DHS submits Strengthen H1B Visa Rule to OMB as Interim Final Rule

The long awaited DHS regulation that has been on Spring 2020 Regulatory agenda under H1B category was submitted to OMB for review today under “Interim Final Rule” stage.  Many of you may wonder, what does this “interim final rule” stage mean and what impact it can have on H1B program, including option for lawsuit in court. In this article, we will review the history of “Strengthening H1B Visa Rule” and rule making process requirements, including common FAQs.  

Update October 7th, 2020 : This rule is published in Federal Register now. Check New H1B Rules – Definition Change, 1 year Approvals, Site Visits, others.  

History of Strengthen H1B Visa Regulation

The official title for this H1B regulation is “Strengthening the H-1B Non-immigrant Visa Classification Program”. This regulation has been on the regulatory agenda for many years. It first appeared in Fall 2017 and continued to appear in every other regulatory agenda after that like Spring 2018, Fall 2018, Spring 2019, Fall 2019 and recently Spring 2020 agendas, you can see this history of its appearance on Reginfo.gov. 

The continuous appearance of this H1B regulation in all these regulatory agendas mean that it was not created all of sudden due to COVID-19 or some other initiative. It tells us that this H1B regulatory issue has been there and part of Trump Administration plans for a long time. Now, with the recent Trump Travel Ban for H1B Visa holders and US economy situation, this has become a priority.

Official “Strengthening H1B Visa Regulation” Info, Key Points

Firstly, the complete official regulation text on the ‘strengthening H1B visa program’ agenda item, called as “Strengthening the H-1B Non-immigrant Visa Classification Program” is not yet published for public to comment or review. Only the basic details required to be in regulatory agenda are available.  Below is that basic information and key points.

Key Goals for the H1B regulation

• DHS proposes to revise the definition of specialty occupation for H1B Program
• They would like to increase focus on getting best and brightest foreign nationals using the H1B program
• The definition of employment and employer-employee relationship will be revised to better protect US workers and their wages.
• H1B program will have additional requirements so that employers pay H1B employees appropriately as per H1B wage levels and prevailing wage

Additional details as per Proposed Rule Stage

• The NPRM (Notice for Proposed Rule Making) date was set to December 2020
• It was classified as “Major” and “Economically Significant”

Note: Anything you see beyond the above details are pure speculations by others that are clickbait articles and fake news.

You may also watch the below YouTube Video that summarizes this news

Below is the screenshot of the regulation as per “Proposed Rule Stage” on Reginfo.gov. You can check the official agenda item text at H1B Strengthen rule on Reginfo.gov

H1B Rule in Interim Final Stage, OMB Review Status

The US Federal Rule making processing is really long and has to go through about 9 steps, depending on the priority and economic impact.  Depending on the situation and impact of the rule, some regulations can skip few of the stages to avoid unnecessary burden, public interest or not practical.  Read 9 Steps for Federal Rule Making  to understand each of the stages and steps involved.

OMB Review Status : Now, the current rule official status for ‘strengthening H1B visa program’ is ‘Pending EO 12866 Regulatory Review’. See below screenshot. This status is also called as OMB review. OMB is short form for Office of Budget and Management(OMB).  OMB plays critical part in doing regulatory review, they look at economic impact.  If a rule is classified as ‘major’ or ‘economically significant’, then OMB would review it thoroughly. In fact, H4 EAD Rule Removal is stuck with OMB for a long time as the economic impact is not justifiable.

Interim Final Rule Stage : Also, if you look at the official stage from above status, the current H1B rule is said to be in “Interim Final Rule” stage. Also, what is contradictory is, in the proposed rule stage, it was classified as “Economically Significant” and now that has changed to “NOT Economically Significant”.  It does not sound logical as the any major changes to H1B Program will have significant impact on the economy and business currently employing H1B workers.

What does Interim Final Rule Stage mean for H1B rule ?

If a rule is set to stage “Interim Final rule”, it will become effective as soon as it is published. It basically means that public does not get a chance to review the rule and give comments on the same, before it becomes effective.

But, after publication, the agency can take in public comments as required and change the interim rule. If they do not make any changes to the interim rule, they can publish the final rule to federal register.  This moving to Interim Final rule stage is usually done by an agency, if there is a good cause that is justifiable by that agency.

Now, let’s review the potential for legal challenges and lawsuit in this new H1B rule case.

DHS moving H1B rule – Propose Rule to Interim Final Stage – Lawsuit ?

Below is the exact jump in stages that have happened for you to see it visually.

In federal rule making process, the change of the stage from “Proposed Rule” to “Interim Final Rule” has to be justified. Technically, in ‘strengthening H1B program’ rule case, DHS is bypassing the stage of seeking public comments and review of the rule by public. Unless, DHS can justify the reason to do this, this will attract a lot of legal challenges.

  The issue of moving the stages without public comment and classifying as not economically significant are really tricky decisions that DHS has taken. This will be subject to review, if DHS is not properly classifying and moving stages quicky.  Many employers, agencies or attorney groups can file a Lawsuit against DHS for this. Also, the agency head can be sued too. See below the official guidance as per rule making. 

Overall, the Trump Administration is trying to do something before upcoming US Elections and maybe use this as part of their election campaign to promote “Protecting American Jobs by changing H1B rules”. Looking at the rulemaking process, if they do anything that is not compliant as per regulations, this would be challenged in court and they will end up losing in court similar to Employer Employee Relationship H1B Memo Decision

What do you think of Trump Administration moving the status and Stage on this H1B rule? Do you think there is chance for this to become final rule? Share your thoughts in comments.