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DOL Proposes Extended Delay of Regulation Increasing PERM and H-1B Wage Minimums

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F-1 students

H-1B Wage Minimums: The Department of Labor (DOL) is proposing an extensive delay in the effective date of a regulation that would raise prevailing wage rates for the H-1B, H-1B1, E-3, and the PERM programs. Under the proposal, the guideline – which is at present set to take effect on 14th May 2020 – would be delayed by 18 months, or until 14th November 2022. Also, the proposal would delay the beginning of the transition period for adjustments to prevailing wage levels until 1st January 2023, from 1st July 2021, and extend the transition period from 18 months to three years.

DOL is proposing the delay to permit it more time to completely analyze the legal and policy issues raised by the rule. As well as extra time to compute and validate prevailing wage data for specific occupations and geographic areas.

DOL proposes delay of regulation increasing PERM & H-1B wage minimums

The proposed delay is expected to be published on 22nd March 2021. DOL will accept comments on the proposal for 30 days. Later on, DOL plans to give a request for public feedback on the substance of the prevailing wage guideline. Which could result in further changes to the substance of the regulation, its implementation schedule, or both.

The prevailing wage rule was proclaimed in January as one of the last regulatory actions of the Trump Government. The rule seeks to rebuild the prevailing wage system for the H-1B, E-3, H-1B1, and PERM programs and lift wage minimums for those programs.

As the guideline is presently composed, Level I (entry-level) wages for H-1B and PERM cases. Would increase to the 35th percentile of wages for every occupation and geographic region, from the 17th percentile. Level II would increase to the 53rd percentile, from the 34th percentile. Level III wages would increase to the 72nd percentile, from the 50th percentile. And Level IV wages would increase to the 90th percentile, from the 67th percentile. The wage increases to be phased in over an 18-month period that was set to start on 1st July 2021.

What this means for employers and foreign nationals

If the proposal is executed, employers would stay subject to DOL’s present prevailing wage rules, levels, and rates for most of the next two years. A transition period to the new pay levels would start on 1st January 2023. With a phase-in of further increases on January 1, 2024, January 1, 2025, and January 1, 2026.

[Biden admin issues notification to further delay mandatory minimum pay for H-1B visa]

However, it is possible that DOL could make changes to the execution dates and substance of regulation. Because of public feedback and its own further analysis of the rule and prevailing wage data.

Separate from the regulation, DOL’s prevailing wage information is set for a normal yearly increase on 1st July 2021. Which will affect work condition applications and prevailing wage determinations certified or filed on or after that date.

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