|
General Administration Letter 2-98 |
Date: October 31, 1997
Directive: General Administration Letter No. 2-98
To: All State Employment Security Agencies
From: Wendy L. McConnell
Acting Administrator for Regional Management
Subject: Prevailing Wage Policy for Nonagricultural Immigration Programs
1. Purpose. To provide policy clarification and procedural guidance for
making prevailing wage determinations for nonagricultural immigration
programs subsequent to the implementation of the wage component of the
Occupational Employment Statistics program.
2. References. 20 CFR part 655, subpart A; 20 CFR part 655, subparts H
and I; 20 CFR part 656; and Technical Assistance Guide (TAG) No. 656 Labor
Certifications.
3. Background. Over the past two years, the Employment and Training
Administration (ETA) has been considering proposals for reengineering the
process used by the States to determine prevailing wages in order to
increase the timeliness of responses to employer requests, insure the use
of a consistent methodology by all States, and to maximize the accuracy of
the determinations. As a result of this activity, it was determined that
the most efficient and cost effective way to develop consistently accurate
prevailing wage rates is to use the wage component of the Bureau of Labor
Statistics’ expanded Occupational Employment Statistics (OES) program.
Effective January 1, 1998, State Employment Security Agencies (SESAs) are
to implement the attached prevailing wage policy for nonagricultural
immigration programs. The OES wage data should not be used for alien
certification purposes until that date unless there are no other sources of
wage data for a particular occupational classification and area. The
validity of SESA surveys or published surveys which were to expire
October 1, 1997, pursuant to GAL 2-97, "Changes in the Prevailing Wage
Process for Labor Certification During Fiscal Year 1997," is hereby extended through
December 31, 1997. The policy guidance provided in this document
supersedes that contained in GAL No. 4-95 (May 18, 1995) effective January 1, 1998.
4. Action Required. State Administrators are requested to:
A. Provide the attached policy and procedural guidance to appropriate staff.
B. Instruct staff to follow these policies and procedures in making
prevailing wage determinations under the permanent and H-2B temporary labor
certification programs as well as under the H-1B nonimmigrant program for
professionals in specialty occupations or as fashion models of distinguished merit and ability.
5. Inquiries. Inquiries regarding this memorandum should be addressed to
the appropriate regional certifying officer.
6. Attachment. Prevailing Wage Policy for Nonagricultural Immigration
Programs.
Attachment to GAL No. 2-98
Prevailing Wage Policy for Nonagricultural Immigration Programs
Table of Contents
I. Background 1
II. General Prevailing Wage Policy 1
A. Summary 1
B. "Similarly Employed" 2
C. "Area of Intended Employment" 3
D. Nature of the Job 3
E. Determining Similar Levels of Skills 4
F. Expansion of the Area of Intended Employment 4
G. Separate Wage Systems 4
H. Skill Levels in Wage Determinations 5
I. Responses to Requests for Wage Determinations 6
J. Use of Employer-Provided Published Wage Surveys or
Employer-Conducted Surveys 7
K. Documentation Issues in Responding to Prevailing
Wage Requests 9
L. Challenges to Prevailing Wage Determinations 9
PREVAILING WAGE POLICY FOR NONAGRICULTURAL IMMIGRATION PROGRAMS
I. Background
In arriving at prevailing wage determinations, the same policies and
procedures shall be followed for the permanent labor certification program,
the nonimmigrant program pertaining to H-1B professionals in specialty
occupations or as fashion models of distinguished merit and ability, and
the H-2B temporary nonagricultural labor certification program. The
implementation of the wage component of the Occupational Employment
Statistics (OES) program requires that policy clarification and procedural
guidance be issued to ensure consistency among State Employment Security
Agencies (SESAs) in making prevailing wage determinations.
