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An early October federal ruling will affect Purdue’s ability to retain and hire international faculty and staff members, the University argued in a federal lawsuit that was filed Monday.

Purdue and 17 other higher education and nonprofit entities filed a complaint in district court in Washington D.C., against the U.S. Department of Labor and its secretary, Eugene Scalia, after its Oct. 8 ruling "dramatically" raised wage levels for foreign national employees nationwide.

The New York Times reported earlier this month that Acting Deputy Secretary of Homeland Security, Kenneth Cuccinelli, said he expects the administration’s changes to cut the number of visa petitions filed annually down by one-third.

The Department of Labor posted its interim final ruling first on Oct. 6 and made it effective two days later, the lawsuit alleges, without allowing the public enough time to comment or respond. The ruling allows a 30-day period for public comment while the rule has already been made effective on Oct. 8.

The complaint alleges the "IFR was made effective immediately and was unlawfully and intentionally meant to upset the U.S. labor market and disrupt the way businesses operate.

"Plaintiffs represent a wide cross-section of academic institutions, businesses, organizations and trade associations that have and will continue to suffer irreparable harm due to the unlawful process and substantive changes under the IFR."

Plaintiff's counsel Jesse Bless reaffirmed Tuesday morning that the ruling "dramatically increases the salary" of foreign national employees.

How does it affect Purdue?

The ruling requires the University to pay international faculty in the Polytechnic Institute an average of $34,537 more than their current salaries, Purdue alleged in a declaration signed by Provost Jay Akridge.

International faculty in the Department of Computer Science would likewise need to be increased up to $21,633 for international faculty.

Wages for Purdue's faculty, regardless of home country, are "already as high as is feasible," the complaint alleges. The filing states that if the federally mandated wage increases affect Purdue's ability to hire international faculty, many of the University's efforts to create a high-quality learning environment will be dashed.

Akridge’s declaration further argues that the wage rule would affect more than just the salaries of international employees, who use H-1B visas to work in the U.S.

“The wage rule has an impact that goes beyond that of H-1B sponsored faculty, staff and postdocs,” the document states. “The wage rules applicable to the H-1B classification involve an actual wage analysis of the pay. As a result, a wage increase to one H-1B worker would necessitate increases to all comparable workers.

“Because of equity pay demands, an increase of wages to one faculty member has a direct impact on the pay band for the entire group. The cumulative effect of the resulting compensation adjustments would pose an impracticable financial burden on universities, like Purdue, that prioritize the affordability and accessibility of a college degree.”

The jump in pay would force Purdue’s hand, the document alleges, as Purdue’s reported inability to hire international faculty under these new salary guidelines would lead to academic programs becoming understaffed. Akridge notes in the document that international understaffing would affect the integrity of academic programs on campus, thus hurting Purdue’s ability to effectively teach its more than 40,000 students.

How does the ruling work?

Foreign workers enrolled in the H-1B nonimmigrant visa program are allowed to enroll in specialty occupations in the U.S., per federal guidelines. Historically, the secretary of labor provides four levels of wages employers must follow.

In the preamble to the ruling, the labor department states that "the existing wage levels — set at approximately the 17th, 34th, 50th and 67th percentiles — have been in place for over 20 years, and that many employers likely have longstanding practices of paying their foreign workers at the rates produced by the current levels.

"Adjusting the levels to the 45th, 62nd, 78th and 95th percentiles represents a significant change, and may result in some employers modifying their use of the H-1B and PERM programs. It will also likely result in higher personnel costs for some employers.”

The lawsuit alleges that those four levels of wages were “arbitrarily” moved higher, so much so that “the wages themselves are no longer rationally connected to the labor market of the United States, and in many cases result in only one wage identified for a job, regardless of the level of experience.

“For example, in the Washington D.C. Metropolitan Statistical Area (MSA), the mandated minimum wage for a newly graduated attorney with no experience seeking work under an H-1B visa is now $208,000."

The federal ruling also states that artificially low prevailing wages have given U.S. employers the ability to hire and pay foreign workers much less than what their U.S. counterparts earn, creating an inherent incentive for U.S. employers to prefer hiring foreign employees.

The filed complaint argues the labor department provides no evidence to back claims that the federal ruling will balance foreign and U.S. salaries.

The plaintiffs also allege the higher salaries will hurt foreign employees working in rural areas of the U.S., such as international physicians who have just graduated from college.

"Approximately one-third of the U.S. physician workforce is comprised of international medical graduates," the complaint states. "These physicians are not only working on the frontlines of the COVID-19 response, but also dedicate their lives to the provision of health care in our most vulnerable and underserved medical populations in the U.S. These wages force U.S. employers to default to a $208,000/year default for not only our U.S. residents and fellows in training, but also our practicing physicians.

"Under the IFR, foreign medical graduates must be paid a minimum of $208,000 per year despite only having just graduated medical school, which is dramatically higher than the market rate for these employees and clearly more than rural hospitals and medical centers are able to pay."

Akridge made the point in his declaration that universities cannot expect domestic employees to appear when international employees vanish, as evidenced by Purdue’s experience during the pandemic. When COVID-19 necessitated a pause in travel and trapped researchers abroad, the researchers were not automatically replaced by scholars closer to campus.

“We therefore have recent, significant data that clearly illustrates that an inability to hire an international researcher does not result in the hire of a domestic researcher – because in certain emerging fields, no such domestic worker exists,” the declaration states. “Instead, what happens is that the positions remain vacant and the laboratory is understaffed.”

What are the other universities arguing?

Other universities involved in the case provided comparative numbers for the now-effective salary hike in the complaint.

The lawsuit describes before-and-after wages for the salaries of a civil engineer faculty member at the University of Michigan for comparison. Level 3 wages for the engineer were set at $70,491 for an entire year as of Oct. 7; as of the new ruling, that salary jumps to $158,392, according to court documents.

The complaint states that the plaintiffs in general have already begun to suffer ill effects from the ruling, including: the termination of employees, increases in operational costs, diversion of resources, pauses in new staff hirings and a decline in morale among staffs.

“Plaintiffs’ staffs work with vulnerable, low-income individuals,” the complaint states, “which is challenging on its own. The IFR denigrates this work.”

In total, plaintiffs include other colleges such as Indiana University, the University of Michigan and Bard College, and organizations including Dentists for America and United Methodist Homes and Services, according to court documents.

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