What Employers Should Know Ahead Of H-2B Visa Changes

Law360

05.13.2025

The H-2B visa program offers employers an opportunity to legally hire temporary foreign workers where sufficient U.S. workers are not available. It does not replace U.S. workers, but supplements the existing U.S. workforce on a temporary basis.

The program is highly regulated. It is limited by statute to a fraction of the visas requested each year, and it is subject to the regulated wage rates set by the U.S. Department of Labor.

This article describes several anticipated changes in the H-2B visa program for immigration attorneys and their clients that rely on H-2B workers. We discuss We discuss possible changes in the number of visas that will be issued, as well as anticipated changes in H-2B prevailing wages required for fiscal year 2026.

The wage changes will take effect for work starting on or after July 1, as part of the annual wage-setting process, while some of the other changes we describe arise from recent U.S. Supreme Court decisions and the change in administration.

Number of Visas Issued

66,000 H-2B visas are authorized by statute for each fiscal year. They are divided equally between start dates from October through March and from April through September.

The only times in recent history that the cap of 66,000 visas was not reached were during the Great Recession and the COVID-19 pandemic, and in most years, the cap is reached quickly as H-2B visa demand substantially exceeds the limited supply.[1]

Congress has authorized supplemental visas each year since fiscal year 2017. In November, the U.S. Department of Homeland Security for President Joe Biden's outgoing administration announced an additional 64,716 supplemental H-2B visas for the remainder of fiscal year 2025.

The appropriations process for fiscal year 2026 is underway, and it is not yet clear whether Congress will approve supplemental visas again, so the number of visas that may be approved is unknown.

For fiscal year 2024, employers requested 301,881 positions against 66,000 H-2B visas, and roughly another 64,000 supplemental visas. While these figures reflect some duplicate supplemental filings for employers that were unable to obtain a visa on their initial filing due to the limited number of visas allocated from the regular cap, the program remains significantly oversubscribed.

To the extent that nonagricultural seasonal employers will increasingly feel the effects of ongoing immigration enforcement activity, we expect the demand for H-2B labor to increase.Some critics have called for President Donald Trump's new administration to not use the discretionary authority provided by Congress, and to not issue any supplemental H-2B visas.

However, the existing supplemental authority process was used in all four years of the previous Trump administration, both to address the ongoing and now increasing seasonal labor shortages, and to target the countries from which many individuals presented themselves at the U.S.-Mexico border and to promote legal circular migration.

Prevailing Wages

On July 1, the DOL will release an online wage library that lists the H-2B prevailing wages that will be in effect over the following 12 months.

The H-2B prevailing wage is typically the average occupational wage in the area where the work will be done, based on the most recent Occupational Employment and Wage Statistics survey.

The OEWS data released on April 2 will be the basis for prevailing wage determinations, or PWDs, for all H-2B visas and approximately 15,000 H-2A temporary agricultural visas. As such, this data provides an accurate preview of the PWDs that will be certified starting July 1.[2]

H-2A Program

Like the H-2B nonagricultural visa, the H-2A agricultural visa program has a requirement that the employment of temporary foreign workers "will not adversely affect the wages and working conditions of similarly employed U.S. workers."

While the DOL uses data from the U.S. Department of Agriculture to determine the prevailing wages for the vast majority of H-2A jobs, it has also recently started using state-level OEWS data for PWDs for certain occupations.

The most common occupations for which the DOL relies on OEWS data for H-2A PWDs include heavy and tractor-trailer truck drivers, construction laborers, shuttle drivers, chauffeurs, and first-line supervisors of farming, fishing and forestry workers.[3]

Agricultural employers that rely on H-2A workers for these jobs can preview their 2026 PWDs by examining the latest state-level OEWS data. However, as we discuss below, several issues make the OEWS a somewhat less reliable data source for wage-setting for both visa programs.

These issues include missing observations, such as the entire state of Colorado; changes in area definitions that cause large wage changes in certain counties; and average wage estimates that vary substantially from year to year due to small sample sizes.

