The official semi-private blog of the Southeastern Cotton Ginners Association. Representing cotton ginners throughout Alabama, Florida, Georgia, North Carolina, South Carolina, and Virginia.
As we’ve mentioned for some time, the Joint Cotton Industry Bale Packaging Committee (JCIBPC) has been deliberating on how to handle a directive from the National Cotton Council to phase out the use of Woven Polypropylene bagging and wire ties from use in the US. This initiative came about from the National Cotton Council’s Strategic Plan.
The JCIBPC took up the measure at its meeting in February but could not come to a consensus. The JCIBPC’s Executive Committee has met several times to attempt to reach an agreement on this which it did in September. The measure came to the full JCIBPC last week and the following table shows the phase out for these two materials.
TLDR: Woven PP bagging can be used through the 2031 crop and wire ties can be used through 2034 with 2031-2034 being export only.
Please see the attached letter from Chris Berry, JCIBPC Chair for more information. You can also call us if you have questions.
We’re looking for this year’s Ginner of the Year for 2025. Nominations are now open and will close on October 29. Please see the attached letter outlining qualifications for the award. This award is presented at our Annual Meeting in January each year.
If you know a deserving gin manager, or operation please take a few minutes and send in an application. Give us a call or email if you have any questions. My email is in the letter.
Just before the Government Shutdown on September 30, the Department of Labor released an Interim Final Rule (IFR) for the calculation of the Adverse Effect Wage Rate. While the rule was released and it has a lot of details, questions still remain but here are the highlights. This is a preliminary review and we reserve the right to get a few details wrong due to interpretation without explanation from DoL Staff. Remember this is for NEW CONTRACTS after October 1, not current contracts.
As we discussed int he State Meetings last month, with the discontinuation of the USDA FLS, the wages will be based on the OWES survey. It reduces that classifications from 6 to 5 that are included. Those 5 classifications will be averaged and a two tier skill system will be implemented. Tier 1 will be low skill with little to no experience needed and Tier 2 will be workers with more than 2 months or special qualifications or training required.
If the workers fall into categories outside the five main categories, then their AEWR will be calculated directly from OEWS survey just like the 2023 rule. For example Truck Drivers will get a higher wage. At this time we are unclear if working in the gin occasionally would make them raise the wage of the other gin employees, but at this point it doesn’t look like it. (a question to be answered)
A second change is that if you have a job that may fit more than one description, the job that is the more predominant in terms of time, is the wage they are calculated on. So if you have a gin employee that sometimes drives a truck, they will get the general AEWR and not the truck driver AWER.
Another important change is that DoL has calculated a housing allowance to reduce the hourly rate for H-2A workers. The housing adjustment is based on HUD data for a 4 bedroom house able to house 8 workers and a 40 hour week. Alabama for example is set at $1.20. Domestic workers that are doing the same jobs would get the full AEWR and you would reduce the H-2A workers by the Housing adjustment. They call it an “Adverse Compensation Adjustment”.
For example: You have a gin in Alabama and are looking for a gin crew. The Skill level 1 rate will be $11.25 per hour and Skill 2 rate will be $14.95. You only need Skill Level 1 workers. The calculated housing allowance is $1.20/hr. You would advertise for the job to and pay US workers at $11.25 but the H-2A workers would only get $10.05 because you’re providing housing to the H-2A’s and not the domestic workers in corresponding employment.
The OEWS data is typically released in May and the new AEWR will change around July 1 although it is not spelled out exactly.
There are still a lot of unanswered questions about this and while this is an Interim Final Rule, there is an opportunity to comment until December 1. As the experts and attorneys digest this rule, it will all become clearer. We just wanted you know there is a new AEWR formula, in most cases it is lower than previously calculated and there is an adjustment for housing.
Below is a table of the AEWR for applications after October 1, 2025 in the Southeast. A full table can be found in the document below.
Secretary Brooke Rollins announced today that the USDA will discontinue the Farm Labor Survey. The FLS has been misused by the DoL for years as the floor for wages and establishment of the Adverse Effect Wage Rate (AEWR). This puts the ball in the Department of Labor’s court as to the calculation of the AEWR.
The USDA has been less than transparent about how the survey was developed so there was no way to adjust or account for the effect of the expanded use of H-2A in the results. It is widely held that the H-2A wages created a feedback loop that continually increased the average and therefore the AEWR.
This just hitting the press at this point and was a total surprise. Since the Blog auto posts at 3PM eastern, we wanted to get this out as soon as possible.
We do NOT know what the future of AEWR calculation will look like because this is so fresh and there has not been a statement from the Department of Labor. The Press release from The National Council of Agriculture Employers is attached.
The National Cotton Council has set the meetings for the Farm Bill Updates recently passed in the One Big Beautiful Bill. Flyers for each state are linked below. Please try to attend at least one of these meetings and help get the word out to your producers about these meetings. We understand these conflict with our state meetings but there should be ample opportunity to get to one of these meetings. We thank the NCC for doing these informative programs.
Late yesterday, the US District Court for the Western District of Louisiana issued a permanent injunction and vacated the 2023 AEWR Rule for the H-2A program. This is the rule that changed how truck drivers and supervisors (and several others) minimum wages are calculated using the OEWS Survey.
The law that created the H-2A program says that the wages used in that program cannot have an Adverse Effect on the wages of domestic workers. The Department of Labor (DoL) has determined that the USDA Farm Labor Survey (FLS) average wage would be a floor for wages and anything below that would have an adverse effect.
In 2023 they went beyond that and with the new AEWR Rule it created a core “Big Six” jobs that were still governed by the USDA FLS but anything outside the Big Six would have the Adverse Effect Wage Rate set by the Bureau of Labor Statistics Occupational Employment Wage Survey (OEWS). This meant that any job not covered by the FLS, would have the AEWR calculated based on data that was largely non-agricultural in nature.
In our world, the most common jobs that would fall outside of the FLS big six were truck drivers and front line supervisors. The 2023 rule significantly increased the wages for these two classifications. This also forced folks to have to have separate contracts for the truck drivers and supervisors from the rest of the crew since the wage for the full contract was the highest job description in the contract AND it created a situation that if that truck driver came in and did any job on the H-2A contract, all the other H-2A’s got that higher wage for that pay period.
The Court’s action last night tossed the 2023 rule completely and the H-2A program to revert to the Farm Labor Survey only. TO BE CLEAR THIS APPLIES TO NEW CONTRACTS THAT GO IN AFTER 8/27/2025. Any contracts in the process or approved already are still subject to the 2023 AEWR rule. The only H-2A AEWR starting with any new contracts will be the FLS derived AEWR… GA, AL, SC – $16.08; FL – $16.23; NC and VA – $16.16 for 2025.
The National Council of Agriculture Employers and others are also suing for the removal of the FLS as well. The argument is that there has never been a justification for use of the FLS as the wage floor and that underlying premise of an adverse effect has not been demonstrated, particularly when no one is applying for these jobs. This action along with work in Washington is ongoing.
This is great news and we applaud the work of NCAE and the other parties in this suit as well as Secretary Chavez-DeRemmer for her understanding of the detrimental effect of the 2023 Rule.
