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PERM: An Introduction

by Lori S. Melton and Roxana C. Bacon


PERM is the new way of filing labor certifications, eliminating the old two methods: RIR and the “traditional”, i.e. DOL monitored system.  Effective March 28, 2005, all labor certification filings must be PERM compliant.  


PERM requires that an employer perform specific recruitment for an open position prior to filing a labor certification application, which can be done either electronically or by mail using the new Form ETA 9089.  Rather than submitting the recruitment documentation with the application, the employer will attest to completing the required recruitment on the new form and will retain the recruitment documentation for five years in case of DOL audit.  


Additionally, the employer must obtain a prevailing wage determination from the State Workforce Agency (SWA) prior to filing the labor certification application.  


The good news for employers and attorneys practicing in this area is that labor certifications may be approved in as fast as 60 days.  Note this is more than double the 21-day processing time promised in the proposed regulation.  If you are familiar with the proposed regulation however, you will be pleasantly surprised at the other changes in the final PERM regulation as most are favorable to employers.


Conversion of Pending Cases

Pending cases can be converted to the PERM process, but it may be risky to do so without further clarification from DOL.  PERM allows for the withdrawal and refiling of regular and RIR cases filed before the effective date of March 28, 2005.  Regular cases can only be withdrawn prior to placement of a job order by the SWA.  


Under the refiling procedures, the employer can retain the priority date of the original labor certification application by filing an application for an identical job opportunity as the original application (after compliance with all PERM filing and recruitment requirements) and withdrawing the original application.[1]


A job opportunity will be considered identical if “the employer, alien, job title, job location, job requirements, and job description are the same as those stated in the original application filed under the regulations prior to March 28, 2005.”[2]Additionally, any amendments made to the original application that were accepted prior to withdrawal of the application will be considered part of the original application.  If the applications are not identical, then the re-filed application will be processed under the new filing date and a loss of priority date will result.  Obviously much will depend on how DOL construes “identical” since the regulation uses “the same” rather than “identical” in the definition.


Prevailing Wages

 Under PERM, there are several significant changes to the labor certification process with regard to prevailing wages.  First, the employer must now promise to pay the beneficiary employee 100% of the prevailing wage, rather than a wage that is at least 95% of the prevailing wage.  


Second, employers under PERM are required to submit a prevailing wage determination issued by the relevant State Workforce Agency (SWA).  To enable implementation of this provision, the SWAs, many of which have ceased to issue prevailing wage determinations in recent years due to budgetary constraints, are now required by regulation to issue prevailing wage determinations which shall be valid for a period designated on the determination form, between 90 days to one year.  Unfortunately, the regulations do not provide a required processing time within which the prevailing wage determination must be made.


A wage set forth in a collective bargaining agreement (CBA) is still binding.  Absent a CBA, the prevailing wage determination made by the SWA must now follow new rules with regard to how the prevailing wage is calculated.  


The prevailing wage “shall be the arithmetic mean . . . of the wages of workers similarly employed in the area of intended employment.”[3]The regulation goes on to say that the Occupational Employment Statistics Survey (OES) shall be used to determine the arithmetic mean.  However, the regulations also now require that a governmental survey shall provide at least four levels of wages in order to be valid for prevailing wage purposes.  


This appears contradictory, since OES is a two-level survey.  However, the Department of Labor (DOL) has taken into account that most governmental surveys, including OES, have only two wage levels which would otherwise make them invalid for prevailing wage purposes.  The regulation creates a formula by which an additional two levels may be added to OES through a mathematical formula, thereby “legalizing” the use of OES and other two-level governmental surveys. (It is important to note that the regulations do not require that the SWAs follow this formula.)  This is done by subtracting the two wage figures and dividing that figure by three.  This number is then added to the first wage level of OES to create the second intermediate level.  It is also subtracted from the second wage level of OES to create a third intermediate level.


If the formula listed in the regulations is used by the SWA, it would create two favorable intermediate levels.  However, the current level 1 and level 2 two wages will not change.  A better (although unlikely) statistical solution would be for the DOL to take the OES survey data and recreate four wage levels rather than using the mathematical “fix” to create two intermediate levels.


DOL has announced that it will issue further guidance on the prevailing wage levels by March 8, 2005.  As DOL is developing this guidance, how the four levels are defined is of critical importance.  If level 1 and level 2 are still defined in the same way, the addition of the intermediate levels may result in little or no practical change from the way that wage determinations were issued previously (and in fact, it would be more onerous on the employer, since payment of 100% of the prevailing wage would now be required).  Since different occupations require different amounts of education and/or experience to arrive at the various compensation levels within that occupation, an occupation-specific definition of the levels would be most accurate.  Absent such a system, we are likely to be left with vague level descriptions such as “entry level” and “experienced,” similar to those that were not properly understood by the SWAs under the two-level system.


