HR Policy Urges DOL to Reconsider Arbitrary Change in H-1B Wage Requirements

November 13, 2020

HR Policy joined several groups in filing comments that outline significant flaws in DOL’s Interim Final Rule on prevailing wages for H-1B workers, including its considerable disconnect from actual wages earned by similarly employed U.S. workers.

Background:  Before filing a petition for an H-1B worker, a company must certify with DOL that the foreign worker’s wages will meet or exceed the “prevailing wage” for an occupational classification within a particular area.  DOL organizes the prevailing wage in four levels: Level I (entry), Level II (experienced), Level III (qualified), and Level IV (fully competent).  The Interim Final Rule (IFR), which has already taken effect, significantly raises the prevailing wage levels in each of the four levels ostensibly to “better reflect the actual wages earned by U.S. workers similarly employed to foreign workers.”

However, the new prevailing wage levels are far higher than actual wages.  “The Department of Labor manufactured a new prevailing wage rate system that is utterly disconnected from the actual wages employers pay similarly situated United States workers,” the comments show.

The comments demonstrate the broad scope of negative impacts the rule will have on companies and the U.S. economy.  For example, the IFR will price out many early-career, foreign-born workers from the U.S. labor market by increasing the minimum required wage to the 45th percentile of the DOL's Occupational Employment Statistics surveyed wages.

HR Policy also joined an amicus brief supporting a preliminary injunction of both the DOL and DHS interim final rules, as reported last week.  The brief emphasizes the importance of H-1B workers to the U.S. economy and argues the government failed to demonstrate “good cause” to finalize the rules without prior notice and opportunity to comment.

Outlook:  While President-elect Biden has promised to undo many of the current administration's immigration policies, it is unclear whether he would undo this rule.  Even if he does, the Biden campaign’s immigration plan would seem to suggest that further regulations may be on the way.