H1B News: The United States government has proposed one of the biggest changes to the H-1B visa system in recent years, aiming to sharply increase the minimum salaries companies must pay foreign workers. The move could significantly affect Indian technology professionals, who form one of the largest groups of H-1B visa holders in America.
The proposed new rule, introduced by the US Department of Labour (DOL), seeks to raise prevailing wage levels across multiple foreign worker programmes, including H-1B, H-1B1, E-3 and PERM labour certification categories. Officials say the current wage system has remained mostly unchanged for nearly 20 years and no longer reflects real market salaries.
If approved, the new regulation could increase salary requirements by 21 to 33 per cent, depending on job category and experience level. Entry-level positions are expected to see the sharpest jump.
H1B News: Why the US Wants to Change H-1B Salary Rules?
The Department of Labour argues that several employers have used outdated wage calculations to hire foreign professionals at salaries lower than those paid to American workers in similar roles. According to the proposal, the current wage structure creates room for “dramatically lower than market rates” for foreign hires.
Officials say the revised wage system aims to protect domestic workers while ensuring companies pay fair market salaries to skilled foreign employees.
The proposed changes would apply to:
- H-1B visas
- H-1B1 visas
- E-3 visas
- PERM labour certification programmes
H1B News: Entry-Level H-1B Salaries Could Rise Sharply
Under the proposal, Level I wages — generally used for entry-level positions — would move from the 17th percentile of wage data to the 34th percentile. This change alone could raise starting salary requirements by more than 30 per cent in several cities.
Reports suggest that the proposed entry-level prevailing wage could rise to nearly $97,746 in some locations, although actual salary requirements would vary depending on the city and occupation.
The proposal also increases wage levels for experienced workers:
- Level II: from 34th percentile to 52nd percentile
- Level III: from 50th percentile to 70th percentile
- Level IV: from 67th percentile to 88th percentile
H1B News: Indian IT Companies and Fresh Graduates May Feel Pressure
Indian professionals dominate the US H-1B visa system, especially in the technology sector. Industry experts believe the proposed wage hike could make it harder for smaller firms and outsourcing companies to sponsor entry-level foreign workers.
Critics of the proposal argue that startups and mid-sized companies may struggle to absorb the higher labour costs. Some analysts also warn that fresh graduates and early-career professionals could face reduced opportunities if employers shift focus toward more experienced candidates.
Several reports suggest the proposal could reshape hiring pipelines in the US technology industry by favouring companies that can afford significantly higher salaries.
H1B News: Public Comment Window Open Till May 26
The proposed rule is not final yet. The Department of Labour has opened the proposal for public comments until May 26, after which officials will review feedback before publishing a final decision.
Immigration lawyers and employer groups are expected to submit detailed responses during this period, especially over concerns related to rising operational costs and talent shortages.
H1B News: What Happens Next?
If the rule becomes law, companies hiring foreign professionals under the H-1B and related visa programmes may need to revise salary structures, hiring plans and sponsorship strategies.
For Indian professionals hoping to work in the United States, the proposal could change salary expectations, visa competition and the overall cost of securing employment in the American tech industry.
