[Federal Register Volume 61, Number 78 (Monday, April 22, 1996)]
[Proposed Rules]
[Pages 17610-17614]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-9911]



=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF LABOR

Employment and Training Administration

20 CFR Part 656

RIN 1205-A152


Labor Certification Process for the Permanent Employment of 
Aliens; Researchers Employed by Colleges and Universities

AGENCY: Employment and Training Administration, Labor.

ACTION: Proposed rule.

-----------------------------------------------------------------------

SUMMARY: The Employment and Training Administration of the Department 
of Labor proposes to amend its regulations relating to labor 
certification for permanent employment of immigrant aliens in the 
United States. The proposed amendments would change the way prevailing 
wage determinations are made for researchers employed by colleges and 
universities. The proposed rule also would change

[[Page 17611]]

the way prevailing wages are determined for colleges and universities. 
The proposed rule also would change the way prevailing wages are 
determined for colleges and universities filing H-1B labor condition 
applications on behalf of researchers, since the regulations governing 
prevailing wage determinations for the permanent program are followed 
by State Employment Security Agencies in determining prevailing wages 
for the H-1B program.

DATES: Interested persons are invited to submit written comments on the 
proposed rule on or before May 22, 1996.

ADDRESSES: Submit written comments to the Assistant Secretary for 
Employment and Training, U.S. Department of Labor, 200 Constitution 
Avenue NW., Room N-4456, Washington, DC 20210, Attention: John M. 
Robinson, Deputy Assistant Secretary.

FOR FURTHER INFORMATION CONTACT:
Contact Denis M. Gruskin, Senior Specialist, Division of Foreign labor 
Certifications, Employment and Training Administration, Room N-4456, 
200 Constitution Avenue NW., Washington, DC 20210. Telephone: (202) 
219-5263 (this is not a toll-free number).

SUPPLEMENTARY INFORMATION:

A. Permanent Alien Employment Certification Process

    Before the Department of State (DOS) and the Immigration and 
Naturalization Service (INS) may issue visas and admit certain 
immigrant aliens to work permanently in the United States, the 
Secretary of Labor (Secretary) first must certify to the Secretary of 
State and to the Attorney General that:
    (a) There are not sufficient United States workers who are able, 
willing, qualified, and available at the time of the application for a 
visa and admission into the United States and at the place where the 
alien is to perform the work; and
    (b) The employment of such aliens will not adversely affect the 
wages and working conditions of similarly employed United States 
workers. 8 U.S.C. 1182(a)(5)(A).
    If the Secretary, through the Employment and Training 
Administration (ETA) of the Department of Labor (DOL or Department) 
determines that there are no able, willing, qualified, and available 
U.S. workers, and that the employment of the alien will not adversely 
affect the wages and working conditions of similarly employed U.S. 
workers, DOL so certifies to INS and to the DOS, by issuing a permanent 
alien labor certification.
    If DOL cannot make either of the above findings, the application 
for permanent alien employment certification is denied. DOL may be 
unable to make either of the two required findings for one or more 
reasons, including, but not limited to:
    (a) The employer has not adequately recruited U.S. workers for the 
job offered to the alien, or has not followed the proper procedural 
steps in 20 CFR part 656. These recruitment requirements and procedural 
steps are designed to test the labor market for available U.S. workers. 
They include providing notice of the job opportunity to the bargaining 
representative (if any) or posting of the job opportunity on the 
employer's premises, placing an advertisement in an appropriate 
publication, and placing a job order for 30 days with the appropriate 
local Employment Service office.
    (b) The employer has not met its burden of proof under section 291 
of the Immigration and Nationality Act (INA) [8 U.S.C. 1361], that is, 
the employer has not submitted sufficient evidence of attempts to 
obtain qualified, willing, able, and available U.S. workers and/or the 
employer has not submitted sufficient evidence that the wages and 
working conditions which the employer is offering will not adversely 
affect the wages and working conditions of similarly employed U.S. 
workers. With respect to the burden of proof, section 291 of the INA 
states, in pertinent part, that:

    Whenever any person makes application for a visa or any other 
document required for entry, or makes application for admission, or 
otherwise attempts to enter the United States, the burden of proof 
shall be upon such person to establish that he is eligible for such 
visa or such document, or is not subject to exclusion under any 
provision of (the INA) * * *.

