The U.S. Department of Labor (DoL) today announced a Final Rule to reform the wage methodology it uses to set prevailing wage rates for Permanent Employment Certification, H-1B, H-1B1 and E-3 Visa foreign worker programs. The Department’s Employment and Training Administration administers the foreign labor programs covered by the Department’s wage methodology.
On Oct. 8, 2020, the Department published an Interim Final Rule, and invited public comment. U.S. Secretary of Labor claimed that “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”. “In response to the comments we received, the Department has adjusted the wages levels used in the Interim Final Rule to better reflect market wages and included provisions to smooth the transition to the new wage levels.” “The Final Rule will improve the accuracy of prevailing wages paid to foreign workers by bringing them in line with the wages paid to similarly employed U.S. workers, ” claims the Labor Secretary.
When seeking H-1B, H-1B1 or E-3 visas for workers, U.S. employers must attest that they will pay nonimmigrant workers, during the period of authorized employment, the higher of the prevailing wage or the actual wage paid to other employees with similar experience and qualifications.
Similarly, when an employer seeks to hire an immigrant under an EB-2 or EB-3 classification, the employer must recruit U.S. workers for the position using a prevailing wage issued by the Department. They must also attest that they will pay foreign workers the prevailing wage.
In the final rule the Department of Labor is including a delayed implementation period under which adjustments to the new wage levels will not begin until July 1, 2021. Further, once adjustments begin, they will be made in a phased approach, with most job opportunities not becoming subject to the full increase to the new levels until July 1, 2022
Changes in the Prevailing Wage Rate on OES survey data:
- Level I Wage:
- From July 1st, 2021, Level I prevailing wage will be adjusted from the 17th percentile to the 90 percent of the 35th percentile wage. [In simple term, this means the new prevailing wage Level I rate will essentially be even littler higher rate than previous (July 2020) Level II wage rate]. From July 1st, 2022, the prevailing wage will be 35th percentile wage.
- Level II Wage:
- Level II prevailing wage will be calculated as per 8 U.S.C. § 1182(p)(4).
- Where the Secretary of Labor uses, or makes available to employers, a governmental survey to determine the prevailing wage, such survey shall provide at least 4 levels of wages commensurate with experience, education, and the level of supervision.
- Where an existing government survey has only 2 levels, 2 intermediate levels may be created by dividing by 3, the difference between the 2 levels (IV minus I) offered, adding the quotient thus obtained to the first level and subtracting that quotient from the second level (Level IV).
- Level II prevailing wage will be calculated as per 8 U.S.C. § 1182(p)(4).
- Level III Wage:
- Level III prevailing wage will be calculated as per 8 U.S.C. § 1182(p)(4).
- Where an existing government survey has only 2 levels, 2 intermediate levels may be created by dividing by 3, the difference between the 2 levels (IV minus I) offered, adding the quotient thus obtained to the first level and subtracting that quotient from the second level (Level IV)..
- Level III prevailing wage will be calculated as per 8 U.S.C. § 1182(p)(4).
- Level IV Wage:
- From July 1st, 2021, Level IV prevailing wage will be adjusted to the 90 percent of the 90th percentile from the current 67th percentile. From July 1st, 2022, the level IV prevailing wage will be adjusted to the 90th percentile.
Note: This is a blog post by Adhikari Law PLLC and should NOT be construed as a legal advice. Changes in immigration policies and procedures are complex and may require a consultation with an experienced immigration lawyer. You can contact us at (+1) 202 600 7742, or email us at info@adhikarilaw.com if you will have any question on this topic. Also sign-up for our next conference call or webinar on this topic.