Harvesting the fruits of labor with the H-2A program

For many people, fruits and vegetables are part of their daily lives. Whether they’re eating them for health reasons or pure enjoyment, accessibility is key. While there are many ways to get fruits and vegetables, the most convenient option is the grocery store. Aside from deciding what’s ripe or looks the best, most shoppers don’t think about how their produce reaches them.

A lot happens before the product gets to stores. Most farms in the United States use laborers to harvest produce. However, according to NPR, finding workers is becoming difficult because farmworkers are getting older, and their children aren’t interested in continuing the tradition. This leaves farmers looking for a solution, especially during harvest season.

The Department of Labor created the H-2A temporary agricultural program, also known as the H-2A visa program, to address the issue. The program allows U.S. farmers to find seasonal workers from other countries for typically no more than a year.

While the H-2A visa program solves short-term labor problems, it can create business challenges. Let’s examine the program, its challenges for the tree fruit industry, and how your organization can prepare.

The H-2A program and the tree fruit industry

Fruit picking takes skill and experience and is often physically demanding. For this reason, this sector is suffering a decline in workers compared to other agribusinesses. Tree fruit growers rely more on the program because they require a sizeable workforce.  

Between 2017 and 2022, annual average crop production employment dropped by 1.4%, and apple orchard employment experienced a 22% decrease.

One company taking advantage of the H-2A program is Washington Fruit Administrative Services II, Inc. (WFAS) and Washington Fruit & Produce Co. The family owned company has operated for over 100 years and harvests, packs, and ships apples, cherries, and pears. WFAS’ Director of Human Resources and H-2A program Katherine Taiclet states, “If you look at workforce management in agriculture, the nature of the industry necessitates a seasonal workforce resulting in a constant cycle of hiring and training that increases operational costs and [disrupted] productivity.” The H-2A program helps them find workers during heavy periods that involve picking and pruning.

Many U.S. agriculture organizations participate in the program. In 2022, the Department of Labor certified nearly 370,000 temporary jobs, seven times more than in 2005 and double the amount in 2016. In Washington, requests for H-2A visa agricultural workers have increased by about 1,700% since 2009. WFAS has also increased its use of H-2A workers. The company went from 200 H-2A workers when it joined the program in 2013 to nearly 1,500 today.

Katherine notes the “H-2A [program] affords us a reliable workforce. It's critical in the absence of sufficient domestic workers. This consistency has remained vital for productivity during peak seasons and ensuring timely completion of essential tasks.” The program allows workers to receive a steady—yet temporary—well-paying job with benefits like housing and transportation.

Despite the benefits, the program has a few complexities that agriculture organizations should consider.

H-2A program challenges

Most programs have pros and cons, and the H-2A program is no exception. The biggest challenge is cost. Under the program, organizations must pay for H-2A worker’s transportation and housing. Other costs include meals unless housing provides facilities for occupants to prepare their own.

Domestic workers don’t typically require housing and transportation, so providing these benefits for foreign workers can impact insurance costs. When insurance carriers examine a grower that transports a large group of H-2A workers, it can signal a huge potential loss if a major accident occurs. Companies may experience insurance premium increases for auto insurance and workers’ compensation (if available in the state).

Transportation insurance is another cost. Companies must take workers into town at least once a week to grocery shop, and they might also take them to fields or orchards. Not every carrier offers the same coverage for buses and vans, so the transportation method may affect obtaining coverage. It’s essential to know what carriers will cover before joining the program.

Another significant cost is the Adverse Effect Wage Rate (AEWR). AEWR was derived from the Department of Labor’s Farm Labor Survey to designate the minimum compensation rate for H-2A workers. USApple’s 2023 Outlook report shows that the average AEWR has increased by 33% to $16.17 per hour over the last five years. The highest AEWRs are in the West, with California ranking the highest at $19.75 and Washington and Oregon at $19.25. Michigan’s rate is $18.50, and New York’s is $17.80. Apple growers are paying well above the national AEWR average of $16.62.

The AEWR aims to provide livable wages and working conditions to H-2A workers. However, the issue is that the rate is a broad result based on an industry with variations in laborer pay. For example, the same state can grow both apples and cherries. Cherries are delicate and have a shorter season. Cherry pickers are under strict constraints to harvest and prepare the fruit for distribution or storage. Because of these factors, cherry pickers often receive incentive pay and bonuses. Nevertheless, the AEWR compiles these and other industry stats to form one number that benefits some growers while hurting others.

The base rate is also not separated from the gross wage. Workers can receive bonuses or incentives to expedite the harvest. AEWR includes all income, and the base wage rate is inaccurately reported. The following year’s base wage increases and the repeated process escalates.

USApple’s Senior Vice President Diane Kurrle compares the AEWR to the pay for a bartender. When examining the base pay, the rate is how much a bar directly pays a bartender. Through the AEWR standards, all tips and outlying days, such as New Year’s Eve, are factored in, inflating a bar tender’s base pay.

The Department of Labor, the Department of State, and the U.S. Citizenship and Immigration Services oversee the program. However, state workforce agencies act as gatekeepers to confirm domestic workers are unavailable. Once approved, a grower follows the requirements of the federal agencies. All entities monitor everything from the vehicles H-2A workers ride in, to the various job codes associated with hiring bus or shuttle drivers. Following state and national regulations adds another layer of complexity.

Katherine notes that multiple regulatory oversight from different parties can “…create communications discrepancies and regulatory red tape.” A recent Department of Labor final rule on H-2A worker protections was enacted on June 28, 2024. Diane adds, “It added more regulatory complexity, created more opportunities for litigation, and gave unions increased access to farms and farmworker housing.”

How to make the most of the H-2A program

Understanding the intricacies of the H-2A program can help you use it to your advantage.

While some aspects may be unnecessarily complex, Katherine finds value in the program. She says, “It’s definitely essential. We could not operate without [the] H-2A program.” Katherine notes that besides working with specific associations, having an industry partner like Marsh McLennan Agency that provides protective insights is also valuable.

Our agriculture specialists help growers find clarity in a messy web of regulatory oversight. Our team offers a variety of insurance support that includes:

• Compliance assistance through the facilitation of certificates of liability 
• Conversations about the use of buses, vans, and other vehicles 
• Driver training and compliance 
• Insights on housing and other compliance requirements required by state and national entities 

Whether you’re already in the program or considering it, our agriculture specialists are ready to help.