US District Court Sets Aside Interim Final Rules Affecting H-1Bs Previously Issued by the US Department of Labor and Department of Homeland Security

On Dec. 1, the United States District Court in the Northern District of California set aside two Interim Final Rules affecting the H-1B program, holding that the Rules were promulgated in violation of the Administrative Procedures Act for not having followed the requisite notice and comment period. 

Specifically, the Court set aside the Oct. 8 rule (which had already taken effect) that changed how to calculate various H-1B prevailing wage levels and increased the prevailing wage floor across all occupational categories. This victory is critical to companies that were encountering issues with prevailing wage rates for H-1B and E-3 extensions and changes of employer petitions. Accordingly, for now this supersedes our client alert of Oct. 8. The Court also set aside the Department of Homeland Security rule (which was to take effect on Dec. 7) that would have narrowed the definition of H-1B “specialty occupation” and further limited the scope of permissible degree fields, applied a more rigorous test in determining an acceptable H-1B employer-employee relationship, and further restricted H-1B employers with workers assigned to third-party sites.

We expect the Department of Labor to update its online prevailing wage survey in the coming days to comply with the District Court’s decision. 

If you have any questions regarding the above, please contact us immediately to discuss options and strategy.