The United Farm Workers (UFW) and affiliated plaintiffs have filed suit in federal court to block the U.S. Department of Labor’s (DOL) October 2025 Interim Final Rule (IFR) updating how Adverse Effect Wage Rates (AEWR) are calculated for non-range H-2A occupations.
The IFR replaces the USDA’s Farm Labor Survey (FLS) – long criticized for inflating wage benchmarks – with a more nuanced, occupation-based system that uses data from the Bureau of Labor Statistics’ Occupational Employment and Wage Statistics (OEWS). The new approach differentiates between basic and more advanced agricultural roles and accounts for the housing value already provided to H-2A workers at no cost, bringing long-overdue balance and economic rationality to H-2A wage determinations.
Predictably, the UFW is attacking the IFR in court, alleging that it undercuts domestic wages and violates procedural rules. But these claims ignore a key fact: the IFR simply reins in artificially high wage escalations that far exceed local market conditions and force employers to pay well above competitive rates for positions with modest skill requirements. By setting AEWRs at the 17th and 50th wage percentiles for Skill Level I and II jobs respectively, the rule introduces a fairer standard that aligns more closely with actual labor costs.
The lawsuit also criticizes a “housing deduction” used in calculating total compensation, despite the fact that providing free housing is a federal mandate under the program and the deduction may not be applied to domestic workers.
What This Means for Employers
If successful, the UFW’s lawsuit could restore an inflationary and unrepresentative wage system that imposes unjustified labor costs on agricultural producers already facing economic pressure from inflation, regulatory burdens, and labor shortages.
The IFR is a welcome, evidence-based correction that helps level the playing field and preserve access to legal foreign labor. H-2A employers should continue to follow the current rule but remain alert; if the courts side with the plaintiffs, it could mean mid-season wage hikes and renewed uncertainty.
For questions about the lawsuit or the Interim Final Rule, contact the Western Growers H-2A Services team.