January 19, 2021
By: Ramón E. Rivera
The Department of Labor (DOL) reissued a rule previously struck down by three federal courts finding that the agency had violated the Administrative Procedures Act by failing to show good cause in not providing the public notice and an opportunity to comment as required before expediting implementation of a final rule changing the way in which the U.S. Citizenship and Immigration Services selects registration of U.S. employers filing H-1B petitions subject to the annual numerical cap. The controversial rule involves government prevailing wage minimums for foreign professionals participating in the H-1B, H-1B1, E-3, and PERM labor certification program. The rule, which took effect on January 14, will significantly increase the Occupational Employment Statistics (OES) prevailing wage minimums for foreign workers at all levels of skill and experience.
Under existing immigration law, employers are required to pay H-1B visa holders the higher of the prevailing wage or actual wage paid to similar U.S. workers. The DOL determines prevailing wages with data from the government’s OES wage survey and uses a mathematical formula to create four levels of wages for each occupation. For example, under current OES levels the entry level–or Skill Level I wage minimum–is set at the 17th percentile of the average wage for the occupation. When the new wage regulation takes effect the entry level minimum will increase to the 35th percentile which is higher than the existing Level II skill level. Despite these wage increases, however, the regulation will permit employers to continue to use alternative wage sources instead of DOL prevailing wage data for labor condition applications (LCAs) and PERM applications which are not subject to the DOL wage percentiles.
The DOL’s new rule takes effect 60 days after publication in the Federal Register. Its impact, however, will not be immediate as existing DOL prevailing wage levels will remain in place until July 1, 2021, for H-1B, E-3, H-1B1 and PERM cases. In addition, and like its prior iteration, the final rule may be the subject of federal lawsuits notwithstanding that DOL has taken steps to address concerns raised in earlier challenges by responding to public comments, providing notice in advance of the slated effective date, and expanding its economic impact analysis. Moreover, the Biden Administration could place the wage rule–along with other regulations finalized during the last days of the Trump Administration–on hold to review its contents and determine whether it should take effect.
Please feel free to contact Ramon Rivera, Esq., at Mackenzie Hughes LLP if you have any questions or concerns regarding the DOLs new prevailing wage rate rule.