(UNITED STATES) The Department of Homeland Security is moving to replace the random H-1B lottery with a wage-based selection system that would tilt odds toward higher-paid roles, reviving a long-debated approach that supporters say better matches the program’s goal of drawing scarce, highly skilled talent. The proposed rule is set for publication in the Federal Register on September 24, 2025, opening a 60-day public comment period before DHS decides whether and how to finalize it. If adopted without major changes, DHS says the system could be in place as early as the March 2025 registration window for the FY 2026 H-1B cap season. Under the plan, all wage levels would remain eligible, but registrations tied to higher wage offers would carry more weight during selection.
How the wage-based selection would work
At the heart of the policy shift is a points-style weighting based on the Department of Labor’s four-tier prevailing wage structure. DHS lays out the structure plainly:
- Level IV gets 4 entries per registration
- Level III gets 3
- Level II gets 2
- Level I gets 1
The agency plans to run the selection in order, starting with Level IV and moving down. Lower wage levels would be considered only if cap numbers remain after higher wage levels are processed.
DHS estimates the change will produce major shifts in selection odds:
– 48% drop in selection odds for Level I wage workers
– 107% increase in selection odds for Level IV wage workers
This weighted approach means higher-paid roles would have substantially better odds of being drawn.
Purpose and expected effects
DHS argues the change aims to:
– Curb mass low-wage filings
– Promote better pay where duties and business needs support it
– Better align selections with the H-1B statute’s focus on specialty occupations
Practical expectations:
– Startups and outsourcing-heavy models that file many Level I/II registrations may face headwinds.
– Employers who pay at or near Level III/IV would see a clearer path to selection.
– Universities, research centers, and hospitals that pay higher wages or rely on specialized roles could benefit.
The proposal is intended to encourage employers to offer higher salaries for genuinely hard-to-fill, higher-skilled roles rather than relying on volume of filings.
Interaction with beneficiary-centric integrity rules
The rule is designed to work alongside the 2024 “beneficiary-centric” integrity rules, which:
– Require a unique registration per beneficiary
– Add other steps to reduce duplicate filings and fraud
Combined effects:
– Two-layer system (unique registration + wage weighting) to reduce gaming
– Wage offered becomes a primary driver of selection rather than sheer filing volume
VisaVerge.com analysis suggests this pairing will likely cut identical filings for the same person and make the wage level central to selection outcomes.
Important: The proposal does not remove any wage level from eligibility. It changes the relative odds by weighting higher wages more heavily.
Legal and political risks
The proposal is likely to draw legal scrutiny. Past efforts that leaned on wages in selection have been blocked or vacated in court, or withdrawn during rulemaking. DHS has opened a 60-day comment window and signaled it may revise the proposal based on feedback and potential litigation.
Key timeline notes:
– Publication: Federal Register — September 24, 2025
– Comment period: 60 days
– Possible implementation for the March 2025 registration for FY 2026 if the rule is finalized swiftly
– Implementation could be delayed or modified if courts or comments require changes
Employers should prepare for both outcomes: wage-based selection in March 2025 if finalized, or continuation of the current system if the rule stalls.
Selection mechanics and stakeholder impact
The H-1B cap remains unchanged (65,000 regular + 20,000 U.S. advanced degree exemption). The registration window and basic process stay, but DHS would fill the cap starting at Level IV and moving down.
Stakeholder impacts:
– Mid-size firms: A Level III wage for a machine learning engineer would carry 3 entries and be processed before Level I; U.S. master’s degree holders still compete under the advanced degree exemption.
– Outsourcing-heavy employers: Heavy reliance on Level I registrations becomes riskier; Level I is considered last and could be excluded if the cap is filled above.
– Universities and nonprofits: Institutions that pay at or above Level III could see improved selection for cap-subject positions.
– Startups: May struggle to meet Level III/IV wages in high-cost regions and face trade-offs between salary increases and runway; some may seek alternative strategies (location, job duties, visa types).
– Workers: Higher wage offers improve odds; Level I candidates may see slimmer chances unless wages are raised.
DHS modeling highlights the distributional effect: +107% for Level IV and -48% for Level I. Critics may argue wages aren’t a perfect proxy for skill or that geographic and sectoral pay differences complicate fairness.
