The Biden administration’s State Department recently released a proposal that could increase costs for those using the Au Pair program, according to a report by The Wall Street Journal.
The proposal requires families to pay au pairs an amount calculated based on state and local minimum wage laws. Currently, au pairs receive housing, meals, and a weekly stipend of $195.75 from their host families for a total of 45 hours of work. Under the new proposal, by using local wage laws to calculate the stipend, families in New York and California, for example, will have to pay a weekly salary of $469.46 for 40 hours worked. They will also need to pay overtime if the work exceeds 40 hours per week.
Massachusetts implemented a similar rule after a court ruling in 2019, raising the state’s au pair stipend to $528.63 per week in 2020, according to the WSJ. Following the wage increase, the number of au pairs working in Massachusetts dropped by 68% in 2022, compared to other states that maintained the current wage rate and saw an average 4% increase in program participation.
Childcare costs have been disproportionately affected by rising inflation, with prices for childcare-related services increasing by an average of 32% since 2019, while inflation grew by 20% during the same period.
Experts believe that, similar to Massachusetts, the program will see low participation if the federal government raises the stipend, potentially becoming an option for about 20,000 American families currently involved in the program, according to the WSJ.
How does the au pair program work?
Au pairs are foreign citizens who travel to the United States on a J-1 visa to live with an American host family for up to two years while caring for children. Sponsoring agencies act as intermediaries that help host families identify au pairs and navigate the regulatory challenges for all parties involved. Au pairs receive housing, meals, and a salary paid by the host families. The minimum wage for au pairs is the federal minimum wage minus 40% to compensate host families for housing and meals. For au pairs, they must take classes paid for by the host families, participate in cultural activities, and engage with the family, going on vacations and being part of the family.
The au pair program allows them to experience and learn about the American way of life for up to two years. One justification for the program is that au pairs will return to their home countries more aware of American values and culture, and American families will also benefit from the cultural exchange by learning about foreign customs. However, the main benefit for most host families is childcare.
In 2022, 21,449 au pairs with J-1 visas entered the United States. Although au pairs can stay in the program for up to two years, many participate for only one year before returning. The number of au pairs represents 2% to 4% of all childcare workers in the U.S. Au pairs typically go to families where both parents are skilled workers with high incomes. Additionally, they are geographically concentrated in the wealthiest cities and suburbs of affluent states. About one-third of au pairs went to California, Washington DC, New York, and Illinois in 2022.
When will the new regulation take effect?
When the government proposes new regulations, it first publishes a Notice of Proposed Rulemaking (NPRM). The regulation does not simply take effect out of nowhere. The purpose of an NPRM is to gather public comments or feedback from anyone who identifies issues that may undermine the intended effects of the regulation or be challenged in the judicial system. Only after this comment period and subsequent government evaluation can the new regulation potentially take effect.
Source: The Wall Street Journal