Biden Administration Freezes Trump’s "Midnight" Regulations

On January 20, 2021, the White House issued a memo directing federal agencies to temporarily halt the rulemaking process of new and pending regulations and postpone the effective dates of final regulations. The memo impacts agency regulations that are typically issued by the outgoing Administration from the time of the presidential election to inauguration day, known as “midnight regulations”. The regulatory freeze is commonly used to allow incoming Administrations time to review regulations and ensure that they align with the new Administration’s agenda.

Effective January 20, 2021, the memo directs all pending regulations that have not been published in the Federal Register to be immediately withdrawn. In addition, it instructs federal agencies to “consider” postponing the effective dates of published regulations for at least 60 days from the date of the memo, or until March 21, 2021. This memo however does not impact regulations that have already taken effect.

How Does the Regulatory Freeze Affect Immigration-Related Regulations?

In response to the White House’s regulatory freeze, the Department of Homeland Security (DHS) withdrew the Trump-era proposed regulation, “Removing H-4 Dependent Spouses from the Class of Aliens Eligible for Employment Authorization” (commonly known as the “H-4 EAD Rescission Regulation”) on January 25, 2021, which has been pending review since February 2019.

The temporary regulatory freeze will also cause the withdrawal of the Department of Homeland Security’s modified final rule on the definition of employer-employee relationship for H-1Bs, which was announced on January 15th but never published. Moreover, the Department of Labor (DOL) just announced on January 27th that it is planning to postpone the effective date of its final rule that will increase the prevailing wages for H-1B and PERM labor certifications from March 15, 2021 to May 4, 2021. The DOL’s postponement of the effective date however does not have much significance as the first phase-in of the new prevailing wages is scheduled to begin in July 2021.

At this time, it remains unclear whether the regulatory freeze will impact the DHS' final rule that modifies the H-1B cap selection process based on wages. If DHS chooses to follow the memo’s directive, the final rule’s effective date of March 9, 2021 would be postponed for a couple weeks to March 21, 2021, which is after the expected end date of the H-1B cap registration period following last year’s closure on March 20, 2020. As noted in our previous alert, we believe that is unlikely that the final rule impacting the H-1B cap selection process will take effect in time for this year’s cap lottery.

We will continue to monitor the DHS final rule and will provide an update when information becomes available.

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