Timeline, fees, and compliance steps
Key dates and fees:
– Publication: September 24, 2025 (Federal Register)
– Comment period: 60 days
– $100,000 new H-1B petition fee in effect since September 21, 2025
Practical employer actions:
1. Review and map current/planned H-1B roles to DOL wage levels by occupation and location.
2. Model selection odds vs. budget when moving from Level II → Level III or Level III → Level IV.
3. Align job descriptions, minimum requirements, and pay to justify the chosen wage level.
4. Prepare for the new $100,000 petition fee and set internal approval thresholds.
5. Build timelines backward from the March registration window to finalize sign-offs, compliance checks, and wage documentation.
Standard filings after selection remain the same:
– Labor Condition Application: ETA-9035 (filed through the FLAG system)
– H-1B Petition: Form I-129, Petition for a Nonimmigrant Worker (filed with USCIS)
– Optional Premium Processing: Form I-907, Request for Premium Processing Service
Recordkeeping and consistency are critical. If selected at Level III, documentation must show duties and evidence supporting the Level III wage. Discrepancies could trigger Requests for Evidence or denials.
Alternatives and workforce planning
Where raising wages isn’t feasible, employers may explore other paths:
– Longer reliance on STEM OPT for F-1 graduates
– TN status for eligible Canadian and Mexican nationals under USMCA
– L-1 intracompany transfers for managers or specialized knowledge workers
– O-1 visas for individuals of extraordinary ability
These alternatives can help mitigate cap pressure but do not replace H-1B at scale.
What to comment on during the public period
DHS has invited feedback. Employers, universities, and stakeholders should provide data-backed comments, for example:
– How weighting affects hiring in healthcare, AI, chip design, clean energy, advanced manufacturing
– Practical consequences for startup hiring models and outsourcing firms
– Suggestions for sequencing, weighting, or safeguards to protect specialized but lower-wage roles
DHS may revise mechanics or weights in response to comments and litigation.
Practical checklist for employers now
- Map likely H-1B roles to DOL wage levels and document justification for each tier.
- Model budget impacts and selection odds for different wage tiers.
- Build salary guardrails to support Level III or Level IV where justified.
- Draft and submit comment letters with concrete examples and data.
- Prepare compliance workflows so registration and petition details match (beneficiary-centric rules).
- Monitor official instructions and USCIS guidance after the Federal Register notice.
Key takeaways
- Selection would be weighted by wage tier: Level IV (4 entries), Level III (3), Level II (2), Level I (1).
- DHS would select from Level IV down to Level I until the cap is met.
- DHS modeling shows 107% increase in odds for Level IV and 48% decrease for Level I.
- The proposal pairs with 2024 integrity rules to reduce duplicate filings and prioritize wage as a driver of selection.
- If finalized and not blocked, the change could apply to the March 2025 registration for FY 2026; litigation or operational issues could delay it.
- The $100,000 petition fee (effective Sept 21, 2025) amplifies the budget decisions employers must make.
Quote for emphasis:
DHS’s message is clear: to improve odds under H-1B, increase the wage level when the job truly supports it.
Official resources and forms
- USCIS H-1B: Specialty Occupations — https://www.uscis.gov/working-in-the-united-states/temporary-workers/h-1b-specialty-occupations
- Form I-129 (H-1B petition) — https://www.uscis.gov/i-129
- Form I-907 (premium processing) — https://www.uscis.gov/i-907
- ETA-9035 (LCA through FLAG) — https://flag.dol.gov/
Use these pages to confirm current forms, editions, fee tables, and any updated guidance after the Federal Register notice.
This Article in a Nutshell
DHS has proposed a wage-based H-1B selection system, published in the Federal Register on September 24, 2025, which would weight registrations according to the Department of Labor’s four-tier prevailing wage structure (Level IV=4 entries, III=3, II=2, I=1). The agency would select starting with the highest wage tier and work downward, increasing selection odds for higher-paid roles (DHS models a 107% increase for Level IV and a 48% decrease for Level I). The proposal complements 2024 beneficiary-centric integrity rules and follows a 60-day public comment period. If finalized quickly, DHS may implement the system for the March 2025 registration window for FY2026. Employers should map roles to wage tiers, justify wage levels with documentation, budget for a $100,000 petition fee effective Sept 21, 2025, and submit data-backed comments during the public period. Legal challenges and revisions are possible, so stakeholders must monitor official guidance and prepare compliance workflows.