II. General Prevailing Wage Policy
A. Summary
In determining prevailing wages for the permanent and H-2B temporary labor
certification programs and the H-1B program the regulatory scheme at 20 CFR
656.40 must be followed. Where a wage determination has been issued under
the Davis-Bacon Act (DBA) or the Service Contract Act (SCA), or negotiated
in a collective bargaining agreement, that rate shall be controlling. In
the absence of a wage determination issued under the DBA, SCA, or a
collective bargaining agreement, SESAs are to determine prevailing wage
rates using wage surveys conducted under the wage component of the OES
program. In the absence of a wage determination under the DBA, SCA, or a
collective bargaining agreement, if the employer provides the SESA with a
survey, whether public or private, which meets the requirements described
in item J of this General Administration Letter that rate shall be used by the SESA
as the prevailing wage determination in response to that
particular request. Where no wage determination exists under any of the
above sources and the SESA is aware of alternative sources of wage
information, whether public or private, the SESA may utilize that wage data
for prevailing wage purposes as long as it meets the criteria established
in item J with regard to the adequacy of employer-provided wage data.
The methodology in any type of survey must reflect the average (arithmetic
mean) rate of wages, that is, the rate of wages to be determined, to the
extent feasible, by adding the wages paid to workers similarly employed in
the area of intended employment and dividing the total by the number of
such workers. This will, by definition of the term arithmetic mean,
usually require computing a weighted average. Surveys which list a median
or modal wage rate may not be used. The regulations also provide that the
wage offered by the employer shall be considered as meeting the prevailing
wage standard if it is within 5 percent of the average rate of wages. The
5 percent variance does not apply to prevailing wage determinations based
on DBA or SCA determinations nor does it apply to wages set forth in
negotiated union agreements.
However, SESAs and employers should be aware that the Department's
enforcement policy under the H-1B program does not allow a 5 percent
variance if back wages are assessed as a result of an investigation
conducted of an H-1B employer. In the H-1B program, the required wage rate
is the higher of either the "actual wage" (see §655.731(a)(1)) or the
"prevailing wage" (see §655.731(a)(2)). Where the required wage is the
prevailing wage and if an employer pays a rate that is no less than 95
percent of the prevailing rate of wages, no violation will be found.
However, if the employer is found to have paid less than 95 percent of the
prevailing wage, a violation will be cited and back wages will be assessed
and due based on 100 percent, not 95 percent, of the prevailing rate. The
5 percent variance does not apply where the required rate is the actual
wage.
In issuing wage determinations the SESAs may be required to convert an
hourly rate to a weekly, monthly or annual rate, or to convert a weekly,
monthly or annual rate to an hourly rate. As a matter of policy, such
conversions shall be based on 2,080 hours of work in a year.
B. "Similarly Employed"
Section 656.40 defines "similarly employed" as having substantially
comparable jobs in the occupational category in the area of intended
employment, except that if no such workers are employed by employers other
than the employer applicant in the area of intended employment, "similarly
employed" means:
(1) Having jobs requiring a substantially similar level of skills
within the area of intended employment; or
(2) If there are no substantially comparable jobs in the area of
intended employment, having substantially comparable jobs with
employers outside of the area of intended employment.
Occupations within an OES code will be considered as meeting the criteria
of similarly employed as defined above.
C. "Area of Intended Employment"
A clear understanding of the definition of "area of intended employment" is
necessary to properly implement the regulation at 20 CFR 656.40. The
definition of "area of intended employment" at 20 CFR 656.3 states that
the: Area of intended employment means the area within normal commuting distance
of the place (address) of intended employment. If the place of intended
employment is within a Metropolitan Statistical Area (MSA), any place
within the MSA is deemed to be within the normal commuting distance of the
place of intended employment.
A determination of the normal commuting distance is not necessary for
places of employment within an MSA since any place within an MSA is deemed
to be within normal commuting distance. Although not specifically
mentioned in the definition of "area of intended employment," any place
within a Primary Metropolitan Statistical Area (PMSA) is also deemed to be
within normal commuting distance of the place of intended employment, since
PMSAs are derived from MSAs. For prevailing wage purposes, however,
commuting distance will not be extended to Consolidated Metropolitan
Statistical Areas. Counties not within an MSA or PMSA have been combined
into "Balance of State" areas within each State. The allocation of the
counties into Balance of State areas included consideration of prevailing
commuting patterns. Counties within each Balance of State area are, for
prevailing wage purposes, within the same area of intended employment.
The same OES wage for the same occupation should be used by the SESA for
every location within the MSA, PMSA, or appropriate Balance of State area.
