The United States Department of Labor (DOL) has put forth a new proposal that could make hiring foreign workers under the H-1B visa program considerably more expensive for American companies. The proposed rule seeks to increase the minimum wages paid to H-1B visa recipients, with some categories seeing a hike of over 30%.
Wage Protections for American Workers
Introduced on March 27, the proposal is currently open for public comments until May 26. Officials argue that the current wage structure, established nearly two decades ago, no longer accurately reflects present-day labor market conditions. The DOL stated that the existing system allows employers to hire foreign workers at salaries “significantly below” those paid to similarly qualified US workers, thereby harming domestic employment opportunities.
Proposed Wage Adjustments Across Levels
The changes would impact wage levels across four distinct categories of workers, from entry-level to the most experienced. The proposed increases are substantial:
- Entry-Level Workers: Proposed increase from $73,279 to $97,746 per year (a 33.39% rise).
- Level II Workers: Proposed increase from $98,987 to $123,212 per year (a 24.47% rise).
- Level III Workers: Proposed increase from $121,979 to $147,333 per year (a 20.79% rise).
- Level IV Workers: Proposed increase from $144,202 to $175,464 per year (a 21.68% rise).
It is important to note that prevailing wages can vary significantly by city and region across the United States.
Industry Reactions and Future Steps
The proposal has elicited a mixed response from businesses and industry groups. Supporters believe that higher wage requirements could mitigate the misuse of visa programs and better protect domestic workers. Conversely, critics express concerns that these changes might pose challenges for smaller companies, making it difficult for them to afford entry-level employees or recent graduates due to elevated salary demands.
The Department of Labor will review all public comments submitted before issuing a final rule. A previous attempt by the Trump administration in 2020 to revise prevailing wage rules without public consultation faced legal challenges and was ultimately shelved. This current proposal includes programs beyond H-1B, such as H-1B1, E-3, and PERM labor certification.