Sean Olender - How to Calculate H-1B Wages

Sean Olender is an immigration lawyer practicing in San Jose and throughout the Silicon Valley.  He has served as an adjunct professor of law at the University of San Diego School of Law since 2013 and the State Bar of California designated him a certified specialist in immigration and nationality law (only 194 California attorneys hold this designation as of October 2015).  He is a member of NCHRA and has given NCHRA seminars on immigration law topics since 1999.  Sean moderated and lectured at the USD International Law Symposium in 2003.  Visit www.olender.pro for more information about immigration law and also H-1B prevailing wages and public access files.

What Is the Prevailing Wage?

The prevailing wage is the average wage for similarly employed workers in the same geographical area. Employers must pay the higher of the actual wage (average wage that employer pays similar workers) and the prevailing wage (the average wage employers generally pay similar workers). Department of Labor publishes prevailing wages each year in the Occupational Employment Survey. It obtains the data from surveys it sends to employers across the United States.

The wages are divided into four tiers.  The applicable tier depends on the education and experience the employer requires for the position and also the education and experience that the Department of Labor believes employers normally require for the position.

What is the Actual Wage?

The actual wage is the mean wage the petitioning employer pays similarly employed workers in the area of intended employment.  Similarly employed workers are ones that have substantially comparable jobs. If the employer has no employees working in substantially comparable jobs, then it must count employees working in jobs requiring a substantially similar level of skill within the area of intended employment.  The area of intended employment generally refers to the "area within normal commuting distance" which is often a metropolitan statistical area or primary metropolitan statistical area.  Some MSAs and PMSAs include a single county and others include more than one county.  Santa Clara County, for example is its own PMSA.  San Francisco County, San Mateo County and Alameda County area all included within the same PMSA.  An MSA is one or more counties that contain a city of 50,000 or more people.  PMSAs a subareas that qualify as an MSA, but have a population of one million people or more.

Does the Employer Have to Pay the Prevailing Wage or the Actual Wage?

H-1B regulations generally require an employer to pay the higher of the prevailing and actual wage. The PERM labor certification process only requires the employer to pay the prevailing wage even if the actual wage (the mean wage the employer pays similarly situated workers) is higher.  Below is a diagrammatic example of how to calculate prevailing wages and actual wages and which one an H-1B employer must pay.

If you have questions about prevailing wages, actual wages, H-1B public access files and more, please visit www.olender.pro or contact us for a consultation.  Here is an article on prevailing wages at www.olender.pro: http://www.olender.pro/immigration/business-immigration/compliance/prevailing-wage and here is one discussing H-1B public access files: http://www.olender.pro/immigration/business-immigration/compliance/public-access-file.