On September 3, 2020, U.S. Citizenship and Immigration Services (USCIS) submitted an Interim Final Rule to the Office of Information and Regulatory Affairs (OIRA) within the Office of Management and Budget (OMB) entitled, "Strengthening the H-1B Nonimmigrant Visa Classification Program." It is anticipated that the administration will publish the regulation as an Interim Final Rule (IFR), rather than as a Notice of Proposed Rulemaking (NPRM), which would normally first require a 60-day comment period. An IFR means that the regulation would take effect possibly upon publication - without the agency first evaluating and responding to public comments.
On September 16, 2020, the U.S. Department of Labor (DOL) submitted an Interim Final Rule to OIRA entitled, "Restructuring of H-1B/H-1B1/E-3 and PERM Wage Levels." It is anticipated that the administration also plans to publish this regulation as an Interim Final Rule and that it could become effective immediately upon publication.
The timing of these regulations is crucial as, with the election coming in November and the possibility of a change of administration coming in January, the clock is ticking on this administration's ability to promulgate new regulations to implement its restrictionist agenda.
The USCIS and DOL Interim Final Rules are expected to combine to substantially modify prevailing wage requirements so as to limit the availability of the H-1B visa program to the most highly paid professionals, regardless of actual wage data for the labor market.
These are some highlights of several expected provisions of these regulations, and a preview of potential legal challenges these regulations may face.
While the specific language of the forthcoming regulations will not be available until they are published in the Federal Register, based on the regulatory agenda and other clues, they are expected to include the following:
- Revision of the definition of an H-1B specialty occupation to "increase focus on obtaining the best and brightest foreign nationals."
- Changes to the definitions of H-1B employment and the employer-employee relationship, with a focus on restricting offsite placement of H-1B workers. It is expected that the Interim Final Rule will revise the regulatory definition of "United States Employer" and the interpretation of "employer-employee relationship" so as to exclude or limit the availability of the H-1B visa program where there is third-party placement of H-1B workers.
- Possible requirement that H-1B employers and their end clients jointly obtain LCAs where H-1B workers will work at client sites. The regulation may include a revision to the Labor Condition Application (LCA) requirement so that when the H-1B worker is assigned to a third-party work site, the end-client would need to join in or be a signatory to the LCA. A joint LCA requirement may create de facto joint employer liability for LCA obligations on wages and working conditions.
- Additional H-1B wage requirements "to ensure employers pay appropriate wages to H-1B visa holders" as well as a restructuring of the H-1B, H-1B1, E-3 and PERM prevailing wage levels.
Litigation Challenging the Regulations
A few grounds for a legal challenge could include:
- Several of the expected changes appear to be inconsistent with existing statutes on specialty occupation.
- If issued as an Interim Final Rule, the agency will also need to show the basis for its determination that there exists "good cause" to skip the normal notice and comment process.
Reforming (read: restricting) the H-1B visa program is a priority for Senior Policy Advisory Stephen Miller. However, issuing these regulations as Interim Final Rules presents many risks and makes a successful legal challenge more likely. If a federal court issues an injunction following a legal challenge, it is unlikely that there would be enough time to republish a regulation and consider public comments - unless there is a second term of the Trump Presidency.