DOL Interim Final Rule Increases Prevailing Wages

A Department of Labor (DOL) Interim Final Rule (the new rule) which took effect yesterday (10/08/2020) changes the prevailing wage levels for H-1B, E-3, and H-1B1 and PERM cases, resulting in higher OES-based prevailing wages. Specifically, the following shows how much the increases are compared to previous wage levels:

• Level I Wage: 45th percentile (from 17th percentile)

• Level II Wage: 62nd percentile (from 34th percentile)

• Level III Wage: 78th percentile (from 50th percentile)

• Level IV Wage: 95th percentile (from 67th percentile)

The new rule was published and took effect on 10/08/2020, and DOL will accept public comments for 30 days. The new wage levels apply as follows:

• H-1B, E-3, and H-1B1: LCAs filed on or after 10/08/2020 will be subject to the new and higher wage levels. LCAs filed and pending before 10/08/2020 are subject to the previous prevailing wage levels. Therefore, for an employee who is currently working under valid H-1B status, there is no need to raise the salary to match the new wage levels. The new wage levels will apply later when an extension petition is filed.

• PERM Applications: Prevailing Wage (PW) Requests issued on or after 10/08/2020 will be subject to the new wage levels, which means PW Requests pending on 10/08/2020 are subject to the new rule. PW Determinations issued before 10/08/2020 will be based on the previous prevailing wage levels.

As we can see, the OES-based prevailing wage increased significantly: for example, a current level II wage (62nd percentile) is almost equal to a previous level IV wage (67th percentile).

There might be lawsuits filed against this new rule in federal courts. If such a litigation case is filed and if the plaintiff is granted a preliminary injunction, the new rule would not be enforced when the case is being litigated.

In the meantime, if you need to file an H-1B, E-3, or H-1B1 case with the new rule in effect, you can also use alternative wage sources, such as private wage surveys, instead of OES-based prevailing wage levels for LCAs and PERM applications. We are currently obtaining wage data from various survey companies and will be glad to provide an assessment of your case.