Department of Homeland Security Submits Proposal to Replace H-1B Lottery

By: Vandana Marath & Min Kim

On July 17, 2025, the U.S. Department of Homeland Security (DHS) sent a proposed rule for review—the first step in the federal rulemaking process—to the Office of Management and Budget (OMB) to replace the random H-1B lottery. The Trump Administration’s recent history has shown their intentions to replace the randomized H-1B lottery process with a wage-based selection algorithm, and speculation exists that this current attempt is a repeat effort on the part of the Administration.

In the previous version (2021) of the proposed rule, DHS described this new selection process in which USCIS would rank and select petitions based on the highest Occupational Employment Statistics (OES) wage level, beginning with OES wage level IV and proceeding in descending order with OES wage levels III, II, and I.

Instead of selecting applications through a random lottery, this rule will give preference to employers who offer higher salaries. Petitions offering the highest wages for the job type will be considered first, and selection will move down the wage levels until the annual visa limit is reached.

Currently, the rule has not been published, nor have any details been made available. It may be identical to the previous version, or it may substantially differ. This rule will not affect the Fiscal Year 2026 H-1B cap, as the limit has already been reached. However, it may take effect for the Fiscal Year 2027 H-1B cap cycle. Once the draft proposal completes the federal review process, it will be published in the Federal Register to allow for public comment. The rule will not become effective unless it successfully completes the full rulemaking process overseen by OMB, which generally takes several months.

As the proposed rule moves forward, the Chugh, LLP immigration team will continue providing updates as they become available. For case-specific questions, please contact your trusted Chugh, LLP attorney.