Employment & Labor Insider

Tomorrow the U.S. Department of Homeland Security will publish a proposed rule changing the selection process for cap-subject H-1B petitions. The proposed rule will be subject to a 30-day notice and comment period. An advance copy is available here.

The proposed rule will change the current random selection process to a weighted selection process based on wage levels. The weighting will favor higher wage levels and will result in significantly fewer H-1B selections for entry-level employees.

This will create additional challenges for employers seeking to retain entry-level employees who require H-1B sponsorship.

The proposed rule applies to new H-1B petitions that are subject to the annual lottery registration process. The rule does not apply to individuals who currently hold H-1B status. It does not affect the ability of employers to file H-1B extensions, amendments, or change of employer petitions for individuals who already hold H-1B status or were previously counted against the cap. It also does not affect individuals who were selected in this year’s lottery process even if their H-1B petitions are still pending and not yet approved.

Summary of the proposed rule

The current cap-subject H-1B lottery is a random selection process. To participate in the lottery, employers must submit a registration for each employee they seek to sponsor for H-1B status for the first time. Each registrant is entered into the lottery only once, regardless of whether multiple employers submit registrations for the same individual.

Under the proposed rule, the number of times a registrant will be entered into the selection pool (that is, the number of times the registrant will be entered into the annual H-1B lottery) would depend on the wage level that corresponds to the employee's salary. The greater the number of entries, the greater the chance a registrant would be selected in the lottery. The weighted formula would be as follows:

• Wage Level IV = 4 entries
• Wage Level III = 3 entries
• Wage Level II = 2 entries
• Wage Level I = 1 entry

The DHS estimates that the new rule would result in the probability of being selected in the lottery as follows:

• Wage IV = 61.16 percent (an increase of 107 percent versus the current process)
• Wage III = 45.87 percent (an increase of 55 percent versus the current process)
• Wage II = 30.58 percent (an increase of 3 percent versus the current process)
• Wage I = 15.29 percent (a decrease of 48 percent versus the current process)

According to the DHS, under the current process, the chance of being selected in the lottery is 29.59 percent and is not tied to wage levels.

If the proposed rule becomes final, the likely result is that Wage Level I registrants will receive far fewer selections in the annual H-1B lottery process than they do now.

Many employers submit cap-subject H-1B petitions for entry-level employees who are often considered Wage Level I registrants because of their roles. The proposed rule would make it more difficult for employers to obtain H-1B workers for these positions, which would also make it more difficult to retain such workers.

Additional details

• The proposed rule would maintain the two-stage selection process for the Bachelor’s and Advanced Degree (also known as U.S. Master’s) cap, but the weighted selection process would apply to both stages.
• Registrants with multiple registrations submitted on their behalf would be assigned the lowest Wage Level of all registrations submitted on their behalf.
• Registrants who will work in multiple locations would be assigned the lowest Wage Level applicable to the locations.
• The proposed rule would authorize the U.S. Citizenship and Immigration Services to deny subsequent new or amended petitions filed by the employer if it appears that the purpose of the new filing is to circumvent the selection process. This would be done by initially offering a higher wage for selection purposes and subsequently seeking to lower the offered wage after selection through a new H-1B filing.
• The proposed rule would require additional wage-related information to be provided as part of the registration process and in any subsequent H-1B petition. Discrepancies between the registration information and the associated H-1B filing could result in denial of the H-1B petition.

We will continue to monitor developments and will provide more information as it becomes available. If you have questions please contact the attorney you work with or any member of Constangy’s Immigration Practice Group.