In cases of cross-State MSAs/PMSAs, the OES data incorporates survey
findings from the entire cross-State area, and will show the same
information for all States affected by the cross-State MSA/PMSA.
D. Nature of the Job
Under § 656.40, the relevant factors in arriving at a prevailing wage rate
are the nature of the job and the geographic locality of the job. In
determining the nature of the job, the first order of inquiry is to
determine the appropriate occupational classification. The Dictionary of
Occupational Titles (DOT) job description that corresponds to the
employer's job offer will normally be used to assign to the job the
relevant 9-digit DOT code. The relevant DOT code will then be cross
walked to an SCA or OES occupational code, as appropriate. If the job
opportunity does not exist in the DOT, the SESA should default directly to
the relevant SCA or OES occupational code. In the case of combination
jobs, e.g., engineer-pilot, the prevailing wage determination should be
based on the SCA or OES code for the highest paying occupation.
E. Determining Similar Levels of Skills
In determining which occupational categories in the area of intended
employment require levels of skills similar to those involved in the
employer's job offer, information contained in the Dictionary of
Occupational Titles, the Selected Characteristics of Occupations Defined in
the Revised Dictionary of Occupational Titles, and, in particular, the
Guide to Occupational Exploration code can be very helpful. If it is
necessary to use these guides, the process will lead to a DOT
classification which must then be crosswalked to the appropriate SCA or OES
code.
F. Expansion of the Area of Intended Employment
The OES survey data will represent all responding employers in the area of
intended employment who employ workers in that OES occupational code. If
the OES survey does not include enough responses in that area and
occupation to allow BLS to publish the data, the OES system will first
default to all MSAs, PMSAs, and Balances of State areas contiguous to the
requested area within that State. If this still does not result in
publishable data, the system will default to statewide information for that
occupation. Because of the size of the sample, it is unlikely this will
occur except in very unusual occupations or in small States.
G. Separate Wage Systems
It cannot be overemphasized that the nature of the employer is not a
relevant factor in making prevailing wage determinations. As noted above,
the relevant factors are the job and the geographic locality of the job.
It has been determined that the language on pages 122 and 123 of Technical
Assistance Guide No. 656 Labor Certifications (TAG) which indicates that an
employer may challenge a finding as to the prevailing wage for an
occupation, such as school teaching, on the basis that there are separate
prevailing wages applicable to employment in public and private schools, is
not supportable by the regulation at § 656.40. As stated by the Board of
Alien Labor Certification Appeals (BALCA) in Hathaway Children’s Service
91-INA-388, February 4, 1994, in relevant part, "(t)he underlying purpose
of establishing a prevailing wage is to establish a minimum level of wages
for workers employed in jobs requiring similar skills and knowledge levels
in a particular locality." Factors going to the nature of the employer,
such as whether the employer is public or private, profit or nonprofit,
large or small, charitable, a religious institution, a job contractor, or a
struggling or prosperous firm, do not bear in a significant way on the
skills and knowledge levels required and, therefore, are not relevant to
determining the prevailing wage for an occupation under the regulations at
20 CFR 656.40. Consequently, OES wage rates are based upon cross-industry
surveys.
H. Skill Levels in Wage Determinations
The level of skill required by the employer for the job opportunity is to
be considered in making prevailing wage determinations. The OES wage
survey will produce two wage levels which distinguish between positions
requiring significantly different degrees of skills in the occupation.
The SESA will determine which of the two levels in the OES survey is
appropriate, i.e., a distinction must be made based on whether or not the
job opportunity involved in the employer’s job offer requires skills at a
level I or a level II, as defined below.
To establish uniformity among SESAs in evaluating surveys and making
prevailing wage determinations within the resources available for
immigration programs, prevailing wage rates for the skill levels described
below should be determined in an occupation when the SESA makes a
prevailing wage determination.
1. Level I
Beginning level employees who have a basic understanding of the
occupation through education or experience. They perform routine or
moderately complex tasks that require limited exercise of judgment and
provide experience and familiarization with the employer’s methods,
practices, and programs. They may assist staff performing tasks
requiring skills equivalent to a level II and may perform higher level
work for training and developmental purposes. These employees work
under close supervision and receive specific instructions on required
tasks and results expected. Work is closely monitored and reviewed
for accuracy.
