H-1B Cap Lottery Process Replaced with a Salary-Based Process

Today, the Department of Homeland Security will publish a rule to replace the current H-1B lottery system for disbursing the 65,000 regular cap slots and 20,000 U.S. Master’s degree slots with a system based on wage levels assigned by the Department of Labor’s Occupational Employment Statistics (OES). While the current process already makes it challenging for individuals with Level 1 wages to obtain H-1B visas, the current computerized system selects H-1B cap applicants at random and entry level positions with Level 1 wages at least have a chance.  The new process prioritizes applicants with the highest salaries in their occupation and geographical area, making it nearly impossible for applicants with entry level wages to be selected in the cap. First, Level IV wages will be selected, then Level III, and so on in descending order. If the number of Level IV wage applications exceeds the slots available, a randomized computer lottery will be used to make the selections for that wage level.

The published rule is set to take effect in 60 days, in time for the FY2022 cap season in March 2021. The rule, however, is almost certainly going to be subject to litigation and may even be enjoined because Congress intended for high-skilled H-1B workers to be hired at all wage levels. Additionally, The Congressional Review Act allows regulations passed in the last 60 days of a President’s term to be delayed by the next administration, so it’s possible that the Biden Administration may delay or rescind the rule after inauguration on January 20, 2021. Nevertheless, the Biden Administration has many immigration priorities to address in its first 100 days and has expressed support for a wage-based system in the past, so it’s unclear what approach it will take with regard to this rule and whether it will play a role in this year’s H-1B lottery.

Employers will need to wait and see what happens after Biden’s inauguration to determine if the new wage-based system will impact their approach to the H-1B cap season this year. Please contact an attorney at Minsky, McCormick & Hallagan, P.C. if you have questions regarding the new H-1B rule.