Legal Affairs Counsel’s Corner: California’s $20.46 Wage Floor, USCIS Extensions, and the AEWR Deadline

Breaking Down California’s New Agricultural Wage Law: Higher Wages, Broader Coverage Questions

California agricultural employers preparing for 2027 face two connected challenges: implementing a higher minimum wage and determining which domestic workers qualify for it. Under newly enacted AB 2646, exposure could extend beyond an employer’s H-2A crew - and beyond the work sites listed in its H-2A job order.

The law establishes a $19.75 base hourly minimum for covered workers and requires annual Social Security cost-of-living adjustments beginning January 1, 2027. Applying the announced 3.6% COLA would will likely result in a new calculated rate of $20.46 per hour, rounded to the nearest cent (i.e. $19.75 × 1.036 = $20.461). Employers should budget for this adjusted amount and confirm California’s published rate and rounding guidance before implementation. AB 2646, SSA’s COLA announcement

The adjusted California minimum remains a floor. For covered non-range occupations, federal regulations require employers to offer, advertise, and pay the highest applicable rate among the AEWR, qualifying prevailing wage, agreed collective bargaining wage, federal minimum, state minimum, and any other wage the employer intends to pay. Wages paid also cannot fall below those guaranteed in the job order. 20 C.F.R. § 655.120(a), 20 C.F.R. § 655.122(l)

Federal H-2A rules also expressly require compliance with applicable state law. Under 20 C.F.R. § 655.135(e), during the employment period covered by the temporary labor certification, the employer must “comply with all applicable federal, state, and local laws and regulations, including health and safety laws.” California’s new agricultural minimum wage therefore also implicates the employer’s federal H-2A compliance obligations wherever the state requirement applies. An approved H-2A job order does not excuse paying less than the applicable California minimum. 20 C.F.R. § 655.135(e) 

Which Domestic Workers Qualify?

AB 2646 covers “approved agricultural employees,” generally understood to include H-2A workers. It also covers California-resident agricultural employees performing the same or substantially similar work during the same period, for the same employer, in the same county. That language creates potential coverage beyond workers assigned to the same field or crew. AB 2646

Employers should assess state and federal coverage separately. Under 20 C.F.R. § 655.103(b), corresponding employment encompasses employment of non-H-2A workers by an employer with an approved temporary labor certification in:

“any work included in the job order, or in any agricultural work performed by the H-2A workers.”

The regulation requires that work occur during the job order’s validity period, including approved extensions. The federal definition thus reaches both listed job-order work and agricultural work actually performed by H-2A workers. 20 C.F.R. § 655.103(b). DOL’s longstanding position on corresponding employment in the seminal case of Overdevest Nurseries requires H-2A employers to pay domestic workers at least the same wage rate paid to H-2A workers for any time that the domestic worker engages in the same type of work being performed by H-2A workers, which even extends to the situation where the job duties are outside the scope of those contained in the underlying job order certified by DOL. 

California’s separate definition introduces a “substantially similar” comparison. A domestic position’s absence from the job order therefore does not resolve the state-law question. AB 2646 does not define “substantially similar,” leaving employers to guess as to the scope of the new wage requirements for the time being. 

AB 2646 incorporates the Agricultural Labor Relations Act’s definition of “agricultural employer.” That definition treats the employer engaging a farm labor contractor as the employer for ALRA purposes. Its incorporation raises questions about comparing workers supplied to the same grower by different contractors. Employers should not assume separate contractor payrolls automatically prevent those workers from being considered employed by the same agricultural employer. AB 2646, ALRB discussion of the employer definition

What could an incorrect decision cost? 

Suppose 20 domestic harvesters receive $17.40 per hour for 40 straight-time hours each week over eight weeks, but are later found entitled to $20.46. The wage shortfall alone would be: 20 workers × 40 hours × 8 weeks × $3.06 = $19,584.

This illustration excludes overtime, interest, damages, penalties, and other potential costs. California’s general statewide minimum will be $17.40 in 2027; paying that rate does not satisfy a higher industry-specific requirement when it applies. California DIR announcement

Key Takeaways for CA Employers

An incorrect coverage decision can repeat across workers and pay periods, creating claims for unpaid wages and related damages and penalties. Willful failure to pay all wages due at separation may also trigger waiting-time penalties. Existing client-employer liability rules can create additional exposure when labor contractors are involved. For H-2A employers, these state-law risks sit alongside the federal assurance to comply with applicable laws. California minimum-wage guidance, waiting-time penalties, client-employer liability rules, 20 C.F.R. § 655.135(e)

This is yet another instance of concerted efforts by state legislatures in California and Washington to nullify the regulatory changes rolled out by the Trump administrations benefitting H-2A employers. 

