Court Halts Trump Administration’s Attempt To Drastically Change H-1B Qualifications and Procedures

In October, the Trump Administration rolled out a series of changes to the H-1B visa program. One of the most drastic changes was a severe increase in the prevailing wage determinations. The Department of Labor rolled out the changes immediately, increasing the prevailing wage percentiles by nearly 30% at all levels. In practice, this change means that employers will either need to significantly increase their H-1B employees’ salaries, or the employee will be downgraded to a lower wage level and could face higher scrutiny for the changes when amending a petition. Other changes with the Department of Homeland Security’s separate rule include increasing restrictions on visa holders working at customer sites as well as limiting the visa to a one-year period and changes to the definition of “specialty occupation”. In particular, the rule change will no longer allow for experience alone to satisfy the term. Instead, the regulation would now demand a “specialized degree” be held.

Changes to the lottery have also been announced. Specifically, the lottery process will become a process where the applicants with the highest wages are selected first, as opposed to an actual “lottery”. In practice, only Level VI and III will be selected, leaving little if any room for applicants at Wage Levels II & I. Tying to the above wage increases, the process will essentially force the employer to pay the new increased wage or lose out on the potential employee.

On December 1, 2020, the Northern District of California, after hearing challenges from the U.S. Chamber of Commerce, set aside both rules as violations of the Administrative Procedure Act. Meaning, the Administration failed to follow the regulatory guidelines in publishing the new rules and failed to justify the “good cause” required to do so. While this does not mean these changes will not ultimately go into effect, it at least temporarily halts the implications of these changes. As a result of that decision, the wage levels have returned to the rates prior to the October rule’s announcement. Other litigation around the country is centered on the substance of the rule changes. And, with the election results as they currently stand, the rules may be scaled back in their entirety.

For more information, contact Karl Ulrich at 937.222.2052 or by email at kulrich@ssdlaw.com.