On October 8, 2020, the Department of Labor published a new rule with immediate effect that looked to increase prevailing wage minimums for foreign workers. The new rule changed the required percentile of each wage level, which significantly increased the prevailing wages required at each level. The previous wage levels were set at approximately the 17th, 34th, 50th, and 67th percentiles. As of October 8, these wage levels were adjusted to the 45th, 62nd, 78th, and 95th percentiles. In other words, where Level II used to require wages at the 34th percentile, Level II now requires wages at the 62nd percentile. As a result, the prevailing wages required now for any of the four wage levels are significantly higher, greatly affecting LCAs and, in turn, the H-1B program.
There are already three lawsuits filed and pending, challenging this rule (Chamber of Commerce et al. v. DHS et al., Case No. 20-CV-7331 (N.D. Ca., October 19, 2020); Purdue, et al. v. Scalia, Case No. 1:20-CV-03006 (D.D.C., October 19, 2020); and ITServe Alliance Inc., et al. v. Scalia, Case No. 2:20-CV-14604 (D.N.J., October 16, 2020)). We do expect an injunction or other relief as a result of these lawsuits, as the new wages required are well above the market wages. However, in the meantime, we are offering our clients an alternate route to prevent the LCA wages from being too high or otherwise restricting our clients’ businesses.
Ordinarily, ILBSG files LCAs using OES data (which stands for Occupational Employment Statistics, which is data published through the Bureau of Labor Statistics, Department of Labor). This has always been our preferred method of calculating the prevailing wages since it is data from the DOL and the LCA is filed with the DOL. However, alternative wage surveys (private or commercial data sets) are expressly permitted under the regulations, which allows us to use this route for the LCAs. Therefore, in cases where the prevailing wages under the OES are too high, ILBSG suggests using an alternative wage survey instead.
This is a good option because it is not advisable to file the LCAs for a lower wage level than we have used in the past for any given beneficiary. In other words, if you have previously filed an LCA for a beneficiary at Level II, we cannot file an amendment or extension with Level I wages. Once you have reached a certain wage level, if we use a lower wage level in a subsequent filing, USCIS will scrutinize the case and likely issue a denial. Since maintaining the same wage level using OES data is resulting in substantial hikes to any given employee’s current wages, ILBSG is now suggesting the alternative wage survey as a strategy to resolve the wage issue while maintaining the appropriate wage level.
While the OES data has always been our preferred method of calculating the prevailing wages since this data cannot be challenged or rejected by the DOL, alternative wage surveys are expressly permitted by law and, therefore, a viable option right now for keeping the LCA wages reasonable. We do not anticipate challenges from the DOL since alternative wage surveys have always been permitted and accepted. However, if there is any question raised, we are confident that the wage determinations we are obtaining from reliable commercials surveys are based on excellent data, which will help us support and confirm the wages selected are appropriate.
As always, ILBSG will update its clients of any further updates from the DOL or any new developments in the pending lawsuits. In the meantime, ILBSG remains dedicated to helping its clients achieve success for all petitions and will continue to offer new and innovative strategies for navigating the ever-changing requirements in the H-1B program.
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