New DHS Regulation Overhauls H-1B Cap Selection: Weighted Lottery to Begin for FY 2027

Background

DHS has finalized a weighted H-1B selection system that replaces the long-standing “pure lottery.” USCIS will assign each eligible beneficiary a weight based on the wage level associated with the offered position. Higher wage levels receive greater weight, and therefore a greater likelihood of being selected. The rule is intended to align H-1B allocation with the program’s stated purpose of filling high-skilled, higher-paid specialty roles, and to discourage use of the program for lower-paid positions. The new system applies starting with the FY 2027 cap, meaning registrations filed in March 2026 will be subject to weighted selection.

Overview of the New System

Under the new rule, USCIS continues to use the beneficiary-centric registration model. Each beneficiary receives one registration, regardless of how many employers submit an entry. USCIS will then place each beneficiary into a weighted pool based on the OES wage level associated with the offered position. The OES wage system assigns four wage levels to each position. Beneficiaries with a Level I wage will be entered in the lottery once, Level II twice, Level III three times and Level IV four times.

While all wage levels remain eligible for selection, those associated with Level III or Level IV wages will have significantly better odds than those offered entry-level wages. Level I wages will continue to be selectable, but with reduced probability relative to the higher levels.

The advanced-degree exemption (master’s cap) remains in place. Beneficiaries with qualifying U.S. master’s or higher degrees continue to receive two opportunities for selection—first in the advanced-degree pool, and if not selected, in the regular cap. Under the new rule, this means that advanced-degree beneficiaries also benefit from the weighting system twice, which will materially improve selection odds for U.S.-educated advanced-degree candidates—especially those offered Level III or IV wages.
Where a beneficiary will work at multiple worksites, the rule requires the employer to identify the location associated with the lowest applicable wage level, and that lowest level will be used in the weighted selection process. This prevents employers from selecting a higher-wage secondary location solely to obtain a more favorable wage level for the lottery. The petition later filed must list all intended worksites and must remain consistent with the worksite information provided at registration.

How the New System Affects the Likelihood of Selection

The regulation provides illustrative probability estimates showing how often beneficiaries at different wage levels would have been selected under the weighted system. USCIS’s modeling indicates the following approximate probabilities of selection under the new rule:

• Level I: 15.29%
• Level II: 30.58%
• Level III: 45.87%
• Level IV: 61.16%

These figures reflect a dramatic shift away from the current randomized selection rate (historically around 29–30%), with Level I beneficiaries experiencing a significantly lower selection likelihood and Level III/IV beneficiaries experiencing substantially higher odds.

Where Wage Levels Come From: The OEWS System

The wage levels used in the H-1B registration system come from the Occupational Employment and Wage Statistics (OEWS) program administered by the U.S. Bureau of Labor Statistics (BLS). OEWS provides government-issued prevailing wage data for thousands of occupations across hundreds of geographic regions.
These wage levels—Levels I through IV—are determined based on:

• The SOC code (Standard Occupational Classification) for the job
• The area of intended employment
• Whether the position is entry-level, fully competent, or involves advanced or specialized duties

Employers can review OEWS wage data at: https://flag.dol.gov/wage-data/wage-search

Practical takeaway for employers

The new system places substantial emphasis on the wage level, which is now the primary driver of selection probability. The advanced-degree exemption remains important, but wage level will do the most work in distinguishing likely selections from long-shot outcomes.
This means employers sponsoring critical workers should begin evaluating whether their compensation structures, job classifications, and leveling systems accurately reflect the appropriate wage level for the offered role.

Risks and Compliance Considerations

Because selection probability is now tied to the proffered wage level, DHS notes in the rule that attempts to manipulate job details—such as changing the SOC code, worksite, or wage in ways that do not reflect the genuine position—may undermine the validity of a registration. USCIS explains that it will assess whether the information submitted at registration accurately reflects the job that will be the basis of the H-1B petition, and that discrepancies or false attestations may result in:

• Denial of the H-1B petition,
• Revocation of an approval, or
• Referral to appropriate federal authorities where USCIS believes a false attestation was knowingly submitted.

In addition, the final rule clarifies that USCIS may apply these same principles when reviewing subsequent H-1B filings for the same beneficiary, including amended petitions and later-filed petitions. If USCIS determines that a new or amended petition was submitted in a way that appears connected to an earlier attempt to improve selection odds—such as lowering the wage level after selection—the petition may be denied or an approval may be revoked.

Employers should therefore ensure that the details listed in the registration—job duties, SOC code, location, and wage—are accurate, supportable, and consistent with the role for which the H-1B petition will later be filed.