H-1B Wage Reform: Weighted Selection Rules End Entry-Level Lottery

DHS’s new wage-based “Weighted Selection Process” takes effect February 27, 2026, reshaping the FY 2027 H-1B cap registration in March 2026. Entry-level Level I roles face the lowest selection odds under the new rule.

On January 5, 2026, employers and candidates are preparing for a cap season that is no longer a pure random lottery. DHS finalized a wage-weighted selection rule on December 29, 2025. USCIS also continues beneficiary-centric controls, meaning one registration per person, even with multiple sponsors.

At the same time, a September 19, 2025 Presidential Proclamation added a $100,000 fee requirement for certain offshore H-1B petitions. That cost can exceed the entire first-year H-1B salary budget for some junior roles.

📅 Key Date: The weighted selection rule is effective February 27, 2026, ahead of the March 2026 FY 2027 registration period.

FY 2027 H-1B cap timeline (employment start: October 1, 2026)

USCIS typically posts the exact registration dates on its cap season page before March. Employers should not wait for the last week to create registrant accounts.

What the “Weighted Selection Process” means for FY 2027

The final rule replaces a purely random selection with a wage-prioritized selection model. The offered wage is measured against DOL’s four prevailing wage levels for the job’s SOC code and the worksite area.

The rule is described as a “weighted” system. The practical effect is greater selection probability for higher wage levels.

Weights described in the rule summary:
– Level IV: 4 “entries” worth of weight
– Level III: 3
– Level II: 2
– Level I: 1

The rule summary includes approximate selection chances (these vary yearly and are not guaranteed):
– Level IV: ~61%
– Level III: ~46%
– Level II: ~31%
– Level I: ~15%

⚠️ Employer Alert: USCIS can scrutinize wage-level placement. A Level I wage paired with senior duties can trigger an RFE or denial.

Beneficiary-centric rule: one registration per person still matters

USCIS moved to beneficiary-centric selection to reduce duplicate registrations. That remains a core compliance pillar.

• Employers must submit one registration per beneficiary.
• Multiple employers may register the same person; USCIS then applies wage weighting in selection.
• Employers should document the wage level rationale early.
• Employees should ask which SOC code and wage level the company plans to use.

Comparison to last year’s cap season

FY 2026 cap season (registration in March 2025) was still a random lottery. USCIS reported 470,342 eligible registrations and approximately 120,000–135,000 selections across rounds. The initial selection rate was roughly in the mid-20% range.

FY 2027 is expected to shift selections upward toward higher wages, which may reduce selection chances for Level I roles even if total registrations fall. Employers that historically relied on Level I roles should plan for fewer selections. Employees in early-career roles should plan backup options now.

The offshore $100,000 fee and who may be affected

A Presidential Proclamation effective September 19, 2025 requires a $100,000 fee for certain new H-1B petitions when the beneficiary is outside the United States.

• This is often described as an “entry fee.”
• It is in addition to normal H-1B filing costs.
• The proclamation describes exceptions in many common scenarios (for example, extensions and many U.S.-based change-of-status cases).

Employers should budget conservatively until counsel confirms whether the fee applies. Employees abroad should ask early whether the petition strategy avoids the fee.

Standard cap-subject H-1B fees (typical):

The proclamation’s offshore cost is separate from these line-item fees. Some employers refer to it as the $100,000 fee.

Steps after selection (what employers and employees must do)

Selection only gives the employer a chance to file an H-1B cap petition. It is not approval.

After selection, employers should:
1. Confirm the SOC code, worksite location, and wage level.
2. File the LCA with DOL and post required notices.
3. Prepare a petition that proves a specialty occupation.
4. File the I-129 during April 1 to June 30, 2026.

After selection, employees should:
1. Confirm the offered salary meets the higher of actual wage or prevailing wage.
2. Verify the job duties match the stated wage level.
3. Plan travel based on change-of-status timing and stamping needs.

⏰ Deadline: Selected registrations must be filed in the USCIS window. Late filings are rejected, even if the selection was valid.

If you are not selected: alternatives

Non-selection is not a denial; it simply prevents filing a cap petition from that registration. Options depend on the person’s current status and employer type.

Common alternatives:
– Cap-exempt H-1B: Universities, affiliated nonprofits, and research entities can file year-round.
– O-1: For candidates with sustained national or international acclaim.
– L-1: Intracompany transfers after qualifying overseas employment.
– STEM OPT extension: For eligible F-1 students, if time remains.
– Day 1 CPT: High-scrutiny area — use only with careful school and program vetting.
– TN (Canada/Mexico): If nationality and role qualify.
– E-3 (Australia) and H-1B1 (Chile/Singapore): If nationality qualifies.

Employers should consider cap-exempt partnerships; a cap-exempt entity can sometimes employ the worker directly, provided the role is compliant and real.

Pending legislation and continued uncertainty

The H-1B and L-1 Visa Reform Act of 2025 (S.2928) proposes a median wage floor for H-1B and additional recruitment requirements. It is not law today, but it aligns with the policy direction behind wage prioritization and should be monitored.

Looking ahead: projected FY 2028 timeline

FY 2028 should follow the same seasonal pattern, absent further changes.

Employers building entry-level pipelines should start wage planning in January (SOC code selection and worksite mapping). Employees should plan career steps that justify higher wage levels; stronger duty complexity supports both selection probability and petition approval.

Action items (January–March 2026)

• Employers: Lock the SOC code, duties, and worksite list by late January 2026. Price out prevailing wages at flcdatacenter.com and set offers accordingly.
• Employees: Confirm your degree major fits the role’s specialty. Ask which wage level will be used, and request the offered salary in writing.
• Both: Track USCIS’s March 2026 registration dates. Prepare for April filing immediately after selection.

📋 Official Resources:
– H-1B Program: https://www.uscis.gov/working-in-the-united-states/h-1b-specialty-occupations
– Cap Season: https://www.uscis.gov/working-in-the-united-states/temporary-workers/h-1b-specialty-occupations/h-1b-cap-season
– Prevailing Wages: https://flcdatacenter.com