DOL Issues Wage Mandate Rule for H-1B Visas

Wages employers must pay foreign employees on H-1B and other work visas will increase under a final rule issued by the U.S. Department of Labor.

The final rule changes the methodology DOL uses to set prevailing wage rates for its permanent employment certification, H-1B, H-1B1, and E-3 visa foreign worker programs.

The DOL said the final rule will bring prevailing wages paid to foreign workers more inline with wages paid to U.S. workers in similar positions.

The change, which came in the final days of the Trump administration, was made “to help protect the wages and job opportunities of American workers,” DOL said.

“The U.S. Department of Labor is taking these steps to strengthen wage protections, address abuses in visa programs, and protect American workers from being undercut by cheaper foreign labor,” U.S. Secretary of Labor Eugene Scalia said in a release.

New Methodology

Under the new methodology, H-1B visa workers on the first, or lowest, level must be paid at least the 35th percentile for the job type and location.

Workers on the second level must be paid at least the 53rd percentile, workers on Level III must get paid at least the 72nd percentile, and those on Level IV must be paid at least the 90th percentile.

The final rule takes effect 30 days after publication in the Federal Register.

It’s unclear if the new methodology will be implemented by the incoming administration.

But it’s unclear if the new methodology will be implemented by president-elect Joe Biden, who takes office Jan. 20.

The Trump administration has sought to restrict immigration and has limited the use of visas, including the H-1B, which allows U.S. employers to temporarily employ foreign workers in specialty occupations that require technical or theoretical expertise.

Visa Limits

U.S. technology companies rely on these visas to hire workers from countries like India and China.

In 2019, the administration reversed the order of selecting petitions for the H-1B visa lottery to increase the number of visas awarded to workers with a master’s degree or higher from a U.S. college or university.

It also limited the number of H-1B visas to 85,000 per year—including 20,000 for workers with advanced degrees.

.@USDOL announced a final rule protecting the wages and job opportunities of American workers by reforming the minimum prevailing wages for permanent employment certification, H-1B, H-1B1, and E-3 visa foreign worker programs: https://t.co/iEJhIWkfHs

— U.S. Department of Labor (@USDOL) January 12, 2021

That impacted staffing and outsourcing companies that contract foreign workers to U.S. employers.

Further visa restrictions were put in place during the pandemic.

The H-1B1 visa is a form of the H-1B used for nationals of Singapore and Chile. The E-3 visa is for Australian citizens.

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For more information, contact CBIA’s Diane Mokriski (860.244.1900) | @HRHotline.