Big Proposed Changes to H-1B Visa Pay Rules
The U.S. Department of Labor has suggested a major update to the salary rules for H-1B visas and employment-based green cards. If finalized, the new rules would significantly raise the minimum pay that companies must offer to foreign skilled workers.
The proposal was released in March. It will be open for public comments for 60 days once it’s officially published in the Federal Register. After that, it could be adjusted before becoming a final rule.
What the Proposal Changes
The plan focuses on overhauling the “prevailing wage” system. This system sets the minimum salary an employer must pay an H-1B or green card worker based on the job’s skill level and location.
Right now, there are four skill levels tied to specific market wage percentiles. The proposed rule would shift these percentiles upward, making the required minimum wage higher for every level.
New Wage Level Percentiles
For example, an entry-level (Level I) job’s minimum wage would jump from the 17th percentile to the 34th percentile of local market wages. The highest level (Level IV) would move from the 67th to the 88th percentile. The government estimates this could raise the average certified wage by about $14,000 per year for each position.
Why This Is Being Proposed
The Department of Labor says the current wage levels are too low and don’t match what U.S. workers are actually paid. They believe this has allowed some companies to hire foreign workers for less than the market rate.
The goal is to prevent the replacement of U.S. workers with lower-paid foreign workers and to ensure fair competition. The Labor Department states the change would make sure foreign worker wages “reflect the true market value of their labor.”
Who Will Be Affected?
These changes would only apply to new applications filed after the rule takes effect. They would not affect people who already have an approved H-1B visa or a pending green card application (PERM) based on older wage rules.
The new, higher wage requirements would apply to two main processes:
- H-1B Visas: Employers must file a Labor Condition Application (LCA) stating they will pay the prevailing wage.
- Employment-Based Green Cards: The PERM labor certification process also requires a prevailing wage determination.
Potential Impact on Salaries
The biggest effect will be on entry-level and lower-wage positions, where the jump from the 17th to the 34th percentile is the most significant. Hiring H-1B workers at these levels would become notably more expensive for employers.
The government predicts this could lead to billions of dollars in extra wage payments across the economy annually. Immigration lawyers note that this proposal is very similar to a rule proposed at the end of the first Trump administration, which was later blocked in court.
Other Recent H-1B Program Changes
This wage proposal is the latest in a series of changes to the H-1B program. Recent updates include:
- A new visa selection system that favors higher-wage job offers.
- A proposed $100,000 fee for certain new H-1B petitions (which is being challenged in court).
- Increased social media screening for visa applicants, contributing to longer wait times at consulates, especially in India.
It’s important to remember this is only a proposal. It must go through the public comment period and could face legal challenges before it becomes law.
