Major H-2A Wage Changes: Overview of New AEWR Methodology

By Lucas Smith and Richard Stup

(This post is lengthy and contains a table of important information, so it is best viewed on a computer screen rather than a phone screen.)

The United States Department of Labor (USDOL) released an Interim Final Rule (IFR) providing clarity as to how H-2A Adverse Effect Wage Rates (AEWR) will be set in the aftermath of the 2023 USDOL methodology being thrown out in court. The IFR took effect on October 2, 2025 and AEWRs will now be established by USDOL based on state-level wage data from the Bureau of Labor Statistics’ Occupational Employment and Wage Statistics (OEWS) instead of the Farm Labor Survey (FLS) which previously guided the setting of regional AEWRs. A public comment period on the IFR is open for 60 days until Dec. 1, 2025.

The new methodology only applies to new job orders filed on or after October 2, 2025 and employers may not adjust contract wages that have already been certified mid-contract since these changes revise wages downward. For additional insights on the new Methodology, see this post from Fisher Phillips: DOL Issues Game-Changer Rule for H-2A Farmworker Wages: 8 Key Takeaways for Agricultural Employers

The changes described here are significant and will likely change further based on public comments and anticipated lawsuits challenging the IFR. Key provisions of the change and how they apply to NYS are summarized below:

New Adverse Effect Wage Rates

The new methodology includes an “Entry-Level Skill Level I” and “Experience-Level Skill Level II” wage rate that allows the AEWR to vary based on skill levels and duties required in the job. The NYS AEWR figures represent a decline from the current $18.83 per hour AEWR. Additionally, employers will be able to apply a downward Adverse Compensation Adjustment, this is essentially an adjustment for H-2A housing costs and is explained in more detail below.

Table 1 shows the combined AEWR schedule for the five most common field and livestock worker standard occupational classification (SOC) codes for NYS and other major H-2A utilizing states.

Table 1. Effects of H-2A Interim Final Rule on Wages in Selected States

[1] An agricultural exemption may apply allowing a reduced wage rate to be paid.

[2] A possible agricultural exemption to the state minimum wage laws may apply and allow the lower $12.46 AEWR to be paid.

[3] An agricultural exemption may apply and allow a reduced wage rate to be paid. https://www.lni.wa.gov/workers-rights/agriculture-policies/wages

The “Big Five” SOC Codes

The new “Big Five” SOC Codes for H-2A are as follows: Farmworkers and Laborers, Crop, Nursery and Greenhouse Workers (45-2092); Farmworkers, Farm, Ranch, and Aquacultural Animals (45-2093); Agricultural Equipment Operators (45-2091); Packers and Packagers, Hand (53-7064); Graders and Sorters, Agricultural Products (45-2041). All five of these SOC codes will follow the combined AEWR schedule in Table 1.

The “All Other Agricultural Workers (45-2099)” SOC code previously included in the “Big Six” from 2023 is no longer included in the new “Big Five” and instead will have its own SOC-specific AEWR. The new SOC-specific AEWR rates for non-range jobs outside of the “Big Five” can be found at:

Implications of this change are not clear regarding jobs outside of the “Big Five” such as heavy truck drivers, construction work, shuttle driving, supervisors, and mechanic work. These categories of workers created significant confusion and cost under the previous 2023 Final Rule because they were often paid higher wage rates based on OEWS data, and had to be handled under separate H-2A contracts. The IFR continues to be ambiguous about how H-2A jobs that fall fully or partially, outside the “Big Five” will be treated. Many of these details will need to be clarified in coming weeks and months.

For additional information on AEWR rates nationwide, see 2025 IFR: AEWR Methodology for the Temporary Employment of H-2A Nonimmigrants in Non-Range Occupations in the United States from the National Council of Agricultural Employers.

NYS Minimum Wage Considerations

Although AEWRs have historically exceeded state minimum wages, some new AEWR rates now fall below state minimum wage rates. USDOL regulations require that H-2A contract wages be based on the highest of the following options: AEWR, a collectively bargained rate, federal minimum wage, or state minimum wage. For most NYS employers this means that the state minimum wage rate will be the floor for “Big Five” Level I jobs. For “Big Five” Level II jobs, however, the new AEWR with Adverse Compensation Adjustment will be $16.35 per hour, so it will be required in upstate NY where the state minimum wage will be $16 in 2026, but in NYC/Long Island/Westchester County the state minimum wage will be higher at $17.00 so $17.00 per hour will be required for “Big Five” Level II jobs in that region.

Skill Levels

Below is a summary of what is known regarding the new Skill Level I and Skill Level II determination factors, though uncertainty remains as to how these factors will be applied in determining the skill level assigned to a contract.

