The Department of Labor has issued a Notice of Proposed Rulemaking (NPRM) that signals one of the most significant shifts in H1B The Department of Labor has filed a Notice of Proposed Rulemaking (NPRM) that signals one of the most significant shifts in H1B and PERM wage compliance in years. Scheduled for Federal Register publication on March 27, 2026, under Docket No. ETA-2026-0001, this proposed rule would substantially raise the prevailing wage floors across all four wage levels for H1B, H1B1, E-3, and PERM labor certification purposes.
If you are an employer currently sponsoring or planning to sponsor foreign national workers, or a visa holder on an employment-based pathway, this proposed rule demands your attention now.
What the Proposed Rule Changes
The Department of Labor currently determines prevailing wages using data from the Bureau of Labor Statistics Occupational Employment and Wage Statistics (OEWS) survey. The existing four-tier structure places wage levels at approximately the 17th, 34th, 50th, and 67th percentiles of the OEWS wage distribution for Levels I through IV, respectively.
Under the proposed rule, those thresholds would shift dramatically:
- Wage Level I: from the 17th percentile to the 34th percentile
- Wage Level II: from the 34th percentile to the 52nd percentile
- Wage Level III: from the 50th percentile to the 70th percentile
- Wage Level IV: from the 67th percentile to the 88th percentile
DOL’s stated rationale is that the current structure sets entry and mid-level wages below what comparably employed U.S. workers earn, undermining the statutory mandate that foreign worker employment not adversely affect domestic wage conditions.
Why This Matters for H1B Employers
In fiscal year 2024, the Department certified over 502,000 H1B Labor Condition Applications. Of all LCAs certified that year, 19 percent were assigned to Wage Level I and 44 percent to Wage Level II, meaning nearly two thirds of all certified H1B positions are concentrated in the two wage tiers facing the steepest upward adjustments under this proposal.
Additionally, approximately 57.6 percent of PERM applications filed in FY 2024 were submitted on behalf of workers already in H1B status. That means the proposed wage increases would ripple through both the nonimmigrant and permanent residence pipelines simultaneously, affecting LCAs and PERM filings alike.
For employers, this is not a distant concern. Workforce planning, compensation benchmarking, and PERM filing strategies need to be evaluated against these proposed thresholds today, before the rule is finalized.
The Regulatory History You Need to Understand
This is not the first attempt to raise H1B prevailing wages. In October 2020, DOL issued an Interim Final Rule that proposed pushing wage percentiles to approximately the 45th, 62nd, 78th, and 95th percentiles. That rule was subsequently challenged and ultimately rescinded before taking effect.
The current NPRM represents a recalibrated approach, with increases that are significant but positioned below those 2020 figures. DOL is explicitly grounding this proposal in the INA’s statutory requirement that wage levels be commensurate with experience, education, and the level of supervision, a standard it argues the current methodology fails to meet.
What Employers and Visa Holders Should Do Now
Once published in the Federal Register, a 60-day public comment period will open. This is a formal opportunity for employers, industry groups, and affected individuals to submit comments at regulations.gov under Docket No. ETA-2026-0001. The comment window begins on the official publication date.
Beyond the comment process, this is the time to conduct a proactive audit of your current workforce wage levels, assess the cost and compliance implications of the proposed increases, and evaluate whether any pending PERM filings or LCA renewals should be accelerated.
At Ahluwalia Law Offices, PC, we counsel employers and foreign national clients on employment-based immigration strategy across H1B, PERM, EB-2, and EB-3 matters from our Dallas, Texas office. We are monitoring this proposed rule closely and are prepared to help you assess its impact on your specific situation.
This is a proposed rule, not a final rule. No timeline for finalization has been confirmed. All strategic decisions should be made in consultation with qualified immigration counsel based on your individual facts.
FAQ SECTION
What is the DOL proposed prevailing wage rule for 2026?
The Department of Labor has filed an NPRM scheduled for Federal Register publication on March 27, 2026, proposing to raise the prevailing wage percentiles used to set H1B, H1B1, E-3, and PERM wage floors. The proposed increases would raise Wage Level I from the 17th to the 34th percentile, Level II from the 34th to the 52nd, Level III from the 50th to the 70th, and Level IV from the 67th to the 88th percentile of the OEWS wage distribution.
How would the proposed rule affect H1B employers?
Employers sponsoring H1B workers would need to offer higher prevailing wages to satisfy Labor Condition Application requirements. Since approximately 63 percent of all FY 2024 LCAs were assigned to Levels I and II, which face the largest proposed increases, the impact on compensation budgets would be broad and immediate upon any finalization.
Does this proposed rule affect PERM green card filings?
Yes. The same OEWS wage methodology governs both H1B LCAs and PERM labor certifications. The proposed increases would apply across both temporary and permanent employment pathways, directly affecting EB-2 and EB-3 sponsorship cases.
When does the proposed rule take effect?
This is a proposed rule and has not been finalized. Once officially published in the Federal Register, a 60-day public comment period will open. No effective date for a final rule has been announced.
How do I comment on the proposed rule?
Public comments may be submitted electronically through the Federal eRulemaking Portal at regulations.gov. Reference Docket No. ETA-2026-0001 in your submission.
Should H1B employers take action before the rule is finalized?
Employers should consult with immigration counsel now to assess the potential wage impact on current and planned sponsorships, review pending PERM filings, and evaluate compensation structures. Strategic preparation before finalization can reduce disruption and compliance risk.