Additionally, for the H-2A program, the OEWS specifically excludes farm employers, making it even more problematic as a wage source for H-2A agricultural work.

Colorado

There was no OEWS wage data released for Colorado on April 2, and the Bureau of Labor Statistics has suspended the release of wage data for the labor market areas in the state.

According to the Bureau of Labor Statistics, the suspension is due to changes in how data is collected through Colorado's unemployment insurance system, and these changes are being reviewed for their impact on data quality.

While the OEWS is evaluating the possibility of releasing Colorado occupational wage estimates in the future, it is not clear if this will occur before July 1. The absence of OEWS data for Colorado is important because PWDs were certified for nearly 11,700 H-2B workers in the state during fiscal year 2024.

For H-2B workers, and for H-2A workers in the minority of occupations that are covered by the OEWS, DOL regulations provide that if a statewide annual average hourly gross wage rate is not

available, as will soon be the case in Colorado, the national average wage rate for that occupation will apply in that state.[4]

Colorado nonfarm businesses that rely on the H-2B program, and Colorado agricultural employers that hire H-2A workers for occupations that are covered by the OEWS, should monitor the possible release of updated OEWS wage data later in the year.

Changes to the Composition of Labor Market Areas

Prevailing wages for fiscal year 2026 will be based on revised definitions of metropolitan and nonmetropolitan areas. Hundreds of counties will be relocated to different labor market areas.

While all businesses face prevailing wage changes due to inflation, businesses that are in relocated counties face an additional adjustment due to the change in the composition of their local area.

Because average wages tend to be higher in metro areas, counties that moved into a metro area from a nonmetro area will tend to see larger prevailing wage increases. Counties that moved out of a metro area and into a nonmetro area will tend to see lower prevailing wage increases and may experience prevailing wage decreases.

Businesses that are in counties that will change labor market areas should examine the OEWS data to understand how the H-2B prevailing wage will adjust due to the relocation.

As set forth below, the 2024 OEWS average wages were announced last month and will be used to set prevailing wages on July 1 for visas issued in fiscal year 2026, which starts on Oct. 1 of this year.

For example, Franklin County, Indiana, was previously in the Central Indiana nonmetro area, and is now in the Cincinnati, Ohio, metro area. Had it remained in the same nonmetro area in 2024, the average wage for landscaping workers would have increased by 6.2% from 2023. In contrast, Franklin County's average wage for landscaping workers increased by 15.8% last year, from $16.05 to $18.59, largely due to its move to the Cincinnati metro area.[5]

This effect can also be seen in reverse. Pike County, Pennsylvania, moved from the New York-Newark-Jersey City, NY-NJ-PA metro area to the Northeastern Pennsylvania nonmetro area. If it had remained in the New York metro area in 2024, the average wage for landscaping workers would have increased by 0.2% from 2023. Instead, Pike County faced a 16.7% decrease in the landscaping worker average wage last year, from $21.87 to $18.22, primarily due to its exit from the New York metro area.[6]

Expected Prevailing Wage Changes

The new OEWS data indicates that prevailing wages will increase by 3.85% on average when PWDs are released on July 1. However, not all prevailing wages will increase by the same percentage because the DOL sets hundreds of thousands of H-2B prevailing wages by local area and detailed occupation each year.

Because each H-2B prevailing wage is based on an average that is calculated for a relatively small sample, many prevailing wages will change substantially from year to year.

For example, businesses in the Baton Rouge, Louisiana, metro area faced a 10.3% increase in the landscaping worker average wage in 2024, from $15.57 to $17.17.[7] This is much greater than the 3.2% increase in wages for private industry workers in the Employment Cost Index within Baton Rouge's census division at the end of 2024,[8] or the 3.27% average wage increase across all workers in Baton Rouge last year, according to the OEWS survey.

As explained below, recent Supreme Court decisions could result in legal challenges to prevailing wage increases that are substantially greater than the wage inflation rate in the local area, like the wage for landscaping workers in Baton Rouge.

