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DHS PUBLISHES FINAL RULE PERTAINING TO NEW CHANGES TO H-1B LOTTERY SYSTEM

On January 08, 2021 the Department of Homeland Security (DHS) published a final rule, under the new system, the selection of H-1B registrations (or petitions, if the registration process is suspended) will be based on corresponding wage levels, in place of the old lottery system.  The rule is scheduled to take effect on March 9, 2021.  The rule was originally published as a proposed rule on November 2, 2020, with the public granted 30 days to comment on the proposal. Although DHS received more than 1,400 comments on the proposed rule, DHS declined to make any changes to the rule between the proposed version and final version.

As per the final rule, if USCIS would receive registrations more than the H-1B limit allows (85,000) during the initial registration period of at least 14 days, it would award the petitions from highest to lowest salary. The selection will be based on the highest Occupational Employment Statistics (OES) prevailing wage level that the proffered wage equals or exceeds for the relevant Standard Occupational Classification (SOC) code and area(s) of intended employment, beginning with OES wage level IV and proceeding in descending order with OES wage levels III, II, and I. If the proffered wage were to fall below an OES wage level I, because the proffered wage were based on a prevailing wage from another legitimate source (other than OES) or an independent authoritative source, USCIS would rank the registration in the same category as OES wage level I. If USCIS were to receive and rank more registrations at a particular wage level than the projected number needed to meet the applicable numerical allocation, USCIS would randomly select from all registrations within that particular wage level a sufficient number of registrations needed to reach the applicable numerical limitation. This proposed rule would not affect the order of selection as between the regular cap and the advanced degree exemption. The wage level ranking would occur first for the regular cap selection and then for the advanced degree exemption.

Now, at the time of the submission of the registration, a registrant or a petitioner would be required to provide the highest OES wage level that the proffered wage equals or exceeds for the relevant SOC code in the area of intended employment. The SOC code and area of intended employment would be indicated on the LCA filed with the petition. For registrants relying on a prevailing wage that is not based on the OES survey, if the proffered wage were less than the corresponding level I OES wage, the registrant would select the “Wage Level I and below” box on the registration form. If the H-1B beneficiary would work in multiple locations, or in multiple positions if the registrant is an agent, USCIS would rank and select the registration based on the lowest corresponding OES wage level that the proffered wage will equal or exceed. Therefore, the registrant would be required to specify on the registration the lowest corresponding OES wage level that the proffered wage would equal or exceed. Furthermore, where there is no current OES prevailing wage information for the proffered position, the registrant would follow the Department of Labor (DOL) guidance on prevailing wage determinations to determine which OES wage level to select on the registration. DOL has provided guidance on its website, and through the Foreign Labor Certification Data Center. If the H-1B beneficiary will work in multiple locations, USCIS will rank and select the registration based on the lowest corresponding OES wage level that the proffered wage will equal or exceed. DHS has proposed changes to the H-1B electronic registration tool and Form I-129 to require petitioners to indicate the highest OES wage level that the beneficiary’s proffered wage equals or exceeds for the relevant SOC code in the area of intended employment.

As per the Department of Homeland Security, all registrations with a proffered wage that corresponds to OES wage level IV or level III would be selected and 58,999, or 75 percent, of the registrations with a proffered wage that corresponds to OES wage level II would be selected toward the regular cap projections. None of the registrations with a proffered wage that corresponds to OES wage level I or below would be selected toward the regular cap projections. For the advanced degree exemption all registrations with a proffered wage that corresponds to OES wage levels IV and III would be selected and 12,744, or 20 percent, of the registrations with a proffered wage that corresponds to OES wage level II would be selected. DHS estimates that none of the registrations with a proffered wage that corresponds to OES wage level I or below would be selected. Accordingly, there is reduced likelihood that registrations for level II would be selected, as well as the likelihood that registrations for level I and below wages would not be selected.

Also, as per the final rule, USCIS also would deny a subsequent new or amended petition filed by the petitioner, or a related entity, on behalf of the same beneficiary for a lower wage level if USCIS were to determine that the filing of the new or amended petition was part of the petitioner’s attempt to unfairly increase the odds of selection during the registration (or petition, if applicable) selection process. In addition, unselected registrations will remain on reserve for the applicable fiscal year.

Please note, the President-Elect’s transition team has indicated that the Biden Administration will issue a memorandum on January 20 delaying implementation of “midnight regulations” (i.e., those issued since the election but not yet effective). It is anticipated that the Biden Administration will adopt a 60-day delayed effective date for such midnight regulations. Depending on how the memorandum is worded, the effective date of this DHS final rule could be delayed either to March 21, 2021 (sixty days from the date of the Presidential memorandum) or May 8, 2021 (sixty days from the regulation’s effective date as published in the Federal Register). The May 8, 2021 effective date would make it extremely difficult, if not impossible, for the agency to implement the rule for the upcoming FY 2022 H-1B cap filing season. Alternatively, an implementation delay only to March 21, 2021 could potentially allow DHS to conduct the selection process based on the new rule, though timing would be extremely tight, if not impossible as the regulations require that the registration period begin at least 14 calendar days before the earliest date on which H-1B cap-subject petitions may be filed for a particular fiscal year, and last a minimum of 14 calendar days.3 Thus, if USCIS implements the registration process for the FY 2022 cap filing season, the regulations would require USCIS to open the initial registration period no later than March 18, 2021, which is the minimum 14 calendars day before April 1, 2021. Accordingly, it is not immediately clear how the agency might try and implement the new wage-based lottery rule for the upcoming H-1B cap filing season if the rule’s effective date is delayed until March 21, 2021.

We will regularly update the blog as soon as any new information is available.

Disclaimer

This article aims to provide new information concerning changes to the H-1B CAP Lottery System through final rule. This article, under no circumstances, acts as legal advice; therefore, for any immigration questions, please contact your Attorney or the Ahluwalia Law Offices, P.C. (Team ALO).

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