Key Points
  • The Department of Labor will soon return to pre-October 8, 2020 PERM and H-1B OES wage data
  • The announcement follows two court orders last week blocking the agency from implementing the rules nationwide
  • Employers may submit Labor Condition Applications on December 9, 2020, using prevailing wage data from before October 8th
  • The Department of Labor has temporarily suspended issuing prevailing wage determinations (PWDs) and will resume on December 15, 2020, utilizing pre-October 8th wage data
  • Employers that received a PWD under the interim rule may request an agency review through January 4, 2021
  • Processing delays should be anticipated
Overview

The Department of Labor (DOL) has issued details on how it will comply with two recent court orders that block enforcement of the agency’s October 8, 2020 rule that increased government prevailing wages for H-1B, H-1B1, E-3, and PERM programs nationwide.

What are the Changes?

On December 9, 2020, the DOL will modify its prevailing wage system to comply with the latest court orders governing the prevailing wage interim final rule. The DOL will return to using the Occupational Employment Statistics (OES) prevailing wage data that is used before the interim final rule to increase wages took effect in October 2020.

Background

The DOL increased minimum wages for H-1B, H-1B1, E-3, and permanent labor certification (PERM) programs on October 8, 2020. The agency’s interim final rule was implemented immediately.

Last week, the US District Court for the Northern District of California blocked implementation of the agency’s rules nationwide. The court ruled that the DOL’s interim rule, which immediately and significantly increased prevailing wages for H-1B, H-1B1, E-3, and PERM labor certification programs starting on October 8, 2020, was invalid. The court also determined that the agency lacked reasonable cause for bypassing normal rulemaking procedures in violation of the Administrative Procedure Act (APA) when it issued the regulation.

On December 03, 2020, a New Jersey court issued a limited injunction that prevented the agency from enforcing the interim rule against plaintiffs in ITServe Alliance Inc. et al. v Scalia.

What Should Employers and Applicants Know?

Employers can submit Labor Condition Applications starting on December 9, 2020, using prevailing wage data from October 7, 2020, and earlier. Prevailing wage requests may continue to be filed, however, issuance of prevailing wage determinations (PWDs) will be temporarily suspended until December 15, 2020. The DOL will then resume processing of PWDs utilizing OES wage data from before October 8, 2020.

Employers who received PWDs while the interim regulations were in effect may request the DOL to review and reissue a new PWD through January 4, 2021.

Looking Ahead

Currently, the DOL is banned from enforcing its wage regulations nationwide. The agency may appeal both court orders issued last week to a higher court. Employers and applicants should anticipate application processing delays following the agency’s compliance announcement.


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