Input Stories

A recently proposed Department of Labor rule that would require employers to pay H-1B visa holders and other employment-based immigrants higher wages “would materially weaken the industry’s efforts to deliver on the president’s vision for long-term, innovation-driven manufacturing growth and onshoring,” the NAM said this week.

What’s going on: In March, the DOL’s Employment and Training Administration put forth a proposed rule to raise the floor for the four wage levels that employers must offer (or exceed) to high-skilled immigrant visa holders.

• The proposal’s aim: “[T]o strengthen program integrity by reducing the incentive for employers to use these programs to replace, rather than supplement, U.S. workers by employing lower-paid alien workers,” according to the draft’s summary in the Federal Register.
• However, “manufacturers dispute the [Notice of Proposed Rulemaking’s] contention that foreign workers are hired at lower wages that depress those of their U.S. peers,” the NAM told the DOL on Tuesday.

Why it’s problematic: Requiring employers to pay the significantly increased wages mandated in the draft rule would have ill effects for the entire economy, the NAM told the agency.

• The proposal suffers from several flaws: It’s based on obsolete data, it contradicts the definition of “entry level” by setting a wage floor that excludes entry-level employees, and it does not take into account non-salary compensation.
• It would impair manufacturing—which has long suffered from a workforce shortage—by reducing access to highly skilled immigrant talent, burdening the sector with undue (and underestimated) compliance and wage costs and failing to offer a realistic phase-in period.

What should be done: The department should reconsider the proposed rule and consider alternative actions to realign U.S. immigration policy with the workforce needs of manufacturers, such as:

• Reserving part of the H-1B cap;
• Enhancing the H-1B selection odds; and
• Adapting the calculation of the prevailing wage levels for H-1B and [permanent labor certification] applications.