Dec 01 2020

Federal District Court Sets Aside New DHS and DOL Rules

United States

At a glance

  • A federal district court in California has set aside the fast-tracked Departments of Labor and Homeland Security rules that significantly increased prevailing wage levels and tightened H-1B eligibility criteria.
  • The court found that the agencies did not have good cause to bypass notice and comment rulemaking procedures in violation of the Administrative Procedures Act.
  • The summary judgement ruling is immediately effective, though a speedy government appeal could affect the decision’s implementation.

The issue

A federal district court in California has set aside two new immigration regulations that were promulgated on a fast track by the Departments of Labor (DOL) and Homeland Security (DHS) in early October. Ruling on summary judgment, the court found that the agencies did not have good cause to bypass notice and comment rulemaking procedures in violation of the Administrative Procedures Act. 

This ruling immediately invalidates the rules; however, the government is expected to appeal the decision in an expedited manner. 

The case is U.S. Chamber of Commerce et al. v. DHS (20-cv-07331).

Background on the challenged rules

The court’s decision comes in response to a lawsuit filed by the U.S. Chamber of Commerce, the National Association of Manufacturers and other trade groups and universities challenging the government’s October 8, 2020 release of DOL and DHS companion rules targeting employment-based immigration, and particularly the H-1B program. The rules were issued as interim final regulations, meaning they could take effect before public comments are considered. The agencies justified expedited review and implementation of the rules on the grounds that a fast track was necessary to support U.S. workers amid the economic impact of the COVID-19 pandemic. The DOL rule took effect immediately on October 8 and the DHS rule was slated to take effect 60 days after publication, on December 7. 

The DOL rule restructured the prevailing wage system for H-1B, E-3, and H-1B1 nonimmigrant cases and the PERM labor certification program, resulting in significantly higher government prevailing wage minimums for foreign professional workers. The companion DHS rule, which was set to take effect on December 7, introduced stricter eligibility criteria for H-1B specialty occupations, placed new restrictions on the placement of H-1B workers at third-party worksites, and reinstated evidentiary policies that had been rescinded earlier this year, among other changes. 

What’s next

The court’s ruling is immediately effective, though a speedy government appeal could affect implementation of the decision.  It is also unknown what approach DOL may take to the prevailing wage determinations that have been issued since October 8 under the new rule.

Regardless of the outcome of an appeal, agencies could take administrative steps to reissue the regulations in the remaining weeks of the Trump Administration. 

Fragomen is monitoring the ongoing litigation and any agency announcements regarding the court order and will post updates accordingly. 

This alert is for informational purposes only. If you have any questions, please contact the immigration professional with whom you work at Fragomen.