H1B Visa and Minimum Salary of $130,000 – The Real Math

Raghu H1B Visa 38 Comments

$130,000 minimum salary for H1B Visa Applications?

Let’s take a deep dive and look at the real numbers by using TCS as an Example.

  • Title: Computer Systems Analyst
  • Location: Tampa, Florida
  • Employer: Tata Consultancy Services

When applying for H1B visa, LCA is required.

LCA stands for Labor Condition Application.

Employer is required to get a certified LCA before applying for H1B Visa. How did we arrive at $130,000 Minimum Salary for H1B Visa?

TCS has applied for H1B Visa for on of it’s employee to work in Florida (I think the client is Citibank).

Looks like they are paying the employee at Level 2 for Computer Systems Analyst Position. The difference in Salary between Level 1 and Level 4 is ove $48,000
Step 1: Find Prevailing Wage

Find Prevailing Wage for Computer Systems Analyst for Tampa Area.

tampa computer systems analyst prevaling wage levels
Step 2: Find the Wages Paid by TCS

Find how much wage TCS is playing for Computer Systems Analyst in Tampa area.

Now, how does $130,000 number come about? Why media is reporting, minimum $130,000 is required.
Let’s look at the same Computer Systems Analyst position for San Jose (Silicon Valley).


Level 4 Wage is $134,971.
As per the H1B Visa bills that has preference system that may look like this:

  1. Advanced Degree in STEM from a US university
  2. Companies who offer a Level 4 wage for that H-1B worker
  3. Advanced Degree degree in any other major from a US university
  4. Companies who offer a Level 3 wage for that H-1B worker
  5. Bachelor’s degree in STEM from a US university
  6. Bachelor’s degree in any other major from a US university
  7. Etc..

As you can see the 2nd criteria shows Level 4 Wage.

So, if an Indian Outsourcing company has to apply for H1B Visa for an employee located in India, they would have to pay Level 4 wage to get H1B visa.

This is developing story. Stay tuned for updates.

Note: This is a proposed bill, not yet implemented. No further details are Ava at this time.

Question – How much do you think TCS would pay for someone for the same role in California – San Jose Area?

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Comments

  1. Are you missing a clause (may be) – 130k restriction is for H1B dependent employers? or is it being proposed for all?

  2. According to the left wing logic used by Robert Reich and others to justify minimum wage, raising the H1B threshold will simply force employers who pay H1B visa holders $110K to pay them $130K.

  3. What happens to people who earn more than 85 %ile wage but do not have a masters degree in US and are not in Indian consulting companies? The new bill proposes elimination of masters exemption clause. I want to know if both conditions (Masters + salary) need to be satisfied or if you earn more that 85%ile you’re good?

  4. Hi Raghu,

    How can i access the H1B plan B course? When I click on the course it says ‘page not found’.

  5. None of these bills will pass given how strong the lobby groups are for the outsourcing companies. Trumps executive order is the real deal.

  6. I’m sorry, but this article appears to be misleading, without adding any real analysis. There is no logical thread between the various steps. As outlined in Section 3 of the summary of the Act by Sen. Lofgren, the $130,000 limit is arrived at by following the DOL’s Occupational employment Statistics, specifically for Computer and Mathematical Occupations. The relevant statistics are [here](https://www.bls.gov/oes/current/oes150000.htm). The $130,000 figure comes about because the Act proposes to fix the H1B salary at the 85th percentile of what somebody in the Computer and Mathematical operations profession would earn. The median (50th percentile) for this profession is $81,430, the 75th percentile is $109,490 and the 90th percentile is $138,420, so it would appear that the 85th percentile is ~$130,000, probably rounded up a little bit.

    1. Author

      I’m referring to same PWR source too. But this is in reference to Level 4 wage from S180 bill.

  7. Hello, great content here. My question relates to the $60k minimum wage. I am not able to find any information on USCIS that says there is a blanket $60k minimum wage for H1b visas. It seems like the minimum applicable wage is determined by the LCA, and is dependent on location and field of work.
    Please clarify if you know the answer. Thanks

    1. There isn’t a blanket $60K wage. Paying a min of $60K apparently means visa applying company doesn’t have to prove “shortage” or “special skills”. $60K is WAY to low to reflect skills shortage.

  8. What if the OFLC website gets updated this year and they make level 1/level2 as 100k or 130k…Because it was last update on july 2016 and before that it was updated on august 2015.

  9. Excellent job with the article, Raghu. After hearing and reading about the “130k” from all around the internet and from friends, deep inside I knew there had to be more to it – It does take folks quite some years to reach that salary. Will stay tuned for further updates from you.

    Thanks,
    George

  10. What about Indian students in the united states ?
    Please write an article for them.

    1. Students come with the assumption there are jobs in the US for them. There isn’t, relative to the number coming.
      Masters and PhDs,
      The FLC databases show PhDs working for $21 an hour at universities. Complete glut of Masters and PhDs being pumped out of universities, because they make a fortune off of them (there never was a job market for Masters or PhDs – which is mainly why there are little to no US students in them).
      Please watch this congressman’s discussion,
      https://www.youtube.com/watch?v=2Tgc9m1IwNc&feature=youtu.be

