On December 1, 2020, Judge Jeffrey White of the U.S. District Court for the Northern District of California issued a decision in striking down two major rules affecting the H-1B nonimmigrant visa program that were issued by the Trump Administration in October 2020. The federal court decision in Chamber of Commerce of the United States of America et al v. United States Department of Homeland Security et al is the latest development in the wake of the uncertainty about the H-1B visa program that the new rules introduced just two months ago.
To recap, on October 8, 2020, the U.S. Department of Homeland Security (“DHS”) and the U.S. Department of Labor (“DOL”) each published new rules that would respectively:
- DHS Rule: Limit access to H-1B nonimmigrant worker visas by making the definition of an H-1B “specialty occupation” stricter and restricting H-1B visas for third-party worksite placements like IT consulting arrangements.
- DOL Rule: Change the calculation of the “prevailing wage” (minimum wage) used in the H-1B visa program by significantly increasing the minimum wage required for H-1B workers at all four H-1B wage levels.
Please see our prior post for a more detailed explanation of the new DHS and DOL rules. Significantly, the Trump Administration did not go through the normal review period for new rules that provides the public an opportunity to submit comments on the new rules (“notice and comment period”). Instead, the Trump Administration stated that the COVID-19 pandemic and high unemployment caused by the pandemic justified eliminating the notice and comment period. The DOL rule went into effect immediately on October 8, 2020 and the DHS rule was supposed to go into effect on December 7, 2020.
In his December 1, 2020 decision, Judge White determined that the Trump Administration improperly eliminated the notice and comment period when issuing both the DHS rule and DOL rule and did not establish “good cause” for eliminating the review stage. The Judge specifically noted that the Trump Administration’s issuance of the new rules introduced major changes to policies that American employers have relied on for years and created uncertainty regarding American employers’ planning and budgeting.
Judge White’s decision striking down the new DHS and DOL rules means that the existing H-1B regulations regarding “specialty occupations” and third-party placements as well as the pre-October 8, 2020 prevailing wage rules are valid. DHS and DOL have not yet respond to Judge White’s decision. It remains to be seen whether the Trump Administration will appeal this decision. Either way, U.S. employers planning ahead for the H-1B “lottery” and application process in the spring of 2021 should pay careful attention to the fast-moving developments on these issues.
© Margaret W. Wong & Associates LLC