The Department of Labor intends to publish a final rule this week to again delay the implementation of new prevailing wages for PERM, H–1B, H–1B1, and E–3 job opportunities. Changes to prevailing wages were originally intended to take effect on March 15, 2021 and had already been delayed until May 14, 2021. On March 22, 2021, DOL proposed to further delay the new prevailing wages and that delay will become official once notice is published in the Federal Register this week. With this delay, the regulation will not take effect until November 14, 2022.  This rule was previously attempted as an Interim Final Rule, skipping the notice and comment requirement, and was blocked from taking effect as a result of litigation. A new version was later issued as a Final Rule to increase the wages associated with the four prevailing wage levels used for Labor Condition Applications and PERM Labor Certifications.

The initial delay was the result of a memo issued by President Biden’s Chief of Staff to executive agencies directing them to consider postponing the effective dates of published regulations that have not yet taken effect for 60 days. The purpose of the freeze was to allow the Biden administration time review any questions of fact, law, and policy the regulations may raise. During the 60-day pause, agencies were to consider opening a new 30-day comment period to allow further public comments before the regulations move forward.

As a result of this freeze, the Department of Labor issued a Final Rule earlier this month to delay the regulation until May 14, 2021. As part of the first delay, the Department received 57 comments from the stakeholder community. Commenters cited disapproval of the final rule overall, concerns that the process in adopting the final rule was rushed, fears that the wage data supporting the final rule was inaccurate, and the need to more thoroughly review the final rule.

The Department of Labor began a comprehensive review of this rulemaking and is now taking the step of a further delay to complete this review. At the time of issuing the Final Rule, the Department did not have the benefit of receiving and considering comments that could have caused it to adopt longer or shorter transition periods, higher or lower transition rates, or to ultimately not include transition provisions in the rule. Furthermore, sources of authority cited as a basis for the rulemaking, or for key assumptions in the rulemaking, have since been revoked or rescinded, such as Executive Order (E.O.) 13788 (Buy American and Hire American). Further, these concerns have been raised in ongoing litigation as well as concerns regarding the rulemaking process itself.

This new delay will allow BLS and ETA’s Office of Foreign Labor Certification (OFLC) adequate time to compute and validate prevailing wage data covering all occupations and geographic areas, complete and thoroughly test modifications to the OFLC Foreign Labor Application Gateway (FLAG) system, train staff, and conduct sufficient public outreach to ensure an effective and orderly implementation by the time the initial transition wage rates could become effective.

The Department of Labor provided the public a 30-day window to comment on the delay, including whether it should delay the effective date and the transition dates of the Final Rule and whether the proposed period of delay is an appropriate length of time or whether other lengths of time may be more appropriate. It received 627 comments, the vast majority of which supported delaying the regulation. Given the complexity of the
regulation, the serious concerns that have been raised, and the potential harm that would result from immediate implementation of the Final Rule, the DOL believes a delay to allow the agency sufficient time to evaluate the rule, instead of permitting the rule to take effect while the Department conducts its review, is the more prudent path. This delay will in turn provide the Department time to review sources and data received that could inform
further action on the rule and/or the development of a future rulemaking to revise the computation of prevailing wage levels in a manner that more effectively ensures the employment of certain immigrant and nonimmigrant workers does not adversely affect the wages of U.S. workers similarly employed.

By: Emily Neumann

Emily Neumann is Managing Partner at Reddy Neumann Brown PC with 15 years of experience practicing US immigration law providing services to U.S. businesses and multinational corporations. Emily has been quoted in Bloomberg Law, U.S. News & World Report, Inside Higher Ed, and The Times of India on various hot topics in immigration. She is a member of the American Immigration Lawyers Association and Society for Human Resource Management.