Starting in 2026, the DHS will replace the traditional random H‑1B lottery with a wage-based weighted selection system. In this blog, we break down the new process, what it means for employers and applicants, and actionable strategies to improve your odds of selection.

Overview of the Wage-Based H‑1B Lottery

The U.S. Department of Homeland Security (DHS) has finalized a rule replacing the traditional random H‑1B cap lottery with a wage-based weighted selection system. This system applies to cap-subject H 1B petitions for the FY 2027 registration season, beginning March 2026.

Under the new system, registrants receive multiple entries in the lottery based on the offered wage, according to the Department of Labor’s Occupational Employment and Wage Statistics (OEWS) four-level structure:

• Level IV wage: 4 entries
• Level III wage: 3 entries
• Level II wage: 2 entries
• Level I wage: 1 entry

Higher-wage positions now have increased statistical chances of selection, while lower-wage positions remain eligible.

Registration and Compliance Requirements

Employers must submit accurate registration information, including:

• Applicable OEWS wage level
• Standard Occupational Classification (SOC) code
• Intended work location

USCIS may deny or revoke petitions if wage levels or other details are misrepresented to gain unfair selection advantage.

Key Note: The OEWS wage level for registration is based on the offered wage, not the LCA wage, which depends on the minimum education and experience requirements for the position.

H‑1B Cap Numbers and Effective Date

The statutory H‑1B limits remain unchanged:

• 65,000 regular visas
• 20,000 visas for advanced U.S. degree holders

Timeline:

• Published in the Federal Register: December 29, 2025
• Effective date: February 27, 2026 (60 days post-publication)
• First applicable cap season: FY 2027 (registrations open March 2026)

Employer Considerations and Strategic Planning

The new rule affects employers in multiple ways:

1. Salary Strategy: Offering higher wages may increase selection odds.
2. Accuracy and Documentation: Ensure all wage and job details align with the LCA to prevent RFEs or denials.
3. Regional Impact: Employers in high-cost cities may have an advantage due to higher wage levels.
4. Entry-Level Challenges: Lower-wage candidates, including new graduates or startup employees, may face reduced odds.

Practical Tips for Employers and Applicants

• Determine the highest OEWS wage level your position qualifies for to maximize lottery entries.
• Ensure registration data matches LCA filings to avoid enforcement issues.
• Evaluate geographic and industry implications for wage levels and selection chances.
• Stay informed about legal and policy updates affecting the FY 2027 H‑1B process.

Criticisms and Legal Challenges

While DHS emphasizes benefits for U.S. worker protection and prioritization of skilled workers, critics note:

• OEWS wage levels were not designed to influence lottery selection.
• Lower-wage positions could be disadvantaged, affecting new graduates and startups.
• The rule could incentivize offshoring rather than paying higher U.S. wages.
• Legal scholars argue DHS may exceed its statutory authority by introducing wage weighting as a selection criterion.

Future litigation may impact rule implementation and interpretation.

Looking Ahead

The DHS wage-based weighted lottery represents a significant shift in H‑1B policy, balancing employer flexibility with U.S. labor protection. Employers and applicants should carefully plan wage strategies, maintain precise documentation, and monitor legal developments to navigate the FY 2027 cap season successfully.

Frequently Asked Questions (FAQ)

Q1: Does the H‑1B cap number change under the new rule?
No, the numerical limits remain 65,000 for regular H‑1Bs and 20,000 for U.S. advanced degree holders.

Q2: How are lottery entries calculated?
Entries are weighted based on OEWS wage levels: Level IV gets 4 entries, Level III 3 entries, Level II 2 entries, Level I 1 entry.

Q3: Can misreporting wage levels affect my petition?
Yes. Inaccurate wage or job details can result in denials, RFEs, or revocations.

Q4: Are cap-exempt petitions affected?
No. The weighted lottery only applies to cap-subject H‑1B registrations.

Q5: When will the first wage-based lottery occur?
For the FY 2027 registration season, opening in March 2026.

Contact Us
We’re here to help. To schedule a consultation, please call or text (470) 800-9213, or email us at [email protected]. Our team looks forward to discussing your case and providing expert guidance.

Helpful Links

Federal Register Final Rule (Official Government Text)
https://www.federalregister.gov/documents/2025/12/29/2025-23853/weighted-selection-process-for-registrants-and-petitioners-seeking-to-file-cap-subject-h-1b

USCIS H‑1B cap page:

DHS/USCIS News Release on the Rule: