USCIS Publishes Final Rule Changing H-1B Cap Selection Process

Today, January 9th, the U.S. Citizenship and Immigration Services (USCIS) published a final rule that radically changes the random selection process for the annual H-1B cap (the “cap lottery”). Under the current system, the limited number of new H-1Bs available each year are selected randomly, with some preference given to holders of advanced degrees from U.S. universities. The new system would allocate new H-1B cap numbers primarily based on the salary offered. Numbers would be made available first to positions being paid the Department of Labor (DOL)’s highest level of prevailing wage for that occupation (“Level IV”). Any remainders would first be made available to positions with Level III wages, and then to positions with Level II and Level I wages, until all available numbers are allocated.

Although the rule is intended to apply to the upcoming FY2022 H-1B cap lottery, which is expected to be run in March of this year, there are several factors which may prevent it from taking effect:

  • The Final Rule is likely to be subject to legal challenge, and may be blocked by a Federal Court because the relevant statutory provisions passed by Congress require that new H-1Bs be allocated based on the order in which they are filed, rather than the wage level.

  • The Biden Administration, working with the Democrat-controlled House of Representatives and Senate, may nullify the rule before it takes effect, as it is likely to do with much of the other “midnight rulemaking” left by the Trump Administration. Although the Biden campaign suggested that it favors a similar revision to the H-1B selection process, it has indicated that it would pursue this change through more legally sound legislative efforts, rather than administrative rulemaking.

  • The USCIS may not have sufficient time to implement the changes that would be required to implement the new rule.

What This Means for Our Clients and Their Employees

For the reasons mentioned above, we believe that the new Rule will not likely go into effect this cap season. If it does take effect this year, it would clearly benefit sponsorship for senior, and higher-paid positions, and work to the detriment of entry-level positions.

We will keep our clients posted with any updates.

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