H-1B Lottery 2027: Selection Outcomes and Next Steps

Announcer: Welcome to the Ogletree Deakins podcast, where we provide listeners with brief discussions about important workplace legal issues. Our podcasts are for informational purposes only and should not be construed as legal advice. You can subscribe through your favorite podcast service. Please consider rating this podcast so we can get your feedback and improve our programs. Please enjoy the podcast.

Meagan Dziura: Hi, everyone. Happy Monday. We are talking today about the H-1B lottery and the results of the H-1B registration therein. I am Megan Dziura. I’m a shareholder in Ogletree’s Raleigh office, and I work in the immigration practice group. And I have Kara Lancaster here, also a shareholder in our Raleigh office in the immigration practice group, and we’re going to go over what the H-1B lottery results are looking like, what was different this year, and what employers should be doing now that we have the results.

So USCIS, they announced they finished their official selections. We’re now focusing our shift from strategy to outcomes, so it’s important now to not only focus on the filings moving forward for the people who were selected, but it’s really important that employers are looking at contingency planning for those who were not selected. So, first, Kara, can you give us a quick refresher on what is the H-1B visa?

Kara Lancaster: Yeah. So, just to take a few steps back and do a little basics of the H-1B. The H-1B is a temporary work visa for specialty occupation roles, and that means that the role requires at least a bachelor’s degree or the equivalent in a related field, and so it’s just your average professional role that requires a particular type of degree. The H-1B visa is granted for up to three years initially, and it’s extendable up to six years total, so typically, it’ll be two separate periods of three years. And the annual statutory cap on H-1B visas that are available is 65,000 H-1Bs that are available under what we call the regular cap, and that’s also sometimes referred to as the bachelor’s cap, and then there’s an additional 20,000 H-1Bs that are allotted specifically for individuals who have a U.S. master’s degree or higher. So those individuals get two chances in this breakup, because they would go into the 65,000 regular cap as well as the 20,000 that’s available for the U.S. master’s cap.

Every year, at least in recent years, and as far back as I can remember, the lottery has been necessary as part of this process because the demand for H-1Bs exceeds the supply. There are more than 85,000 people each year that want an H-1B, and so that results in a lottery format where USCIS will collect information electronically and then run that lottery.

Where we are now in that timeline is that the electronic registration period closed on March 19th. So, employers had about a two-week period to register employees online if they wanted to put them into this H-1B lottery. That closed on March 19th, and USCIS has now conducted the lottery and issued the results. And so, for those that were selected in the lottery, employers will have about 90 days to file their full H-1B petition with USCIS. That period runs from April 1st to June 30th, and the earliest start date for those petitions though remains October 1st.

I’m going to let Meagan talk about how the lottery was different this year than in previous years. There were some big changes that affected the way that electronic lottery is run, so Meagan, maybe you can walk us through that.

Meagan Dziura: Yeah. So, it was still a lottery, but the way USCIS changed it for this year was they made it what they called a wage weighted lottery. So previously, the lottery was one chance per beneficiary. You could go into the master’s cap, but you had that one chance in the master’s cap, and then if you weren’t selected, you got filtered down into the full regular cap, but you still had just one entry into the lottery based on your registration, so it was just one chance per person.

What they changed it for this year, they essentially looked at higher paid individuals and gave them more chances based on the higher they were paid. So, more senior roles, presumably more senior roles that were higher paid were much more likely to be selected, entry roles that presumably were lower paid were less competitive. So, it still was technically a lottery, but it wasn’t equal odds anymore. What made it even more odd was that the leveling system that the government used for the HMB registration was different than what we typically used for determining wage levels for H-1Bs.

Determining wage levels for H-1Bs goes beyond the scope of this episode. Maybe we’ll do a whole podcast on prevailing wage levels and wage leveling for H-1Bs, but to simplify it, normally when we talk about wage level analysis, we talk about analyzing the role for seniority based on the job duties and the responsibilities for the role. And an attorney will look at those and do a calculation to see what wage level it should fall under given the job location and those job duties and responsibility.

So, with the registrations though, there was no formal job duty leveling analysis required. Instead, what USCIS wanted entrants to do is just look at what their salary is, the employer given salary, and then whatever salary that matched up to in that location and jobs wage level, that was the wage level to use in the registration.

The wage levels go from one to four. Four is the highest wage, level one is the lowest wage, and those wage levels corresponded to the number of entries someone would have in the lottery. So like I said, someone who’s in presumably a more senior position may have four chances in the lottery versus someone in more of an entry level, if they’re wage level one, they’d only have one chance in the lottery.

So, it did create a lot of confusion amongst employers and practitioners, just because wage level was used in a different way for the registration than it will be used for in the actual filing of the LCA and filing of the petition. So, if someone is selected in the lottery, the petition still uses the true wage level analysis, so we still have to make that wage level analysis, even if the wage level at registration may have been different.