The regulations allow the employer to submit a survey as a basis for the prevailing wage determination.  In such a case, the employer’s survey can not only use a survey methodology based on the arithmetic mean, but may also use a survey based on a median wage.  In such a case, the prevailing wage “shall be the median of the wages of workers similarly employed in the area of intended employment.”

 The criteria that the employer’s survey must satisfy are similar to the criteria articulated in General Administration Letter No. 2-98 (GAL 02/98).  Specifically, the survey must be published within 24 months of the prevailing wage request submission and must be the most updated version of the survey.  The data upon which the survey is based must have been collected within 24 months of publication.  


Of great benefit is the requirement that if the SWA rejects the prevailing wage survey presented by the employer, it is required to provide written notice of the rejection, specifying the reasons that the survey was unacceptable.  The employer may then make a one-time supplemental submission to request reconsideration of the decision.  If the prevailing wage request is again rejected, the employer can either file a new prevailing wage request or request review by the Certifying Officer within 30 days of the determination.  If the Certifying Officer (C.O.) affirms the SWAs decision to reject the survey, the employer has 30 days from the C.O.’s decision to appeal to BALCA.


Nonprofits, higher educational institutions, and governmental research organizations have often complained that it is inappropriate to compare their wages against those offered in the private sector.  The new PERM regulation rectifies this problem by allowing these types of entities to have their wages compared with similar entities in the area of intended employment.


Recruitment Requirements

 Under PERM, an employer must perform specific advertising based on the type of position offered, i.e., professional and nonprofessional.  Professional positions are defined as “an occupation for which the attainment of a bachelor’s or higher degree is a usual educational requirement.”[4]A nonprofessional position would then be a position that does not require at least a bachelor’s degree.


For nonprofessional positions, the employer must place a job order with the applicable SWA and two newspaper advertisements within 6 months of filing the application.[5]


For professional positions, the employer must complete three steps.  


• First, the employer must place a job order with the SWA covering the area of intended employment for at least 30 days. 

• Second, the employer must place two newspaper advertisements on two different Sundays in the newspaper of general circulation for the area of intended employment.  If the position requires experience and an advanced degree, a professional journal advertisement may be used in lieu of one of the Sunday newspaper ads.  The test for the appropriate newspaper or professional journal remains one of “the most appropriate to the occupation and the workers likely to apply for the job opportunity and most likely to bring responses from able, willing, qualified, and available U.S. workers.”[6]These first two steps are categorized as mandatory and must be completed at least 30 days, but no more than 180 days before filing the application.[7]

• Third, employers with professional employees have options.  They must choose at least three additional recruitment steps from the following list provided by DOL:


            (1)  Job Fairs;

            (2)  Employer’s Website;

            (3)  Job Search Website Other than the Employer’s;

            (4)  On-campus Recruiting;

            (5)  Trade or Professional Organizations;

            (6)  Private Employment Firms;

            (7)  Employee Referral Programs with Incentives;

            (8)   Campus Placement Offices;

            (9)   Local and Ethnic Newspapers; and

            (10) Radio and Television Advertisements.[8]



All advertisements must contain specific information, including the employer’s name, job location and a description of the job offered that is “specific enough to apprise the U.S. workers of the job opportunity.”[9]The ad must not contain a wage lower than the prevailing wage rate, nor can it contain any excessive job requirements.  The ad must also direct applicants to send resumes to the employer.


Only one of the alternative recruitment steps for professional positions may consist solely of activity conducted within 30 days of the filing and none of the steps may have taken place more than 180 days prior to the filing. The comments discuss the fact that unlike in the newspaper advertisements, the additional recruitment steps only require employers to advertise for the occupation involved in the application rather than for the job opportunity, thereby potentially minimizing the costs to the employer.  However, by recruiting for a broader occupation rather than the specific job opportunity, an employer is likely to receive a large number of resumes from individuals who ultimately may not be remotely qualified for the specific job opportunity.  Therefore, even though the DOL perceives this as a benefit, this leads to a greater amount of work by an employer in screening each and every applicant against the position.   


The new regulations essentially force an employer to conduct recruitment efforts that will be easiest to track rather than to utilize recruitment efforts that may yield the greatest amount of applicants and may be more in line with "real world" recruitment.    While companies who are seriously recruiting for U.S. workers often use a variety of sources for recruitment similar to those required by the Department of Labor, for purposes of preparing a PERM application, an employer's incentive to rely on some of these recruitment sources for the PERM application may be curtailed by the strict document retention requirements.   