2. Level II
Fully competent employees who have sufficient experience in the
occupation to plan and conduct work requiring judgment and the
independent evaluation, selection, modification and application of
standard procedures and techniques. Such employees use advanced
skills and diversified knowledge to solve unusual and complex
problems. They may supervise or provide direction to staff performing
tasks requiring skills equivalent to a level I. These employees
receive only technical guidance and their work is reviewed for
application of sound judgment and effectiveness in meeting the
establishment’s procedures and expectations.
If a baccalaureate degree is normally required for entry into the
occupation, the wage rate for a job offer in that occupation which requires
an advanced degree (Masters or Ph.D.) shall be the rate for workers
performing tasks requiring skills at a level II. In this case, the
requirement for advanced education substitutes for the skills required at a
level II. Where an advanced degree is normally required for entry into the
occupation, the wage rate for a job offer in that occupation which requires
such a degree shall be the rate for workers performing tasks requiring
skills at a level I, unless there are other requirements contained in the
job offer or components thereof which require skills that are at a level
II. For example, a job opportunity for a librarian, an occupation for
which a Master’s degree is normally required for entry into the occupation,
would generally be considered to require skills at a level I, unless other
requirements in the job offer or components thereof require skills at a level II.
Where State licensure is required for an individual to independently
perform all of the duties encompassed by the occupation, such workers shall
be considered to be performing work requiring skills at a level II, unless
the employer can present sufficient evidence that the alien does not, in
fact, independently perform all of the duties encompassed by the
occupation.
I. Responses to Requests for Wage Determinations
To enable SESAs to provide employers or their representatives accurate wage
determinations that take into account the employer's particular job and its
requirements, all requests for and responses to wage determinations will be
in writing. The requests should specify the employer's title for the job,
a brief description of the job duties, the education, training and
experience requirements, and any other information deemed necessary by the
SESA for case processing or tracking. The name and address of the
employer, contact person and telephone number, and the city or county of
intended employment, if different from the employer's address, should be
indicated.
The SESA's responses shall state the specific wage rate applicable to the
employer's job opportunity and indicate the source of such information.
The response shall also specify in bold letters that the rate is valid for
filing applications and attestations for 90 days from the date of the
response.
Responses to requests for a prevailing wage determination should be sent to
the employer or its representative in writing in a timely manner,
preferably within 14 working days of receipt of the request. If the
employer provides to the SESA its own published or privately-funded survey
and requests SESA acceptance of the survey’s use for prevailing wage
purposes, responses to such requests should be sent to the employer or its
representative in writing in a timely manner, preferably within 30 working
days of the receipt of the request. If the employer’s survey is not
accepted, the response to the employer shall include the reasons why the
survey is not acceptable (e.g., the survey presented only the median wage
rate, or the geographic area covered by the survey is broader than that
which is necessary to obtain a representative sample), and shall provide
the employer with the appropriate prevailing wage rate as derived from the
SCA or OES survey data, as appropriate.
Lastly, it is important to note that §656.40(c) provides that a prevailing
wage determination for labor certification [or labor condition application]
purposes shall not permit an employer to pay a wage lower than that
required under any other Federal, State, or local law. For example, if the
OES wage rate is lower than the Federal, State, or local minimum wage, the
response to the employer’s request should indicate that the employer must
offer at least the minimum wage provided by Federal, State, or local law,
whichever is higher. Since the OES wage data is collected in the year
prior to the data being available to the SESA, this may occur in some
instances.
J. Use of Employer-Provided Published Wage Surveys or Employer-Conducted
Surveys
In determining prevailing wage rates in the absence of a wage determination
issued pursuant to the DBA, the SCA, or an applicable wage rate from a
collective bargaining agreement, the SESA shall consider wage data that has
been furnished by the employer, i.e., wage data contained in a published
wage survey that has been provided by the employer, or wage data contained
in a survey that has been conducted or funded by the employer. The use of
such employer-provided wage data is an employer option. However, if an
employer wishes to use alternative wage data, it will be incumbent upon the
employer to make a showing that the survey or other wage data meet the
criteria outlined below. In all cases where an employer submits a survey
or other wage data for which it seeks acceptance, the employer must provide
the SESA with enough information about the survey methodolgy (e.g., sample
frame size and source, sample selection procedures, survey job
descriptions) to allow the SESA to make a determination with regard to the
adequacy of the data provided and its adherence to these criteria. If the
employer does not present sufficient information with its request, the SESA
shall request such additional information from the employer as may be
necessary to make the determination. Information from employers that
consists merely of speculation, subjective impressions, or pleas that it
cannot afford to pay the prevailing wage rate determined by the SESA cannot
be taken into consideration in making a wage determination.
