Significant and Damaging Changes to the H-1B Program

On October 8^th, 2020, two significant changes happened to the H-1B and guest worker visa program:

1. Wage Level Change Introduced by DOL’s through interim final rule:

The U.S. Department of Labor (DOL), published an interim final rule, that changed the methodology for calculating prevailing wage under 8 U.S.C. 1182(p)(4). This new interim final rule is targeted towards non-immigrant workers such as H-1B/H1-B1/E3. The interim final rule affects ETA Form 9035/9035E (Labor Condition Application) and ETA Form 9141 (Prevailing Wage Determination). Since, it is an interim final rule, it went into effect immediately. According to DOL’s FAQs https://www.dol.gov/sites/dolgov/files/ETA/oflc/pdfs/H1-B-Prevailing-Wage-IFR-FAQs-20201006.pdf, a pending ETA Form-9141 awaiting wage determination will be affected by this rule, any previously issued wage determination and pending/certified ETA Form 9035/9035E will not be affected.

There are 4 wage levels (Level I to IV), that an employer has to pay to a specialty occupation worker. The prevailing wage varies from the type of occupation to location where the worker will work. An employer has to file ETA Form 9035/9035E before a H-1B/H1-B1/E3 petition can be filed. The DOL certifies the ETA Form 9035/9035E. The new rule raises the pay from the 17th, 34th, 50th, and 67th percentiles of the Bureau of Labor Statistics Occupational Employment Statistics database to the 45th, 62nd, 78th, and 95th percentiles. Accordingly, the new rules affect the entry level positions the most. This new interim rule is open for public comments until November 09, 2020. The government has by this action, made the hiring of the H1B worker harder to do. Researching and paying for private wage surveys is the way to file the Labor condition applications is what we expect. Though this will increase the cost of filing the H1B, the wages that are provided will be more realistic. Attorneys have used such surveys in the past successfully. We will provide updates, if we see a push back from the USCIS regarding these.

2. Changes to Specialty Occupation and evidence requirement by the Department of Homeland Security (DHS)

The new interim final rule published by The Department of Homeland Security (DHS) on October 8, 2020, in the federal register revises the definition of specialty occupation and introduces several other changes. The new rule is set to take effect 60 days later if not enjoined by any court order and is open for public comments for next 60 days. The new rule will apply to all the H-1B petitions filed on or after the effective date of the rule. The new rule makes following changes:

i. The interim rule narrows the definition of “specialty occupation”, according to it a position is not a specialty occupation if a general degree is sufficient to qualify for that position, without any further specialization. Accordingly, a bachelor’s degree or equivalent is minimum requirement for entry into a said position, and the degree must be directly related to the specific H-1B specialty occupation.

ii. The interim rule differentiates between the worksite and a third-party worksite, according to the new rule, a worksite is the physical location where the work is actually performed by the H-1B worker. A third-party worksite is a place “other than the beneficiary’s residence in the United States” that is not owned, leased or operated by the petitioner.

iii. The interim rule also requires the petitioner to establish that the required degree is minimum requirement for entry into parallel positions at similar organization.

iv.  The interim rule limits the third-party placement H-1B validity to one-year increments and reimposes contract, work orders, or other similar requirements, such as an itinerary to establish that the petitioner will have an employer-employee relationship with the beneficiary, and that the beneficiary will perform services in a specialty occupation at the third part worksites.

v. The interim rule allows for the site visits at petitioner’s location and at third part worksites before or after the approval of an H-1B petition. The rule also grants power to deny or revoke a petition as a result of a petitioner’s or third party’s refusal to cooperate with inspection.

vi. The interim rule requires the employer to show the right to control, supervise, hire, terminate the employee placed a third-party worksite. In addition, it requires the petitioner to provide an evidence to show that the H-1B beneficiary is providing an end-product that can be directly linked to the H-1B petitioner’s business.

On this new change, we see a revert back to something that USCIS had announced as a change after the litigation spearheaded by Itserve Alliance- ( ITServe Alliance, Inc. v. United States Citizenship and Immigration Services, No. 1:18-cv-02350-RMC in the United States District of Columbia). The settlement referenced here- https://nfap.com/wp-content/uploads/2020/05/ITSERVE-SETTLEMENT-AGREEMENT-fully-executed_Redacted52020.pdf caused the USCIS to approve cases which were recently filed without much difficulty. This announced regulatory change will bring back harsh adjudications and will have the consulting companies get approvals in yearly increments.

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

Disclaimer

This article aims to provide new information concerning interim final rule introduced by DOL and DHS. 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).