Finally, both professional and nonprofessional positions require completion of an internal posting at the location of employment for 10 consecutive business days AND notification in “any and all in-house media, whether electronic or printed, in accordance with the normal procedures used for the recruitment of similar positions in the employer’s organization.”[10]


Recruitment Report

PERM requires the employer to provide a detailed recruitment report containing the following information:


(1) Description of the recruitment steps undertaken and the results achieved;

(2) The number of hires; and

(3) The number of U.S. workers rejected, categorized by the lawful job related reasons for such rejections.[11]


The Certifying Officer may, after a review of the recruitment report, request resumes of U.S. workers.


 U.S. Worker Qualifications

In determining whether a U.S. worker is qualified for the position offered, the employer must determine if the U.S. worker applicant “can acquire the skills necessary to perform the duties involved in the occupation during a reasonable period of on-the-job training.”[12]A reasonable period of time is not defined under the regulation, as DOL argued in its response to the comments received that a reasonable period of time would vary from occupation to occupation. Obviously, most employers will maintain that no OJT is acceptable in professional jobs, especially those involved primarily with technical or scientific skills.


Job Duties and Requirements

 Unlike the proposed PERM regulation, the final PERM regulation retains an employer’s option to exceed the specific vocational preparation (SVP) level under the O*NET Job Zones, so long as the employer can adequately document the business necessity as defined by BALCA case law.  


The PERM regulation also continues to allow business necessity to justify foreign language requirements.  The regulation expands current BALCA case law to include the need to communicate effectively with one’s co-workers or subordinates as well as safety considerations to support a foreign language requirement.  


PERM also retains the employer’s ability to justify a combination of occupations under the current standard. 


Finally, PERM allows employers to specify alternative requirements with one caveat:


“If the alien beneficiary already is employed by the employer, and the alien does not meet the primary job requirements and only potentially qualifies for the job by virtue of the employer’s alternative requirements, certification will be denied unless the application states that any suitable combination of education, training, or experience is acceptable.”[13]


The employer must thus consider applicants who could meet the alternative requirements that the foreign national meets, or the application will be rejected as tailored to the foreign national. 


 Foreign National Experience Requirements

 The proposed PERM regulation eliminated the opportunity for foreign nationals to qualify for a position based on any prior experience gained with the employer, any of its related companies or even in a contracting position.  The final regulation is much more lenient and provides for use of prior experience with the same employer or as a contract employee (i.e., independent contractor), so long as the prior experience is not “substantially comparable” to the offered position.  The regulation defines “substantially comparable” as “a job or position requiring performance of the same job duties more than 50 percent of the time.”[14]


Further, the new regulation defines employer narrowly to include only entities with the same Federal Employer Identification Number (FEIN).  This narrow definition actually expands the potential realm of useable experience for foreign nationals by allowing experience gained abroad with a foreign related entity or even a related U.S. entity so long as the FEINs are distinct.



 The new regulation requires that employers notify and consider only their own potentially qualified laid off U.S. workers, rather than those laid off by other employers as the proposed regulation required.  Employers must consider those workers laid off during the six months prior to filing the application that were laid off in the same or related occupation.  Related occupation is defined as “any occupation that requires workers to perform a majority of the essential duties involved in the occupation for which certification is sought.”[15]


The regulation also defines a layoff as “any involuntary separation of one or more employees without cause or prejudice.”[16]Such a narrow definition again allows for broad employer interpretation.  If an employee is terminated for poor performance, such a termination would not be considered a layoff under this narrow definition.   PERM also requires that employers document the results of consideration of laid off employees for the position.



Because of the attestation-based new Form ETA 9089, DOL will now have authority to audit a labor certification application file either for cause or randomly.  If selected for audit, the employer will have 30 days to respond to the audit letter or the case will be denied.  If the employer fails to respond to the audit letter, the Certifying Officer may, within his/her discretion, require the employer to conduct supervised recruitment for any future labor certification filings for up to two years.  After audit, the Certifying Officer may request the employer conduct supervised recruitment or request additional information.[17]Requiring an employer to retain resumes for a five-year period of time imposes a substantial burden, particularly on large employers who may receive thousands of resumes each month.  


 Supervised Recruitment  

If subjected to supervised recruitment by the Certifying Officer, the employer will essentially be subject to the same requirements as under the current traditional labor certification process.  


 Determinations & Labor Certification Validity

If the Certifying Officer grants the labor certification, the employer and/or the employer’s attorney will receive notification of the Final Determination.  If the case is denied, the Final Determination will contain information on the reason for denial and outline the requirements for review of the decision.  If the Certifying Officer finds that the employer filed to produce required documentation, or that the documentation was inadequate or contains a material misrepresentation, the employer may be required to conduct supervised recruitment for any future labor certification application filing for up to two years.  


After a determination is made, employers will have 30 days to file a request for review with the Board of Alien Labor Certification Appeals (BALCA).  Unlike the current appeal system, however, BALCA’s authority to remand a case to a Certifying Officer for further consideration or fact-finding and determination has been eliminated.


