The U.S. Department of Homeland Security (DHS) is proposing to change the H-1B lottery system by moving from a purely random lottery selection to a weighted process that prioritizes higher-paid workers, while still preserving opportunities across all wage levels.
Registrations for H-1B cap-subject petitions would be weighted based on the Department of Labor's Occupational Employment and Wage Statistics wage level tied to the offered wage for the relevant position and location. A worker offered a Level 4 wage (the highest level) would be entered into the selection pool four times; a Level 3 beneficiary, three times; a Level 2 beneficiary, two times; and a Level 1 beneficiary, once — significantly increasing the selection probability for higher wage levels.
DHS said the proposed rule aims to implement the numerical cap in a way that incentivizes employers to offer higher wages, or to petition for positions requiring higher skills that are commensurate with higher wage levels.
The current lottery often favors lower-wage roles, according to DHS data. Higher-paying positions (Levels 3 and 4) are the least represented among approved petitions. The new rule would shift incentives for employers to offer stronger salaries and recruit for more senior-level roles.
"The majority of H-1B workers petitioned for by employers are at the first or second wage rates — requiring these employers to pay these workers the 17th or 34th percentile of the prevailing wage," said Elizabeth Jacobs, the director of regulatory affairs and policy for the Center for Immigration Studies in Washington D.C. "Data provided by DHS in November 2020 showed that the two-year average of H-1B selections for FY 2019 and FY 2020 indicated that 85 percent of employers were paying at wage levels 1 or 2. DHS noted that in every fiscal year from FY 2019 to FY 2024, petitions for beneficiaries at wage levels 3 and 4 were the least represented among all wage levels in cap-subject H-1B filings."
DHS said that total wages paid to H-1B workers would increase by billions over the next several years, but that over 5,000 small businesses that currently receive H-1B visas would suffer a significant economic impact due to loss of labor.
"It will make it harder for more entry-level workers and those graduating from colleges and universities to use the program," said Julia Gelatt, associate director of the U.S. Immigration Policy Program at the Migration Policy Institute in Washington, D.C. "That would be a big structural change, because the student visa program is a major feeder to the H-1B visa, which in turn is a feeder into the employment-based green card system. The U.S. would no longer benefit from the contributions of talented foreign national college graduates."
The Trump administration first proposed a similar regulation in November 2020 that aimed to shift the lottery process toward higher-paid applicants. It was delayed by President Joe Biden before it could go into effect in March 2021 before being blocked by a federal judge in September 2021 and withdrawn by the Biden administration three months later.
A major difference between the current proposal and the Trump administration's first attempt was that the 2020 version would have virtually eliminated the chances for wage level 1 or 2 selections.
"The inference is that people in entry-level positions or any position that qualifies under a Level 1 wage are not in a specialty occupation or highly skilled role," said Andrew Wilson, an immigration attorney and partner at Lippes Mathias in Buffalo, N.Y. "Does that mean that entry-level physicians, engineers, or architects are not highly skilled people? A person offered Level 4 wages is probably a higher-skilled worker than someone offered Level 1 wages, but that doesn’t mean that the person offered Level 1 wages is not highly skilled. Most people pursuing H-1B visas are just graduating from colleges and universities. How are they going to be at Level 4 wages?"
The proposed rule published Sept. 24, carries a 30-day comment period. If the proposal is finalized and goes into effect, the new system could be in place for the next H-1B lottery held in March 2026.
The proposed rule comes after President Donald Trump signed a proclamation ordering a $100,000 fee to be imposed on new H-1B petitions filed on or after Sept. 21.
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