USCIS Issues New Proposed Rule Removing Deference Given to Prior Visa Approvals: What H-2A Employers Need to Know

Background and Current Policy

USCIS has issued a Notice of Proposed Rule Making (NPRM) that would end required deference to prior eligibility determinations when reviewing I-129 petitions. The policy has shifted with presidential administrations: the Trump 1.0 administration rescinded the longstanding guidance in 2017, the Biden administration reinstated it in 2021 and codified it in 2024, and the Trump 2.0 administration now seeks to remove it. Current policy generally requires deference when the petitioner, workers, and underlying facts remain the same, unless there is a material error, material change, or new material information affecting eligibility. Employers must still establish eligibility with every filing. USCIS’s Account of the Policy’s History.

How H-2A Extensions and Transfers Work

Employers may file an I-129 requesting a short-term or long-term extension of the workers’ current contract. Qualifying short-term extensions of up to two weeks due to emergent circumstances do not require an additional DOL temporary labor certification; longer extensions generally require certification covering the additional dates. Alternatively, an employer may file a new I-129 seeking to transfer workers to a new DOL-certified contract with the same or a different employer. Each filing requires evidence of eligibility and maintenance of status. For qualifying continued employment with the same employer, a timely extension request generally allows workers to continue previously authorized employment for up to 240 days after their authorized stay expires while the request remains pending, subject to existing employment conditions and earlier termination upon notification of a denial. This extends employment authorization; it does not automatically grant 240 days of H-2A status. USCIS Policy Manual; I-129 Instructions; Employment Authorization Rules.

Why USCIS Wants to Make the Change

USCIS argues that required deference can discourage independent review and allow earlier errors or fraud to carry forward. Effectively, the agency seeks greater latitude to revisit previously approved eligibility issues and issue Requests for Evidence (RFEs) or Notices of Intent to Deny (NOIDs) on extensions, even when the parties and facts remain unchanged. Its supporting evidence focuses largely on H-1B and L-1A filings, suggesting those programs are principal drivers rather than identified H-2A-specific problems. Nevertheless, H-2A petitions fall within the NPRM’s scope. USCIS’s Discussion and Analysis.

Potential Effect on Extensions and Transfers

Both short-term and long-term extension requests on the workers’ current contract could lose required deference where it currently applies. For a new I-129 seeking to transfer workers to another DOL-certified contract, the effect depends on the filing. An internal transfer with the same petitioner does not automatically qualify for deference if material facts change. An external transfer involving a different petitioner generally does not meet the same-parties requirement. The actual parties and employment circumstances determine whether deference currently applies, rather than the “extension” or “transfer” label. Officers could still consider relevant prior approvals, and substantive eligibility requirements would remain unchanged. I-129 Instructions; DHS’s Explanation of Deference. Ultimately, it remains to be seen whether the USCIS policy change will have an impact on named petitions, but we are closely monitoring the situation moving forward. 

H-2 Portability & Grace Periods Would Remain Available

The NPRM would leave the 2024 H-2 portability and grace-period provisions intact. Workers completing their contracts generally have up to 30 days after the approved petition expires, subject to the maximum period of stay. Workers voluntarily or involuntarily separating from employment generally have up to 60 consecutive days, or until their authorized admission ends, whichever is shorter, once per authorized admission. The applicable grace period sets the deadline for an employer to file an I-129 requesting an extension of the worker’s existing contract or a transfer to a new DOL-certified contract with their existing employer or a different employer. The grace period itself does not authorize employment. Under H-2A portability, eligible workers transferring to a new contract may begin work once USCIS receives a properly filed, nonfrivolous I-129 requesting the necessary amendment or extension of their stay, or on the requested start date, whichever is later, without waiting for approval. DHS’s H-2 Final Rule.

Employer Impact & Opportunity to Comment

DHS expects the change could increase processing times, preparation costs, and uncertainty about continued employment. Its FY 2022–2025 analysis reports a 64-calendar-day processing difference between petitions with and without an RFE, based on average annual median processing times. The NPRM does not explain whether the analysis accounts for electronic versus mailed RFE responses, which could affect response delivery and processing times. The historical figures therefore should not be read as a forecast for every H-2A filing. Current requirements remain in place unless USCIS issues a Final Rule that takes effect. Employers may Submit Comments Through Regulations.gov before midnight Eastern Time on November 13, 2026, identifying USCIS and docket USCIS-2026-0529. DHS’s Impact Analysis.

H-2A Stakeholder Litigation Update: Employers Suffer Setbacks in Federal Court Challenges to DOL’s AEWR Methodology & NY’s Farmworker Unionization Law

UFW v. DOL (E.D. Cal.) - Court Imposes Dec. 30 Deadline for DOL’s New AEWR Rule

As discussed in Seso’s prior update, the Eastern District of California ruled in August that DOL’s October 2025 AEWR methodology was arbitrary and capricious and procedurally defective under the Administrative Procedure Act. The Court granted UFW relief on summary judgment but temporarily left the rule in place to avoid disrupting the H-2A program while directing DOL to promptly develop a lawful replacement methodology and publish new wage rates. The Court reserved the question of backpay until replacement rates are available.

