DOL Published Guidance on Overtime Pay for H-2B Workers

On December 7, 2021, the U.S. Department of Labor (DOL) published Field Assistance Bulletin (FAB) No. 2021-3 to help employers understand their overtime pay obligations toward employees working under an H-2B visa.

H-2B Visa Program

The H-2B nonimmigrant program permit employers to temporarily hire nonimmigrants to perform nonagricultural labor or services in the United States. The employment must be of a temporary nature for a limited period of time, such as a one-time occurrence, seasonal need, peakload need or intermittent need.

The program requires participating employers to comply with all applicable federal, state minimum wage and local wage payment laws when compensating H-2B workers. This obligation remains in effect throughout the entire period of the approved H-2B labor certification.

The H-2B program also establishes certain recruitment and displacement standards in order to protect similarly employed U.S. workers.

Action Steps

The DOL is the agency charged with enforcing H-2B program compliance.

Employers participating in this program should review FAB 2021-3 and become familiar with the agency’s role in overtime compliance enforcement and the guidelines outlined for the accurate disclosure of overtime wages under the program.

Overtime Pay Guidance

The H-2B program does not require but allows participating employers to make overtime hours available to workers. Employers that make overtime available to H-2B workers must include their overtime offer (including the overtime wages offered) in their job order.

Once overtime work is made available to H-2B workers, participating employers must comply with all applicable federal, state and local overtime payment laws. Generally, workers employed under the H-2B visa program are covered by the Fair Labor Standards Act (FLSA). The FLSA requires employers to pay nonexempt employees at least the federal minimum wage for every hour worked in a nonovertime workweek and overtime premium pay of at least 1 1/2 times the regular rate of pay for every hour worked over 40 in an overtime workweek.

However, employers should be aware that additional requirements may apply under state or local laws. For instance, federal, state and local laws may vary by the hour threshold at which overtime will be paid, the rate at which overtime will be paid, employer coverage and employee eligibility for overtime. When multiple overtime laws apply, employers must comply with the law that provides the greatest benefit to the worker.

Finally, employers must pay the wage offered to H-2B workers in the job order, including any offered overtime pay. These wages must be paid free and clear during the entire period covered by the Temporary Employment Certification application.

The DOL is authorized to pursue legal action and collect back wages due, liquidated damages and civil penalties for any unpaid wages.

Accurate Disclosure

H-2B program rules require participating employers to ensure that U.S. job applicants are fully informed of opportunities and benefits made available to H-2B visa workers, including the potential for overtime wages. In addition, employer must offer U.S. workers at least the same benefits, wages and working conditions they offer, intent to offer or will provide to H-2B workers.

FAB 2021-3 indicates that one of the reasons for this requirement is “to ensure that employers do not understate wages or benefits in the job order in an attempt to discourage U.S. workers from applying for the job.” Failure to provide an adequate disclosure may be considered impermissible preferential treatment and a violation of program rules. For this reason, the DOL may issue citations to employers that fail to disclose the benefits and working conditions offered to H-2B workers.

To avoid disclosure and preferential treatment issues, employers must include overtime hours and payment information in their job orders and in any other materials used to recruit U.S. workers. These disclosures must include the details pertaining to overtime rates, their applicability, and the hour thresholds at which overtime will be paid (when different from the requirements set by the FLSA).

Though rare, some employers may encounter situations where some H-2B workers change venues and become subject to different state or local laws (based on work location). In these situations, employers have an obligation to research and follow all applicable labor and employment laws in each area where their workers operate. Employers may consider the following sample disclosures for these situations. The DOL also recommends that employers should state whether there are no overtime obligations.

When overtime obligations differ between worksites, the DOL will determine the specific wage obligation and possible preferential treatment of H-2B workers by examining the disclosures made on the relevant documents and the overtime obligations required by applicable laws.

Sample Optional Disclosure Language

1. Example 1:
   • Scenario: Worksite in California. The employer is required to pay overtime by both the FLSA and California state law.
   • Disclosure language: “An overtime premium will be paid when required by federal, state or local law, including at time-and-a-half after eight hours in a day and for the first eight hours on the seventh consecutive day of work in a workweek; at double-time after 12 hours in a day and for all hours worked in excess of eight on the seventh consecutive day of work in a workweek; and at time-and-a-half after 40 hours in a workweek.”
2. Example 2:
   • Scenario: Worksites in Minnesota, Wisconsin and Illinois, with a different state overtime law applicable in each state. The employer is exempt from federal overtime provisions in all states under FLSA section 13(a)(3) because it is an amusement or recreational establishment and does not operate for more than seven months in any calendar year. However, Minnesota and Illinois overtime requirements contain no such exemption.
   • Disclosure language: “An overtime premium will be paid when required by federal, state or local law, including at time-and-a-half after 48 hours per week in Minnesota and time-and-a-half after 40 hours per week in Illinois. No overtime premium rate will be paid in Wisconsin.
3. Example 3:
   • Scenario: Worksite in Alabama, with no applicable state or local overtime law. The employer is exempt from federal overtime provisions in all states under the FLSA section 13(a)(3) because it is an amusement or recreational establishment and does not operate for more than seven months in any calendar year. There are no applicable state or local overtime laws. Therefore, the work is not covered by federal, state or local overtime laws.
   • Disclosure language: “No overtime premium will be paid, as it is not required under federal, state or local law.”

Sources: U.S. Department of Labor & Field Assistance Bulletin 2021-3