New Rule Could Bring Substantial Changes to H-1B Program

Immigration Update

Date: January 14, 2021

On January 8, the Department of Homeland Security released a final rule that will modify the H-1B nonimmigrant visa cap selection process. However, it is probable that the incoming Biden administration will delay or revoke the regulation before it takes effect.

The new rule, which was originally proposed in October 2020, replaces the current random H-1B lottery selection with a wage-based priority selection. On January 8, DHS published it as a final rule with no change from the original regulatory text in the proposed rule.

The rule is scheduled to take effect 60 days from publication – on March 9 – just in time for this fiscal year’s H-1B selection, which occurs by the end of March. However, it is anticipated that the rule’s implementation will be delayed by the Biden administration and it will not impact the FY 2022 cap season beginning this spring.

The rule calls for H-1B selections to be made according to offered wage, with those having the highest offered wages selected first. The Department of Labor divides wages into four levels. Because the rule favors H-1B applicants with higher salaries, registrants like recent college graduates and other entry-level professionals typically in the lower prevailing wage levels will be less likely to receive H-1B visas under the new system. Indeed, DHS has predicted that there would be no selections offered for petitions with level 1 wages.

The Biden transition office has stated that once President-elect Joe Biden is inaugurated, he will issue a memo to stop or postpone the Trump administration’s midnight regulations or actions that have not taken effect by Inauguration Day. Ultimately, the rule could be repealed by a Democrat-led Congress, along with other midnight regulations finalized during the last months of the Trump administration under the Congressional Review Act. Likewise, the rule potentially could be challenged in federal court by industries that believe the new ranking system might impede their ability to hire foreign talent. The Biden administration’s view on the proposed wage-based selection is not clear.

We will continue to monitor ongoing developments with respect to the final rule, whose future is uncertain. Employers looking ahead to H-1B sponsorships in the coming years should consider moving them up to this year if the rule is delayed so they have the benefits of a lottery selection that is not tied to offered wages.

FOR MORE INFORMATION

For more information, please contact:

Sarah C. Flannery
216.566.5718
Sarah.Flannery@ThompsonHine.com

Staci M. Jenkins
513.352.6734
Staci.Jenkins@ThompsonHine.com

Hannah E. Caldwell
216.566.5908
Hannah.Caldwell@ThompsonHine.com

or any other member of our Immigration group.

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