Wage Rates for Laborers Complicating Immigration Rewrite

The AFL-CIO is seeking to exempt industries with high unemployment rates such as construction from a new worker-visa program that is complicating bipartisan talks on a rewrite of the nation’s immigration laws.

The largest federation of U.S. labor unions and the U.S. Chamber of Commerce, which have tentatively agreed to an annual cap of 200,000 U.S. visas under a new program, are at odds over how wage rates for these workers should be determined.

AFL-CIO President Richard Trumka said in an interview taped yesterday for C-SPAN’s “Newsmakers” program that the labor federation wants some higher-skilled laborers to be exempt from any new program until the jobless rate improves. In February, unemployment in the construction industry was 15.7 percent, according to the Bureau of Labor Statistics.

“Until the unemployment rate gets down to a certain level you don’t bring them in,” Trumka said in the C-SPAN interview, airing this weekend. “Those are skilled workers,” he said. “You can’t just bring people in off the street and pay them, as was proposed, 25 percent of market value.”

While the AFL-CIO says it will oppose any new visa plan that would decrease wages for U.S. workers, business representatives say the labor group is demanding wage rates that are higher than those paid to U.S. workers performing the same job. After the C-SPAN taping, Trumka said in an interview that the labor group and the chamber have been in close contact on the issue and that he is hopeful it will be resolved soon.

‘90 Percent’

Yesterday, New York Senator Charles Schumer said a bipartisan Senate group of eight lawmakers is “90 percent” finished with its draft legislation. “We have a few little problems to work on,” he said.

The Senate group is planning to unveil the legislation, based on principles it released in late January, during the week of April 8. Schumer, a Democrat, said yesterday that the group was “on track” to meet that deadline.

President Barack Obama, who has called overhauling the nation’s immigration system the top legislative priority of his second term, said yesterday he is confident that an immigration bill will pass in the next several months.

“Labor and businesses may not always agree exactly on how to do this, but this is a resolvable issue,” the president said in an interview with Spanish-language station Telemundo.

Still, wary of undermining talks with Republicans, Obama has taken a back seat in the negotiations. Rather than advocate for specific proposals, he has spoken privately to lawmakers in the group and sent aides to provide technical support.

Construction Roadblock

The toughest issue to resolve in the negotiations will be construction, said Geoff Burr, vice president of federal affairs for Associated Builders and Contractors. The AFL-CIO is demanding that some immigrant construction workers be paid from 40 percent to 60 percent more than what similarly qualified U.S. workers are paid, Burr said, a claim the labor group disputes.

“While the unions say publicly they want a guest-worker program, their actions and their demands make clear that the only program they’d support is one employers would never use,” Burr said.

Trumka said there was “not a shred of evidence” to support that statement, adding, “We have initiated a presidential-style campaign to get this done.”

All Industries

In the interview, Trumka said the AFL-CIO proposed last week that the Senate legislation include a requirement that the U.S. issue visas across all industries only at a rate that won’t hurt U.S. wages or benefits. The dispute is over what method should be used to determine these wages and what unemployment rate should trigger additional visas, Trumka said.

Under the AFL-CIO’s proposal, the Labor Department would determine what that level should be. The Chamber of Commerce wants wages to be set under a four-tiered system based on workers’ experience and skills.

The first level of that system would be equivalent to 25 percent of the market rate, or poverty-level wages, Trumka said. “It relegates those newcomers to a life of poverty,” he said. “The second thing it could do is drag down wages for American workers and benefits. Nobody wants that.”

For example, a construction worker paid at a first-level rate would receive an hourly wage of $9.05, or $18,820 a year, according to a chart based on BLS data. That compares to the current federal hourly minimum wage of $7.25. Boosting the rate to a level three, as the AFL-CIO wants, would establish a minimum hourly rate of $14.30, or about $29,730 a year. The current federal poverty rate for a family of four is $23,550.

U.S. Chamber

The U.S. Chamber, the nation’s largest business lobby, says the four-tiered system is based on documented wage rates across multiple industries tabulated by the Labor Department. It says the idea that immigrant workers would be paid below the current market rate is false.

“It is simply untrue that the business community is seeking to pay foreign workers anything other than what American workers receive,” said Randy Johnson, the chamber’s senior vice president of labor, immigration and employee benefits. “The unions have jeopardized the entire immigration reform effort.”

Still, Johnson said the group is hopeful a deal can be reached on immigration legislation.

Small Business

Demands from small-business groups to pay immigrant workers at a lower rate than prevailing wages may be a bigger impediment to an agreement than the chamber, which represents larger companies, according to a person familiar with the talks who asked to not be identified in describing the deliberations.

Concerns over a guest-worker visa program helped scuttle a 2007 immigration overhaul effort in Congress.

Another point of discussion in the senators’ talks is meeting a Republican demand that creation of a path to citizenship for immigrants in the U.S. illegally be contingent upon measurable increases in border security.

Schumer and fellow Senate Democrat Michael Bennet of Colorado joined Republicans John McCain and Jeff Flake, both of Arizona, for a tour of the Arizona border with Mexico yesterday. After the tour, Schumer said he had deepened his understanding of the challenges in securing the U.S. border, without providing details.

The group of eight senators, which includes McCain and Flake, is finalizing a bill that would allow the 11 million illegal immigrants now estimated to be living in the U.S. the ability to achieve full citizenship in 13 years.

That includes a 10-year wait for a green card and three more years to reach citizenship. The process currently takes about 15 years.

To contact the reporter on this story: Heidi Przybyla in Washington at hprzybyla@bloomberg.net

To contact the editor responsible for this story: Jodi Schneider at jschneider50@bloomberg.net

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