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H1B Salary - All About H1B Wage Levels and Prevailing Wages
April 20, 2022
12 mins
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In this article, we have covered the following points:

  • The H1B Wage Rule
  • H1B Wage Levels
  • H1B Wage Levels and Prevailing Wage Determination

The H-1B is a temporary nonimmigrant work visa that US employers use to employ aptly qualified foreign talent when they cannot fulfill a job vacancy from within the US workforce. An acceptable wage paid to the H1B candidate is a key factor in H1B compliance and Visa approval. USCIS' 'Wage Levels' has set minimum salaries criteria for H1B employers to fulfill if they are to be eligible for H-1B petitioning. These wage levels depend on several factors, including location, SOC code, experience, and area. Many laws and rules regulate employment-based visas, like the H1B wage level. Let's take a look at H1B salary levels, how they have been set, and how much it weighs in on determining USCIS' approval for H1B LCA.

The H1B Wage Rule - What is it?

H1B wage levels were implemented to protect H1B immigrant workers from exploitation. It ensures that they are paid on par with US workers who work in a similar environment. To pursue an H1B petition, US employers are mandated by law to submit details of the job description, wage level, location, and all other employment details for approval in compliance with the Labor Condition Application (LCA).

Wage levels are pitched at competency levels. It was first introduced in the year 1997 with only two skill levels:

  • Level 1 for entry-level employees
  • Level 2 for employees with high-level competencies

The USCIS defines wage level, also called prevailing wage, as the average salary earned by working individuals in a particular area. As time progressed, it was found that a two-tiered leveling would not suffice when it came to defining more complex job roles that required advanced cognitive and judgment-based skills. As a revision to address this drawback, the USCIS released a four-tiered wage-level system in 2004 and called the H1B Visa Reform Act 2004. This has been the wage level system in practice since then.

H1B Wage Levels - The Differentiation

As stated earlier, salary levels are differentiated on the basis of education, experience, and location to keep them at par with the prevailing wage levels for US employees. Each wage level is defined as a percentile. Here is a breakdown of the four wage levels in the H1B Wage Level System:

H1B Entry level: Wage Level 1
The Level 1 Wage is in the 17th percentile. H1B wage level 1 is allotted for entry-level H1B workers who can perform tasks that require a basic level of understanding to perform duties.

H1B Qualified level: Wage level 2
Wage level 2 is the next step up. Most H1B workers with some level of education and experience fall in this category. This wage level is at the 34th percentile.

H1B Experienced level: Wage level 3
Level 3 may include managerial level duties. Employees who have gained a deeper understanding of job roles and responsibilities through years of experience will be placed at this wage level. Level 3 makes up the 50th percentile.

H1B Fully competent level: Wage level 4
Wage level 4 lies at the 67th percentile. Workers at this wage level will be seasoned professionals and given upper-level management responsibilities.

H1B Wage Levels - Minimum Salary Requirements

The H1B visa is a great opportunity to live and work in the US. But the h1b minimum wage is an important factor in obtaining an H1B visa. As stated above, several factors like job location and experience level are reflected in the wage level the job is placed at.

The US government takes the wage level system very seriously. High levels of scrutiny go into an H1B visa application approval process, and the wage level is one of the most important factors for H1-B visas to get denied. This program is the US government's way of ensuring that employees and employers are treated right. Wage levels protect the employee against abuse and ensure that they are compensated for their work with the mandatory h1b salary requirement. The government proposed a minimum annual wage of $150,000 to $250,000, depending on the type of job and other factors.

Wage Requirements for LCA Application

The H1B wage level keeps your salary at par with the average wage levels within the job location and profile you are aiming at. You cannot get the LCA approved if the salary your employer proposes does not meet this requirement. Since H1B jobs aim to procure skill sets that contribute positively to the US economy, you may not qualify for H1B LCA approval if the wage level is below par.

So, this is an important factor to remember when you consider applying for an H1B visa. A proposed H1B salary below the wage level for that position is one of the most common reasons H1B visas get denied.