B. Department of Labor Regulations

    The Department has promulgated regulations, at 20 CFR part 656, 
governing the labor certification process described above for the 
permanent employment of immigrant aliens in the United States. Part 656 
was promulgated pursuant to section 212(a)(14) of the INA (now at 
section 212(a)(5)(A)). 8 U.S.C. 1182(a)(5)(A).
    These regulations set forth the factfinding process designed to 
develop information sufficient to support the granting or denial of a 
permanent labor certification. They describe the potential of the 
nationwide system of public employment service offices to assist 
employers in finding available U.S. workers and how the factfinding 
process is utilized by DOL as the primary basis of developing 
information for the certification determinations. See also 20 CFR parts 
651-658; and the Wagner-Peyser Act (29 U.S.C. Chapter 4B).
    Part 655 sets forth the responsibility of employers who desire to 
employ immigrant aliens permanently in the United States. Such 
employers are required to demonstrate that they have attempted to 
recruit U.S. workers through advertising, through the Federal-State 
Employment Service System, and by other specified means. The purpose is 
to assure an adequate test of the availability of qualified, willing 
and able U.S. workers to perform the work, and to insure that aliens 
are not employed under conditions adversely affecting the wages and 
working conditions of similarly employed U.S. workers.

C. Prevailing Wages and Researchers

    Covered employers wishing to employ immigrant workers must recruit 
for U.S. workers at prevailing wages. State employment security 
agencies (SESA's or State agencies) survey prevailing wage rates on 
behalf of DOL. The permanent labor certification regulations at 
Sec. 656.40 specify how State agencies are to calculate prevailing 
wages. The prevailing wage methodology set forth is used not only in 
determining prevailing wages for job opportunities involved in 
applications for permanent employment certification, but is also 
followed in determining prevailing wages for the H-2B temporary 
nonagricultural certification program, the H-1B labor condition 
application (LCA) program, and the F-1 student off-campus employment 
program. See 20 CFR part 655, subparts A, H, and J, respectively. In 
each of these programs, the applicable legislative and/or regulatory 
history require that prevailing wages be determined in accordance with 
the requirements of the permanent labor certification regulations at 20 
CFR 656.40.
    The INA requires that the wages paid to an H-1B professional worker 
be the higher of the actual wage paid to workers in the occupation or 
the prevailing wage for the occupational classification in the area of 
employment. The H-1B regulations incorporate the language of 20 CFR 
656.40 (as required by H.R. Conference Report, No. 101-955, October 26, 
1990, page 122) and provide employers filing H-1B applications the 
option of obtaining a prevailing wage determination from the SESA, 
using an independent authoritative source, or other legitimate

[[Page 17612]]

source, as defined at Sec. 655.731(a)(2)(iii) (B) and (C) of the H-1B 
regulations.
    Section 656.40 of the permanent labor certification regulations 
requires that in the absence of a wage determination issued under the 
Davis-Bacon Act, the Service Contract Act, or a collective bargaining 
agreement, the prevailing wage shall be the weighted average rate of 
wages paid to workers similarly employed in the area of intended 
employment, i.e., ``the rate of wages to be determined, to the extent 
feasible, by adding the wage paid to workers similarly employed in the 
area of intended employment and dividing the total by the number of 
such workers.'' Section 656.40(b) further provides that ``similarly 
employed'' is defined as having substantially comparable jobs in the 
occupational category in the area of intended employment.

