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Trump’s new rules hike H-1B wages by up to 47% in some regions

Lawsuits against the rule may, however, save India’s IT industry a big headache. The aim of the wage increase is to make it tough for companies to hire H-1B workers and instead encourage local hiring. Along with the wage hikes, the Trump administration had also announced a new rule that would make it harder to qualify for an H-1B visa.

October 09, 2020 / 02:47 PM IST

US immigration attorneys are working against time to file a lawsuit in the coming days against the Department of Labor’s (DOL) hike in wage levels for H-1B and green card applicants.


The new wage levels came into effect from October 8 and have increased H-1B wages by as much as 47 percent.


The aim of the wage increase is to make it tough for companies to hire H-1B workers and encourage local hiring. Along with the wage hikes, the Trump administration had also announced a new rule that would make it harder to qualify for an H-1B visa.


The lawsuit could help Indian IT and tech firms, which have a significant concentration of H-1B employees, and the substantial increase would bite into their margins.


In an email response to Moneycontrol, Greg Siskind, founding partner, Siskind Susser, PC, an immigration law firm in Memphis, said: “We are still assembling the plaintiffs group. It will be diverse and should include employers, employees and organisations/associations. We’re on the fast track here and are hoping to file the case in the next couple of days or weeks.”


Separately, in a tweet, Siskind had said the litigation challenging the DOL wage rule is pro bono (undertaken for the public good, voluntarily and without payment).



New wage rule increase

On October 6, the DOL announced implementation of new wages for highly skilled immigrants such as H-1B, H-1B1 (nationals of Chile and Singapore), E-3 (Australian citizens) and green card applicants across the four levels, from entry level to experienced professionals in the field.


These wage levels are calculated based on Occupational Employment Statistics (OES) data, based on role, geography and experience. The increase in wages, experts pointed out, was quite significant.


Let us look at salary before and after implementation of wage rules in Texas.

For Software developers/systems software [engineers] the wage levels were $61,901, $80,766, $99,632 and $118,498 for level 1, level 2, level 3 and level 4, respectively, per year. The updated wage levels show that the wages per year for level 1 to level 4 now stand at $91,624, $119,059, $146,494 and $173,930, respectively.


The wages have increased by 47 percent on average across levels for this particular occupation in Texas.


Moneycontrol also checked two more regions in California for the role of Computer programmers, and wages have seen an increase of close to 40 percent across the four levels there.


The median salary of Indian H-1B visa holders is $90,730 per year, according to a report by brokerage firm HDFC securities.


Grounds for lawsuits

The rule is already vulnerable to challenges, pointed out experts.


Any major new rules are supposed to go through reviews and receive feedback from the public before implementation. In a note, US-based immigration firm Fragomen said: “DOL took the rare step of issuing the regulation with immediate effect, no advance notice or opportunity for public comment, and without an economic impact analysis, all of which make the rule vulnerable to challenge.”


Recently, a US court blocked the USCIS from implementing visa fee hikes starting October 2, which increased visa fees across categories, including H-1B. The visa fee for H-1Bs was increased by 21 percent to $555.

For firms with more than 50 employees and those that have more than 50 percent of their workforce as H-1B visa holders will have to pay $4,000 for extensions. Kellen Powell, an immigration attorney, said that the fee was hiked to almost double of what it is right now.
Swathi Moorthy
first published: Oct 9, 2020 02:47 pm
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