1. What is the purpose of the H-2B visa program? 2. May an employer pass along to...
Question:
1. What is the purpose of the H-2B visa program?
2. May an employer pass along to employees expenses for goods and services that are “primarily for the benefit or convenience of the employer” and be in compliance with the FLSA minimum wage if the expenses reduce real wages below the minimum wage? Or must the employer deduct those expenses from the cash wage to determine compliance with the FLSA minimum?
3. Did the court find that out-of-the-ordinary expenses the employees incurred because of the business decisions of the employer, such as travel from remote points of hire, costs of passports and work visas, and fees paid to mandatory recruiters, should be deducted from cash wages to determine the FLSA wage rate?
[Rivera and the other plaintiffs are citizens of Guatemala and Mexico who worked as seasonal landscapers for defendant the Brickman Group between 2003 and 2005. Brickman petitioned for and was granted temporary work visas for the plaintiffs under 8 U.S.C. § 1101 (a)(15) (H)(ii)(b) and 8 C.F.R. § 214.2(h)(6). That program (commonly known as the "H-2B program") allows U.S. employers to petition the Department of Labor for permission to employ nonagricultural foreign workers for periods of less than one year.
Although plaintiffs' cash wages appeared to comply with all applicable laws, plaintiffs claim that Brickman forced them to pay for employmentrelated costs out of pocket. These costs, they contend, operated as de facto deductions that reduced their real wages below the applicable minimum wage.]
POLLAK, J.…
Having concluded that neither the INA nor the Portal-to-Portal Act has any bearing on this case, I turn to how the FLSA treats the three categories of expenses at issue here. The FLSA defines "wage" to include both cash wages and "the reasonable cost … to the employer of furnishing such employee with board, lodging, or other facilities, if such board, lodging, or other facilities are customarily furnished by such employer to his employees." 29 U.S.C. § 203(m). In other words, when the employer pays for "board, lodging, or other facilities," it may add the costs of those facilities to the cash wage for purposes of complying with the FLSA minimum. The Department of Labor has stipulated that an employer may not count as "other facilities" goods or services that are "primarily for the benefit or convenience of the employer," 29 C.F.R. § 531.3(d)(1), and, as a corollary, has provided that employers may not pass along to employees expenses for such goods or services, 29 C.F.R. § 531.35. If an employer does pass along such an expense, then the expense is deducted from the cash wage to determine compliance with the FLSA minimum….
1. Transportation costs
… Rivera emphasizes the fact that, unlike an employer generally advertising a job opening, Brickman specifically directed its recruiting efforts to workers in Mexico and Guatemala by (1) participating in the H-2B program, and (2) hiring third-party recruiters based in Mexico and Guatemala to hire potential workers. To participate in the H-2B program, Brickman had to demonstrate to the Department of Labor that it was unable to find a sufficient number of suitable workers in the United States. Rivera argues that, under circumstances like these, in which an employer specifically directs its recruiting to remote points-of-hire because it cannot find suitable labor in its area, transportation is an expense that primarily benefits the employer. Indeed, assuming that Brickman and the Department of Labor correctly determined that there were not enough suitable workers in the United States, Brickman would have been unable to staff its operations had it not participated in the H-2B program and hired foreign workers….
I conclude that, in the context of this case, the cost of transportation from remote points-of-hire is "primarily for the benefit of the employer." That means that it was not permissible for Brickman to pass along to plaintiffs the costs of travel between the pointsof hire in the workers' home countries and the Brickman worksites to the extent that doing so reduced the plaintiffs' wages below the FLSA minimum.
2. Visa-related costs
The visa-related costs at issue here are various fees associated with obtaining a valid H-2B work visa.
The Arriaga court also considered this issue and concluded that because the visa costs arise directly and necessarily from the employer's decision to recruit guest workers, and because visa costs are not ordinary living expenses, the visa costs are primarily for the benefit of the employer. 305 F.3d at 1244….
Passport costs, however, are different. Unlike the cost of an employer-specific visa, which has but one use, a passport has more general use, and seems more like an ordinary living expense (similar to the cost of obtaining a non-commercial driver's license). Therefore, while I conclude that plaintiffs' expenses related to obtaining work visas were "primarily for the benefit of the employer," I exclude costs associated with obtaining passports of general use from that category.
3. Workers' representatives' fees
To recruit H-2B workers, Brickman hired third-party recruiters in Mexico and Guatemala to secure for them a suitable workforce. These recruiters found prospective employees by consulting firms that specialized in bringing together large cohorts of able-bodied workers and representing them in finding suitable foreign employment. These firms acted as the prospective workers' representatives in connecting the workers with Brickman. To prevent fraud, the government requires that H-2B employers designate which workers' representatives are authorized to represent their employees. According to Brickman's paperwork and responses to Rivera's statement of undisputed facts, Brickman authorized no more than one workers' representative per country in each year. Thus, it appears that prospective employees wishing to work for Brickman had little choice but to go through the Brickmandesignated workers' representative.
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