D. Effects of Hathaway Children's Services on Prevailing Wages

    Under the en banc decision of the Board of Alien Labor 
Certification Appeals (hereinafter referred to as BALCA or Board) in 
Hathaway Children's Service (91-INA-388, February 4, 1994), prevailing 
wages are calculated by using wage data obtained by surveying employers 
across industries in the occupation in the area of intended employment. 
In Hathaway, BALCA overruled its decision in Tuskegee University, 87-
INA-561, Feb. 23, 1988, en banc, which interpreted Sec. 656.40 to 
permit an examination of the nature of the employer's business in 
ascertaining the appropriate prevailing wage. 87-INA-561 at 4. In 
Tuskegee the Board said, in relevant part:

    Thus to be ``similarly employed'' for purpose of a prevailing 
wage determination, it is not enough that the jobs being compared 
are in the same occupational category they must also be 
``substantially comparable.'' Accordingly, it is wrong to focus only 
on the job title or duties; the totality of the job opportunity must 
be examined *  *  *.
    It is clear that it is not only the job titles, but the nature 
of the business or institution where the jobs are located--for 
example, public or private, secular or religious, profit or non-
profit, multinational corporation or individual proprietorship--
which must be evaluated in determining whether the jobs are 
``substantially comparable.''

    In Hathaway, the Board declined to make an exception for 
maintenance repairers employed by non-profit institutions, analogous to 
the exception it had made in Tuskegee. The employer in Hathaway, a non-
profit United Way affiliate, urged that the Board's decision in 
Tuskegee should be dispositive. The employer argued that the rationale 
in Tuskegee necessarily extends to non-profit employers, thereby 
differentiating them from for-profit employers.
    The Board stated in Hathaway, that its holding in Tuskegee was ill-
advised and should be explicitly overruled. The Board went on to say 
that:

    The underlying purpose of establishing a prevailing wage rate is 
to establish a minimum level of wages for workers employed in jobs 
requiring similar skills and knowledge levels in a particular 
locality. It follows that the term ``similarly employed'' does not 
refer to the nature of the employer's business as such; on the 
contrary, it must be determined on the basis of the similarity of 
the skills and knowledge required of the job offered. Of course the 
nature of the employer's business may be reflected in that 
determination, to the extent it bears on the knowledge and skills 
required to perform the duties of the job *  *  *. But neither the 
record in Tuskegee nor the record before us today [in Hathaway,], 
suggests that the skills and knowledge required to perform the 
duties of the job opportunity being offered are any different 
depending upon the employer's financial ability to pay the going 
rate. Specifically, there is no evidence to suggest that the duties 
of the job offered, either as an associate professor of physics in 
Tuskegee or as a maintenance repairman in the present case 
[Hathaway,], differed as between charitable non-profit institutions 
and businesses operated for a profit. We find no basis, under the 
Act or its implementing regulations, for allowing this Employer to 
hire an alien so that it can pay sub-standard wages to its 
maintenance repairer or other workers, on the ground that it cannot 
pay the prevailing wage, while we tell the Mom-and-Pop shop next 
door or around the corner that ``There is no provision in the law or 
regulations which allows for waiver of the prevailing wage 
requirements on the basis of an Employer's financial hardship'' 
[citing Norberto La Rosa (89-INA-287), March 27, 1991] *  *  *.
    In accordance with the holding in Hathaway, SESA's were instructed 
to survey all employers, without regard to the nature of the employer, 
in the area of intended employment in determining prevailing wages for 
an occupation.
    It has since been asserted that implementation of this policy 
resulted in considerably higher prevailing wage determinations for 
research positions in colleges and universities. The higher education 
community maintains that this policy will jeopardize its ability to 
recruit foreign researchers with talents and skills not readily 
available in the U.S. Further, the Department has received comments and 
inquiries from Congress and other Federal agencies and organizations, 
such as the Council of Economic Advisers (CEA), National Science 
Foundation (NSF), the Department of Defense, Defense Research 
Engineering (DRE), Office of Science and Technology Policy (OSTP), 
National Institutes of Health (NIH), National Aeronautics and Space 
Administration (NASA), United States Department of Agriculture (USDA), 
United States Geological Survey (USGS), Department of Energy (DOE), and 
Department of Transportation (DOT), expressing concern about the 
Department's change of policy in determining prevailing wages for 
researchers employed by universities.

