DHS Formally Rescinds a Regulation that Sought to Tighten H-1B Program Criteria
May 18, 2021
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At a Glance
- The Department of Homeland Security has formally vacated a regulation that would have redefined the H-1B specialty occupation, restricted offsite placement of H-1B employees, and otherwise increased employer compliance obligations.
- The vacatur follows a federal court ruling that set aside the regulation because the agency did not have good cause to bypass notice and comment rulemaking, in violation of the Administrative Procedures Act.
- Though the regulation had never formally taken effect, DHS’s action today officially reinstates the longstanding H-1B criteria into the Code of Federal Regulations (CFR).
The issue
The Department of Homeland Security (DHS) has removed from the Code of Federal Regulations (CFR) an October 8, 2020 interim final rule (IFR) that would have tightened the criteria for the H-1B program. Though the Trump-era regulation never took effect due to a federal court ruling, today’s notice formally rescinds it and reinstates longstanding H-1B eligibility criteria.
The notice was published in the Federal Register on May 19, 2021.
Background on the IFR and litigation
On October 8, 2020, DHS and DOL issued 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 were 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 DHS rule, which was slated to take effect on December 7, 2020, would have revised the definition of “specialty occupation,” placed new restrictions on the placement of H-1B workers at third-party worksites, and reinstated contract and itinerary requirements. The DOL rule, which took effect immediately on October 8, 2020, 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 rules were immediately challenged in court, and on December 1, 2020, a federal district court in California set them aside, finding that the agencies did not have good cause to bypass notice and comment rulemaking in violation of the Administrative Procedures Act.
Both agencies immediately discontinued the implementation rules, though DOL ultimately published a revised version of its prevailing wage rule after taking the comments it received in response to the IFR into consideration. That rule is slated to take effect in November 2022.
What today’s notice in the Federal Register means for employers
By reinstating the prior regulatory language, DHS is putting to rest the Trump-era regulation. However, the Biden Administration may propose its own regulatory changes to the H-1B program in the future.
This alert is for informational purposes only. If you have any questions, please contact the immigration professional with whom you work at Fragomen.