So, it is creating a lot of confusion. It will likely continue to create confusion when these petitions are filed, possibly create confusion when these petitions are adjudicated by USCIS, but that is how the weighted registration guidelines were versus the petition filing guidelines.
So, what did selections actually look like? So, the official volume, as of this recording, the official registration volume has not been released by USCIS, but just from context, recent trend context, last year, the selections were approximately in the mid 30% range, so again, that was the one ticket to the lottery per beneficiary. So this year, with the weighted selection, across the board, employers are reporting around 50% selection rates, so a little bit below, a little bit above, but why is it so much higher?

So, one thought that won’t be confirmed until we see the official registration volume is that there were just fewer registrations across the board. So, drivers for fewer registrations may include higher costs for H-1Bs, a higher registration cost, which was raised last year as well. There is also a $100,000 fee for out-of-country registrations that, again, that may have to be for a whole other podcast, but there’s also just increased compliance scrutiny and just uncertainty around this new framework. I think some petitioners were just not encouraged to put a lot of people in the lottery because there’s just uncertainty of how this would work, and if it’s even worth it if you had a lot of just wage one, maybe lower-level roles going into the lottery. So, we’ll see what the official volume looks like, but again, that’s around 50% selection rates is what we’re seeing, so higher than it has been in the past four years at least. So, now that we have all the selections, Kara, what should employers be doing?

Kara Lancaster: Yeah. So, this is really, registration is over but this is the beginning, if you will, in some ways. So now that we have the results, employers, start doing contingency planning for employees who were not selected, right? So obviously for those that got selected, they’ll be filing those petitions over the next 90 days, but it’s a whole other exercise looking at who was not selected and who is really in a critical space right now where that H-1B was really important for them.

So, a few different groups of employees that are often looked at are, first of all, are there any F1 students that need their H-1B petition filed before June 30th? And then again, this is in the selected group, right? But a lot of times, F1 students may have their work authorization expiring sometime before the actual H-1B filing deadline, and in order for them to benefit from what’s called cap-gap work authorization, their petition would need to be filed before their student work authorization expires.

That could be anywhere between April onwards, because we sometimes do have individuals whose student work authorization is expiring in April, and so those individuals have a very quick turnaround to have their H-1B petition filed, and then ultimately, that allows them to stay work authorized while they’re awaiting that H-1B to be processed.

Meagan Dziura: What about if you have an L or a TN and you’re trying to…or even an O1 visa, is there any like H-1B selected gap coverage similar to the STEM, or should employers make sure that they’re still filing extensions for anyone whose work authorization may end before 10/01?

Kara Lancaster: Yeah, good question. There’s really no such cap-gap work authorization coverage for other visa types, so if someone was selected, like a great example is those on an L1 or a TN or some other work visa like that, if their current expiration is prior to October 1st, they are still going to need an extension to be filed to cover that gap. And so, it ends up working a little bit like cap-gap, but it’s different because it does still require that separate filing associated with their current visa, and so they’ll need at least an extension filed to cover that time period up until October 1st. So, that’s another group that employers would look at and make sure that they are still filing extensions where needed, even if that individual was selected in the H-1B lottery.
An important thing to look at are employees who, and we often call these critical employees where this year may have been their last year, at least inside the U.S., on their current visa to be selected in the H-1B lottery. So, those would be individuals who, based on their current visa expiration, it’s not going to take them all the way to next year’s lottery, right? So, that could be someone who is on an F1 student visa again, and maybe they are still work authorized right now, and maybe they’re even work authorized through February 2027, but the lottery is not going to be run until March, April 2027. And so, it’s really looking forward at individuals who this was their last chance, so to speak, unless they have alternative options, right?

So, that’s part of the analysis, is do these individuals that were not selected have any other options? Of course, sometimes people’s first option may be a personal type of case, sometimes people are eligible for maybe a marriage based green card on a personal level, but when we look to just the employment based alternative options, the common ones would be based on nationality. So, individuals who are Canadian or Mexican nationals, we can look to see if they are eligible for a TN visa. That is a whole different assessment as well, because not all types of positions are eligible to pursue a TN visa. Just because someone is Canadian or Mexican does not mean the TN automatically works, but it’s definitely an option to look at. Similarly, there’s the E3 visa for Australian nationals, and the H-1B1 visa for nationals of Chile and Singapore. Those are a little more similar to the H-1B visa in the sense that as long as the role is a professional position and the individual qualifies in terms of their educational background, that’s a really great backup option for individuals not selected in the H-1B lottery.

One thing that’s in common for the TN and the E3 and the H-1B1 is that they don’t have a concrete limit in terms of how many times they can be extended. It’s certainly not a forever visa because these are visas that imply that you are going to only be here temporarily, and so a lot of times, if one of these alternatives is available, those individuals may still be going into H-1B lotteries in the future if the intent is that they may want to stay in the US permanently and pursue a green card, but it’s a good temporary alternative if they have one of these various nationalities that could make this an option for them.

