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The US Department of Labor's final rule to lift prevailing wage floors for H-1B, H-1B1, E-3 and PERM workers reached the White House on 6 November 2026, entering what could be its last regulatory hurdle before publication.
The DOL submitted the final rule to the White House for review before publication in the Federal Register. The rule — titled Improving Wage Protections for the Temporary and Permanent Employment of Certain Foreign Nationals in the United States — is now with the Office of Information and Regulatory Affairs (OIRA), part of the Office of Management and Budget, for review and clearance.
After OIRA completes its review, the next step will be for DOL to publish the final rule in the Federal Register with a future effective date.
If finalised, the rule would represent one of the most significant changes to H-1B and PERM wage requirements in over two decades, with entry-level salary requirements potentially increasing by more than 30 per cent.
Under the proposal, the entry-level (Level I) wage floor would move from roughly the 17th percentile to the 34th percentile of the wage distribution for the same occupation and location. Level II would shift from the 34th to the 52nd percentile, and Level III from the 50th to the 70th percentile.
DOL estimated these proposed wage requirements would increase H-1B employer costs by approximately $1.46 billion in the first year.
The rule traces back to a presidential directive. On 19 September 2025, the President issued a proclamation directing the Secretary of Labor to initiate rulemaking to revise prevailing wage levels under the H-1B programme.
H-1B employers constitute the largest affected group, but the rule would also affect H-1B1 employers sponsoring nationals of Chile and Singapore, E-3 employers sponsoring nationals of Australia, and employers pursuing PERM labour certification for EB-2 and EB-3 employment-based green cards.
The rule would not apply retroactively. H-1B cap petitions for fiscal year 2027, which were required to be filed by 30 June 2026, are expected to remain unaffected, as Labour Condition Applications would have been filed prior to the rule's anticipated effective date.
