this bill when we get involved. So, if you already use H-2B, it's great information to have, it's information that you might wanna use to plan forward, uh, particularly with growth opportunities. And I'll get into that in a little bit. 

If you're someone that is using H-2B and already doing construction, it's good. If you are someone that is looking to use H-2B to get construction workers, it's terrible. We'll get into all that as we go. I'm gonna give you guys just my initial reaction, and for those of you that have been with me for a while and, and know how I generally view legislation, it's pretty cynically.

I usually, when I'm reading through these things, there's a lot of red flags here and there and, you know, frankly, in, in this legislation there's some, but this legislation's not all bad, which is normally what I see when I see. The proposed bills for H-2A, for example, those are almost all terrible.

And the people that are pushing those are, it's almost like they're trying to get legislation through for the sake of getting legislation through. That's not what I see here, so credit to the folks that have been involved at the negotiating table on this particular bill, because they're doing a great job.

That's, you know, they're doing a great job and you see where they gave and where they gained. And it's, it's a, it is an actual two-sided bill, which I don't see a lot of. There is that, so give credit where credit is due. And I also think that because of that, this actually has potential to pass, which is another reason that I think it's important that we talk about it and that you plan for it because I do think that there's an actual legitimate possibility that this thing passes.

So, let's talk real briefly, some content in the bill. And then I'm gonna, I'm gonna go through what I think that you should be doing here. So, let's talk about the bad stuff in the bill first, there's a few provisions in there that are particularly bad. One of 'em is the specific exclusion of construction occupations.

This bill says, specifically in the language that it's to be liberally construed, that's not great because if you are a construction company that hasn't used H-2B before, and then you come to rely on H-2B, say if construction's removed from the H-2A program and you would then be relying on the H-2B program if you haven't been utilizing the H-2B program, you would be.

And so that's, that's really bad. It would make it to where you just don't have access to your labor, it also prevents future people from being involved in the H-2B program that have construction occupations that they want to fill, which I think is really bad. I think it one that access to labor is just not there. I think that in a lot of areas, particularly remote areas, there's just not the labor. It doesn't matter how much you pay 'em, the labor doesn't exist, so I, I don't like that aspect of it, but if you're someone that has used H-2B for construction occupations, you'll be grandfathered in.

So that's great. That means that this gives you a little bit of time, I mean very little time, but it does give you some time to ensure that if you wanna bring in non-immigrant labor to perform construction occupations, then you have the opportunity to to do so. So that's one thing. So, if you're a construction company, hasn't been using H-2B may rely on H-2B in the future. It's time, you should get involved with H-2B program. That's one of my recommendations.

So, one of the other bad provisions in this particular bill is the specific exclusion of meat and poultry processors for slaughtering and processing.

Now the actual implications here, the reality is, is that a lot of employers that are engaged in this type of work already struggle to access, they should be programmed because of their inability to demonstrate a peak load or seasonal need. Uh, but there are a lot of 'em that do.

And for those that do, it's fine if they've used it before, but if you're looking to in the future, it's, it's not gonna be good.

So that, that's the other bad thing. Now the good. It broadens the cap-exempt definition, which is really, really cool.

It broadens who has access to cap-exempt workers. If you're an employer that's utilized the H-2B program for the prior five years, then you would be entitled to have cap-exempt workers for the highest number of certified workers you had in any of those individual fiscal years.

And it, that doesn't require one certification. So, let's say that you're an employer and you perform work all over the country and uh, you have 50 labor certifications for a thousand workers. The thousand workers would be cap-exempt and that's great. That's great for you. That's great for people that are looking to utilize this program in the future.

It makes it to where there's more cap space available, so that's actually really, really awesome, the other thing is, is that it doesn't actually prevent you from increasing the number of workers. The number of workers can increase. It's just that the requested number above the cap-exempt would be cap-subject.

So, you would still be fighting for cap space, but again, the cap space wouldn't be nearly as competitive. So, that's also really cool. Now, the, the cap increase is also one of the parts that's pretty cool about this bill. So, for those of you that have dealt with me going on a old-man tangent about the logic of a numerical cap, you would know that I despise numerical caps to begin with because I don't think they make any logical sense.

Of course, if everything our politicians did were logical, I guess we'd be in a different situation altogether. But this is what they say about a numerical cap. You need a numerical cap because you need to be able to ensure that these jobs are not adversely affecting the US workforce.

