On October 8, 2020, the Department of Labor (DOL) and Department of Homeland Security (DHS) simultaneously issued interim rules which create significant immigration changes if permitted to stand. The twin rules were issued in response to the Presidential Proclamation instructing DOL and DHS to revisit immigrant regulations amidst the COVID-19 pandemic. As interim rules, they forego the lengthy comment and review period of final regulations and go into effect virtually immediately. The DOL rule is effective as of October 8 and the DHS rule becomes effective on December 7, 2020. These rules are of enormous public concern, impacting many thousands of individuals, and the scores of hospitals, universities, businesses, and others that employ them. This broad impact compelled the University to join a lawsuit in Federal District Court challenging the legality of the rules and seeking injunctive relief. (See President Folt’s letter to the USC community here.)
The DOL Rule – Change in Prevailing Wages
The Department of Labor rule changes the DOL Wage Survey formula for determining the 4 levels of prevailing wages applicable to H-1B, E-3, and green card applications. It revises the percentile of the surveyed wages among all professionals at all levels (from the most entry-level to the most experienced) in a given occupation artificially increasing wages substantially. For instance, the change in the prevailing wage required for a mid-level postdoc molecular biologist in the Los Angeles area rose from $76,871 to $111,975 per year. Under the new DOL rule, the new formula changes wage computations as follows:
| Existing Methodology | DOL Rule | |
| Level I | 17th percentile | 45th percentile |
| Level II | 34th percentile | 62nd percentile |
| Level III | 50th percentile | 78th percentile |
| Level IV | 67th percentile | 95th percentile |
The DOL has concluded that it lacks sufficient data to identify a prevailing wage rate under its new rule for more than 18,327 combinations of occupations and geographic labor markets. For these occupations, the minimum wage rate is set at $208,000 per year.
The new DOL rules went into effect immediately upon publication and now apply to all applications requiring prevailing wages. The wages do not apply retroactively but will apply to all new petitions and applications filed after October 8, 2020. These include the following University petitions and applications filed after the effective date:
- H-1B and E-3 extensions of status;
- H-1B and E-3 changes of status (for example J-1 to H-1B or F-1 to H-1B);
- H-1B and E-3 changes of employer; and
- Prevailing wage determinations required for PERM applications (most EB-2’s and EB-3s).
The new wages do not apply to:
- O-1s,
- TNs,
- EB-1 petitions,
- J-1s,
- F-1 OPT/CPT, and
- those employed with Employment Authorization Documents (EAD).
Faculty/Staff Visa Services (FSVS) is contacting hiring departments for positions adversely impacted by the new wages. Hiring units and admins that have cases that must be filed within the next two months should contact FSVS if not already contacted to review alternatives. We request that all others to not contact FSVS to determine if the new wages apply to your position. FSVS’ mission is to provide timely support to our community, but the number University cases potentially subject to prevailing wages make it impractical to provide individual updates. We request your patience. Additionally, the new DOL rule may no longer be applicable if successfully overturned or enjoined by litigation by the time your case needs to be filed.
DOL Wage Rule Alternatives
For those USC positions that are unable to meet the new DOL wages, current regulations permit the University to provide alternate wage surveys instead of the DOL 4 -tiered surveys. In order to qualify, alternate surveys must meet specific regulatory requirements. FSVS and our peer institutions are actively reviewing and identifying acceptable alternate surveys. Not all positions will be covered by a qualifying alternate wage survey which may then require sponsorship under a different visa category if available.
The DHS Rule – Changing What Qualifies as a Specialty Occupation
The new DHS rule amends the regulatory definition of “specialty occupation” and related requirements to restrict the categories of jobs that will qualify as H-1B specialty occupations effectively constraining the universe of specialty occupations compared to existing law. The current definition permits employers to establish a position qualifies as a specialty occupation by showing a baccalaureate or higher degree in a specific or closely related field is normally the minimum requirement for entry into the occupation across employers. For example, the position of software designer can qualify as a specialty occupation by showing a baccalaureate or higher degree in Computer Science/Engineering/Technology or the closely related field of Electrical Engineering is the normal minimum requirement for entry into the occupation..
The new definition will require a showing that a specific degree is always the requirement for entry into the occupation across employers. So, a postdoctoral scholar position in Statistics that will accept a PhD in Statistics, Mathematics, Physics, or Computational Engineering, would unlikely continue to qualify as a specialty occupation without additional justification. Employers will need to show how the H-1B beneficiary’s degree(s) and coursework are directly related to the duties and responsibilities of the H-1B position.
