Hotels feel the labor pinch with H-2B in flux
08 APRIL 2015 7:33 AM
The fate of the H-2B visa program, an important pipeline of seasonal workers for many hotels, awaits a joint final rule after a court decision rendered 2008 regulations moot.
REPORT FROM THE U.S.—The U.S. Department of Labor’s H-2B visa program, which provides a crucial pipeline of seasonal workers for many hotels, is in a state of flux, with a wave of litigation threatening to shut it down for good.
Hoteliers were treated to a sneak preview of such consequences when the DOL on 5 March announced that it would no longer accept or process H-2B visa requests.
After a grassroots lobbying effort by the hotel industry as well as labor-intensive sectors that use the program, a judge issued a stay on 18 March allowing the DOL to continue processing applications until 15 April.
The long-running H-2B program allows businesses that need non-agriculture, temporary, seasonal workers to hire them from outside of the United States. In addition to the hotel industry, sectors that commonly use these seasonal workers include landscaping, restaurants that serve large seasonal populations and others.
According to Brian Crawford, VP of government and political affairs for the American Hotel & Lodging Association in Washington, D.C., 66,000 temporary worker visas were issued last year. It is unknown how many of those were issued in the hotel industry, but Crawford said the number is “significant.”
The Broadmoor Hotel, which is one of the largest employers in Colorado Springs, Colorado, employs 215 H-2B workers each year during its busy season that runs April through November. That number represents more than 10% of its 2,000 total employees.
“Losing 10% of our workforce would have been devastating,” said Jack Damioli, president and CEO of The Broadmoor. “If we couldn’t have gotten those workers, we would have had to figure out something, a great deal of training goes into preparing our employees to work at a five-star, five-diamond hotel.”
Damioli said most of the seasonal workers return each year.
The source of the struggle
Crawford said the problems with the decades-old program began in 2008 when the DOL issued new regulations designed to afford more protections to the rights of workers, which some workers’ advocates considered weak and regressive. Additional regulations were issues in 2011 and again in 2012.
Several workers’ rights lawsuits followed, including Perez v. Perez, in which a Florida federal district court on 4 March ruled that the DOL lacks authority to issue any regulations regarding the H-2B program.
The DOL responded on 5 March by halting activities that kept the program running, thus suspending the processing of requests for H-2B visas.
Crawford said the ruling did not require the DOL to act; it merely vacated the 2008 regulations. The DOL could have continued to process visa applications as normal but instead suspended processing altogether, he explained.
A letter-writing and lobbying campaign to lawmakers followed the announcement to get the program up and running—now and for the long term, said Crawford, who also chairs the H-2B Workforce Coalition, which has member representatives from several industries.
The DOL filed a motion to stay the federal court’s order until 15 April. On 18 March, the court granted the motion and stayed its injunction, stating, “given that there are numerous United States employers who rely on the H-2B program to fill their temporary labor needs, the Court agrees that the requested temporary relief is warranted.”
Damioli said that it wasn’t just that the DOL said it would stop processing applications, it was that they did it so suddenly and before all of the applications for the high spring and summer season had been processed.
"The fact that it just came out of the blue was shocking,” he said.
Crawford said that at the time of the announcement, approximately 18,000 of the 33,000 visa applications allotted during the six-month period beginning 1 April had not been granted. It was unknown how many of those were in the hotel and lodging industry, he said, or how many were still waiting in what has become a log jam of applications due to the nearly two weeks applications weren’t being processed.
The Beachmere Inn in Ogunquit, Maine, is one of the hotels still waiting on word for its applications. The inn filed for six workers on 27 February and also paid the premium processing fee to ensure the applications would be handled on time.
“I’m starting to get worried. When this has happened before, we’ve had problems with embassy delays on Jamaica,” said Sarah Diment, whose family has owned the inn for 78 years. “We need people here by 15 May, which is Victoria Day weekend, when we get a lot of clients from Canada.”
The inn has used H-2B seasonal workers for years, the majority of whom return year after year. The 73-room inn has 22 employees and hires five to six H-2B workers to help them with the large tourist influx during the summer months. The Beachmere is located in a small town in a huge recreational region that has approximately 15,000 hotel rooms and 6,000 restaurants.
Diment said that even with offering compensation above minimum wage, there is still no way to get the seasonal workers her industry needs in that region without drawing from the H-2B program. However, if they aren’t able to get those workers, she said, it could cost her inn up to $1,500 a night when part of it would have to be shut down.
“There comes a point in the season, though, when we are booked up and would have to open those rooms, which means everyone, including management, would have to work harder and longer hours to meet our guest’s needs,” Diment said.
The future of H-2B
What happens after the 15 April court stay is anyone’s guess, Crawford said. He said the problems were unnecessary and politically motivated.
“Anytime something becomes a part of constant litigation, there is a fear of it shutting down,” Crawford said. “The long-term viability of the program is in question.”
The cost to the industry of losing such a program would be huge, he said.
DOL and the Department of Homeland Security, which is involved in the program, intend to issue a joint interim final rule by 30 April, which is supposed to be consistent with the Florida federal court’s decision.
“We’re anxiously awaiting the next step with everyone else,” Damioli said.
The DOL did not respond to requests for an interview for this report.