DHS Proposes Overhaul of H-1B Visa Lottery to Favor Higher-Skilled, Higher-Paid Foreign Workers

The U.S. Department of Homeland Security (DHS) is set to publish a notice of proposed rulemaking in the Federal Register on Wednesday, September 24, 2025. This proposal would significantly alter the annual H-1B cap lottery. The new system, proposed by U.S. Citizenship and Immigration Services (USCIS), aims to move away from the current random selection process and implement a weighted approach that favors higher-skilled and higher-paid foreign workers. Just days after President Trump signed a proclamation ordering a $100,000 fee for some H-1B visa petitions, a new rule has been proposed.

“Specifically, the proposal would weigh registrations (or petitions) for selection generally based on each beneficiary’s equivalent wage levels. When random selection is required because USCIS receives more registrations than USCIS projects to be needed to meet the numerical allocations, USCIS would conduct a weighted selection among the registrations for unique beneficiaries (or petitions) received generally based on the highest Occupational Employment and Wage Statistics (OEWS) wage level that the beneficiary’s proffered wage would equal or exceed for the relevant Standard Occupational Classification (SOC) code in the area(s) of intended employment. The proffered wage is the wage that the employer intends to pay the beneficiary,” the Federal Register notice reads.

Under the proposed system, H-1B registrations would be assigned to one of four wage levels based on the beneficiary’s proffered wage relative to the Department of Labor’s OEWS. Beneficiaries at the highest tier (Level 4) would have their names entered into the selection pool four times, while a Level 3 beneficiary would be entered three times, a Level 2 beneficiary two times, and a Level 1 beneficiary only once.

The Federal Register notice further clarifies, “Each unique beneficiary would only be counted once toward the numerical allocation projections, regardless of how many registrations were submitted for that beneficiary or how many times the beneficiary is entered in the selection pool. This proposed weighting and selection process would not alter the prevailing wage level associated with a given position for U.S. Department of Labor (DOL) purposes, which is informed by a comparison of the requirements for the proffered position to the normal requirements for the occupational classification.”

The DHS believes this new model will incentivize employers to offer higher wages or to petition for positions that require a higher skill level. According to the document, the total annual salaries for H-1B workers could increase by over $500 million in the first year alone. The proposal also notes that while the new system is designed to provide a greater chance of selection for higher wages, it still allows for all wage levels to have an opportunity.

“Through the proposed regulatory revisions, DHS aims to implement the numerical cap in a way that incentivizes employers to offer higher wages, or to petition for positions requiring higher skills and higher skilled aliens, that are commensurate with higher wage levels. The proposed process would favor the allocation of H-1B visas to higher-skilled and higher-paid aliens, while maintaining the opportunity for employers to secure H-1B workers at all wage levels,” USCIS said in the Federal Register notice.

This proposed regulation would not be finalized until it has cleared the federal rulemaking process, which could take several months. The public will have a 30-day period to submit feedback after the notice is published. If finalized, the rule could be in effect for the FY 2027 H-1B cap season, which is set to begin in March 2026.

According to the Immigration and Nationality Act (INA), the H-1B visa program allows U.S. employers to temporarily hire foreign workers to perform services in a specialty occupation, services related to a U.S. Department of Defense (DOD) cooperative research and development project or coproduction project, or services of distinguished merit and ability in the field of fashion modeling. A specialty occupation is defined as an occupation that requires the theoretical and practical application of a body of highly specialized knowledge, and the attainment of a bachelor’s or higher degree in the specific specialty (or its equivalent) as a minimum qualification for entry into the occupation in the United States.

Congress has established limits on the number of foreign workers who may be granted initial H-1B nonimmigrant visas or status each fiscal year (FY). The total number of foreign workers who may be granted initial H-1B nonimmigrant status during any fiscal year may not exceed 65,000. Certain petitions are exempt from the 65,000 numerical limitation. The annual exemption from the 65,000 cap for H-1B workers who have earned a qualifying U.S. master’s or higher degree may not exceed 20,000 foreign workers, according to the INA.