DOL DRAMATICALLY RAISES PREVAILING WAGES

DOL DRAMATICALLY RAISES PREVAILING WAGES

On January 14, 2021 the US Department of Labor (DOL) published its Final Rule regarding the calculation of prevailing wages.  Readers of our blog will note that the DOL previously issued an Interim Rule about calculation of prevailing wages which was struck down by Federal Judges late last year.  The Final Rule published on January 14, 2021 is the updated version of the Interim Rule.

 

Summary of the Final Rule

The Final Rule will dramatically change the calculation of prevailing wage levels resulting in significantly higher prevailing wages.  While the new percentiles are lower than the October 2020 Interim Rule’s percentiles, the new percentiles are still considerably higher than the current percentiles. 

 

Wage Level	Current Percentile	October 2020 Interim Rule Percentile	January 2021 Final Rule Percentile
1	17	45	35
2	34	62	53
3	50	78	72
4	67	95	90

 

The Final Rule applies to prevailing wages applicable to applications for H-1Bs, H-1B1s, E-3s, and Green Cards.

 

Transition Periods

The Final Rule attempts to provide employers and foreign nationals an opportunity to adapt to the change in calculations.  For those who did not have an I-140 approval in hand as of October 8, 2020, the transition will occur over an eighteen-month period:

• Stage One, Present to June 30, 2021: Current Percentiles remain in effect
• Stage Two, July 1, 2021 to June 30, 2022: 90% of the Final Rule percentile
• Stage Three, July 1, 2022 and Beyond: 100% of the Final Rule percentile

For those who did have an I-140 approval in hand as of October 8, 2020, and so are applying for a post-six year H-1B extension, the transition will occur over an three and a half year period:

• Stage One, Present to June 30, 2021: Current Percentiles remain in effect
• Stage Two, July 1, 2021 to June 30, 2022:85% of the Final Rule percentile
• Stage Three, July 1, 2022 and Beyond: 90% of the Final Rule percentile
• Stage Four, July 1, 2023 and Beyond: 95% of the Final Rule percentile
• Stage Five, July 1, 2024 and Beyond: 100% of the Final Rule percentile

The American Immigration Lawyers’ Association (AILA) reported that President-Elect Biden’s transition team will issue an immediate 60-day delay to the implementation of this and other last-minute regulations promulgated by the Trump presidency, but how the Biden Administration will move forward remains unknown.

 

Alternative Wage Surveys

Alternative Wage Surveys may be accepted by the DOL if the survey meets specific requirements.  Employers concerned about the Final Rule and its implications for their employees may want to consider using an Alternative Wage Survey in place of the DOL’s wage survey.  For more information about which wage surveys may be accepted by the DOL, please contact your MU attorney.