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Worldwide ERC® Files Comment on Proposed H-1B Wage Cap Rule

On 30 November, Worldwide ERC® filed a comment on a proposed USCIS wage-based lottery process that would negatively impact the workforce mobility industry.

On 30 November, Worldwide ERC® filed a comment on the proposed United States Citizenship and Immigration Services (USCIS) wage-based lottery process rule “Modification of Registration Requirement for Petitioners Seeking to File Cap-Subject H-1B Petitions,” 85 Fed. Reg. 69236 (November 2, 2020). Exacerbated by the new U.S. Department of Labor (DOL) wage computation rule, the proposed wage-based lottery process would negatively impact the workforce mobility industry. Worldwide ERC® also signed onto a joint-stakeholder letter and joined a comment letter with 128 organizations on the H-1B Lottery (prioritization) Notice of Proposed Rulemaking.

What is the new proposed rule on H-1B selections?

Under the new rule, the U.S. Citizenship and Immigration Services (USCIS) will prioritize the selection of H-1B cases based on the highest wage levels established under the Standard Occupational Classification (SOC) codes within the subject area of employment. The proposed rule change, when combined with a new wage rule released by the Department of Labor, severely limits the amount of high-skilled foreign talent U.S.-based employers can hire.

How does the new rule affect businesses and talent?

Specifically, the new rule would shut out of the U.S. labor market talent who are at the start or midpoint of their career as well as impose undue burdens on emerging and smaller businesses. With H-1B selections going to higher-waged individuals, the new rule neglects to take into consideration industry and company-specific differences establishing seniority and its associated wages, as well as various factors that influence wage determinations in the private sector. The result is essentially a wage-based auction, wherein selection is based on those who are subjectively assumed to be highest skilled or highest valued.

Smaller and emerging businesses that operate on lower salary structures, and businesses negatively impacted by COVID-19, would face unnecessary hardship when hiring foreign high-skilled talent. Those who are just starting out or are in the mid-point of their careers, such as recent graduates, could also be priced out of selection. The new rule will have a particularly deleterious effect on students from U.S. universities seeking to change to H-1B status, establishing a system that shuts out graduating students or those otherwise newer to the labor force, and potentially driving some of the best trained and educated minds back to their home countries, and perhaps without intention forcing entire businesses off-shore. The wage-based lottery could also shut out otherwise qualified and highly skilled but entry level health care workers, who are particularly critical as the U.S. continues to fight the COVID-19 pandemic.

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How does this impact mobility?

These are just a selection of the many reasons why the proposed rule would negatively impact U.S. businesses working to hire needed foreign talent, and the workforce mobility industry professionals who facilitate and support the hiring and moving of such talent. It is imperative that the voices of this industry are heard as this new rule proposes undue challenges in conjunction with previous rule changes. Worldwide ERC® commented on the new rule and asked that the USCIS delay its implementation of the rule until Fiscal Year 2023 H-1B cap season as employers are already preparing H-1B cap cases for Fiscal Year 2022 with the current registration process in mind. Doing so would permit time for the regulated community to make any necessary adjustments and avoid disruptions caused solely by the regulatory process.

Should any member have questions regarding this rule or the previously announced rules, as well as questions regarding Worldwide ERC®’s comments, please reach out to Vice President of Member Engagement and Public Policy Rebecca Peters, rpeters@worldwideerc.org.

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