On September 24, 2025, the U.S. Department of Homeland Security (DHS) published a proposed rule Federal Register :: Weighted Selection Process for Registrants and Petitioners Seeking To File Cap-Subject H-1B Petitions that could fundamentally change how H-1B registrations are selected in the lottery. This proposal aims to rework the H-1B random selection process to a wage-weighted selection system that favors more experienced, and thus, higher-paid workers.
The proposed rule is now in a comment period which will end November 24, 2025. The rule may be finalized thereafter in its present form or with some changes. Litigation is also possible as the rule may result in inequitable treatment based on employer size and industry.
Please note that this rule applies only to future H-1B lottery selections. It does not apply to petitions for H-1B extensions, amendments, change of employer, or petitions filed by cap exempt employers.
The Current System
Under the current H-1B cap system, U.S. Citizenship and Immigration Services (USCIS) allots a set number of new H-1Bs each year—65,000 under the “regular cap” and an additional 20,000 for individuals with a U.S. master’s degree or higher. Selections are made through a random lottery in March of each year for an H-1B start date of October 1st of the following fiscal year. Wages are not considered nor are they disclosed in the random selection process.
The Proposed Change
The new proposed rule aims to replace the prior system and implement a “weighted selection process”, which assigns prospective employees to four different wage bands. Under this system, the wage level would dictate how many times a particular individual is entered into the lottery (thus impacting selection rates), as follows:
- Level IV (fully competent workers, ~67th percentile): 4 entries
- Level III (experienced workers, ~50th percentile): 3 entries
- Level II (qualified workers, ~34th percentile): 2 entries
- Level I (entry-level, ~17th percentile): 1 entry
Under the new system, employers seeking to hire more experienced, higher-paid workers will have higher selection rates, while those relying on lower-paid recent graduates and entry-level hires will have lower selection rates.
If the rule is finalized, the new rule could be promulgated in time to impact the upcoming FY2027 H-1B cap season, which is expected to begin with H-1B lottery registrations in March 2026.
Unlikely to Change
The beneficiary-centric model, in which each foreign national can only be selected once, even if multiple registrations are submitted on their behalf.
The total number of registrations which may be selected, which remain 65,000 under the “regular cap” and an additional 20,000 for individuals with a U.S. master’s degree or higher. The numbers are statutory and would require Congressional action to change.
What This Means for Employers
In anticipation of changes employers should begin evaluating how a wage-weighted lottery might affect their workforce planning. For hires who would be subject to an H-1B lottery, consider:
- Reviewing how your H-1B roles align with wage levels. Employers offering Level III and Level IV wages will have a clear advantage in the lottery selection process. This in turn could influence decisions around on-campus recruiting and hiring of new graduates. It could also have more significant consequences for employers and industries for which Level I and Level II wages are common, such as start-ups and smaller employers.
- Assessing the impact on entry-level hiring pipelines, especially current employees in OPT/STEM OPT status
- Coordinating with internal teams (including leadership, talent acquisition, and finance) on projected costs
LAC will continue to provide updates as they become available and will work with clients regarding immediate and long-term strategies in response to these changes.
This update was prepared by Brianda Renteria-Huber, Associate Attorney, Fausta M. Albi, Partner and Melissa O. Nonaka, Senior Associate Attorney – Larrabee Albi Coker LLP