On March 27, 2026, the U.S. Department of Labor (DOL) published a Notice of Proposed Rulemaking (NPRM) that would overhaul how prevailing wages are calculated for H-1B, H-1B1, E-3, and PERM workers. The comment period closed May 26, 2026. If finalized, the rule would raise minimum wages for sponsored workers by an average of $14,000 per year — with entry-level positions seeing increases of 30% or more depending on location.
For employers who sponsor H-1B workers and for foreign nationals navigating the US work visa system, this proposed rule is one of the most consequential regulatory changes in a decade. Here is what the NPRM proposes, what it would mean for different roles and cities, and what to expect next.
What Is the Prevailing Wage — and Why Does It Matter for H-1B?
Every H-1B petition requires the employer to pay the worker at least the prevailing wage for the job in that geographic area. The DOL sets these wages using Bureau of Labor Statistics (BLS) Occupational Employment and Wage Statistics (OEWS) data. Wages are divided into four levels based on skill and experience:
| Level | Worker Profile | Current Percentile | Proposed Percentile | Estimated Avg Increase |
|---|---|---|---|---|
| Level I | Entry-level; routine tasks under close supervision | 17th | 34th (+100%) | +$14,000–$30,000/yr |
| Level II | Qualified; uses judgment, some independent work | 34th | 52nd (+53%) | +$10,000–$20,000/yr |
| Level III | Experienced; full range of duties, minimal supervision | 50th | 70th (+40%) | +$8,000–$15,000/yr |
| Level IV | Fully competent; top of field, senior/specialist | 67th | 88th (+31%) | +$15,000–$25,000/yr |
The DOL estimates that more than 75% of Labor Condition Applications (LCAs) certified between FY 2020 and FY 2024 would fall below the proposed new wage floors. In other words, if the rule had been in effect during those years, three out of four H-1B sponsorships would have been non-compliant at the offered salary.
What Would Entry-Level H-1B Salaries Look Like Under the New Rule?
Wages are determined by occupation and metro area. The table below shows the estimated impact on software engineers (SOC 15-1252) — the most common H-1B occupation — under Level I (entry-level) in major tech markets:
| Metro Area | Current Level I (FY 2026) | Proposed Level I (est.) | Increase |
|---|---|---|---|
| San Francisco, CA | ~$135,700 | ~$162,000 | +~$26,300 (+19%) |
| New York, NY | ~$103,200 | ~$132,000 | +~$28,800 (+28%) |
| Dallas–Fort Worth, TX | ~$87,000 | ~$113,000 | +~$26,000 (+30%) |
| Seattle, WA | ~$120,000 | ~$148,000 | +~$28,000 (+23%) |
| Chicago, IL | ~$90,000 | ~$115,000 | +~$25,000 (+28%) |
| Austin, TX | ~$94,000 | ~$120,000 | +~$26,000 (+28%) |
Note: Proposed figures are estimates derived from the DOL NPRM methodology (17th → 34th percentile shift) applied to current OEWS data. Exact final figures will be determined when the rule is finalized.
Which Visa Programs Are Affected?
The NPRM covers all visa and labor programs that use the DOL prevailing wage system:
| Program | Affected? | Notes |
|---|---|---|
| H-1B | ✅ Yes | Specialty occupation workers — most impacted program |
| H-1B1 | ✅ Yes | Chile and Singapore free trade agreement workers |
| E-3 | ✅ Yes | Australian specialty occupation workers |
| PERM (EB-2/EB-3 green card) | ✅ Yes | Labor certification for employment-based green cards |
| H-2A (agricultural) | ❌ No | Uses separate Adverse Effect Wage Rate (AEWR) methodology |
| H-2B (non-agricultural seasonal) | ❌ No | Separate wage calculation |
| L-1 (intracompany transfer) | ❌ No | No LCA/prevailing wage requirement for L-1 |
| O-1 (extraordinary ability) | ❌ No | No prevailing wage requirement |
What Happens Next — Timeline
The comment period for the NPRM closed on May 26, 2026. The DOL received comments from employers, universities, immigration attorneys, and advocacy groups. Major tech companies, the US Chamber of Commerce, and several higher education associations submitted comments opposing the rule on the grounds that it would reduce H-1B sponsorship and push jobs offshore. Unions and worker advocacy groups generally supported the increases.
After reviewing comments, the DOL publishes a Final Rule with a response to significant comments. There is no fixed timeline — final rules typically take 6–18 months after comment period close, though the current administration has shown willingness to move faster on immigration-related regulations. The rule could take effect as early as late 2026 or in 2027.
Important: Until a final rule is published in the Federal Register and takes effect, current prevailing wage levels remain in force. Employers should not unilaterally raise salaries in response to the NPRM — wait for the final rule.
What Should Employers and H-1B Workers Do Now?
For employers currently sponsoring H-1B workers: Audit your existing LCAs and identify positions certified at Level I or II. Under the proposed rule, many of these would fall short of new floors. Build budget scenarios assuming +$14,000–$20,000 per sponsored worker per year. If you have renewals or new petitions planned for late 2026 or 2027, factor in a potential wage increase.
For H-1B applicants in the FY 2027 lottery (registration March 2027): The proposed rule may not be finalized in time to affect FY 2027 cap petitions. Current prevailing wage rates apply unless a final rule is published before then. Monitor the Federal Register for publication of the final rule.
For foreign nationals on H-1B considering a job change: A new employer would file a new LCA at whatever wage levels are in effect at that time. If the rule is finalized before your job change, your new employer’s petition would need to meet the higher floor.
Also note — new fees effective May 29, 2026: On top of the proposed wage increases, H-1B petitions now carry a $250 Visa Integrity Fee and employers must pay a $102 Annual Asylum Program Fee per H-1B/L/O petition under the H.R. 1 interim final rule. These fees are already in effect, not proposed. See: New USCIS Fees 2026.