Similar to the current rule, a labor certification is valid indefinitely.  However, the Department of Homeland Security or the Department of State may invalidate a labor certification upon a finding of fraud or willful misrepresentation of a material fact involving the application.  Further, the Certifying Officer may revoke approval of a labor certification if he/she finds that the certification was not justified.  No definition of “not justified” is included in the regulations.  In such a situation, the employer will receive a Notice of Intent to Revoke and will have 30 days to respond to the Notice before the application approval is revoked.


 Recruitment Tracking & Audit Strategies

 The PERM regulation requires an employer to report and track its recruitment results for the specific job opportunity for the application for permanent employment certification.  For large, volume employers who recruit nationally for multiple position openings at various site locations, tracking PERM recruitment may prove difficult and might not be representative of an employer’s broader recruitment efforts.  Therefore, to best prepare for an audit, large employers may wish to track not only its PERM recruitment efforts, but also its broader recruitment efforts, to provide as much evidence as possible for audit purposes.


To meet the regulation’s requirements, employers need only track applicants to the specific job opportunity, which, depending on an employer’s recruitment methods, could be limited to the advertisements/recruitment efforts taken to comply with PERM.  While solely tracking number of hires and number of U.S. workers rejected (along with job-related reasons for the rejections) in response to PERM recruitment efforts seems to fulfill an employer’s reporting obligations, it would be beneficial for an employer to continue to track its general recruitment efforts similar to those recruitment efforts tracked for RIR purposes.   In this way, an employer may bolster an audit response by not only submitting data from the specific PERM-recruitment report, but also broader data showing that it has been unable to locate sufficient qualified and available U.S. workers and continues to have multiple position openings for the position for which the application for permanent employment certification was filed. 


The PERM regulation sets forth that an employer must retain copies of permanent employment certification applications and supporting documents for five (5) years from the date of filing the application.  The regulation also states that the Certifying Officer “may request the U.S. workers’ resumes or applications, sorted by the reasons the workers were rejected.”[18]The five year retention requirement and the Certifying Officer’s ability to request paper resumes and applications is contrary to the premise behind PERM to allow for a more automated, faster manner of filing and preparing applications for permanent employment certification.  Although the regulation states that the Certifying Officer may request resumes or applications, the regulation does not state that the employer is required to retain these paper documents and provide them to the Certifying Officer.  In reality, the retention of such documents for a five-year period would be contrary to normal business practice.  While it is still unclear how critical the retention of such documents will be, employers should begin to consider alternatives to this archaic requirement.  For example, employers might consider setting up a detailed, well-documented process for the review of applicants to the job opportunity, which, along with the recruitment report, can be presented to the Certifying Officer in case of an audit.  


Additionally, an employer could show that applications/resumes rejected for lawful, job-related reasons are treated the same as all applications/resumes received.  For example, employers could show that rejected applications/resumes are placed into the employer’s general resume database for the same amount of time that all applications/resumes are stored, and that they, like all other applications/resumes, may be considered for other position openings with the employer.  While we still do not know how important the retention of resumes and applications will be, employers should at least consider putting processes into place that could meet its burden in an audit situation that limits the amount of voluminous paperwork it would otherwise need to retain.

[1] 1 20 C.F.R. §656.17 (d)(1).  Federal Register, Vol. 69, No. 247, Monday,
December 27, 2004, pg. 77392.
[2] 20 C.F.R. §656.17 (d)(4).  
[3] 22 C.F.R. §655.731(a)(2)(A).  Id. at 77385.
[4]  20 C.F.R §656.3, Id. at 77388.
[5] 20 C.F.R. §656.17 (e)(2).  Id.
[6] 20 C.F.R. §656.17 (e)(1)(i)(B).  Id. at 77393.
[7]  20 C.F.R. §656.17 (e)(1)(i).  Id.
[8] 20 C.F.R. §656.17 (e)(1)(ii).  Id.
[9] 20 C.F.R. §656.17 (f)(3).  Id.
[10] 20 C.F.R. §656.10 (d)(ii).  Id. at 77390.
[11] 20 C.F.R. §656.17 (g)(1).  Id. at 77394.
[12] 20 C.F.R. §656.17 (g)(2).  Id.
[13] 20 C.F.R. §656.17 (h)(4)(ii).  Id. 
[14] 20 C.F.R. §656.17 (e)(1)(i).  Id.
[15] 20 C.F.R. §656.17 (k)(2).  Id. at 77395.
[16] 20 C.F.R. §656.17 (k)(1).  Id.
[17] 20 C.F.R. §656.20.  Id. at 77396.
[18]  20 C.F.R. § 656.17(g).  Id. at 77394.