What Do Wages Have to Do with the H-1B Program?
The H-1B nonimmigrant visa gives permission to professionals to work for a specific US employer in a specific job. As a minimum requirement, the position offered to the person must require someone to have a degree, and specifically a degree in a particular field. Jobs with duties that can be performed by individuals with a degree in any wide range of fields usually do not qualify for an H-1B. In addition, there must be a US employer and the US employer must offer and pay the individual a “required wage.” This required wage is the higher of the actual wage (i.e., what the employer is paying other similarly situated US workers) or the prevailing wage which is determined by the US Department of Labor (DOL) by comparing the job duties and requirements to the data that it has.
The current administration issued two rules that impact the H-1B program based on wages: (1) an Interim Final Rule (IFR) issued on October 8, 2020 redefining the benchmarks for the DOL’s prevailing wages and (2) another rule giving priority to higher wage positions in the allocation of H-1B visa numbers that is to take effect 60 days from January 8, 2021. While the current administration ends this month, it is unclear whether the rules issued will actually take effect. That said, it is good to keep these two in mind moving forward.
IFR Regarding DOL’s Prevailing Wages
On October 8, 2020, the DOL issued an IFR that redefined the benchmarking of its prevailing wage levels whereby increasing some prevailing wages by $30,000-$40,000 and others to a default wage of over $200,000. On December 1, 2020, two courts struck down the IFR because they were not convinced that the economic conditions during COVID were so severe that the DOL was justified in avoiding a 60-day notice and comment period before having its rule take effect.
Some question whether the DOL will now reissue the rule, given that, in theory, 60 days has passed since it first issued it in October. Stay tuned!
Rule Regarding Wage-Preferences in H-1B Visa Number Allocations
On January 8, 2021, the US Citizenship and Immigration Services (USCIS) published a rule entitled “Modification of Registration Requirement for Petitioners Seeking to File Cap-Subject H-1B Petitions.” This rule would take effect 60 days later, i.e., March 9, 2021.
There has been a shortage of H-1B visa numbers for employers seeking to classify their employees in H-1B status, where the employee has never been in H-1B status before. (Those who have been given a number at least once and whose employers were not colleges, universities, or other exempt organizations are not subject to this requirement again.) As a result, each spring, USCIS holds a lottery for employers to obtain an H-1B number. In 2020, USCIS conducted an electronic registration program which facilitated the lottery process. The rule that has been published addresses this lottery process.
The new process will require employers to provide more details regarding the job offered to the prospective H-1B employee. This information will include the salary, occupational code, job location, and job requirements. Instead of being random, priority will be given to those registrations that show that the offered salary meets or exceeds the highest wage level (there are four prevailing wage levels). If the number of registrations at that wage level exceeds the available number of H-1B visas, then a lottery will be conducted for all of them at that wage level. In theory, therefore, those positions with salaries at or above the Level IV prevailing wage level would be in the best position. If there are not enough registrations with wages at or above Level IV, then registrations with Level III wages would be considered next, and so on.
This rule is to take effect in March, which is when the lottery system should be happening. That said, the incoming administration has put a hold on the implementation of new regulations for 60 days. It is yet to be seen whether the 60 days would mean 60 days from the publication of the rule (January 8, 2021) or 60 days from the time the new administration announces the “hold” which would make implementation of this rule beyond March 2021 and therefore not relevant to this year’s H-1B visa allocation process. Again, stay tuned!
All of the above information has been provided for educational purposes. As with most immigration rules and matter, everything has been very fluid and each person’s set of facts are different. Please consult with Clark Lau LLC attorneys to see how the above impacts your situation.