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Tuesday, December 1, 2020

Federal Court Set Aside Rules on Prevailing Wage Increase and H-1B Restrictions


A federal district court in Northern California set side two interim final rules of the U.S. DOL and DHS:

1) Strengthening Wage Protections for the Temporary and Permanent Employment of Certain Aliens in the United States (Wage Rule)

2) Strengthening the H-1B Nonimmigrant Visa Classification Program (H-1B Rule), 

Both rules were promulgated swiftly by the Government recently without going through the normal rule making process.  The Wage Rule was published on 10/08/2020 by DOL - which substantially increased the wage requirements for many employment-based immigration petitions - took effect almost instantly.  

The H-1B Rule - which would impose stricter requirements on the H-1B visa program by restricting the applicants' subjects of study, redefining the meaning of specialty occupation, as well as imposing additional requirements regarding employer-employee relationship - was scheduled to take effect on 12/07/2020.  

A lawsuit was filed by the U.S. Chamber of Commerce to stop the enforcement of these rules.  One of the bases for the lawsuit was government's failure to follow the normal rule-making process.  The Government countered by arguing that the occurrence of COVID-19 excused it from following the normal notice and comment timetable. 

The U.S District Court, Northern District of California, disagreed with the government that these rules are so urgently needed that the public's right to notice and comment should be taken away.  The normal rule-making procedure can be skipped only under very narrow circumstances or in the event of emergencies. 

The Government argued that sky-high unemployment rates brought about by the pandemic justified the quick promulgation of the rules.  The Court noted that the government had been aware of the unemployment situation for several months already and should have taken actions earlier.  In fact, President Trump announced the Buy America, Hire Americans initiative as early as 2017, directing the cabinet Secretaries to address the issues regarding the labor market.  Hence, the Government's delay in pushing out these rules without following the normal procedure was unreasonable. Further, the employment rates in the professional and business sectors, which employ most H-1B workers, have actually been low. Hence, there is no urgent need to restrict the H-1B visa program.

It is important to note that the Court did not address whether the rules would actually achieve the purported goals of the Government.  The Court decision merely held that the Government failed to justify the implementation of the rules without public notice and comment.  

What's Next

The Government may still appeal the District Court's decision.  Hence, the outcome is still uncertain at this moment.  However, assuming the decision stands, the Labor Department would have to quickly revert the wage tables to the old rates.  DHS/USCIS would also have to stop enforcement the new H-1B rule on 12/07/2020.  

12/4/2020 Update

Both DHS and DOL have agreed to follow the federal court order.  DOL has already planned to revert the wage data on its systems next week.  Hence, we can consider the decision to be final. 

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