E. Basis for Proposed Rule

    The Department believes there are substantial policy reasons to 
propose an exception whereby prevailing wage determinations for 
researchers employed by colleges and universities should be based 
solely on the wages paid by such institutions. These policy reasons are 
discussed below.

1. Existing Precedent

    Congress established precedent in the INA for treating colleges and 
universities differently in their employment of talented, highly 
qualified scholars who are members of the teaching profession. Special 
procedures in DOL regulations were established for college and 
university teachers because of the provisions at 8 U.S.C. 
1182(a)(5)(A)(i) (I) and (II) which require, in relevant part, that DOL 
must determine in cases involving aliens that are members of the 
teaching profession that the U.S. applicant is at least as qualified 
(equally qualified) as the alien before a labor certification can be 
denied because a U.S. worker is available for the job opportunity. For 
all other occupations, the DOL Certifying Officer need only find that 
the U.S. applicant is qualified or meets the employer's minimum job 
requirements. The ``special handling'' procedures for college and 
university teachers provide for a more limited test of the labor market 
than the basic process at 20 CFR 656.21 to successfully apply for a 
labor certification.
    The ``equally qualified'' language was added to section 212(a)(14) 
of the INA [now at section 212(a)(5)(A), 8 U.S.C. 1182(a)(5)(A)] on 
October 20, 1976, by the Immigration and Nationality Act Amendments of 
1976, Pub. L. 94-571, Section 5, 90 Stat. 2705. The Judiciary Committee 
of the House of Representatives stated, on passage of the bill, that:

    The Committee believes that the Department of Labor has impeded 
the efforts of colleges and universities to acquire outstanding 
educators or faculty members who posses specialized knowledge or a 
unique combination of administrative and teaching skills. As a 
result, this legislation includes an amendment to section 212(a)(14) 
which requires the Secretary of Labor to

[[Page 17613]]

determine that ``equally qualified'' American workers are available 
in order to deny a labor certification for members of the teaching 
profession * * *.
(H. Rep. No. 1553, 945h Cong., 2d Sess. 11 (Sept 15, 1976))

    Prevailing wage determinations for college and university teachers 
are necessarily based solely on the wages paid by colleges and 
universities, since such teachers are employed only by institutions of 
higher education. Research positions are closely related to teaching 
(faculty) positions and often involve teaching duties, albeit not in a 
classroom setting. As stated in a letter dated July 25, 1995, which the 
Department received from the Association of American Universities 
(AAU):

    Teaching is a primary mission of universities and occurs in all 
university settings. Teaching and research are inextricably 
intermingled in universities with research extending into 
undergraduate education, and teaching extending into postdoctoral 
education. Academic research scientists are expected to operate as 
teachers as well as researchers. University teaching includes a wide 
range of activities beyond the traditional classroom lecture, such 
as seminars, advising and other forms of mentoring. Some of the most 
effective teaching about research is carried out by doing research, 
and university research personnel often operate as student and 
teacher at the same time in the same setting: a postdoctoral fellow 
is instructed by the faculty researchers with whom he or she is 
working at the same time he or she serves as a teacher for graduate 
and undergraduate students working in the same lab.

2. Impact of Hathaway and Reinstatement of Previous Practice

    The proposed rule would merely reinstate the practice that existed 
before the decision in Hathaway of basing prevailing wage 
determinations for researchers employed by colleges and universities 
solely on the basis of the wages paid by such institutions. Hathaway 
has had the greatest impact on colleges and universities wishing to 
file H-1B LCA's or permanent labor certification applications on behalf 
of researchers. Prior to Hathaway, SESA's in conducting prevailing wage 
surveys for researchers employed by colleges and universities 
consistently limited prevailing wage surveys to colleges and 
universities. ETA is not aware of any other situation in which a 
similar practice was consistently followed in determining prevailing 
wages for an occupation found in a variety of industries.
    The application of the policy resulting from the Hathaway decision 
to the determination of prevailing wages for researchers has resulted 
in markedly higher prevailing wage determinations than those made 
previously. It has been alleged, for example, that prevailing wage 
determinations post-Hathaway have been 34 to 93 percent in excess of 
the actual wages paid to certain positions. Additionally, 
Representative Lamar Smith stated in a letter to the Secretary of Labor 
that:

