SIGNIFICANCE OF PREVAILING WAGE COMPLIANCE

• Ensures foreign workers are not exploited

• Helps prevent the suppression of wages in the U.S

• Levels the playing field and ensures fair competition

• Helps in upholding immigration laws

• Fosters economic stability and prosperity

DETERMINING PREVAILING WAGE

Wage determination points to “the listing of a set of wages and fringe benefits ruled by the U.S Department of Labor to be prevailing for a given labor category in a given locality”.

An employer filing for an H-1B visa on behalf of their employee should first obtain a credible prevailing wage from the U.S Department of Labor’s NPWC (National Prevailing Wage Center). This is done by filing an application for form ETA-9141. The NPWC will process the request and provide an appropriate prevailing wage, also indicating the validity period. The employer is advised to file the H-1B petition within the validity period to be able to use that determined prevailing wage, as it is subject to change.

There are three significant considerations when determining prevailing wage.

• Classification of the occupation

• Appropriate wage level for the scope of work

• Locality of intended employment

1. Classification of the occupation

The Foreign Labor Certification Data Center assigns various job titles into job zones that describes the level of experience and Specific Vocational Preparation (SVP). SVP is the time needed by an average worker to acquire both theoretical and practical information as well as develop the skills needed to perform in a specific role.

The occupational classification not only focuses on the job title but also daily duties that will be carried out for the specific title. The United States Citizenship Immigration Services (USCIS) uses this system to determine whether the job offered is a specialty occupation. This is a significant criterion, given that H-1B visas are granted majorly on the condition that the applicant is taking on a specialty occupation.

2. Appropriate wage level for the scope of work

Job positions given to H-1B nonimmigrant workers require high skill sets and knowledge as they are specialty occupations. Most specialty occupations are classified with a Specific Vocation Preparation (SVP) of 8, which means they require a minimum of four to ten years to acquire the necessary theoretical and practical knowledge.

The Department of Labor (DOL) has put in place four wage levels:

• Level 1: This is for employees with basic comprehension of the scope of work and are closely supervised. They require minimal independent judgement as they receive guidance on expected work.

• Level 2: This is for employees who have gained skills through experience or formal education. They are qualified to perform tasks that only need limited judgement, as they have a good understanding of the occupation.

• Level 3: For employees are experienced and are able to take on senior or lead roles. They have very sound comprehension of the occupation that is gained through experience or education.

• Level 4: This is for employees who are able to work and conduct independent evaluation. They often engage highly advanced and complex skills and techniques.

3. Locality of intended employment

The area of intended employment is the geographical location where the H-1B nonimmigrant will be employed. The prevailing wage is different in every locality; therefore, Prevailing Wage Determination will ensure that the foreign employee’s wage reflects the same wage being paid to others occupying similar roles.

In cases where the employer has more than one site of work, the applicant will be paid the prevailing wage of the specific site he/she will be assigned to. However, in a situation where the applicant’s site of work is not specific as a result of the employer having multiple clients, the applicant is paid the prevailing wage of the headquarters’ location.

STEP BY STEP GUIDE TO DETERMINING PREVAILING WAGE

To carry out the Prevailing Wage Determination, use the Department of Labor’s online wage library, ‘Foreign Labor certification data center’. This is a useful online resource that is helpful for employers to get insight on the prevailing wage in their locality.

• • STEP 1: Select the area of intended employment (State wise).

• • STEP 2: Select the county or township of employment

• • STEP 3: Enter a keyword for the job position. Alternatively, you can use the (Standard Occupational Classification) SOC code to select the offered job title and then search.

You will get a list of corresponding job titles and job descriptions according to your entries. Each job title will have a hyperlink that will direct you to a stipulated prevailing wage at every wage level. The employer can use this to determine the required wage by comparing it with the actual wage being paid to employees occupying similar roles. Upon comparison, the higher one of the two wages is the required wage.