Proposed Changes to the Prevailing Wage Structure
Under the current system, prevailing wage levels are generally calculated using wage percentiles ranging from the 17th to the 67th percentile of OEWS wage data.
The proposed rule would shift those wage levels upward as follows:
- Level I: increase from the 17th percentile to the 34th percentile
- Level II: increase from the 34th percentile to the 52nd percentile
- Level III: increase from the 50th percentile to the 70th percentile
- Level IV: increase from the 67th percentile to the 88th percentile
These revised wage levels would apply to both temporary work visa programs and employment-based green card sponsorship processes, including PERM applications associated with EB-2 and EB-3 categories.
According to the proposal, the revised wage methodology would apply prospectively to:
- Prevailing wage determinations pending on the effective date
- New Labor Condition Applications (LCAs)
- New prevailing wage requests filed after the rule becomes effective
- The DOL also intends to continue allowing employers to use qualifying private wage surveys in limited circumstances.
Why the DOL Is Proposing These Changes
The DOL states that the current wage calculation framework does not adequately reflect factors such as education, experience, skill level, and supervisory responsibilities associated with specific positions.
The agency further argues that existing wage levels may allow some employers to pay foreign workers below wages earned by similarly qualified U.S. workers in comparable roles and geographic markets.
The proposal references Presidential Proclamation No. 10973, issued in September 2025, which directed the Department of Labor to reevaluate prevailing wage standards used in the H-1B program.
According to the DOL, the proposed changes are intended to better protect U.S. workers and align prevailing wage determinations with statutory requirements under the Immigration and Nationality Act (INA).
Potential Impact on Employers
If implemented, the proposed rule could significantly increase labor costs for employers sponsoring foreign national employees.
The DOL estimates that average wages associated with impacted visa programs could rise by approximately $14,000 per worker annually, with larger increases expected for entry-level and mid-level positions.
H-1B, H-1B1, and E-3 Cases
Employers filing new LCAs may face substantially higher minimum salary obligations, potentially affecting hiring budgets, compensation planning, and workforce strategy.
PERM and Employment-Based Green Card Sponsorship
For PERM cases, higher prevailing wages may:
- Impact recruitment outcomes during labor market testing
- Increase wage commitments listed on ETA Form 9089 filings
- Raise long-term sponsorship costs for employers
Employers may also need to evaluate how increased wage requirements affect internal pay equity and compensation structures for U.S. workers.
Employer Considerations Moving Forward
The proposed rule is currently open for public comment through May 26, 2026.
The DOL has specifically requested feedback regarding whether the proposed methodology appropriately accounts for varying levels of education, experience, and responsibility within occupational categories.
Employers with active or anticipated immigration sponsorship cases should consider:
- Reviewing current H-1B and PERM matters
- Assessing projected wage increases
- Evaluating future sponsorship costs
- Considering timing strategies for upcoming filings
- Reviewing broader compensation and workforce planning implications
Because this is still a proposed rule, the final version may change before implementation. Employers and foreign national employees should continue monitoring developments closely.
