DHS Proposes New Rules to Replace H-1B Lottery with Wage-Based Selection Process

October 30, 2020 Sara Herbek

Key Points

  • DHS has proposed a new rule to change the H-1B lottery to a wage-based selection process
  • DHS intends to update the current lottery-based selection process to prioritize higher paid H-1B beneficiary employees
  • The announcement follows recent changes to the H-1B program in October 2020
  • The proposed rule is part of the Trump Administration’s plan to protect American jobs
  • The rule would apply to the regular H-1B cap and the H-1B advanced degree exemption

Overview

On October 28, 2020, the Department of Homeland Security (DHS) announced plans to change the H-1B selection process from a lottery system to a wage-based selection process. The new rule, set to be published on November 2, is designed to prioritize H-1B petitions filed on behalf of beneficiary employees who are offered higher wages.

Background

The agency’s proposed amendment to the H-1B visa selection process is part of the Trump Administration’s broader plan to protect American workers. The latest announcement follows recent changes to the H-1B program implemented earlier in October 2020, including minimum prevailing wage increases and additional restrictions for businesses on hiring H-1B workers.

What are the Changes?

DHS intends to modify the H-1B cap selection process by replacing the random selection process with a new wage-based selection process. Under the new rule, the program will prioritize H-1B employee beneficiaries who will earn a higher salary. According to the Trump Administration, this will create an incentive for employers to offer higher wages to their employees, require higher skills, and employ higher-skilled workers rather than hiring H-1B beneficiary employees for lower-paid positions. 

It is important to note that according to USCIS data, 66.1% of all H-1Bs issued in Fiscal Year 2019 with known occupation data were for "computer-related occupations,” and 54% of all H-1B beneficiaries held a master’s degree, and 36% held only a bachelor’s degree. 

Graduate degrees, particularly master’s degrees, account for the largest share of STEM degrees awarded to foreign students. The number of postsecondary STEM degrees attained by foreign national students has increased 315% from SY 1988-1989 to SY 2016-2017 (from 27,470 degrees to 114,092 degrees). As such, foreign national students made up 54% of master’s degrees and 44% of doctorate degrees issued in STEM fields in the U.S. during the 2016-2017 school year.

Who is Affected?

The rule would apply to FY2022 H-1B cap registrations submitted by prospective petitioners looking to file H-1B cap-subject petitions. The changes would impact the H-1B regular cap and the H-1B advanced degree exemption. 

Looking Ahead

A 30-day public comment period will begin when the rule is published in the Federal Register. DHS will review and consider all submitted comments before issuing a final rule.


Envoy is pleased to provide you this information, which was prepared in collaboration with Sara Herbek, who is the Managing Partner at Global Immigration Associates, P.C. (www.giafirm.com), Envoy’s affiliated law firm.

Content in this publication is not intended as legal advice, nor should it be relied on as such. For additional information on the issues discussed, consult an Envoy-affiliated attorney or another qualified professional.

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