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Article: Court Battles Ensue on DOL’s H-1B Prevailing Wage Rule by Wolfsdorf Rosenthal

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  • Article: Court Battles Ensue on DOL’s H-1B Prevailing Wage Rule by Wolfsdorf Rosenthal

    Court Battles Ensue on DOL’s H-1B Prevailing Wage Rule

    by


    Court Battles Ensue on DOL’s H-1B Prevailing Wage Rule
    October 21, 2020

    As predicted, lawsuits are being filed to stop the Department of Labor’s (DOL) H-1B prevailing wage rule. One such suit, ITServe Alliance Inc. et al. v. Scalia et al., was filed October 16, 2020. The plaintiffs, a group of technology firms, say the new interim final rule will “upend” their businesses and object to the rule on several grounds:

    DOL “dramatically altered” the way it calculates H-1B prevailing wage rates
    The agency made the wage rates “exponentially higher without notice or opportunity for comment
    The new wage rates are “set under a novel standard that conflicts with the governing statutory criteria
    The new wage rates are “arbitrary and capricious because the agency relied on outdated, incorrect, or limited empirical data, failed to consider readily available, relevant data and empirical studies, and engaged in reasoning that conflicts with basic economic theory”
    The plaintiffs seek both preliminary and permanent injunctions to stop the rule from taking effect.

    In related news, research from the National Foundation for American Policy (NFAP) finds that the wages mandated under the new rule “do not reflect market wages or meet the definition of a prevailing wage.” NFAP said it “downloaded the entire DOL wage library used to determine prevailing wage rates as of June 30, 2020, and compared those wages to the new required minimum wages for every occupation and geographic area after the DOL rule went into effect.” NFAP also “obtained a sample of private wage surveys to compare market wages to the new DOL wages for a selection of common occupations.”

    DOL determines prevailing wages under four defined levels: Level 1 (entry level); Level 2 (qualified); Level 3 (experienced); and Level 4 (fully competent). The new wage rule increases the required minimum salary by a substantial margin across all wage levels for H-1B visa holders and employment-based green card holders. For all occupations and geographic locations, the new minimums are, on average, 39% higher for Level 1 positions, 41% higher for Level 2, 43% higher for Level 3, and 45% higher for Level 4, NFAP’s research found.

    As examples, NFAP found:

    The new rule mandates that an employer pay a petroleum engineer 99.5% more than the prevailing wage in existence at Level 1 only shortly before the DOL wage rule took effect.
    On average, employers would need to increase annual salaries by nearly 50% at Level 1 for computer hardware engineers, more than 40% for computer programmers and chemical engineers at all wage levels, and more than 35% for electrical engineers, computer network architects, computer systems analysts, mechanical engineers and database administrators at all wage levels.
    On average, employers would be required to pay software developers at least 45% higher annual salaries.
    The new DOL wage rule appears to be unworkable for employers in another important respect, NFAP found: The new DOL wage system requires employers to pay exactly $100 an hour, or $208,000 a year, for more than 18,000 combinations of occupations and geographic labor markets, regardless of skill level and position, because DOL cannot provide prevailing wage data for the occupations under the new system. This takes place for some of the most common high-skilled occupations in America’s leading high-tech area, NFAP said.

    More litigation is expected shortly on both the DOL interim final rule and a Department of Homeland Security interim final rule on specialty occupations and employer-employee relationships. Stay tuned.

    WR hosted a webinar on this topic recently.

    Contact your WR attorney for advice in specific situations.

    This post originally appeared on Wolfsdorf Rosenthal LLP. Reprinted with permission.


    About The Author

    Wolfsdorf Rosenthal LLP is a full-service, top-rated immigration law firm providing exceptional immigration and visa services. With over 30 years of experience and offices in Los Angeles, New York, Oakland, San Francisco, Santa Monica, and Shanghai, the firm specializes in providing global immigration solutions for investors, multinational corporations, small businesses, academic and research institutions, artists and individuals. Wolfsdorf Rosenthal attorneys are experts in their field and are featured contributors and speakers at local, national and global immigration forums and publications. They are also consistently recognized for their work and honored by the most prestigious awards on a national and global level.


    The opinions expressed in this article do not necessarily reflect the opinion of ILW.COM.

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