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DOL and DHS Interim Final Rules Concerning H-1B Blocked by The United States District Court

This an update relating to DOL and DHS Interim Final Rules affecting the H-1B program. On October 08, 2020 the DOL published a Rule (Strengthening Wage Protections for the Temporary and Permanent Employment of Certain Aliens in the United States) which dramatically increased the salary requirements for H1B and PERM cases overnight. The DOL rule changed the manner in which the DOL calculated the prevailing wage rates. The DOL also adjusted the prevailing wage percentiles for Levels I and IV upward. Also, on October 08, 2020 the DHS published an interim final rule (Strengthening the H-1B Nonimmigrant Visa Classification Program), which sought to redefine the Specialty Occupation Definition and the employer-employee relationship. The DHS Rule also sought to reduce the validity period for H-1B workers employed at third-party job sites from three years to one year. The DHS Rule was scheduled to go into effect on December 7, 2020 without taking into account the comments received during the comment period. On October 19, 2020, the Plaintiffs filed their complaint and asserted four claims for relief under Administrative Procedure Act “APA”, and alleged that the Government did not follow the rule making procedure (notice and comment procedures) and did not afford interested parties a meaningful opportunity to participate in the rulemaking process.

 

On December 1, 2020, in Chamber of Commerce of the United State of America, et al., v. United States Department of Homeland Security, et al., the United States District Court Northern District of California Ordered “Granting Plaintiff’s motion for partial summary judgment and denying Defendants’ Cross-Motion”. The Court set aside the DOL and DHS rules concerning H-1B on the basis that they were promulgated in violation of 5 U.S.C. section 553(b) and entered a partial judgment on those claims pursuant to Federal Rule of Civil Procedure 54(b). The Court concluded the DHS Rule was promulgated “without observance of procedure required by law” and must be set aside.

The United States District Court Northern District of California made following important observations and conclusions in the case:

  • The Court in this case “determines whether or not as a matter of law the evidence in the administrative record permitted the agency to make the decision it did.” The APA provides that a court “shall … hold unlawful and set aside agency action, findings and conclusions found to be … without observance of procedure required by law.”
  • According to the Court “The APA’s notice and comment procedures afford interested parties a meaningful opportunity to participate in the rulemaking process and assures that an agency’s decisions will be informed and responsive”, and “The APA’s 30 day waiting period is designed to give affected parties time to adjust their behavior before a final rule takes effect.”
  • The Court applied a de novo standard of review, and the analysis proceeded on case by case and took into account the totality of the factors at play.
  • The Court concluded that “The good cause exception to notice and comment is narrowly construed and reluctantly countenanced.” Also, the Court concluded that the “Good cause usually is invoked in the event of emergencies, where delay would do real harm to life, property, or public safety.”
  • The Court observed that “Although both agencies cited to skyrocketing and widespread unemployment rates as a basis to find immediate action was necessary, they did not do so for over six months.” The Plaintiffs argued that the Defendants unduly delayed in taking action and forfeited the ability to rely on the good cause exception, as a good cause cannot arise as a result of the agency’s own delay.
  • The Court observed that “Finally, it is a matter of public record that between March and October, Defendants issued a number of proposed rules unrelated to the COVID-19 pandemic, at least one of which expressly requested input on the impact of the COVID-19 pandemic on the proposed rules, and from that, it is reasonable to conclude Defendants are not entitled to a presumption of urgency.”
  • According to the Court “The good cause exception is to be narrowly construed, and in light of that standard, the Court concludes it is appropriate to focus on how the pandemic is impacting domestic unemployment for the types of positions held by H-1B workers.” Therefore, the Defendant’s assertion of a dire fiscal emergency falters. The statistics presented to the Court indicate that unemployment is concentrated in service occupations and that a large number of job vacancies remain in the areas most affected by Rules: computer operations which require high-skilled workers.
  • The Court observed that the Defendants did not suggest in the Rules or at oral arguments that they (Rules) are intended to be temporary solutions until the emergency situation has been eased by the promulgation.
  • The Court discussed that the record supports an inference that DOL delayed in responding to a problem it has been aware of since 2017, and the Court is not persuaded that DOL demonstrated the impact of the COVID-19 pandemic on domestic unemployment in sectors where most H-1B workers are employed is so dire that immediate changes to the prevailing wage rates were required, especially given the scope of those changes.

At the end, in the conclusion, the Court reiterated, “the history of the United States is in part made of the sorties, talents, and lasting contributions of those who crossed oceans and deserts to come here. The National Government has significant power to regulate immigration. With power comes responsibility, and the sound exercise of national power over immigration depends on the Nation’s meeting its responsibility to base its laws on a political will informed by searching, thoughtful, rational civic discourse.”

We will regularly update the blog as soon as any new information is available from DOL and DHS pursuant to December 01, 2020 order of the United States District Court.

Disclaimer

This article aims to provide new information concerning the December 01, 2020 order of the United States District Court. 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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