  11. Just to make things clear…
    – Here’s the proposal direct from the horse’s mouth: https://lofgren.house.gov/uploadedfiles/high_skilled_bill_sxs_and_analysis_-1-2017__final.pdf
    – Gist of it:
    -> The 130k limit applies only to “dependent companies”, which by the definition in the proposal is a company that has >15% of its workforce as H1-B holders. In other words, desi consultants, TCS, Infy, Wipro and the like
    -> Non-discretionary bonuses can be counted towards the 130k requirement
    -> 20% of H1-B visas to be allocated to start-ups with Elimination of the advanced degree exemption (a.k.a “Masters quota” as we call it)
    -> Elimination of per-country cap for immigrant visas

    TL;DR – if your company has less than 15% of workers on H1B, you’re fine.
    More importantly, this bill was introduced by Zoe Lofgren, a Democratic Congresswoman from California. The chances of this being passed = near zero

    1. Why near zero? There have been many articles on H1B reform being a bipartisan supported issue. Actually, the Republicans used to have a bill which would grant a green card to Ph.D. STEM degree holders. But it was held hostage by President Obama because he wanted the congress to pass a comprehensive immigration reform bill which would benefit illegal immigrants.

      Yes, this bill was introduced by a Democrat congresswoman, but I believe she has bipartisan support from the other side of the isle.

      I think this bill is a step in the right direction.

  12. Thank you for the article. I am also looking for “130K” everywhere. I dont see it. I think for the current H1b employees who are getting less than 100K/year will be in trouble while changing job or extending the status.

  13. If this bill passes, I am certain that all people who are seeking to work in the USA, will be unable to do so. No (or very few) US employer will hire foreign workers, when the minimum is set at $130,000, which is what this bill aims at; to prevent industries to hire cheap foreign workers.
    It appears as if the Indian IT sector will have to shift to europe, as they do not have the same restrictions. In turn droves of people (including their families) who are here on H-1B Visas, will be forced to leave when the companies that they work for, are unwilling or unable to bump up their pay to adhere to the minimum wage.
    This is Trump’s proposed “Americans first” policy. Forcing companies to hire americans, before they can hire foreign workers.

    1. I think The people currently working here and their families would not be affected as their LCA is already filed . Only fresh H1bs and / or extensions would be impacted .

    2. This will backfire. Companies will start moving to Asian countries like India and China… Practically in a team of five members, one highly skilled is required, rest all need to follow the skilled person with some dedication. Thats all. The company also want to pay only to the one highly skilled and for rest….. why they have to pay a lot. This will lead to establishing ODC (offshore delivery center..) and manage the workforce…. Any business man American,Indian,Korean,European or Chinese… at the end of the day…. thinks about operation cost…. and optimizing the cost….

      1. Because this visa was never intended to import cheap labor, and it is being used for that.
        If there was no reason to offshore, they’d have done it by now. And at some point, if most of their operation is offshore, we’ll have to oust them from US stock market.

  14. Nice job Raghu! I’ve explained this to 4 worried people since this morning -all working in Mechanical Engineering companies with good paying jobs and with MS from a reputable US school. Not to mention my worried parents after watching a sensationalist piece in local media which lied saying that this bill has already passed.

    In essence, this bill (if passed) is more beneficial for the immigrants who invested enough time and effort to attain an advanced degree in the US.

    1. Hi .
      Im still confused about this.
      I am into Electrical Engineering and ive got M.S from US univ and have 5 yrs experience.
      I am a level 3 engineer in my company and hence make little less than 130k . So will I have any problems in renewing my h1-B or during LCA for PERM ?

      1. Given US is as fickle as a kid in an ice cream shop, it’s going to be a while before congress converges on a new policy, if ever.

  15. Hello. Will there be a difference between a H1B dependent employer and a non-H1B dependent employer?
    Read somewhere that this change will not affect non H1B dependent employers pay scale.Any idea?

    1. Its will impact companies like Infosys ,microsoft,Tata(mostly H1b dependent companies) etc., but not to apple,google,facebook,Aol etc ( to these companies equal pay work force culture regardless of citizenship/h1b ).,

      1. Not true. If pay restrictions, Apple/Google/FaceBook/etc. have $60K and less paid H1Bs. 75% of H1Bs are currently paid $60K or less.

  16. If that is how it is gonna work there is no point studying undergraduate degree in the US if you plan to work after that. US will loose billions.

    1. Already tons of foreign students who falsely thought a US degree meant a US job.
      Think about it – proliferation of degreed does not equate to endless number of jobs available.

  17. Hi Raghu,
    Thank you for the explanation.
    Can you also explain how things change for students that have completed their Masters in US working at Level 1 but do not have H-1B yet.

  18. Hi Raghu,

    If I am a MBA student in the US, should my minimum wage also be $130,000 to qualify for a H1B visa?

    Thanks,
    Karthic Srinivaas

    1. Hi…Companies don’t mind u hold masters or bachelors degree..what they need is highly talented & high skilled ..if min wage becomes 130k its gets more & more tough to find job especially to fresh graduates of foreign nation students ….& more people foreign national will loose jobs bec h1b companies prefer cost cuts …

  19. How about the one who is not in Tech field,live in small town of 60,000 population and has done master from US university. How would it effect to us.

  20. Hi Raghu, question about this. My employer will be applying for my VISA under the Statistitan category ( looking a thing my LCA from last year). I looked up the Level 4 wage in my area and I am actually getting more than that. How would that relate to the $130k minimum wage? Thanks

      1. Hi, This discussion came up with good information.. But still no one come to the one point that is:
        How if some one has H1B visa and have green card filed. Plus i140 approved. what happens in this case to that visa holder. Also tell us will this law affect 3rd renual/extension? (i mean after 6 years of h1b with i14o approved)

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