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Highlights
- The U.S. Department of Labor (DOL) seeks to raise the minimum wage paid to foreign national employees sponsored on the H-1B, H-1B1, and E-3 temporary visa classification.
- The proposed rule would also impact employers seeking to permanently sponsor employees through the PERM labor certification program.
- It would also continue to allow employers to utilize private wage surveys and other alternative wage survey data as an alternative to DOL required wages.
On March 27, 2026, the U.S. Department of Labor (DOL) published a notice in the Federal Register seeking to restructure the calculation used to issue prevailing wages for employers seeking to hire temporary foreign employees under the H-1B, H-1B1, and E-3 visa classification, as well permanent sponsorship through the PERM labor certification program.
Organizations seeking to hire temporary foreign nationals through the H-1B, H-1B1, or E-3 visa classifications must pay sponsored employees the higher of:
- the prevailing wage; or
- the actual wage rate paid to similarly qualified U.S. workers in the area of intended employment.
For organizations seeking to offer permanent sponsorship to foreign nationals through the PERM labor certification program, employers are required to pay foreign nationals the prevailing wage in the area of intended employment.
The DOL uses Occupational Employment and Wage Statistics (OEWS) data from the Bureau of Labor Statistics to set prevailing wages. The prevailing wage is divided into four wage levels: entry (Level I), qualified (Level II), experienced (Level III) and advanced (Level IV).
Currently, Level I wages are set at the 17th percentile, Level II at the 34th percentile, Level III at the 50th percentile, and Level IV at the 67th percentile of the OEWS wage data.
Proposed Rule
The DOL seeks to adjust the OEWS percentile levels used to set the four prevailing wage levels as follows:
| Wage Level | Current Percentile | Proposed Percentile | Average Increase |
| Level I | 17th percentile | 34th percentile | 33% |
| Level II | 34th percentile | 52nd percentile | 24% |
| Level III | 50th percentile | 70th percentile | 21% |
| Level IV | 67th percentile | 88th percentile | 22% |
In short, the salary required for an entry level position (Level I) would increase to the current minimum salary for a qualified position (Level II). An experienced position (Level II) would increase to slightly higher than a current experienced position (Level III). An experienced position (Level III) would increase to slightly higher than a current advanced position (Level IV), and the Level IV increase jumps 21 points.
Impact to Organizations
If implemented, the proposed rule would only be applicable to new or pending wage determinations and labor condition applications that are pending with DOL as of the rule’s effective date, and to new applications submitted on or after that date. There will be no effect on previously approved cases.
However, the proposed changes would result in significant wage increases across all four levels for some pending applications and all new filings to include extensions of H-1B, H-1B, and E-3 employees. Based on the DOL’s comparison of historical and proposed prevailing wages data, the proposed wage level adjustments would increase the average certified wage by approximately $14,000 per year per sponsored employee. The proposed rule would continue to permit employers to use alternative wage sources beyond the OEWS salary survey data, which are not subject to the DOL wage percentiles.
The DOL will accept public comments through May 26, 2026. The effective date will be addressed in the final rule. The rule would not become effective until it has completed the notice-and-comment rule-making process, which may take several months. Once the final rule is published, it would become effective a short period later, typically thirty to sixty days after publication.
Recommendations
Organizations should contact their legal immigration counsel to identify potentially impacted employees and analyze potential actions, which could include filing for extensions of the H-1B status or considering the use of alternative wage survey data sources. Additionally, organizations may consider reviewing current job descriptions used for visa sponsorship to identify roles which may be impacted and assess whether to edit the positions duties or minimum requirements to potentially mitigate the risk of the proposed wage increases.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
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