H-1B Prevailing Wage Levels

An employer that petitions for an H-1B, H-1B1 or E-3 worker files a Labor Condition Application promising to pay at least the higher of the actual wage it pays similar employees and the prevailing wage for the occupation in the area of intended employment. An employer sponsoring a worker for permanent residence through PERM labor certification makes a comparable promise. The rule for the H-1B family is 20 CFR 655.731; for PERM it is 20 CFR 656.40. Both point to the same method for the prevailing wage, administered by the Department of Labor’s Office of Foreign Labor Certification (OFLC).

Where the figures come from

Unless a collective bargaining agreement covers the job, or the employer uses an acceptable independent survey, the prevailing wage comes from the Bureau of Labor Statistics’ Occupational Employment and Wage Statistics (OEWS) program, the same survey behind the occupation pages and state profiles on this site. OFLC takes the OEWS wage distribution for an occupation in a metropolitan or nonmetropolitan area and publishes four wage levels for it. The published figures are in the OFLC wage library, searchable at the Foreign Labor Application Gateway (FLAG) wage search, which lets a user pick an area, an occupation and a wage year and returns the four levels. The wage year runs from July 1 to June 30; the library is rebuilt each July from the OEWS release of that spring.

Because the levels are built from OEWS percentiles for an occupation in an area, they move with each OEWS release and differ by area in the same way the medians on this site do. They are not the same numbers as the OEWS percentiles, however: OFLC computes them by its own formula, described below, and an OEWS table should not be read as a prevailing wage determination.

The four levels

The method is set out in OFLC guidance under 20 CFR 656.40(b)(2), which requires the determination to use the OEWS data and to provide at least four levels commensurate with experience, education and the level of supervision. In the published guidance the levels are built from the OEWS mean and the distribution around it:

• Level I (entry): beginning-level employees with a basic understanding of the occupation, who perform routine tasks requiring limited judgment under close supervision.
• Level II (qualified): employees who have attained a good understanding of the occupation and perform moderately complex tasks with limited exercise of judgment.
• Level III (experienced): employees with a sound understanding of the occupation who have attained special skill or knowledge, exercise judgment and may supervise others.
• Level IV (fully competent): employees with sufficient experience to plan and conduct work independently, set objectives and manage a function.

OFLC assigns a level to a job offer by a worksheet that starts at Level I and adds points for experience, education, special skills and supervisory duties beyond what the occupation normally requires, as recorded in the Department of Labor’s Occupational Information Network (O*NET) job zone for the occupation. Level I therefore does not mean “the lowest wage anyone is paid”; it means the wage OFLC considers appropriate for a job with the occupation’s normal requirements and no more.

What the figures do and do not say

An employer must pay at least 100 percent of the applicable level (20 CFR 655.731(a)(2)). The level is a floor for one position in one area; it is not a market rate and not a measure of what workers on these visas are paid, which the Department of Labor publishes separately in its disclosure data. Consistent with this site’s rules, FastWages does not reproduce employer-level disclosure records or build pages about any employer.

A prevailing wage determination also depends on the area of intended employment, which follows the OEWS metropolitan and nonmetropolitan area definitions, and on the occupation code OFLC assigns to the job duties, which can differ from the title the employer uses. Where the job is in more than one area, the highest applicable wage governs. For PERM cases the employer requests a determination from OFLC’s National Prevailing Wage Center on Form ETA-9141 and receives a figure valid for a stated period; for H-1B cases the employer may rely on the FLAG wage library directly and must document the source.

Related rules

The actual-wage requirement means an employer paying its own similarly qualified staff more than the prevailing wage must pay the visa holder that higher amount. Wages must be paid in full for nonproductive time caused by the employer (“benching” is prohibited), and the required wage cannot be reduced by deductions that are not authorized in 20 CFR 655.731(c). The Wage and Hour Division enforces these requirements through complaints and investigations.