If you are an employer relying on high-skilled international talent, or an H-1B worker planning your future in the United States, you need to pay close attention to the news that dropped just days ago. On March 26, 2026, the Department of Labor (DOL) released a bombshell proposal that could fundamentally alter the financial landscape of business immigration in America. 
For decades, the H-1B program has been a cornerstone for innovation, but the cost of participating in that program is about to face its most significant hike in a generation. At Badmus & Associates, we have been tracking these developments closely, and the reality is clear: you must plan as though these changes are coming.
In this article, we will break down exactly what the DOL is proposing, why the numbers are shifting so drastically, and what you can do during the critical 60-day window to make your voice heard.
What exactly did the DOL announce on March 26?
The Department of Labor’s latest notice of proposed rulemaking is designed to overhaul how “prevailing wages” are calculated. In simple terms, the “prevailing wage” is the minimum salary an employer must pay to a foreign worker to ensure that the employment does not adversely affect the wages and working conditions of similarly employed U.S. workers.
The DOL argues that the current system, which hasn’t seen a methodology update since 2005, allows companies to hire foreign talent at rates significantly lower than what a U.S. worker would demand. To “fix” this, they are proposing a massive upward shift in the wage percentiles for all four levels of the Occupational Employment and Wage Statistics (OEWS) data.
This isn’t a small adjustment; it is a structural shift. If finalized, this rule will apply not only to new H-1B petitions but also to H-1B1 (Chile/Singapore), E-3 (Australia), and the PERM Labor Certification process.
How much will your wage obligations actually increase?
The most jarring part of the March 26 announcement is the specific shift in wage percentiles. Currently, the DOL uses a four-tier system based on the 17th, 34th, 50th, and 67th percentiles of local wages for a specific occupation.
The new proposal moves those goalposts significantly higher:
- Level I (Entry Level): Moving from the 17th percentile to the 34th percentile. This is a 100% increase in the percentile rank, effectively mandating that “entry-level” foreign workers be paid what is currently considered a “qualified” mid-level wage.
- Level II (Qualified): Moving from the 34th percentile to the 52nd percentile.
- Level III (Experienced): Moving from the 50th percentile to the 70th percentile.
- Level IV (Fully Competent): Moving from the 67th percentile to the 88th percentile.
According to early analysis and the DOL’s own estimates, these shifts are expected to result in wage increases of 20% to 33% across the board. On average, an employer could be looking at paying an additional $14,000 per year per worker.
For a startup or a small business, adding $14,000 to the annual overhead for a single engineer or analyst is a massive burden—and it hits small employers in a very different way than it hits large companies. Big firms often have deeper cash reserves, dedicated immigration teams, and more flexibility to spread higher labor costs across large contracts or product lines. Smaller employers, on the other hand, typically already have a harder time finding qualified workers locally (especially for specialized roles), and they may have fewer options when wages jump: they either increase compensation immediately, slow hiring, restructure roles, or abandon the H-1B route altogether.
For larger tech firms with thousands of H-1B employees, the cumulative cost is astronomical.
Why is the government making these changes now?
This proposal didn’t appear out of thin air. It is the direct result of a September 2025 Presidential Proclamation aimed at “protecting American labor.” The administration’s stance is that the current H-1B system has been “deliberately exploited” to replace U.S. workers with lower-paid alternatives, particularly in STEM fields.
The DOL’s internal research claims that the average wage offered to H-1B workers is currently about $10,191 lower than the average wage for similarly classified U.S. occupations. By hiking the requirements, the government intends to make it more expensive to hire foreign talent, theoretically incentivizing the hiring of domestic workers.
However, as many of our clients at Badmus & Associates know, the talent gap in specialized fields often means there simply aren’t enough U.S. workers to fill these roles, regardless of the salary offered. This rule may not “protect” jobs so much as it might drive innovation, and the jobs associated with it, overseas.
Who is affected by this “Wage Shock”?
If you are involved in any of the following programs, you are in the line of fire:
- H-1B Employers and Employees: Every new petition, amendment, or extension involving a Labor Condition Application (LCA) will be subject to these new rates.
- E-3 and H-1B1 Applicants: While often overlooked, these specialized visas for Australians, Chileans, and Singaporeans rely on the same wage data.
- PERM Labor Certification Applicants: This is perhaps the most critical impact. Over 57% of PERM applications are filed for workers who are already in the U.S. on H-1B status. If the prevailing wage for a PERM application jumps by 30%, and the employer cannot or will not meet that new wage, the path to a Green Card could be permanently blocked for that individual.
If you are currently in the middle of a PERM process, you must consult with your legal team immediately to see if your filing can be completed before these rules potentially take effect.
Can we stop this proposal from becoming law?
The proposal was published in the Federal Register, which triggered a 60-day public comment period. This is your opportunity to take action.
The Department of Labor is legally required to read and respond to every unique, substantive comment they receive. If you are an employer who will be forced to downsize, or if you are a worker whose path to citizenship will be derailed by these costs, your story needs to be part of the official record.
Industry groups, trade associations, and legal experts are already preparing to challenge the rule. However, the best defense is a strong public outcry during this 60-day window.
How should you prepare right now?
Waiting for the final rule to be published is a mistake. You must plan as though these changes are coming. Here is what we recommend:
- Audit Your Current H-1B Workforce: Look at your employees who will need extensions in late 2026 or 2027. Calculate what a 30% increase in their salary would look like for your budget.
- Accelerate PERM Filings: If you have employees eligible for PERM, consider starting those cases now to lock in current wage determinations before the new system is implemented.
- Consult with Counsel: Navigating the intersection of DOL wage rules and USCIS adjudication is complex. Our team at Badmus & Associates is ready to help you develop a strategy to mitigate these costs.
- Review Your Hiring Strategy: You may need to reconsider whether Level I (entry-level) hires remain viable under the new wage percentiles.
Final Thoughts
The DOL’s March 26 announcement is a clear signal that the era of “affordable” high-skilled immigration is under threat. Whether this is a necessary correction or a protectionist barrier is a matter of debate, but for you, the impact is purely financial and operational.
Stay informed, stay proactive, and don’t let these changes catch your business or your family off guard. We will keep you updated as the comment period progresses and as we learn more about the final implementation dates.
Legal Disclaimer: The information provided in this blog post is for general informational purposes only and does not constitute legal advice. Immigration laws are complex and subject to frequent changes. For advice regarding your specific situation, please consult with a qualified immigration attorney. Use of this website or blog does not create an attorney-client relationship between the reader and Badmus & Associates.
Ready to protect your business from rising immigration costs? Contact us today to schedule a consultation with our experienced legal team.
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The post Are H-1B Worker Salaries About to Skyrocket? The DOL’s 2026 Wage Proposal Explained appeared first on Badmus & Associates.