Even before the Covid-19 pandemic exacerbated hiring challenges, seasonal employers struggled to find enough temporary workers to meet their labor needs. One saving grace has often been the Temporary Non-Agricultural Worker H-2B program, which provides 66,000 visas per year to seasonal nonfarm employers such as landscapers, fisheries and resorts. While H-2Bs can be a great resource for workers, buyers must do their homework and consult with legal advisors to avoid potential pitfalls.

The following is a list of violations and court rulings related to H-2Bs.

Pandemic-related labor shortages not a qualifier. Labor shortages resulting from the Covid-19 pandemic do not justify the hiring of H-2B temporary workers because they do not qualify as a “one-time occurrence,” the US Department of Labor ruled last month. Given that the Covid-19 pandemic continues with no definable end-date, the department determined that the pandemic does not qualify as a one-time occurrence under the H-2B program.

Carl C. Risch and John Corgan of law firm Mayer Brown discussed the ruling in a Mondaq.com blog post.

Before hiring an H-2B worker, the employer must demonstrate that a “temporary” need for foreign workers exists due to a one-time occurrence, the seasonal nature of the business, a short-term spike in demand (i.e., a peak load), or the intermittent nature of the work.

In this case, the US employer — Tofte General Store — argued that the Covid-19 pandemic is a “one-time occurrence” causing severe but temporary shortages in the local labor market that required the company to hire H-2B workers to stock shelves and run cash registers.

The Labor Department, however, said that labor shortages alone do not justify a finding that an employer’s need for workers is temporary in nature. Instead, the US employer must demonstrate that the need for temporary foreign workers will end in the “near, definable future.”

Cooler production company settles immigration-related discrimination claims. The US Department of Justice announced a settlement with Igloo Products Corp., resolving its claims that the producer of coolers, jugs and hydration products reserved certain positions for workers with H-2B visas. The department had alleged that Igloo, based in Katy, Texas, failed to consider US applicants for seasonal production helper positions because the company assumed that US workers would not be interested in temporary seasonal employment.

Under the Immigration and Nationality Act, employers generally cannot discriminate based on citizenship, immigration status or national origin at any stage of the hiring process. In addition, the Department of Labor requires employers seeking permission to hire H-2B workers to first hire all qualified and available US workers who apply by the relevant deadline.

Under the terms of the settlement agreement, Igloo will pay $21,000 in civil penalties to the US and will make $40,000 in back pay available to eligible victims of discrimination. Igloo will also change its policies and procedures to comply with the INA’s anti-discrimination provision, train its employees on the requirements of the law, undertake additional recruitment efforts before seeking H-2B visas in the future, and be subject to monitoring for a three-year period to ensure the company is complying with the agreement.

Seafood processor sentenced for federal visa fraud that resulted in H-2B visa holders receiving lower wages than they were entitled to. Capt. Phip’s Seafood Inc., a Maryland seafood processor, was sentenced on Nov. 23 to three years’ probation and a $240,000 fine for underpaying its H-2B visa workers by having them perform work outside the scope of their visas. In addition, US District Judge Ellen Hollander sentenced owner Phillip J. “Jamie” Harrington III, of Dorchester, Maryland, to one year of probation, to pay a $10,000 fine, a $5,000 special assessment, and to perform 100 hours of community service for knowingly hiring approximately 89 undocumented foreign workers to work at other businesses controlled by Harrington Cos.

Judge Hollander also ordered Harrington and Captain Phip’s Seafood to participate in a verification program for their employees and debarred them from participating in the H-2B visa program.

According to the company’s Sept. 14 guilty plea, Captain Phip’s Seafood from 2013 through 2018 routinely sought prevailing wage determinations for multiple job descriptions, and then filed petitions for H-2B visas for only the jobs with the lowest prevailing wage, regardless of the actual work duties of the employees. For example, Capt. Phip’s in 2016 secured 24 H-2B visas for non-immigrant Mexican nationals authorizing them to work for Capt. Phip’s Seafood as ice production workers in the US with a prevailing wage of $11.10. However, once the Mexican workers entered the US, the company used them for jobs beyond ice production — including for oyster processing and as maintenance workers, truck drivers and drivers’ assistants — which would have required a higher wage.

In its plea agreement, Capt. Phip’s admitted that it intentionally and falsely claimed that the foreign workers would only be engaged in ice production in order to pay them the lower prevailing wage. Had Capt. Phip’s truthfully filed for H-2B visas for many of these duties, these employees would have been entitled to a higher wage.

Between approximately 2013 and 2018, Capt. Phip’s filed petitions for H-2B visas for approximately 142 nonimmigrant workers. However, the company has not participated in the H-2B visa program since at least January 2019.