The Biden Administration announced that it would delay implementing a new rule promulgated in the waning days of the Trump Administration that would change the long-standing practice of allocating H-1B visas for highly skilled workers through a random lottery in favor of a system that would give preference to applications associated with higher-paying positions. The new rule, which was published in the Federal Register on January 8, 2021, and set to take effect on March 9, 2021, will not be implemented until December 31, 2021, although the Biden Administration did not foreclose the possibility that it would alter the rule.

In a notice scheduled to be published in the Federal Register on February 8, 2021, the Department of Homeland Security (DHS), which administers the H-1B program through its component agency the US Citizenship and Immigration Services (USCIS), stated that it “expects that delaying the rule to December 31, 2021, will provide USCIS sufficient time to develop, thoroughly test, and implement the modifications to the registration system and selection process and give stakeholders sufficient time to adjust to new procedures arising from the new rule.” The notice did, however, leave open the possibility for further changes to the H-1B selection process, stating that “[d]uring the delay, while USCIS works through the issues associated with implementation, DHS leadership will also evaluate the January 8th rule and its associated policies, as is typical of agencies at the beginning of a new Administration.”

Demand for H-1B visas—most of which are capped at 65,000, with an additional 20,000 reserved for highly educated foreign workers—routinely outpaces availability. According to USCIS, it has received more applications for H-1B visas than were available each year for at least the past decade, with total requests surpassing the number of available visas within five days of the start of the lottery registration every year since 2013. Under the current lottery system, only applicants, known as “registrants,” chosen at random are eligible to file H-1B cap-subject petitions.

The final rule, titled Modification of Registration Requirement for Petitioners Seeking to File Cap-Subject H-1B Petitions, replaced the random lottery system with a process by which registrants would be given preference based on their applications equaling or exceeding the prevailing wage for the type and location of their intended employment. Preference would be given in descending order to registrants whose positions are associated with the highest to lowest of the program’s four prevailing wage levels. See 86 FR 1676, 1677. DHS stated that “prioritizing registrations based on wage level . . . will incentivize H-1B employers to offer higher wages, or to petition for positions requiring higher skills” and that the rule will “maximize H-1B cap allocations, so that they more likely will go to the best and brightest workers; and it will disincentivize abuse of the H-1B program to fill relatively lower-paid, lower-skilled positions, which is a significant problem under the present selection system.” Id. at 1676. 

The former acting secretary of DHS had approved the proposal to change the lottery system on October 28, 2020. The final rule had been set to take effect following the requisite 60-day comment period after its publication in the Federal Register. The Biden Administration’s position on the new rule is consistent with prior representations that it would stop or delay so-called midnight regulations, meaning those regulations that had not taken effect when President Biden assumed office on January 20, 2021.