Okay. Well, part of the application process is already demonstrating that you're not adversely affecting the U.S. workforce. And if you do, there are some serious fines associated with that. And so, if you're already proving you're not adversely affecting the U.S. workforce, why do you need this arbitrary cap to limit your ability to access the foreign workforce?

It doesn't make any sense. Well, I. I'll get off my soapbox and I'll, I'll just tell you that they, they plan on increasing the cap to anywhere from 75,000 to 150,000, and it'll fluctuate with unemployment. Now, one thing that I'm not sure about here is if this cap becomes competitive, would they be doing any cap increases?

That's one concern I would have with the cap. They would say, oh, well, we gave more cap space, and so I, I don't know, but the reality is, is that even an increase in cap to say 125,000, 130,000, cuz it'll be in that range, is really, really good. Much better, especially considering the number of people that would fall within the exemption status.

So, I think that's great, one other thing that's actually really cool about this is the dual-intent element. So, I don't know if you guys are familiar with this, legal concept, but all visas have what's called, uh, an intent element. And it is, do you intend to immigrate here permanently? You would do this through a green card.

Let's say you are an investor and you're doing an EB-5 investment, same thing. You would hold out to the U.S. government. I intend on coming here permanently. And what you do whenever you're an H-2B worker right now, which is called, it's a single intent visa, it's a non-immigrant visa.

You're holding out to the go. I intend on coming, I intend on doing my work and I intend on leaving. And so, the cool thing about a dual-intent element here is it would allow employers to continue to bring up the H-2B worker while they have a green card pending, and that's really, really cool. 

So, that would, that would be a, a great aspect to it. And it's something that would really benefit people because one of the reservations that you would have right now if you were filing green card applications for someone that you bring on an H-2B, let's say it's in a different occupation, uh, is when you get to a certain point, they might not be able to come back into the United States on an H-2B Visa because they have this pending immigrant intent visa and it could lock 'em out for a couple years.

And you don't want that. They're, you're probably doing that for your best employees. So, that's a that's a great thing to know. And I guess the other thing just to be aware of, and this is kind of the, the last thing before I'll start getting to some Q&A, is this bill doesn't make you particularly vulnerable if you're already accessing the H-2B program.

The thing I don't like about it is it restricts the access to H-2B program for future employers. However, you're fortunate enough to have the opportunity to make sure that your business doesn't fall under that now. So, from, from my, uh, holistic economic approach, I, I, I think, man, I, I don't like the limiting of H-2B workers.

I don't think that that's smart from an economic policy, but from your individual business, if you have concerns about your access to non-immigrant labor. So, say you're an H-2A employer and you're worried you can't get H-2A workers to perform a certain job function or, uh, you're a company that's considered using H-2B before, but you haven't started using it.

It's a really good time to do that because by being included now, you'll be included in the future benefit of that, so that's, that's pretty neat, okay. I'm gonna move over to some Q&A. 

I had one question about these labor summits that we do, do these labor summits where we bring people in, to our area generally, and we just get to know 'em and introduce 'em to some other like-minded business owners where, where they can work collaboratively on overcoming any issues that they have in their business. And also, generally, we shoot a lot of guns and fish and hunt. So that's a lot of fun too. So, I don't know when we're gonna do the next one, but if you want to participate, let me know. Okay. 

Can you clarify the cap exemption? One thing to remember about filing applications, and this is just advice, uh, is you're, you're filing for an anticipated need. So, there is that. But you also wanna make sure that when you're filing H-2B certifications, you're filing for what's called a bona fide need, meaning there's a real job opportunity. That, that's, that's there. Now, I, I understand that jobs fall through, particularly now, I've, I've seen a ton of jobs fall through just because of material deliveries and, and that's kinda stuff.

But there is this notion of a bona fide job opportunity just to, just to make sure everyone is aware of what that means. It means that whenever you're applying for H-2B visas says you are attesting to the fact that there is a legitimate job there, and so this, provision is meant for the actual certifications received, not the number of people that were actually issued a visa. 

Caps - Is this number divided by two for April and October? I would assume so, but I actually don't recall that from my first reading through the bill. Um, and I, I actually don't know if that would. That's something I would have to check on and get back to you. I don't remember. I need to read back to this bill.

I don't remember from the last time I read through it.

