Prevailing Wage Breaking News Alert
Prevailing Wage Increase
October 8, 2020
The Department of Labor (“DOL”) issued a Prevailing Wage increase rule on October 8, 2020, that went into effect immediately. Specifically, the rule changes the computation of Prevailing Wages, resulting in higher Prevailing Wages for all occupations on all levels (there are four levels).
Under Immigration Law, employers must pay certain foreign workers the Required Wage, which is the higher of either the Prevailing Wage or the Actual Wage paid by the employer to other employees with similar qualifications, both of which are based on the specific position and area of employment. By ensuring that these foreign workers are offered and paid wages that are no less than similarly employed U.S. workers, the wage requirements are intended to guard against both wage suppression and the replacement of U.S. workers by lower-cost foreign labor.
Employers are required to obtain a certified Labor Condition Application (“LCA”) with the appropriate Prevailing Wage from the DOL in order to sponsor a foreign worker for the H-1B, H-1B1, and E-3 Nonimmigrant (temporary worker) categories. Additionally, employers are required to obtain a certified PERM Labor Certification application (“PERM”) with a certified Prevailing Wage Determination (“PWD”) from the DOL in order to sponsor a foreign worker for certain Immigrant (“Green Card”) categories. Since the rule increases the Prevailing Wages for all of these categories, the result is an immediate increase to the Required Wage employers need to pay to sponsor a foreign worker.
The rule will apply to all LCAs filed and all PWD applications pending on or after October 8, 2020. The DOL will not apply the rule to any previously certified LCAs, PWDs, or PERMs.