On October 8, 2020, the US Department of Labor and Homeland Security issued sweeping changes to the current H-1B framework, resulting in significant hikes in wage amounts and (predictably) litigation. The rule change, which was issued without any public comment or notice, changed the way in which the DOL computed prevailing wages, which directly impacts the required wage floor for H-1B, H-1B1 and E-3 workers and prospective green card applicants. The DOL indicated that the rule change was necessary “to better reflect the actual wages earned by U.S. workers similarly employed to foreign workers.”
The employment-based immigration system is predicated largely on protecting American workers and supplementing the existing workforce with foreign workers for needed job positions. The seismic changes in the US economy has placed increasing focus and demand on highly-skilled foreign workers, as Americans alone have often failed to meet the growing demand of US employers. The impact of the DOL’s changes on wages is reflect in a simple comparison: prior to the wage change, an Applications Software Developer in Durham, NC had an entry level (Level I) wage of ; after the change, that wage jumped from $60,590 to $93,850. The top-end wage for the same position (Level IV) went from $95,472 to $188,698. Moreover, if the DOL had insufficient wage information about a particular job position, the agency now simply defaults to a $100/hour wage amount.
The outcry from industry has been swift and a consortium of technology and manufacturing companies has requested court intervention. A hearing on a request to stop the implementation of the rule until further judgement was scheduled for November 13th, but has since been cancelled with a judgment expected to be forthcoming. Until some clarity is provided by the courts as to the use of the new wage rules, employers are recommend to wait before submitting H-1B or prevailing wage requests to the DOL, as an injunction may reset all wages to their pre-October 8 levels.