Judge Orders Replacement of H-2A Farmworker Wage Rule
Agricultural employers face potential wage hikes and back-pay mandates after the 2025 rule was declared illegal.
Updated on Oct. 28, 2026 in Employment
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A federal judge ruled on August 26, 2026, that the Department of Labor's current H-2A farmworker wage rule is illegal. The agency must now replace the regulation by December 30, which affects labor costs for agricultural employers nationwide.
Why it matters
The ruling invalidates a wage formula that shifted approximately $2.46 billion in annual earnings from workers to employers. It addresses concerns that the Labor Department failed to protect U.S. workers or follow public comment protocols when creating the rule.
The 2025 rule saw H-2A certifications reach 398,258 positions, with the rule allowing for wage reductions to offset housing costs. Investigations between 2018 and 2023 found labor violations in 84% of H-2A employer cases.
The players
Kirk Sherriff
The United States District Judge for the Eastern District of California who ruled the H-2A wage rule illegal.
Department of Labor
The federal agency responsible for setting labor standards and overseeing H-2A worker certifications and wage enforcement.
Gavin Newsom
The Governor of California who signed state-level legislation to set minimum pay rates for agricultural workers.
Trump Organization
A private real estate and hospitality company that recently sought H-2A workers for a Virginia winery at lower wage offers.
The details
The invalidated rule used a nonfarm Bureau of Labor Statistics survey to set entry-level wages at the 17th percentile, which permitted lower pay for farmworkers. In California, this caused the hourly minimum for H-2A workers to drop from $19.97 to $16.90. Employers who utilized these lower rates may now face requirements to pay back wages to affected workers depending on further court directives.
Timeline
August 26, 2026: Judge Kirk Sherriff ruled the H-2A wage rule illegal.
December 30, 2026: Deadline for the Labor Department to replace the rule.
January 1, 2027: California law AB 2646 sets a $19.75 minimum wage for H-2A workers.
Money Landscape
The federal wage rule was part of a shift that reduced protections compared to previous labor standards. This court intervention halts the recent trend of lowering agricultural wage floors while states like California pursue higher mandates.
Agricultural employers should prepare for potential wage increases and the possibility of retroactive pay adjustments. Households or businesses that rely on the H-2A program should consult with a tax or labor professional to monitor pending updates to wage calculations.
The takeaway
The court ruling signifies a major pivot in how agricultural labor costs are calculated, as the Labor Department must now rewrite rules that shifted billions in wages. Readers should track the December 30 deadline and review any potential back-pay obligations with a qualified professional.
What happens next
The Labor Department is required to report its progress on replacing the wage rule to the court every three weeks until the December 30, 2026, deadline.
Further reading
For more on how these regulations impact your labor budget, visit our Employment section.
Source note: This article includes information reported by Fortune.
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