The United States government is reviewing a proposal that could raise the minimum salary employers must pay foreign workers under key visa programmes, a move that may significantly alter hiring costs, eligibility criteria, and job opportunities for international professionals.
The proposal, submitted by the U.S. Department of Labor to the Office of Management and Budget, is still under review and has not been made public.
However, early indications suggest it seeks to increase prevailing wage levels across multiple visa categories, including H-1B, H-1B1, E-3, and PERM labour certification programmes.
What they are saying
At the centre of the proposal is the “prevailing wage” system, which determines the minimum salary employers must offer foreign workers based on job role, experience level, and geographic location.
The current framework uses a four-tier wage structure, and any upward revision would raise salary thresholds across all levels.
If implemented, the changes could make it more expensive for U.S. employers to hire foreign talent, particularly for entry-level roles. Reports note that higher wage requirements may reduce the number of lower-paid positions available under the H-1B visa programme, potentially limiting opportunities for early-career professionals.
What you should know
This is not the first attempt to revise wage thresholds for foreign workers. In 2021, the Trump administration introduced a rule that significantly increased wage percentiles across all four levels, with entry-level wages rising from the 17th to the 35th percentile and top-tier wages from the 67th to the 90th percentile. That rule, however, faced legal challenges and was later withdrawn.
- Subsequent efforts under the Biden administration to introduce a revised wage framework were delayed and eventually removed from the regulatory agenda, leaving the current system unchanged until now.
- The potential policy shift is expected to affect several widely used work visa pathways. The H-1B visa, one of the most sought-after, allows U.S. companies to employ foreign professionals in specialised fields such as technology, engineering, healthcare, and finance.
- The H-1B1 visa applies to citizens of Chile and Singapore, while the E-3 visa is reserved for Australian nationals in similar professional roles. The PERM labour certification process, a critical step in employer-sponsored green cards, could also be impacted.
- For employers, higher prevailing wages typically translate into increased labour costs, which could discourage smaller firms from sponsoring foreign workers. For skilled professionals, however, the changes may lead to improved compensation packages, even as competition for fewer roles intensifies.
The proposal remains under federal review, and full details are expected to be disclosed once it is published in the Federal Register. At that stage, stakeholders will be able to submit public comments before a final rule is adopted.