(1) The data upon which the survey was based must have been collected
within 24 months of the publication date of the survey or, if the
employer itself conducted the survey, within 24 months of the date the
employer submits the survey to the SESA.
(2) If the employer submits a published survey, it must have been
published within the last 24 months and it must be the most current
edition of the survey with wage data that meet the criteria under this
section.
(3) The survey or other wage data must reflect the area of intended
employment. A valid arithmetic mean for an area larger than an OES
wage area, whether an MSA, PMSA, or an OES Balance of State area, may
only be used if there are not sufficient workers in the specific
occupational classification relevant to the employer’s job opportunity
in the area of intended employment. However, the area of intended
employment should not be expanded beyond that which is necessary to
produce a representative sample. In all cases where an area that is
larger than an OES wage area is used, the employer must establish
that there were not sufficient workers in the area of intended
employment, thus necessitating the expansion of the area surveyed.
(4) The job description applicable to the employer’s survey or other
wage data must be an adequate match with the job description contained
in the employer’s request for acceptance to use the survey or other
wage data for prevailing wage purposes. Published wage surveys may
not always present an arithmetic mean for job opportunities requiring
skills at a level I and level II. In such instances, the arithmetic
mean contained in the published survey that most closely conforms with
the employer’s job opportunity should be used as the basis for the
prevailing wage determination. The job description submitted on the
request for acceptance of an employer-provided survey or other wage
data will be used in determining the appropriate level of skill to be
applied.
(5) The wage data must have been collected across industries that
employ workers in the occupation.
(6) The survey or other wage data must provide an arithmetic mean
(weighted average) of wages for workers in the appropriate
occupational classification in the area of intended employment. In
all cases where an employer provides the SESA with wage data for which
it seeks acceptance, measures of central tendency other than the
arithmetic mean, such as the median or modal wage rates, cannot be
used as the basis for the prevailing wage determination.
(7) In all cases where an employer provides the SESA with a survey or
other wage data for which it seeks acceptance, the employer must
include the methodolgy used for the survey to show that it is
reasonable and consistent with recognized statistical standards and
principles in producing a prevailing wage (e.g., contains a
representative sample), including its adherence to these standards for
the acceptability of employer-provided wage data.
It is important to note that a prevailing wage determination based upon the
acceptance of employer-provided wage data for the specific job opportunity
at issue does not supersede the OES wage rate for subsequent requests for
prevailing wage data in that occupation.
K. Documentation Issues in Responding to Prevailing Wage Requests
It is incumbent upon SESAs to organize the prevailing wage function and
establish controls that will enable them to provide information regarding a
particular prevailing wage determination, to answer questions if it is
required in an enforcement action conducted by the Department of Labor, and
to adequately represent the certifying officer before the Board of Alien
Labor Certification Appeals.
Requests from employers for wage determinations shall be filed in writing
with the organizational subcomponent of the SESA responsible for alien
labor certification prevailing wage determinations. Only that component
shall respond to requests for wage information for immigration purposes. A
dated copy of the prevailing wage determination provided to the employer
should be maintained by the SESA for two years. The relevant portions of
an employer-provided survey must also be maintained with the determination
for the requisite period.
L. Challenges to Prevailing Wage Determinations
Employers who wish to challenge prevailing wage determinations made by
SESAs in connection with temporary labor certification applications, labor
condition applications, and attestations, may do so pursuant to the
provisions of the Employment Service Complaint System. See 20 CFR part
658, subpart E. However, under the permanent labor certification program,
there are regulatory provisions and procedures that allow employers to file
challenges regarding prevailing wage determinations or findings made by
SESAs directly with the regional certifying officer. |