Federal Court Orders DOL to Replace H-2A Wage Methodology

September 3, 2026 Update — The U.S. Department of Labor has notified H-2A employers that, while no back wage payments are currently required, some employers may face future wage adjustment obligations once a new H-2A AEWR methodology and wage rates are issued.

• On September 2, 206, the U.S. Department of Labor issued a notice to H-2A employers regarding the court ruling on the H-2A proposed rule changes.
• On August 27, 2926, a federal court ruled that the Department of Labor’s H-2A wage rule unlawfully reduced wages for agricultural workers and ordered the agency to develop a new wage-setting methodology.  

DOL Issues Employer Notice on Potential Future Wage Adjustments 

On September 2, 2026, the U.S. Department of Labor’s (DOL) Office of Foreign Labor Certification (OFLC) issued a notice in response to the federal court’s August 26, 2026, order in United Farm Workers, et al. v. DOL et al. 

The notice advises employers that they may need to make wage adjustment payments in the future if the Department of Labor (DOL) issues new Adverse Effect Wage Rates (AEWRs) under a revised methodology and those rates exceed the wages employers paid during the affected period.

Importantly, DOL emphasized that:

• Employers are not currently required to make back wage payments.
• Employers must continue to comply with the existing AEWRs currently in effect.
• Future court decisions and the publication of new AEWRs will determine whether employers must make any wage adjustments.
• If required, the adjustment period would begin on September 2, 2026, and continue until DOL publishes new AEWRs under a replacement methodology.

The notice applies to employers with active H-2A certifications, pending H-2A applications and new H-2A applications filed before DOL implements a revised AEWR methodology.

DOL also reminded employers to maintain accurate records for both H-2A workers and corresponding U.S. workers, including contact and identifying information, in case future action becomes necessary.

Court Orders DOL to Replace H-2A Wage Methodology 

A federal district court in California has ruled that the U.S. Department of Labor’s (DOL) H-2A wage rule is unlawful and directed the agency to develop new wage standards for temporary agricultural workers. While the current rule may remain in effect temporarily, DOL must create a replacement methodology that complies with federal law.  

Background 

The case challenged a 2025 DOL interim final rule that changed how the Adverse Effect Wage Rate (AEWR), the minimum wage employers must generally pay H-2A workers, is calculated. Farmworker advocates argued that the rule lowered wages for both H-2A workers and similarly employed U.S. workers, contrary to the requirements of the H-2A program.  

According to the plaintiffs, the rule reduced wages by as much as $7 per hour in certain states and shifted billions of dollars in wages from workers to employers. 

Court’s Decision 

On Aug. 26, 2026, U.S. District Judge Kirk E. Sherriff concluded that DOL failed to adequately demonstrate that the revised wage methodology would satisfy its statutory obligation to ensure that the employment of H-2A workers does not adversely affect the wages and working conditions of U.S. workers. The court found key portions of the rule to be arbitrary and capricious under the Administrative Procedure Act.  

Rather than immediately vacating the rule, the court allowed it to remain temporarily in effect to avoid disruption to the agricultural labor market while DOL develops a replacement methodology.  

What’s Next? 

Under the court’s order, DOL must promptly establish a new wage-setting methodology consistent with the ruling. The agency must also notify employers that they could face back-pay obligations if newly established wage rates exceed the wages currently being paid under the existing rule.  

It remains unclear whether the government will appeal the decision. 

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