The U.S. Department of Labor’s (DOL) Office of Foreign Labor Certification (OFLC) has released Frequently Asked Questions Regarding Delays Issuing Prevailing Wage Determinations and H-1B Labor Condition Applications (pdf).  OFLC’s current priority is to complete H-2B wage redeterminations, but it also notes that it receives voluminous requests for prevailing wage determinations (PWD) in connection with H-1B petitions. When filing an H-1B petition, the employer must pay to the H-1B employee 100% of the prevailing wage or higher. As OFLC points out in its FAQ document, an OFLC-issued PWD is not mandatory for H-1B petitions, and employers filing petitions may use the following alternative sources for determining a prevailing wage:

• a wage rate included in a collective bargaining agreement;
• a wage rate for the occupation and area of intended employment under the Davis-Bacon Act or the McNamara-O’Hara Service Contract Act;
• a wage rate produced by a survey conducted by an independent authoritative source that meets DOL regulatory standards; or
• a wage rate produced by another legitimate information source, such as the Bureau of Labor Statistics Occupational Employment Statistics Survey or a state-generated prevailing wage survey.

OFLC points out, however, that using an OFLC-issued PWD for an H-1B petition provides employers a “safe harbor” against claims that they failed to pay H-1B workers the required prevailing wage. If an employer uses an alternative source for determining the prevailing wage, it is at risk during a DOL wage and hour investigation and/or enforcement action of having to defend its asserted prevailing wage and demonstrate that the PWD meets the criteria dictated by H-1B regulations.

Consequently, should an employer use an alternative prevailing wage source (other than one issued by OFLC) when filing an H-1B petition, it is critical for the employer to ensure that the proper methodology is used by the person preparing the Labor Condition Application (LCA). An inaccurate representation on a LCA or the failure to be in full compliance with the required attestations may subject the employer to certain penalties, including fines, back pay and debarment from obtaining work authorization for foreign national employees. Further, the failure to comply with the DOL regulations regarding the employment of H-1B employees may result in a finding that the company is a “willful violator,” resulting in additional onerous attestation obligations regarding displacement of U.S. workers and recruitment of U.S. workers prior to the hiring of H-1B employees. Thus, it is very important to carefully review any such applications to be filed by the company to ensure accuracy, particularly the PWD used.