H-1B Employers Would Pay Higher Wages in New Trump Proposal (2)

The Trump administration is seeking to prevent companies from undercutting salaries for Americans with new rules requiring significantly higher wages for foreign workers in the US.

Prevailing wage levels for white-collar workers on H-1Bs and certain green card categories would be adjusted based on specific occupation and geographic market under the proposal released Thursday by the Labor Department.

The H-1B program, the main visa for professional jobs, has become a prime target for opponents of foreign hiring in the US who say it’s exploited by companies that hire inexpensive foreign talent to avoid paying higher wages for citizens. Top employers of new H-1B hires in fiscal year 2025 included Amazon.com Inc., Microsoft Corp., Meta Platforms Inc., Google, and IT services provider Tata Consultancy Services.

Businesses say H-1B workers are essential to meet specialized hiring needs and that they pay competitive wages. But the program has been attacked for allowing IT and staffing firms to hire inexpensive workers for lower-level tech jobs.

The first Trump administration attempted to dramatically increase prevailing wage levels, but regulatory efforts were hamstrung by court challenges and ultimately abandoned by the Biden administration.

“This proposed rule will help ensure that employers pay foreign workers wages that reflect the real market value of their labor, in addition to protecting the wages and job opportunities of American workers,” said Secretary of Labor Lori Chavez-DeRemer in a statement. “The continued abuse of the H-1B program by certain bad actors will no longer be tolerated.”

Proposed Wage Floors

The Labor Department classifies positions in four “wage levels” that account for job duties and required experience levels. It sets pay ranges for those four tiers based on Bureau of Labor Statistics survey data.

Employers must agree to pay the designated prevailing wage level for an occupation in a given labor market to get DOL approval before submitting an H-1B petition. Raising those prevailing wages to a higher percentile of the BLS wage data sets higher pay mandates for those skilled foreign workers to match compensation for similar Americans.

The proposal would increase Wage Level I, which covers most entry-level workers, from the 17th percentile to the 34th percentile; Wage Level II from the 34th to the 52nd; Wage Level III from the 50th to the 70th; and Wage Level IV from the 67th to the 88th.

For Wage Level I, that would translate to an 18% increase over average offered wages in data from 2020 to 2024, the DOL projects.

Those higher wage floors, if finalized, would add to a series of moves starting last fall to overhaul the H-1B program. The Department of Homeland Security has revamped the annual lottery for 85,000 H-1B visa slots, tilting the odds in favor of the highest-paid, most senior workers in their field. And the White House has imposed a $100,000 fee on hiring of workers on H-1B visas from outside the US.

The proposed rule would further shift the program toward higher-wage roles and add another hurdle for businesses hoping to sponsor entry-level or early career workers.

It also applies to the permanent labor certification process for EB-2 and EB-3 immigrant visas, a labor market test that employers must clear when sponsoring workers for green cards. Those programs are closely linked to the H-1B program, the DOL noted, as more than 57% of so-called PERM applications in fiscal year 2024 were filed on behalf of employees on H-1B status.

The public will have 60 days to submit comments in response to the proposal after it’s published in the Federal Register on March 27.