Md. crab processors battle federal wage rule
Industry would pay more for temporary guest workers
Crab pickers working in the plant. They will pick 400 bushels of crabs a day sorted in to four different grades of crab. (Baltimore Sun photo by Lloyd Fox / September 15, 2011)
But this summer, Brooks and the operators of other Eastern Shore picking houses are dealing with an entirely different challenge. Brooks has plenty of workers, but he's not sure whether he'll be able to afford to keep them.
Seafood processors along the East Coast are steamed about a new Labor Department requirement that would force businesses that use foreign workers to increase their wages by as much as 50 percent. Employers say the new rule, set to begin Sept. 30, would cripple the industry and prompt some businesses to close.
"It'll have a devastating impact on the seafood industry and on rural Maryland," said Brooks, co-owner of J.M. Clayton Seafood Co. in Cambridge. He predicts that the higher wages would add $1 to the price of every pound of Maryland blue crab.
"We compete on a global level, and we just cannot pass these costs along."
The U.S. allows 66,000 foreigners to come to the country for several months each year under what is known as the H-2B visa program. The temporary workers are hired for seasonal industries such as crab picking, oyster shucking or landscaping; they are required to return home once the season is over.
Labor Department officials proposed higher wages for H-2B workers in January after a federal court struck down guidelines for the program crafted by the Bush administration. Under the new rules, workers in Maryland who now make $7.25 an hour would receive $9.24, according to the industry. In North Carolina, the rate in some cases would increase from $7.43 to $11.18.
The change was initially to take effect next year, but the department was forced by a separate court order to speed up the transition. Now, the higher wages are set to begin in the middle of this year's crab season.
Administration officials and advocates for the unemployed argue that more of the H-2B jobs could be filled by U.S. workers if companies paid higher wages, particularly given the nation's 9.1 percent unemployment rate.
Jane Oates, assistant labor secretary for employment and training, said the wage changes are intended to meet a congressional mandate "that U.S. workers not be adversely affected by the H-2B program."
Brooks counters that, for the seafood industry, there just isn't a supply of Americans waiting to do the work.
The number of people willing to pick crabs has steadily declined since the 1960s, he said, when the wives of Chesapeake Bay watermen would devote hours on end to the tedious work. He said his company has tried to recruit from job fairs and jails — and once rented a bus to bring in would-be crab pickers off the streets of Baltimore.
None of it worked. Facing the possibility of having to shut its doors for want of workers, Clayton and other companies on the Eastern Shore turned in the 1990s to the H-2B program.
"If I could turn the clock back to the '50s and '60s when the place was full of Americans, that would be great," he said. "But simply the people are not here that are willing to do this seasonal work."
The guest worker program wasn't a perfect solution for the industry. Demand by landscaping companies and the hospitality industry often scooped up all the available workers before the crab season began. Brooks and other Eastern Shore businessmen were frequently forced to appeal to Congress for exceptions to the national quota.
This year, perhaps because of the sluggish economy, Brooks had little trouble bringing on a full staff of pickers. But the new wages, he said, could force him to send most of them back before the season is out.
Industry leaders stress that such a move would also cost U.S. jobs — the watermen, secretaries and truck drivers who rely on the steady flow of crab meat for their livelihood.
"What would happen is all of my crabbers, all of the watermen, they would be shut down," said Robin Hall of the G.W. Hall & Son crab processing plant in Fishing Creek. "In the fall is when they really make all the money."
Concern over the wage rule extends beyond Maryland. Brooks and Hall were joined by seafood processors from Virginia and North Carolina as they met with lawmakers on Capitol Hill this week to press their case. Several companies in Louisiana have recently filed a federal lawsuit against the Labor Department and the Department of Homeland Security over the new wages.
Opponents say that the current rules keep wages artificially low, depressing the market for U.S. workers who might consider the jobs if they paid better. The groups also have pointed to examples in other industries in which the guest workers have been cheated out of wages and forced to endure squalid conditions.
"Of course the employers are screaming, because they're going to have to pay a little more," said Mary Bauer, legal director of the Southern Poverty Law Center, which frequently defends immigrants and guest workers. "But the purpose of the program has never been to provide employers with cheap labor."
The fight against the new wages has created a rare political alignment in the state, putting Democratic Sen. Barbara A. Mikulski on the same side as Republican Rep. Andy Harris. In separate interviews, both lawmakers called on the administration to delay implementation of the new rule.
Mikulski has had success advocating for the industry in the past, particularly in 2005, when she moved legislation through Congress that exempted certain returning workers from counting toward a nationwide cap on the number of H-2B visas issued.
This time, Mikulski said, she is prepared to fight for the seafood industry again — and said she is confident she has support from a majority of Congress.
"First of all, the Department of Labor decided to change the rules of the game in the middle of the season," Mikulski said. "I think they've gotten bad advice, and I'm going to fight for those jobs."
Saying she and other coastal lawmakers are "crabby" with the department, Mikulski also noted that the administration has refused her requests to discuss the issue because of the pending lawsuit in Louisiana.
"I had hoped to be able to talk to the Department of Labor to be able to have a rational conversation," she said, "but they lawyered up."
Harris, a Baltimore County Republican whose district includes the Eastern Shore, cast the issue in terms of job creation. Washington has stepped up its rhetoric on unemployment after President Barack Obama sent a $447 billion jobs package to Congress on Monday.
"We're at a critical time in the American economy, and the last thing we can afford to do is issue yet another regulation that will send American jobs overseas," Harris said. "If they don't have those workers, these businesses will close up and eliminate all the other jobs that are associated with the businesses."
But any attempt to address the issue in Congress is likely to run into the politically charged debate over illegal immigration. Lawmakers have all but given up on a comprehensive approach to reforming immigration policy, and even proposals that enjoyed bipartisan support in the past — such as allowing certain young immigrants brought to the country by their parents to seek citizenship — have faltered.
Brooks and others who support changing the new wage rule separate the two issues faster than fingers can pull meat from a crab.
"This is not an immigration issue," he said. "They come here, they work and they go home."