H-1B and PERM Programs Face Possible Wage Overhaul

The United States Department of Labor (DOL) has submitted a new regulatory proposal that could significantly reshape employer-sponsored immigration, signaling a renewed push to strengthen H-1B and PERM wage protections. The proposal, titled “Improving Wage Protections for H-1B and PERM Employment,” has been forwarded to the Office of Management and Budget (OMB) for review, marking the first formal step toward potential rulemaking.

While the full details of the proposal remain confidential, early indications suggest a sharp increase in wage requirements for foreign workers—an approach intended to prioritize American workers by making it more costly and restrictive for US companies to hire overseas talent.

H-1B: A Familiar Policy Path Resurfaces

The move echoes a similar effort undertaken during the previous Trump administration. In 2021, the DOL finalized a sweeping regulation aimed at overhauling the prevailing wage system used for several visa categories, including H-1B, H-1B1, E-3, and permanent labor certifications under the PERM process.

That regulation sought to raise minimum wage benchmarks by redefining how prevailing wages were calculated. However, it was met with immediate legal challenges and was ultimately withdrawn under the Biden administration. Although the Biden-era DOL initially signaled plans to craft its own version, the initiative faced repeated delays and was eventually dropped from the regulatory agenda.

The latest proposal suggests a policy revival following former President Donald Trump’s 2025 proclamation directing the DOL to rewrite prevailing wage rules.

“The move follows Trump’s 2025 proclamation directing the DOL to rewrite prevailing wage regulations. Details aren’t public yet, but this could significantly impact H-1B and PERM costs. Employers should be watching closely,” immigration attorney Emily Neumann wrote on X.

What the 2021 DOL Proposal Tried to Change

The 2021 regulation focused on how prevailing wages are determined for foreign workers entering the US labor market. At its core was a restructuring of the four-tier wage system derived from the Occupational Employment Statistics (OES) survey conducted by the Bureau of Labor Statistics.

The DOL argued that the existing system underestimated market wages, allowing foreign workers to be hired at salaries below those earned by similarly employed US workers. By recalibrating wage tiers upward, the department aimed to ensure that hiring foreign labor would not suppress wages or limit job opportunities for domestic workers.

These changes would have directly affected Labor Condition Applications (LCAs) and PERM labor certifications, forming the backbone of many employer-sponsored immigration pathways.

H-1B: Potential Impact on Employers and Workers

Immigration policy analysts warn that the revived proposal could dramatically alter the economics of hiring foreign professionals. In a post on X, James Blunt said the regulation could effectively sideline large portions of the H-1B program by pushing prevailing wages to levels many employers cannot sustain.

According to Blunt, roles that previously complied with wage rules at around $120,000 annually could suddenly require salaries in the $230,000 to $240,000 range—not only for new filings but also for extensions and job transfers.

Such increases, he argued, would severely disrupt the technology, healthcare, staffing, and employer-sponsored immigration sectors, potentially accelerating the offshoring of jobs rather than protecting domestic employment.

“This level of disruption is exactly what forced the rapid retraction of the earlier rule,” Blunt noted, adding that the ripple effects would extend far beyond visa holders alone.