DHS Proposes Significant Changes to H-1B Visa Lottery

Key Points

• DHS has proposed a regulation to implement significant changes to the H-1B visa lottery.
• Proposed changes would greatly increase chances of selection for higher-paid workers.
• Odds of selection in entry-level positions would decrease by half but would not be eliminated.
• DOL plans to revise prevailing wage levels in line with the goals of the proposed DHS rule.
• DOL announces significant H-1B compliance enforcement initiative in workplaces.

On September 24, 2025, the Department of Homeland Security (DHS) published a proposed regulation that aims to make significant changes to the H-1B visa lottery. Under this proposal, the lottery selection process will heavily favor higher-paid beneficiaries. By increasing the salaries for their prospective H-1B employees, employers will be able to greatly increase the chances that those employees will be selected in the H-1B lottery. DHS likely has enough time to finalize the proposed rule before the next H-1B lottery, scheduled to take place in March 2026. DHS will collect written comments on the rule for 30 days, until October 24, 2025. This alert provides detailed analysis of the proposed rule.

The H-1B Cap Lottery

The H-1B visa is available to beneficiaries sponsored by U.S. employers to temporarily perform services in a specialty occupation, as defined by Immigration and Nationality Act (INA) Section 214(i)(1). The number of initial H-1B visas available each fiscal year is established by Congress and limited to 65,000 visas. This numerical limitation is often referred to as the “regular cap.” An additional 20,000 H-1B visas are reserved for beneficiaries who have earned a U.S. master’s or higher degree, commonly referred to as the “master’s cap.” For more than ten years, the demand for H-1B visas each fiscal year has far exceeded the availability of H-1B visas in both caps.

Under the current regulations, employers submit online registrations for beneficiaries they wish to sponsor for an H-1B visa during a period of at least 14 days each March. DHS has implemented a random selection process—a lottery—to select beneficiaries until the numerical cap is reached. Each beneficiary is considered one unique entry to the lottery, even if they have been submitted to the lottery by multiple employers. After the initial 65,000 beneficiaries are selected, any beneficiaries holding a U.S. master’s or higher degree, as indicated on the online registration, may be selected in the subsequent lottery held for the master’s cap. In the most recent lottery held in March 2025, the probability of selection for each unique beneficiary was approximately 35%.

DHS Proposes Weighted Selection Process

Under the proposed rule, DHS would implement a weighted selection process that would significantly favor the allocation of H-1B visas to higher skilled and higher paid beneficiaries. DHS has indicated that these changes to the H-1B lottery will incentivize employers to offer higher wages, or to petition for positions requiring higher skilled beneficiaries.

The revisions to the current process would require that employers select a wage level that correlates with the beneficiary’s proffered wage at the time of the online lottery registration. In addition to the wage level, employers would need to assign the Standard Occupational Classification (SOC) code for the proposed position (i.e., a specific job from a list published by the Department of Labor (DOL)), as well as the area of intended employment. Wage levels are determined by comparing the requirements for a job opportunity, specifically, any education, training, or experience requirements, against tasks, knowledge and skills requirements for the relevant occupation. DOL uses four wage levels that are classified as “entry,” “qualified,” “experienced” and “fully competent” and sets the prevailing wage for each wage level after collecting wage data from employers in each area of employment.

The proposed changes to the H-1B selection process would weight registrations for selection based upon the beneficiary’s wage level. The beneficiary would then be entered into the lottery as follows:

• Beneficiaries assigned to wage level IV would be entered into the lottery four times.
• Beneficiaries assigned to wage level III would be entered into the lottery three times.
• Beneficiaries assigned to wage level II would be entered into the lottery two times.
• Beneficiaries assigned to wage level I would be entered into the lottery one time.

If a beneficiary is proposed to have more than one intended worksite, such as a client worksite, the information that correlates with the lowest wage would be listed on the registration. Similarly, if the offered wage is a range, the lowest end of the range would be selected. Additionally, if a beneficiary is submitted by multiple organizations, a wage level based on the lowest wage among all registrations will be assigned to the beneficiary. This process would apply to both the regular and master’s cap selection processes.

DHS states that this specific proposal is intended to remove any incentive to submit multiple frivolous registrations and to ensure fairness and prevent employers from artificially inflating wages to increase a beneficiary’s odds of selection in the lottery, only to pay that beneficiary lower wages upon selection. If the beneficiary is selected, the H-1B petition filed with the U.S. Citizenship and Immigration Services (USCIS) must reflect the corresponding wage level previously submitted on the online registration. The proposed rule would revise the regulations to clarify that “a valid registration must represent a bona fide job offer.”

Impacts of the Proposed Rule

The proposed rule departs from a similar proposal from the first Trump administration that aimed to select H-1B beneficiaries starting with the highest paid. Under that proposal, beneficiaries at the two lowest wage levels (“entry” and “qualified”) would have been unlikely to be selected at all. Instead, the current proposal would assign weight to higher pay, rather than ranking H-1B beneficiaries by wage level.

DHS estimates that under this weighted selection system, registrations using wage level IV would have an approximately 61% probability of selection (an increase of 107%), with wage level III at approximately 46% (an increase of 55%). Wage level II registrations would have a probability of approximately 31% (an increase of 3%) and wage level I registrations would have a probability of approximately 15% (a decrease of 48%).

The proposed rule would provide USCIS with the discretion to deny or revoke H-1B petitions in circumstances where the agency determines that the petitioner or a related entity made attempts to “unfairly increase the chance of selection during the registration … process.” This would include changing the proffered wage in a later, amended petition to an amount that would be equivalent to a lower wage level than the wage indicated on the beneficiary’s online registration.

Additional Changes to H-1B Visas

On September 19, 2025, President Trump issued a Proclamation titled “Restriction on Entry of Certain Nonimmigrant Workers,” which requires a $100,000 payment in connection with new H-1B visa petition filed for a beneficiary outside of the United States at the time of filing. USCIS, Department of State and Customs and Border Protection have issued guidance on the Proclamation, stating that the fee will apply prospectively and will not apply to any previously issued H-1B visas, including extensions, amendments or change of employer petitions filed on behalf of those beneficiaries. The Proclamation does not limit the ability for current H-1B visa holders, with a valid H-1B visa stamp, to travel to the United States.

New H-1B petitions filed by employers exempt from the H-1B cap (e.g., research nonprofit organizations and institutions of higher education) are subject to the new fee, effective September 21, 2025. The Proclamation will remain in effect until September 21, 2026, unless extended. Currently, H-1B selections for the fiscal year 2027 H-1B lottery to be held in March 2026 would be subject to the new fee. It is likely that litigation will be filed challenging this Proclamation.

In addition to the imposition of the fee, the Proclamation also directs the Secretary of Labor to revise the prevailing wage levels used in the H-1B visa “consistent with the policy goals” of the Proclamation. The expectation is that the wage levels for most occupations will be increased, which in turn will require employers to pay higher wages to their H-1B employees.

The Department of Labor has also announced Project Firewall, an H-1B enforcement initiative under which the DOL will conduct investigations of employers “to maximize H-1B program compliance.” Employers found to be in violation of H-1B requirements may be required to pay back wages to affected workers, civil penalties and/or be subject to a ban on future use of H-1B visas.