Another alternative would be the 01 visa for highly accomplished or specialized employees. It’s a high bar to meet. The 01 visa is specifically for individuals of extraordinary ability. You have to be able to demonstrate that this individual is really at the top of their field. So having things like recognition, either in the media or through awards, having really critical contributions to their field, those are things that have to be demonstrated for somebody to qualify for the 01 visa, so there is a small group of people who this could be an option for as well, depending on their background and their type of work.

And then of course, a really common backup option for F1 students is if they are eligible for a STEM OPT extension. So individuals who graduate from a US university with F1 student status, they will always have at least one year of work authorization, but then individuals who have a STEM degree, so a degree in a science, technology, engineering or math field, they are eligible for an additional two-year extension of their student work authorization, and so that’s something that they would want to continue pursuing if not selected in the H-1B lottery.

And I will say, oftentimes, even if they are selected in the H-1B lottery, they may still need to pursue the STEM extension in parallel, just depending on when their current work permit expires. If it’s expiring soon after the lottery results and we don’t yet know if their H-1B has been approved, sometimes it’s possible that both of those could be pursued in parallel, but certainly for those not selected, would want to look to that STEM extension as their next best option.

Meagan Dziura: And I did want to mention one other thing that is important. For people who are either doing the STEM extension or anyone who’s filing the H-1B, they are selected and filing the H-1B change of status, because of the $100,000 fee, please make sure that employers are communicating with their selected associates about travel and whether they are able to travel during this H-1B process, because the $100,000 fee would apply to anyone who is consular processing their H-1B. It’s really, really important that everyone is communicating about travel to anyone selecting the lottery, that anyone selected is communicating with their employer and attorney. We don’t want anyone who is not subject to the $100,000 fee all of a sudden potentially being subject. So, just really important that everyone is aware of travel plans.

Kara Lancaster: Yeah. I would say that’s definitely another big change this year, right?

Meagan Dziura: Yeah.

Kara Lancaster: We had the big change of the weighted lottery based on salaries, but then the second big change was this $100,000 fee that could be triggered still. If for somebody who’s selected, if they are not aware of what departing the US can do, and that’s definitely something that’s still in play right now, so employers and employees both want to be aware of that.
So similar to the last few years here, sometimes USCIS has ultimately conducted a second or third selection round, depending on whether the initial selections were all used or not. So sometimes, they may select someone, and for whatever reason, maybe that individual is no longer joining the company that placed them in the lottery, but for whatever reason, a lottery selection or multiple lottery selections go unused. And when that happens, the USCIS will then reallocate those unused selections by conducting an additional selection round. This would normally be sometime after the initial filing period, so we wouldn’t expect to hear about an additional selection round anytime prior to June 30th, because they won’t know until June 30th if all of the existing selections were used. So typically, we would find out maybe closer to July, August, September timeframe if there was going to be an additional lottery.

I think this is becoming slightly less common because they’ve realized through the years that they’re going to have this portion that goes unused, and so they compensate for that on the front end now, but it’s still possible. There’s really no way to say for sure whether we will have additional selection rounds, so that’s something that we continue to monitor as we get into the later summer months.

Meagan Dziura: And we don’t always find out either. Sometimes, it’ll be like a ripple will go through the immigration world and people are like, “Oh my gosh, selections are happening. More selections are happening.” And then USCIS will be like, “Oh yeah, we did some selections.” It’s not always this big announcement.

Kara Lancaster: Right, that’s right. Sometimes, it’s like the online accounts just start getting updated, and that’s another good point too. I think there’s a little bit of confusion sometimes around the fact that right now, in any individual’s selection status inside the official USCIS accounts, it’ll either say selected or submitted. And that status of submitted can be confusing, but the reason is that it essentially means as of today, that individual has not been selected, but they keep it as the word submitted until they officially confirm later on in the year that they have used all 85,000 H-1Bs. And so, if they were to either do an additional selection round or not, that’s what we have to wait for before the online status within the accounts will actually change to not selected. So that doesn’t happen until later in the year typically, and so that’s just one kind of nuance that sometimes can cause infusion.

Meagan Dziura: Yeah, that’s a great point.

Kara Lancaster: All right. Well, that is everything we have today. Just a quick check-in on where we are right now in this year’s H-1B lottery. Like I said, even though we are through registration and the results are out, in many ways, this is just the beginning, especially when it comes to not only filing full H-1B petitions, but also looking at contingency planning for employees who were not selected. So, it’s a busy time, and it’ll stay busy for the next few months in the H-1B world.

Meagan Dziura: Thanks, Kara. Thanks everyone for listening.

Kara Lancaster: Thank you. Bye.

Meagan Dziura: Bye.

Announcer: Thank you for joining us on the Ogletree Deakins podcast. You can subscribe to our podcast on Apple Podcasts or through your favorite podcast service. Please consider rating and reviewing so that we may continue to provide the content that covers your needs. And remember, the information in this podcast is for informational purposes only and is not to be construed as legal advice.