Employer Compliance

H-2B regulations require that employers pay the highest applicable prevailing wage rate if their work spans worksites in multiple wage areas.[9]

Where wages may have spiked in the new OEWS data, H-2B employers must be aware of the changes and still need to list every worksite where their employees will be working.

H-2B rules prohibit employers from placing H-2B workers outside the "area of intended employment" that was listed in their application for temporary employment certification.[10] Doing so may be grounds for debarment from the H-2B program.[11]

It is incumbent on employers to be aware of the prevailing wages in areas where they are considering operating, and to decide, prior to filing their application with the DOL, whether it makes business sense to operate in each of those areas, based on the new OEWS wage data.

For example, a landscaping business in Decatur County, Indiana, will be required to pay the higher Cincinnati prevailing wage for any work completed in neighboring Franklin County in fiscal year 2026.

Litigation Landscape

The current H-2B prevailing wage methodology relies on OEWS data — which measures average wages with considerable noise due to small sample sizes, as discussed above — and comes from a rule issued 10 years ago, titled "Wage Methodology for the Temporary Non-Agricultural Employment H-2B Program."

Where H-2 employers have challenged wages set by the DOL as being improperly calculated or implemented, the government has taken the position that such challenges must be brought within six years of the issuance of the rule that sets the methodology, rather than the publication of the specific wage rate being challenged.

Substantively, the DOL's wage-setting methodology was traditionally subject to Chevron deference, even where the challenge was brought within the six-year window provided by Title 28 of the U.S. Code, Section 2401(a).

In 2024, the Supreme Court issued two game-changing decisions for challenges to H-2 wage methodology.

In Loper Bright Enterprises v. Raimondo, the court put an end to 40 years of Chevron deference, fueling substantive challenges to agency interpretation of authorizing statutes.

Three days later, in Corner Post Inc. v. Board of Governors of the Federal Reserve System, the court held that Section 2401(a) allowed for Administrative Procedure Act challenges brought within six years of the plaintiff being injured by the agency action, rather than when the agency action first occurred.

These two decisions have opened the door for employers to challenge the department's wage-setting methodology.

Conclusion

To sum up the important potential changes in the H-2B visa program in fiscal year 2026, first, it is unclear whether the supplemental H-2B visas that have been authorized in recent years will be extended.

Second, although there will be substantially different prevailing wage changes across jobs and locations, by reviewing the recently released OEWS data, businesses can accurately preview the prevailing wages that will be required in fiscal year 2026.

Finally, because of two recent Supreme Court decisions, businesses that face unusually large prevailing wage increases may challenge the DOL's wage-setting methodology in court.

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Steve Bronars is a partner at Edgeworth Economics.

Elliot Delahaye is a managing consultant at Edgeworth Economics.

Chris Schulte is a partner at Fisher Phillips LLP.

The opinions expressed are those of the author(s) and do not necessarily reflect the views of their employer, its clients, or Portfolio Media Inc., or any of its or their respective affiliates. This article is for general information purposes and is not intended to be and should not be taken as legal advice.

CITATIONS

[1] For example, the 33,000 cap for authorized H-2B visas for the second half of FY2025 was reached on March 5.

[2] This is shown by the count of H-2A wage certifications for occupations outside of the "Big 6" occupations covered by the Department of Agriculture's wage survey (https://flag.dol.gov/wagedata/adverse-effect-wage-rates) in the "H-2A Disclosure Data, Office of Foreign Labor Certification."

[3] The states with the most H-2A workers with PWDs based on OEWS data include Louisiana, Florida, Texas, Iowa, and Arizona.

[4] 20 C.F.R. § 655.120(b)(1)(ii)(B).

[5] Occupational Employment and Wage Survey, 2024, Bureau of Labor Statistics.

[6] Ibid.

[7] Ibid.

[8] Employment Cost Index, West South Central Division, 12-Month Percentage Change, 2024, Bureau of Labor Statistics.

[9] 20 C.F.R. § 655.10(d).

[10] 20 C.F.R. § 655.20(x).

[11] 29 C.F.R. § 503.24(a)(7).