    Major research universities would clearly suffer if required to 
pay industry-scale wages to researchers. They pay research 
associates about $25,000 a year, as opposed to salaries of 
approximately $65,000 in industry. Since the amount universities pay 
under federal research grants is strictly limited by the federal 
government, they would be effectively barred from using immigrants 
in these positions. Even in instances where the schools found it 
feasible to pay the higher salaries out of their own funds, this 
would create discord with American employees and divert badly needed 
resources. The end result could be dramatically impeded scientific 
and technological progress in the United States.

    Colleges and universities have also maintained that it would be 
untenable for them to pay international staff more than their 
counterparts who are United States citizens and lawful permanent 
residents, and they would be forced to either increase the wages of 
similarly employed U.S. citizens or stop hiring international faculty 
and researchers on H-1B visas.

3. Nonproprietary Nature of Academic Research

    It has also been advanced that a significant reason for basing 
prevailing wage determinations for researchers employed by colleges and 
universities solely on the wages paid by such institutions relates to 
the nonproprietary nature of the research performed in an academic 
setting as opposed to that performed in a private, for-profit setting. 
The research product delivered by researchers in private, for-profit 
organizations is proprietary in nature and can be appropriated by the 
employing institution for commercial purposes. As pointed out by the 
AAU in its July 25, 1995, letter:

    Academic research scientists are expected to disseminate the 
results of their research promptly and widely through publication in 
peer-reviewed scientific journals; indeed, in the highly competitive 
marketplace of fundamental research, professional recognition is 
accorded to the first to publish a new discovery.
    Industrial scientists are expected to apply the results of their 
research to product development within their company (emphasis in 
original); often, meeting this objective in a competitive 
marketplace will require the industrial scientist to withhold 
publishing research results of proprietary information either 
indefinitely or at least until that information has been 
incorporated into the company's development process.
    This difference in application of the results of research is so 
fundamental that it constitutes one of the greatest barriers to 
cooperation between academic and industrial research programs. Most 
universities have rules prohibiting the withholding of research 
results, and many companies are reluctant to permit industry-
sponsored research results to be freed from proprietary restraints 
on dissemination * * *.

    The AAU went on to summarize the difference between academic 
research scientists and industrial scientists, in relevant part, as 
follows:

    Academic research scientists must be able to expand the 
frontiers of knowledge through an independently initiated and 
sustained fundamental research program and be able to translate the 
underlying body of knowledge, theories, principles and research 
procedures to succeeding generations of researchers. In contrast, 
industrial scientists must be able to translate basic discoveries 
into a program of applied research and development that has a 
reasonably high probability of producing marketable products and 
processes as end results.

    The Department specifically requests comments on whether there are 
attributes of academic research that distinguish it from research 
conducted by private, for-profit employers.

4. Concern of Other Federal Agencies

    As indicated above, other Federal agencies and organizations, with 
an interest in the research talent, knowledge, abilities and skills 
available to the U.S. academic community, have expressed concerns that 
the Hathaway decision could interfere with the ability of institutions 
of higher education to obtain the services of talented foreign scholars 
and researchers. These agencies which included, as stated above, the 
CEA, NSF, DRE, OSTP, NIH, NASA, USDA, USGS, DOE, and DOT, expressed the 
view that prevailing wage determinations for researchers employed by 
institutions of higher education should not include wage data from 
private sector employers.
    Similarly, the Department is aware that Congress is examining 
legislative options to address the concerns of the research community 
on this matter. These options would extend the concept discussed in 
this proposed rule to prevailing wage rates in other employment, such 
as researchers employed by (a) institutions of higher education (as 
proposed above), and (b) federal research agencies and their affiliated 
nonprofit research institutions which are engaged in basic research and 
which employ postdoctoral fellows and visiting scientists in a manner 
similar to colleges and universities. While this