The new rule creates a heightened specialization requirement that also makes it more difficult for positions to qualify where positions do not match up neatly with universities’ labels for their degree programs. This will directly impact positions in emerging fields and cross disciplines such as those in biophysics, bioinformatics, or biomechanical engineering.
The new DHS rule is not effective until December 7, unless enjoined by litigation. As with the DOL rule, it does not apply retroactively and only for H-1B petitions filed after December 7, 2020. It will apply to H-1B extensions, changes of employer, and changes of status. It will not apply to petitions in process filed before December 7, 2020.
FSVS’ current top priority is filing H-1B petitions that can be filed prior to December 7, 2020.
Legal Challenges to the Twin Rules
Both the DOL and DHS rules were prepared and issued with no input from and sprung upon the public. They circumvented the legally required notice, comment, and review period required for permanent regulations under the pretext the COVID-19 pandemic necessitated an end-run. Multiple lawsuits are now in process challenging the legality of the rules. Until injunctive relief is granted, the DOL rule is effective now. The DHS rule is not effective now but could become effective if an injunction is not ordered by December 7, 2020.
New Rules FAQ’s.
What do the new rules do?
The DOL rules increase the prevailing wages employers must pay. For those positions that DOL does not have wage data for, employers must pay a wage of $208,000 per year.
The DHS rules change the definition of specialty occupation narrowing down occupations that will qualify for H-1B.
Who do the new rules apply to?
The new DOL rule now applies to all petitions and applications subject to a prevailing wage:
- H-1B and E-3 extensions of status;
- H-1B and E-3 changes of status (for example J-1 to H-1B or F-1 to H-1B);
- H-1B and E-3 changes of employer; and
- Prevailing wage determinations required for PERM applications (most EB-2’s and EB-3s).
They do not apply to the following:
- O-1s,
- TNs,
- EB-1 petitions,
- J-1s,
- F-1 OPT/CPT, and
- those employed with Employment Authorization Documents (EAD).
The new DHS rule will apply to the following H-1B petitions filed after December 7, 2020:
- H-1B Extension of Status;
- H-1B Change of Employer;
- H-1B Consular Processing; and
- H-1B Change of Status.
Are the rules retroactive?
No, they are not. New DOL wages will only apply to applications and petitions filed on or after October 8, 2020. Certified and approved applications do not require current wages to be revised upwards.
The DHS rule does not apply to current petitions or those filed before December 7, 2020.
I think the new rules apply to my position, what should I do?
If your status is not expiring within the next two months, please hold off from enquiring with FSVS. The new rules may no longer apply at the time your petition will be filed. FSVS is currently contacting hiring departments with petitions and applications that need to be filed within the next two months that are affected by the new rules. Admins who have cases that fall within this window and have not been contacted by FSVS should contact their Visa Specialists. To minimize duplication of efforts, we ask foreign nationals whose cases fall within this window to first contact their admins for an update before contacting FSVS.
What are the University and FSVS doing about the new rules?
FSVS is prioritizing and filing all H-1B petitions that can be filed before December 7, 2020. We are identifying wage surveys that meet the DOL alternative wage survey requirements. FSVS is also reviewing alternate visa categories not affected by the new rules that can be pursued. Additionally, the University joined a lawsuit in Federal District challenging the new rules.
Are there alternatives to the new rules?
Current DOL regulations allow employers to use alternate wage surveys that meet DOL predefined criteria. Alternate surveys can have more accurate wage data. Some foreign nationals may qualify for alternative visa categories that are not affected by the new rules. FSVS will work closely with departments to purse these alternatives for those who can avail of them.
Can I contact FSVS to see if the new rules apply to me?
FSVS is reviewing and coordinating with hiring departments the applicability of the new rules. Cases that must be filed within the next two months (i.e. status is expiring in two months) are FSVS’s priority. We ask that FSVS not be contacted if status is not expiring before December 31, 2020. The University has numerous applications that may be subject to the new rules at this time. FSVS does not have the capacity to individually address cases expiring after December 31, 2020. We respectfully requests inquiries be held off for those that expire before that date. FSVS will not respond to requests for case statuses expiring after December 31, 2020. Additionally, ongoing litigation could make the new rules inapplicable by the end of December or sooner.
What can we do for -H-1B petitions that will become subject to the rules?
Hiring departments should prepare more detailed job descriptions and be prepared to show a direct correlation between the qualifying degree and a foreign national’s transcript to the position’s duties and responsibilities.
Hiring departments must also carefully assess the actual minimum education and experience required for a position. Case initiations should not list the “nice to have” requirements as these can be higher than the actual minimum requirements increasing applicable DOL wage levels.
FSVS remains committed to providing quality service to our community and will keep you informed of updates and developments with the DOL and DHS rules.