Factors Impacting The H1B Wages

The existing H1B salary is determined by location and job requirements. Location is crucial because prevailing wages differ from one area to another. Wage levels are also determined by the skills and effort required for different types of jobs. Labor statistics vary by region, so a particular geographic location's working conditions affect the existing wages in that area. A state with a higher median wage for a given position will have a higher prevailing wage.

Advantages of Prevailing Wages

The existing wage laws benefit employees, employers, businesses, and the economy. The benefits include:

  • Lower racial rate gaps

Sometimes, employers may exploit and discriminate against certain employees because of their racial biases. Fortunately, the prevailing wage laws ensure that all employees, irrespective of their race or religion, are treated equally promote inclusivity and enhance working conditions.

  • Better employee performance

The prevailing wage laws provide employees with a sense of security. Having a guaranteed minimum salary based on their job profile and location encourages them to work at their best. This sense of security helps eliminate any misgivings in the minds of both foreign and American employees.

  • Better economical support

The H1B wage laws create a secure environment for taxpayers, thereby enhancing their responsibility towards the states. Their goal is to hire the best human resources for the country and give them the resources they need.

  • Impartial work environment

While the H1B program promotes job transparency and creates an employee-friendly work environment, it also ensures that people holding similar job profiles are treated equally. This equitable ecosystem also ensures financial equality, creating a productive environment for native and foreign employees.

How to Determine the Right Wage Level for LCA?

Two websites give reliable salary information about prevailing H1B wage levels for LCA approvals:

  •  FLCDataCenter.com
  •  H1BGrader.com

H1BGrader uses the same data source as the FLCDataCenter website, but there is the added advantage of 'history checking' tools and a better User Interface.

How to Determine The Correct Wage Level for Your Profile

Look at 'Section G' of your LCA. You will be able to find all information related to your proposed H1B wage level and H1B position, including salary database year, the average wage in the area, and the wage level you are at. This should be part of the information and application package your prospective employer shares with you.

You could also use the 'Search' feature on H1BGrader.com and use your LCA number to get your LCA details like H1B wage level on H1Bgrader.com.

Looking up Wage Levels for Job, Location, History

To look up the prevailing minimum wage for a particular job profile in a specific location, use the following procedure:

  • Visit H1BGrader.com and navigate to Prevailing Wage Search Page
  • Enter the SOC Code of the job title and the Area Name
  • The results page will display prevailing wage levels and the base salary that has to be paid for any wage level in a particular area

For a record of wage levels over a previous five-year period, there is a 'History of Prevailing Wages' tab on the same website. Click on the tab and follow the same steps as above.

Using FLCDataCenter

Use the following steps to find the prevailing wage level for any H1B job position on the FLCDataCenter website:

  • Navigate to the website homepage and find the search wizard. You can make a step-by-step state-wise search on this wizard or go to the Quick Search tab for direct search options
  • The search bar prompts you to select options to narrow down the exact information you need, including the Source of Database for Prevailing Wage, the area where you plan to work, and the job title. If you are unsure of the Source of Database for Prevailing Wage, you could make an 'All Industries' selection
  • Hit the Search button after all the fields have been filled, and you will be taken to the results page displaying all wage information related to your search specifics. Wage levels and minimum wage for your particular profile

How Recruiters Determine Prevailing Wage

There are two ways the prospective employer can determine the prevailing wage for an H1B beneficiary:

  • Submit a prevailing wage determination application to NPWC: the Form ETA - 9141. An electronic application is strongly recommended
  • Independently set the prevailing wage when the LCA is filed

There are three different 'sources' from which the H1B employer can get a prevailing-wage determination:

  • The NPWC, as mentioned earlier
  • A survey conducted by an independent source of authority
  • Any other source of justifiably legitimate information

Out of the three sources, information acquired from the NPWC affords the applicant something called a 'safe-harbor' status. 'Safe Harbor' signifies that if the US DOL's Wage and Hour Division exercises the authority to investigate the proposed wage, there will be no contest to the declaration if the information was acquired from the NPWC. There will, of course, be scrutiny of whether application details like geographical location, occupation, and skill level were submitted correctly.

