Understanding H-1B and PERM Prevailing Wage Requirements and How to Look Them Up

Under U.S. Department of Labor rules, U.S. companies hiring H-1B professional employees must meet strict wage requirements. Specifically, the employer must pay the H-1B employee the higher of the prevailing wage (also translated as "current wage") or the actual wage. The prevailing wage refers to the average wage for the position in a particular location and industry; the actual wage refers to the wage actually paid for the position within the employer's company.

For example, if the prevailing wage for a position is $90,000 and the actual wage is $80,000, then to meet H-1B hiring requirements, the employer must offer the H-1B employee a wage of $90,000. Otherwise, the employer may be unable to file an H-1B visa for that employee.

What Is the "Prevailing Wage" for an H-1B Visa?

The "prevailing wage" required for an H-1B visa position can be one of the following two:

• Unionized positions: If the position is covered by a union agreement, the prevailing wage is the corresponding wage level specified in the agreement.

• Non-union positions: For such positions, the prevailing wage refers to the average wage of employees performing similar work in the same area.

Factors affecting the prevailing wage include:

• Primary job duties (including the field of study, such as computer science, molecular biology, history, etc.)

• Minimum education and experience requirements

• Whether there are supervisory responsibilities

• Whether other special knowledge or skills are required

• Work location (including remote work situations)

The Department of Labor updates minimum wage data every year, so the minimum wage requirements may well differ from year to year. When an employer files an extension for an existing H-1B employee, it may encounter a higher minimum wage.

What Is the "Actual Wage" for an H-1B Visa?

The "actual wage" for an H-1B employee refers to the wage level of other similarly qualified employees (including U.S. workers) at the same work location who hold the same position. Note that the actual wage is not necessarily the salary paid to the H-1B employee, unless the H-1B employee is the only employee in that position (that is, no one else performs exactly the same job). If others hold the same position, the actual wage should be a salary range that covers all employees in that position.

The Department of Labor's rules are intended to ensure that people performing substantially the same work at the same work location receive equal pay.

Permissible Differences in the H-1B Visa "Actual Wage"

The H-1B employee must receive the higher of the "minimum wage" or the "actual wage." With respect to the actual wage, the employee's compensation should be comparable to that of others at the same work location performing the same or similar work. However, in some cases, wage differences may also be justified.

The H-1B visa program aims to protect the rights and interests of both U.S. workers and H-1B workers. The program requires that all employees performing similar work receive equal pay, unless there are legitimate wage differential factors. The legitimate factors recognized by the U.S. Department of Labor are limited to the following:

• Work experience: including the depth and breadth of experience.

• Education: including degree level, type, and the standing of the granting institution.

• Job content and responsibilities: including any special assignments or additional supervisory responsibilities.

• Special knowledge, skills, or training

• Other indicators of performance or ability: including performance evaluations, publications, awards, achievements, or other honors.

• Other legitimate factors consistent with recognized recruitment and compensation principles in the professional field

The following factors cannot serve as reasons for wage differentials in the H-1B visa context: market conditions, negotiated lower salaries, or budget or project funding limitations. H-1B employees cannot receive lower wages than other employees in the same position because of these factors.

How Is the Prevailing Wage Determined?

Employers can obtain the prevailing wage standard by submitting an application to the National Prevailing Wage Center (NPWC), or they can access other legitimate sources of information, such as the "Online Wage Library" applicable to some programs. Most employment visa programs involving the Department of Labor have minimum prevailing wage requirements.

Since 1998, the U.S. Department of Labor's Bureau of Labor Statistics has been providing wage data collected under its Occupational Employment Statistics (OES) program for foreign labor certification processes. These data can be found on the Foreign Labor Certification Data Center Online Wage Library website.

Without a valid prevailing wage determination issued by the National Prevailing Wage Center (NPWC), H-2B temporary labor certification applications and permanent labor certification applications may not be filed. For the H-1B, H-1B1, and E-3 programs, employers may submit a prevailing wage application to the NPWC or may determine the prevailing wage themselves when filing the labor condition application. It is worth noting that the NPWC does not issue prevailing wage determinations for the H-2A temporary agricultural program.

To apply for a prevailing wage determination for non-agricultural immigration programs (PERM, H-1B, H-1B1, H-2B, and E-3), employers must complete Form ETA-9141 (Application for Prevailing Wage Determination) and submit it to the National Prevailing Wage Center (NPWC).

For the H-1B, H-1B1, and E-3 programs, employers may choose one of the following three wage sources to determine the prevailing wage:

• Request a prevailing wage determination from the NPWC;

• Use a wage survey conducted by an independent authoritative source;

• Use other legitimate sources of information.

Employers in the H-1B, H-1B1, and E-3 programs who obtain a prevailing wage determination from the NPWC have "safe harbor status." This means that if the employer's wage compliance is investigated for any reason, the U.S. Department of Labor's Wage and Hour Division will not challenge the validity of the prevailing wage, as long as it is used correctly (i.e., the correct geographic area, occupation, and skill level are used).

How to Check the H-1B Prevailing Wage

1. Open this Department of Labor website and select your state; in this example, we selected California.

2. The data source defaults to the latest, no need to change; the drop-down menu contains previous data.

3. The area defaults to selection by county/city, but you can also select by BLS statistical area.

4. For the occupation, you can enter keywords or select from the drop-down menu.

In this demonstration, we use a software engineer in San Francisco as an example. After entering the keyword and clicking search, there are multiple matching results, including:

• 15-1252.00 Software Developers

• 15-1254.00 Web Developers

• 15-1255.00 Web and Digital Interface Designers

• 15-1299.05 Information Security Engineers

After selecting Software Developers, the results are as follows:

According to your level, you can refer to the corresponding minimum salary. For example, the minimum wage for Level 1 is an annual salary of 113,000, and for Level 3 the minimum is 181,000. For the criteria for determining these four levels, see {https://gonglue.us/72382}. Note that this is only base salary and does not include stock or other incentives.

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