Can one do a dual intent with an H-2A Visa? So, H-2A also is a single-intent visa. So, it's kind, it's in the same, same boat as H-2B. Okay. 

Our company applied for H-2B workers for the first time this year but have not yet been approved, would that mean that we are grandfathered in or not? By grandfathered in, if you mean you're a construction company and would you be grandfathered into the H-2B program? The answer is once you receive certification, yes. But you do have to receive certification to be grandfathered in. But, since this is your first year, this is a great, distinction to make. Since this is your first year, you won't be eligible for the returning employer exemption. So, your application would still be cap-subject.

How do you foresee the additional demand for H-2B caused by construction restrictions on H-2A? So right now, there's not construction restrictions on H-2A, but if you think about it, let's say that there are 3000 H-2A construction occupations certified each year, and then if it got rid of H-2A construction occupations, and then that would be forced to go to H-2B, it would make H-2B that much more competitive. It would be a direct translation.

Does all this apply to landscaping companies as well? So landscaping companies, this is an interesting question because, in, in theory, no. Uh, in theory, landscaping companies would be a pretty good beneficiary of this legislation, even if they haven't participated in the H-2B program before because they should be coded as a landscaping occupation.

But a lot of landscaping companies also do hardscaping, and I could see the Department of Labor trying to encompass that in an SOC code that falls under construction occupations, which would then exclude you. So, the mowing of grass? No, the construction of a deck probably. 

For a first-time H-2B applicant, is there a timeline to get approved before this law will take effect? Yes. Just to be perfectly clear, perfectly honest, I obviously do not know if this law will pass, and parts of me are hopeful that it will, and parts of me are hopeful that it won't, but I don't know. I think it does have some wind in the sails, which is why we're talking about it so early on.

And you would need to be certified prior to the end of the year. I would suggest, and remember, it has to be a bona fide job opportunity, so file certification, very, very soon, we're already coming up on deadlines for October filings, which is when the next cap, will open up. And so, the, the sooner the better. 

When could these potentially take effect next fiscal year? My guess would not be next fiscal year. It would be next calendar year, uh, because it comes in the omnibus packages, which are always at the end of the year. How many construction workers are currently working under H-2A?

I do not know the answer to that. I would guess several thousand though. Uh, well, maybe not several thousand. Several thousand certified cases, but that doesn't mean that's several thousand individual workers. So I, I don't, I don't know the answer to that one.

 Should we up our number of certified workers to have more cap-exempt workers in the future? This is from someone that has used the program for the last five years. You know, if you have a bona fide need for additional workers, then yes, you absolutely should because it would give you more cap-exempt people in the future. The the thing is, is just make sure you got bona fide need for the total number of workers requested.

And if you do good, let's go, that's exactly how you should be reading this and planning on this. So that's a great question. I actually meant to say that earlier and I, I completely failed to, so thank you. 

What if one year we request 50, but one year we only had a need for 16, which would be under the cap-exempt? So, first of all, you gotta make sure that you're meeting the first bar, which is am I an employer that has received certification in each of the prior five fiscal years? And if you meet that, then it is the year, that fiscal year where you had the highest number of approved certifications. Let's say you had, uh, a need for 50 people one year and only 10, the next year, the 50 would would apply.

So, the, the question is, our biggest problem to date is having individual workers at the embassy denied for no reason, so the State Department is supposed to provide you or provide the worker a document that says the reason for their denial, but the reality is that this reason can be rather arbitrary, such as you didn't demonstrate enough ties to your home country.

So, we think that you're gonna abscond whenever you get there, there's not a great way to ensure that individual workers can come over here because the consulate has a ton of discretion who they approve or deny. But what you can do is if you are consistently giving that denial, which happens particularly from certain countries really often, and, and at certain embassies really often, is you can take the evidence with you to the appointment that demonstrates why you have to. You're, you're, let's say you're, uh, married and you bring your marriage license and your wife or or husband is staying, back in their home country. You're, you have kids in your home country. You bring their birth certificates, you've got elderly parents. You bring pictures, and you, you've got a, a property that you own. You bring evidence of the property, electric bills, those sorts of things. Uh, and that's great evidence to help overcome that, that hurdle. 

I do appreciate participating in all the Q&A. It, it's, uh, lot of fun and it's always a, a highlight of my week, so I, I appreciate it and we will talk to everyone soon.