NewsFlash! DOL Proposes Significant Hike to Prevailing Wages for H1B, H1B1, E-3, and PERM

Tomorrow, the U.S. Department of Labor (DOL) will publish a Notice of Proposed Rulemaking (NPRM) in the Federal Register that proposes to dramatically increase the prevailing wage levels used in the H1B, H1B1, E-3, and PERM labor certification programs. The NPRM is titled “Improving Wage Protections for the Temporary and Permanent Employment of Certain Foreign Nationals in the United States” and is published under Docket No. ETA-2026-0001.

What is Being Proposed?

The DOL is proposing to revise the four-tier prevailing wage structure that employers must follow when sponsoring foreign national workers. Since 2005, the four wage levels have been set at approximately the 17th, 34th, 50th, and 67th percentiles of the Occupational Employment and Wage Statistics (OEWS) wage distribution for a given occupation and geographic area. Under the proposed rule, these levels would shift substantially upward:

The DOL states that its proposed levels were derived through a statistical model designed to align the average prevailing wage with the average actual wages paid to U.S. workers similarly employed in H1B-type occupations. The DOL estimates that these changes would increase the average certified wage by approximately $14,000 per year per position.

Which Programs are Affected?

The proposed changes apply to all four of the following programs:

• H1B nonimmigrant visa (specialty occupation workers)
• H1B1 nonimmigrant visa (workers from Chile and Singapore)
• E-3 nonimmigrant visa (workers from Australia)
• PERM labor certification (EB2 and EB3 immigrant visa categories)

The DOL is maintaining a unified four-tier wage methodology across all these programs to ensure consistency and prevent what it calls “program shopping.”

Why is DOL Proposing This?

The DOL contends that the existing wage levels, which have been in place for over 20 years, fail to adequately protect U.S. workers. According to the agency, the current methodology permits employers to hire foreign national workers at wage levels significantly below those paid to similarly employed U.S. workers, which the DOL argues creates an incentive to replace, rather than supplement, the domestic workforce. The DOL also points to evidence that major H1B program users have engaged in large-scale layoffs of U.S. workers while continuing to hire foreign nationals at lower wage levels.

What Happens Next?

Because this is an NPRM and not a final rule, it does not take effect immediately. The public will have 60 days from the date of publication (i.e., from 27.Mar.2026) to submit written comments.

The DOL will review all comments before issuing a final rule. If finalized, the new wage levels would apply prospectively to new certifications, allowing employers time to adjust.

What Should Employers and Foreign Nationals Do?

While this rule is still in the proposed stage, the potential impact is significant for employers who rely on the H1B or PERM programs. Employers should:

• Review their current and anticipated prevailing wage determinations in light of the proposed new percentile thresholds.
• Consider submitting comments to the DOL during the 60-day comment period, particularly if they believe the proposed levels are inappropriate or would have undue economic impact.
• Consult with their immigration counsel about how the proposed changes might affect pending and future cases.

MurthyDotCom will post a more detailed analysis of this proposed rule. Watch for updated information as it becomes available.

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