[[Page 17614]]

proposed rule would cover the college and university researchers, at 
this time the Department has insufficient information on whether 
extending the rule change to researchers in other employment is 
supportable. Commenters, therefore, are invited to submit comments 
about such a regulatory change and the Department will consider those 
and any other comments in the development of the final rule.

5. Non-Pecuniary Factors

    The academic community and others believe that intangible, non-
pecuniary incentives to working in an academic environment should be 
considered in determining prevailing wages for researchers employed by 
institutions of higher education. Such intangible benefits, according 
to the CEA, ``may include autonomy in choice of research, contact with 
students, immersion in an educational environment, and other types of 
participation in a university environment.'' The Department is 
interested in comments that specify the nature of these intangible 
benefits and how they are unique to higher education.

Executive Order 12866

    The Department has determined that this proposed rule is not an 
``economically significant regulatory action'' within the meaning of 
Executive Order 12866, in that it will not have an economic effect on 
the economy of $100 million or more or adversely affect in a material 
way the economy, a sector of the economy, productivity, competition, 
jobs, the environment, public health or safety, or State, local, or 
tribal governments or communities.
    While it is not economically significant, the Office of Management 
and Budget reviewed the proposed rule because of the novel legal and 
policy issues raised by the rulemaking.

Regulatory Flexibility Act

    The Department of Labor has notified the Chief Counsel for 
Advocacy, Small Business Administration, and made the certification 
pursuant to the Regulatory Flexibility Act at 5 U.S.C. 605(b), that the 
rule does not have a substantial impact on a substantial number of 
small entities.

Paperwork Reduction Act

    The proposed rule would create no collection of information 
requirements.

Catalog of Federal Domestic Assistance Number

    This program is listed in the Catalog of Federal Domestic 
Assistance at Number 17.203. ``Certification for Immigrant 
Workers.''

List of Subjects in 20 CFR Part 656

    Adminstrative practice and procedure, Agriculture, Aliens, 
Crewmembers, Employment, Enforcement, Fashion models, Forest and forest 
products, Gaum, Health professions, Immigration, Labor, Longshore work, 
Migrant labor, Nurse, Penalties, Registered nurse, Reporting and 
recordkeeping requirements, Specialty occupation, Wages, Working 
conditions.

Proposed Rule

    Accordingly, it is proposed to amend part 656 of Chapter V of title 
20, Code of Federal Regulations, as follows:

PART 656--[AMENDED]

    1. The Authority citation for Part 656 continues to read as 
follows:

    Authority: 8 U.S.C. 1182(a)(5)(A); 29 U.S.C. 49 et seq.; section 
122, Pub. L. 101-649, 109 Stat. 4978.


Sec. 656.40  [Amended]

    2. Section 656.40 is amended as follows:
    a. In the introductory language in paragraph (b), the phrase 
``except for researchers employed by colleges and universities'' is 
added immediately after the phrase ``For purposes of this section,''.
    b. Paragraph (c) is redesignated as paragraph (d), and a new 
paragraph (c) is added to read as follows:


Sec. 656.40  Determination of prevailing wage for labor certification 
purposes.

* * * * *
    (c) For purposes of this section, ``similarly employed'' in the 
case of researchers employed by colleges and universities in the area 
of intended employment.'' If no researchers are employed by colleges 
and universities other than the employer applicant, researchers 
employed by colleges and universities outside the area of intended 
employment shall be considered ``similarly employed.''
* * * * *
    Signed at Washington, DC, this 16th day of April 1996.
Robert B. Reich,
Secretary of Labor.
[FR Doc. 96-9911 Filed 4-19-95; 8:45 am]
BILLING CODE 4510-30-M