October 2025
Garza Labor enthusiastically welcomes the Department of Labor’s (DOL) new interim final rule for the Adverse Effect Wage Rate (AEWR), which institutes a revised, more equitable methodology for calculating H-2A guestworker wages. This change is a watershed moment for American agriculture, directly addressing the escalating labor costs that have threatened the financial viability of our nation’s farms for years.
As an organization dedicated to providing essential, reliable labor solutions to growers, Garza Labor has long advocated for an AEWR that recognizes the full economic reality of hiring an H-2A workforce. The previous wage methodology, which resulted in unsustainably high rates, acted as a significant barrier for many small and mid-sized producers.
Our Position is Clear: This Rule Is a Game-Changer.
1. Lower Labor Costs Unlock the H-2A Program
The key element of this rule is the introduction of the Adverse Compensation Adjustment (ACA), which for the first time, provides a critical deduction to the AEWR to account for the substantial, employer-mandated cost of providing free housing and utilities to H-2A workers. This, combined with the shift to the OEWS data source and tiered wage structure, translates into an immediate and essential reduction in the effective hourly labor cost for the vast majority of our clients.
- For Current H-2A Users: These savings can be reinvested directly into farm infrastructure, technology, or managing other rising input costs, boosting competitiveness.
- For Prospective H-2A Users: The lower rate breaks the financial barrier to entry, making the stability and reliability of the H-2A program finally accessible to growers who previously could not afford it. We are committed to onboarding these new users effectively.
2. A More Balanced and Sustainable Program
This new methodology creates a more sustainable and balanced framework for the H-2A program. By recognizing the non-wage costs employers bear, the rule creates a wage floor that is fair to both domestic workers (who must still be paid the highest applicable rate, which may be the state minimum wage) and the employers struggling to remain solvent. This is a critical step toward ensuring a domestic food supply that is both stable and affordable for consumers.
3. Garza Labor is Prepared to Lead
While initial reports suggest temporary uncertainties due to administrative issues at the DOL, Garza Labor is fully prepared to navigate this new landscape. Our commitment is to immediately assist our clients—new and existing—in optimizing their job orders under the new tiered (Skill I and Skill II) wage structure to maximize the cost relief provided by the ACA.
Conclusion:
This decision is a decisive victory for the financial stability of the American farmer. Garza Labor is excited to see our industry enter a new era of labor affordability and stability. We are ready to partner with every grower to seize this opportunity and secure the reliable workforce needed for a successful future.
Garza Labor