Also Read: A Comprehensive Mini Guide on H1B Prevailing Wage

What is the best way to find prevailing wage jobs for H1B visas?

To acquire an H1B prevailing wage job, you can:

  • Attend job fairs.
  • Browse the Department of Labor website for information.
  • Look up classified ads and job boards.
  • Enlist with employment agencies.

H1B Prevailing Wage and Wage Levels - FAQs Answered

What should I do if I find evidence that my employer is not paying me according to the H1B prevailing wage?
Every employer who has hired an employee on an H1B visa is mandated to follow the H1B prevailing wage and wage levels. If you find that your employee is not following the H1B mandates, you can demand your dues from your employer and raise a complaint with the Department of Labor (DOL) by filing Form WH4.

Do the prevailing or minimum wage for H1B rules and recommended numbers change annually?
Yes. Prevailing wage is data that is refreshed and published every year. You can observe and compare changes in numbers by looking at a five-year history of the prevailing wage, which you can obtain on the History of H1B Prevailing Wage page on H1BGrader.com. At any given time, the prevailing wage will be whatever is currently published on FLCDataCenter webpage that you will use to file an LCA.

Is it mandatory that every H1B employee be paid according to H1B prevailing wage regulations?
Yes. There is a responsibility placed on the employer to ensure that the salary standards of the H1B employee are set according to prevailing wage regulations to be on par with any US citizen in a similar profile. This mandate eliminates the fear of being taken advantage of in the employee's mind.

What calculations help you arrive at the prevailing wage figure?
The prevailing wage is decided by the US DOL and Occupational Employment Statistics. Surveys are conducted to determine wages reflected in the local economy through a cross-section of jobs within the same occupation and region. These figures depend on many factors and can vary from state to state.

Are H1B wage levels inclusive of bonuses?
Yes, they are. However, the bonus is not paid separately. It is included with the regular wages. As per the Fair Labor Standard Act (FLSA), the regular wages include the compensatory payment for worked hours, good work performance, and services rendered.

Does the H1B LCA prevailing or minimum wage differ yearly?
Yes, it does. The Occupational Employment Statistics (OES) surveys annually determine and update the current salary. You should:

  • Keep a close watch on when the information is published.
  • Use the current prevailing salary when submitting a new LCA.

What is the minimum number of work hours that guarantee payment?
The guaranteed minimum number of work hours is calculated by the number of hours the H1B employer mentions in Form I-129 or I-129 W, item number five, which is also called Petition for Non-Immigrant Worker.

The H1B employee is entitled to the guaranteed payments as soon as they join the employment, but not later than thirty days after entering the USA. If the employee is already in the country, the guaranteed payments will begin sixty days after they are authorized to work for their H1B employer.

Is it mandatory for the employer to pay for the guaranteed minimum hours even if the employee is not given any work?
Yes, the employer must pay for the minimum hours unless the employee hasn't reported for work due to various non-work-related reasons, including voluntary time-off requests or other circumstances where the employee cannot work.

Do H-1B workers have other wage requirements under Federal law?
In fact, yes. Workers on H-1B visas are subject to the same wage statutes as other US employees.

In conclusion

H1B visas are very specific in terms of the job offered, and the salary offered to the prospective client. The Labor Condition Application with disclosure of all the details about the job, including profile, duties, and salary based on prevailing wage, has to be approved by the Department of Labor before a visa application can begin. Here the salary offered must either match or exceed the prevailing wage of the area. For the best chances of H1B approval, make sure you choose the right kind of job and monitor the prevailing wage numbers for the year you are applying.

Visit TechFetch H1B for more information about H1B and all about the Prevailing wages.

**Disclaimer: H1B rules and regulations keep changing from time to time. For updated information, always refer to the USCIS official website.

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