The parties then disputed how much time DOL should receive. DOL initially proposed nine to twelve months for permanent rulemaking, later proposing up to six months for an interim rule, while UFW sought a substantially faster replacement. In its October 2 ruling, the Court rejected DOL’s longer timeline, noting that the agency issued the challenged rule in just five and a half weeks and had not justified the additional delay. The Court ordered DOL to issue a replacement interim final rule by December 30, 2026, vacated the existing rule effective that same date, and required status reports beginning October 22 and every three weeks thereafter.

A separate issue is whether—and how broadly—the Court may require DOL to impose backpay obligations on employers who are not parties, including those outside the Ninth Circuit. In Trump v. CASA, SCOTUS limited injunctions extending beyond what is necessary to provide complete relief to the plaintiffs, but left the scope of APA vacatur undecided. Although the August AEWR ruling recognized authority to order wage-adjustment relief, whether backpay will be awarded and its scope remain unresolved. CASA may inform challenges to that relief; it does not automatically exempt employers outside the Ninth Circuit.

Key Takeaway: Prepare for New AEWR Rates & Potential Adjustments in December

Current AEWRs remain applicable during the transition, and no backpay is presently due. However, DOL’s September 2 notice warns that covered employers may eventually owe adjustments for qualifying work beginning September 2 if replacement rates exceed wages paid. Employers should preserve payroll records and budget for potential increases while the replacement methodology and scope of any backpay relief remain unsettled.

NYSVGA v. James (W.D.N.Y.) - Magistrate Judge Sides with NY PERB

As discussed in Seso’s prior litigation update, NYSVGA v. James challenges New York’s farmworker unionization law (Farm Laborers Fair Protection Act) and its application to H-2A employers. Filed in 2023, the lawsuit contests the law’s constitutionality and the New York Public Employment Relations Board’s (PERB) administration of union certification and collective bargaining procedures. NYSVGA secured a limited preliminary injunction protecting employer speech in February 2024, but the court declined to block other challenged provisions, a result upheld on appeal. The litigation continued as PERB certified United Farm Workers (UFW) bargaining units, adjudicated related unfair labor practice charges, and referred bargaining disputes to compulsory arbitration. In the latest development, the Magistrate Judge issued a Report and Recommendation, filed September 24, 2026, recommending denial of a motion for a second preliminary injunction in the NYSVGA litigation seeking to halt those processes and related enforcement activities.

Summary of Court’s Rulings

The Report addressed three principal constitutional arguments:

• Violation of Procedural Due Process Rights: NYSVGA argued that PERB provided inadequate notice, denied meaningful evidentiary hearings and access to union authorization cards, and lacked an impartial decision-maker. The Magistrate Judge rejected this argument because the written submissions, conferences, administrative appeals, and available state-court review provided sufficient procedural protections, while the hearing officer’s recusal from appellate review addressed the impartiality concern.

• Violation of the Supremacy & Contracts Clauses: NYSVGA argued that the imposed collective bargaining agreements conflicted with federal H-2A hiring, temporary employment, and job-order requirements and impaired existing contractual obligations. However, the Magistrate Judge rejected this argument because federal H-2A requirements establish minimum protections that can coexist with collective bargaining agreements, including recall and seniority provisions that remain subject to federal hiring preferences and visa limits.

• Violation of the Takings Clause: NYSVGA argued that provisions granting UFW representatives access to employer property constituted an unconstitutional taking of private property. Unfortunately, the Magistrate Judge also rejected this argument as a basis for preliminary injunctive relief because New York provides a procedure for seeking compensation for an alleged taking, leaving the underlying question of whether a taking occurred undecided.

More broadly, the Magistrate Judge found insufficient evidence of imminent, irreparable harm, citing unresolved enforcement proceedings and inadequate financial documentation supporting claims that compliance would threaten the farms’ financial viability as well. Based on these findings, the Magistrate concluded that the issuance of a preliminary injunction was not warranted but did not reach the merits of the underlying arguments at this stage and recommended that the district court issue in order consistent with the report’s findings. 

Key Takeaway: Small Battle Lost, Not the War for NY Employers

This is a setback for NYSVGA’s effort to obtain immediate relief, but the Magistrate Judge’s report is not binding or a final decision on the lawsuit. The next procedural step is for NYSVGA to pursue specific objections before federal District Judge John L. Sinatra, Jr., who may accept, reject, or modify the recommendation and must independently review the portions properly challenged. The report sets an objection deadline of 14 days after service, unless extended by Judge Sinatra. Even if the District Judge adopts the recommendation, denial of preliminary relief does not dispose of the underlying claims: the case would continue toward a decision on the merits, with further proceedings and an eventual appeal likely. New York employers should continue meeting applicable obligations while monitoring the litigation. The fight is far from over.