The new rule is slated to take effect on March 9, 2021, so it will apply to this H-1B cap filing season, unless suspended by the Biden administration.
The Department of Homeland Security (DHS) has issued a new rule that transforms the so far fully random cap H-1B selection process to one that prioritizes registrations and petitions based on the highest Department of Labor (DOL) prevailing wage level met by the offered salary. It is not clear yet whether the incoming Biden administration will implement this rule at all or with modifications.
On January 8, 2021, DHS published a new regulation regarding the electronic registration and lottery-based selection process for cap H-1B petitions, i.e., those petitions for initial H-1B status subject to the annual numerical limitation of 65,000, plus an additional 20,000 for beneficiaries with a qualifying U.S. master’s degree or higher.
Last year under the existing rule, once DHS received a sufficient number of registrations, it ran a random selection process on all electronic registrations and notified the selectees that they were eligible to file H-1B cap-subject petitions. According to the new rule, DHS will replace the random, computerized H-1B lottery with a selection based on the highest prevailing wage level that the wage offered by the employer equals or exceeds. (The DOL prevailing wage level system is called OES: Occupational Employment Statistics.) DHS believes that this will help U.S. employers attract the best and brightest, and may incentivize them to hire U.S. workers for low-skilled and low-paid positions.
Planned Effective Date and Possible Impact of Biden Administration
The new rule is slated to take effect on March 9, 2021, so it will apply to this H-1B cap filing season, unless suspended by the Biden administration. The Biden administration has already announced that it will halt or delay all “midnight” regulations passed in the last days of the Trump administration that have not taken effect before Inauguration Day on January 20, 2021. In the unlikely event the Biden administration decides not to delay this rule, it will require DHS to make significant technical changes very quickly to this year’s registration process in order to capture data required by the new regulations. DHS has yet to announce the initial registration period―last year it ran from March 1, 2020, through March 20, 2020, so we expect a similar registration period for this year. However, the Biden administration and DHS could also suspend just the registration process, but then still apply the new selection rules to the filed petitions.
Key Points from the New Rule
- DHS (assuming it receives more than a sufficient number of registrations to meet the “regular” cap and the “master’s” cap slots, either during the initial registration period or on the final registration date) would use a wage-level-based allocation process. It would rank and select the properly filed registrations received on the basis of the highest OES wage level that the wage offered by the employer at least equals, for the relevant occupational code in the area of intended employment. DHS would start with level IV, and then continue to select cases in descending order from OES wage levels III, II and I―potentially substantially decreasing the chances of selection with a level II or I wage.
- As with last year, the first allocation would apply to the “regular” H-1B cap of 65,000 slots, and the second allocation would apply to the H-1B numbers under the 20,000 advanced degree cap. This essentially gives those with advanced U.S. degrees two bites at the apple, as they would be considered first in the regular cap lottery and then in the advanced degree cap lottery.
- Where an offered wage is lower than the OES wage level I because the employer is using a private wage survey, DHS will rank the registration in the same category as OES wage level I.
- Where there is no available OES prevailing wage information for the offered position, DHS will rank the filing based on the OES wage level that corresponds to the requirements of the position (i.e., degree and years of experience required, managerial responsibility and other special requirements). DHS might even require a certified labor condition application (LCA) from the DOL before submitting the registration to avoid the need for DHS to determine what an “appropriate wage level” is.
- If the beneficiary will work in multiple locations, DHS will rank the filing according to the lowest corresponding OES wage level that the offered wage will equal or exceed.
- A computerized lottery would be used if the number of registrations for a specific wage level exceeds the number of H-1B cap slots available.
We will carefully monitor implementation of this new rule after the inauguration and issue additional Alerts.
For More Information
If you have any questions about this Alert, please contact any of the attorneys in our Immigration Law Group, any of the attorneys in our Employment, Labor, Benefits and Immigration Practice Group or the attorney in the firm with whom you are regularly in contact.
Disclaimer: This Alert has been prepared and published for informational purposes only and is not offered, nor should be construed, as legal advice. For more information, please see the firm's full disclaimer.