Factors Considered for a Skill Level I position:

• No formal education or training required
• No or very little work experience (0-2 months) necessary or several weeks of on-the-job training required
• Instructions given from a supervisor
• Work “closely monitored, tracked, and assessed for quality, accuracy, and production results”

Factors Considered for a Skill Level II position:

• Education, training, experience, knowledge or skills are necessary to perform the full job duties of the SOC code.
• Work experience (3+ months) required
• A demonstration on how to perform their job is not generally required
• May be assigned to more complex tasks
• Work may not be as closely monitored

The determination of what Skill Level a job order falls under is up to the certifying officer (CO), as has been the case with what SOC code a job is coded under. Additionally, the determination of Skill Level for a job order is based on the minimum qualifications necessary to perform a job, not on the experience of the actual employees that will fill the job order.

Employers will need to pay careful attention to the language used in job descriptions in H-2A job orders in order to secure enough workers in appropriate job classifications and skill levels. Key words and phrases borrowed directly from the government’s job code and skill level descriptions can help guide DOL certifying officers to make decisions that employers want.

Adverse Compensation Adjustment

The IFR allows for an “H-2A Adverse Compensation Adjustment” for H-2A employers providing housing at no cost to H-2A employees to account for the value of this non-monetary compensation benefit. For NYS, the Adverse Compensation Adjustment is $2.40. This means that an H-2A wage offer can be no less than NYS Minimum Wage ($16.00 in upstate and $17.00 in Long Island/NYC/Westchester County beginning in 2026) for Skill Level I and $16.35 for Skill Level II (or $17.00 in Long Island/NYC/Westchester County beginning in 2026).

The Adverse Compensation Adjustment is applied at the time of filing a contract, only applies to H-2A employees, and is not considered a payroll deduction. Domestic workers in corresponding employment will be subject to higher rates of the NYS Minimum Wage ($16.00 in upstate and $17.00 in Long Island/NYC/Westchester County) for Skill Level I and $18.75 per hour for Skill Level II. Additionally, the Adverse Compensation Adjustment may not be applied to reduce the compensation of H-2A workers below the state minimum wage.

The downward adjustment will be set annually as the “equivalent hourly rate based on the weighted statewide average of Fair Market Rents (FMRs) for a four-bedroom housing unit available from the Department of Housing and Urban Development (HUD).”

SOC Code Assignment

The determination of what SOC code will apply will be based on a “majority duties standard.” There remains uncertainty as to how SOC code assignment under this standard will work but relevant sections from the IFR are provided below:

The NYS Department of Labor and the Certifying Officer “will determine the appropriate SOC code(s) based on the duties performed for the majority (meaning more than 50 percent) of the workdays during the contract period, including those duties closely and directly related, and qualifications contained in the employer’s job offer.” “When the employer identifies on the H-2A job order (Form ETA-790A) the duties that it expects workers to perform for the majority of the workdays during the contract period. . . [NYSDOL and the Certifying Officer] will assess such duties and, in combination with any necessary job qualifications, assign the SOC code that best represents the employer’s job opportunity.”

“To implement this new standard, the Department will provide guidance in the form of frequently asked questions that can help employers understand how to use the existing the H-2A job order form to specify the majority duties, including those closely and directly related duties, and then distinguish those from other duties that the worker(s) are expected to perform during the period of employment.”

Similar to Skill Level assignment, employers will need to pay careful attention to the language used in job descriptions in H-2A job orders. Employers should review the FAQ DOL intends to provide as soon as it becomes available and incorporate references to the FAQ into job orders.

Announcement of New AEWRs and Adverse Compensation Adjustments

The announcement of new AEWRs which previously happened at two points throughout the year will now be consolidated to one announcement of new AEWRs around the end of May to early June with an effective date of July 1 each year. The Adverse Compensation Adjustment will also be announced around that same time each year.

As has been the case in the past, if the AEWR goes down on July 1 from the previous year, the previously certified rate continues to be required for contracts that were already certified. If the AEWR goes up on July 1, already certified contracts will be required to adjust pay to the higher wage even if this results in an increase mid-contract.

The next AEWR update is expected to take effect on July 1, 2026 though employers should also be aware of changes to the NYS minimum wage expected to be announced annually in late fall and take effect on January 1 every year. NYSDOL has written “beginning in 2027, the minimum wage will annually increase by the three-year moving average of the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) for the Northeast Region.” Where the state minimum wage exceeds the Skill Level I or II AEWR for domestic and H-2A employees, the state minimum wage will be the minimum wage rate required for a job order over the lower AEWR.

Final Thoughts

These changes to the AEWR H-2A methodology are significant and will require H-2A applicants pay close attention to new developments especially as the start of new job order filings approach. Applicants need to be careful about how they craft job orders for H-2A positions and monitor any guidance released from USDOL. Additionally, it is expected there will be significant litigation surrounding the IFR and it is possible that additional changes will be made by USDOL in the coming months.

By Lucas Smith and Richard Stup, Cornell University. Permission granted to repost, quote, and reprint with author attribution.
The post Major H-2A Wage Changes: Overview of New AEWR Methodology appeared in The Ag Workforce Journal.