This morning, USCIS officially announced that it was rescinding the final rule from January 8, 2021 titled “Modification of the Registration Requirement for Petitioners Seeking to file Cap-Subject H-1B petitions.” This rule was originally designed to rank and select registrations in the H-1B lottery and give priority to higher wage levels. More details on the original rule can be found here: https://www.rnlawgroup.com/818-dhs-proposes-wage-based-selection-process-to-replace-h-1b-cap-random-selection-process/

Multiple organizations filed lawsuits against this rule as it negatively impacted small businesses and non-profits that do not qualify for cap-exempt H-1Bs. In September 2021, the Court in the Northern District of California vacated the rule and found it was unlawful. That case was Chamber of Commerce of the United States of America et al. v. United States Department of Homeland Security, et al., No. 4:20-cv-07331. Since that ruling, USCIS was still defending the rule in other courts and was potentially considering an appeal. However, the Agency has recently announced it would no longer defend the rule and would be rescinding it. Given the new stance, USCIS has published a final rule rescinding the previous rule that can be found here: https://public-inspection.federalregister.gov/2021-27714.pdf.

So What Does This Mean for Employers and Employees?

As of now the H-1B lottery for FY 2023 that will be conducted in March 2022 is expected to be conducted as it has in FY 2021 and FY 2022 with the electronic registration system. See https://www.rnlawgroup.com/what-should-employers-and-employees-know-about-the-lawsuit-challenging-the-2019-h-1b-lottery-registration-regulation/ for an update on the electronic registration system.

The rescinding of the rule means that H-1Bs with higher wage levels will not be given priority in the H-1B lottery and the lottery will still be conducted at random. The FY 2023 H-1B lottery is expected to be conducted in March 2022, so employers should start gathering information and preparing for that date.

By: Steven A. Brown