Business Immigration Insights

The Trump Administration’s April Executive Order, “Buy American, Hire American,” puts the H-1B visa program under increased scrutiny, but is not likely to have significant, if any, impact on the program for the foreseeable future.

In contrast to previous EOs that have mandated specific timeframes, this one calls for a formal review “as soon as practicable.” In addition, although the Order seeks to prevent fraud and abuse in the H-1B program, it addresses only “rules” (i.e., regulations) and “guidance” (i.e., guidelines issued by federal agencies through memoranda and other communications), rather than new legislation, and suggests that reform will occur only “if appropriate” and only “consistent with applicable law” – muted language with limited effect.  And finally, while the ostensible purpose of the Order is to protect “U.S. workers,” it also defines that term under a legal provision that includes permanent residents, refugees and asylees, all of whom hold the right to live and work permanently in the United States, just as U.S. citizens do, and thus are also “Americans” by the EO’s own terms.  In fact, tens of thousands of H-1B workers are sponsored for green cards by their employers every year and are now permanent residents.

H-1B visas allow U.S. employers to hire foreign workers for “specialty occupations”:  jobs that require at least a bachelor’s degree or equivalent experience in a field closely related to the job duties.

Since 2005, Congress has capped the number of new H-1Bs at 65,000 per year, with an additional 20,000 set aside for people who hold advanced degrees from U.S. colleges or universities. Employers may file new H-1B petitions only once a year, during the first five business days of April. Because the number of petitions filed during that period routinely outstrips supply by a factor of two or three, U.S. Citizenship and Immigration Services (USCIS) selects petitions that will be processed through a random computer‑generated lottery, with the odds of selection in past years at only 30 to 50 percent.

There is no specific salary threshold for an H-1B worker – a common misperception – unless an employer is classified under the law as “H-1B dependent” (based on percentage of H-1B workers in the overall workforce).  However, the Department of Labor does require all employers to attest that an H-1B worker will be paid the greater of either (1) the actual wage the employer pays other workers with similar qualifications who hold similar jobs at the same location, or (2) the prevailing wage for that occupation in the geographic area where the job is located.  The employer must also attest that it is not displacing U.S. workers by hiring through the H-1B program. To continue employing after the maximum 6-year stay expires, the employer must sponsor the H-1B worker for permanent residence (a “green card”) by showing, among other things, that no U.S. worker who meets the minimum requirements is available to fill the job.  Therefore, the EO’s underlying implication – that properly hired H-1B workers generally undermine wages and displace U.S. workers – is unfounded.

The most controversial aspect of the H-1B visa program has been its use by IT contractors to place workers at U.S. employers’ worksites, sometimes replacing U.S. workers in the process. These same contracting companies also often file speculative H-1B petitions in order to staff contracts they hope to obtain in the future.  This is a questionable use of the H-1B program, which requires a bona fide job offer and acceptance and a specific employer-employee relationship, and can displace large numbers of other employers’ petitions in the annual lottery. Optimally, longer-term consequences of any H-1B program review will establish a fairer annual selection method, perhaps including realistic caps on the number of petitions any one employer may file, and more stringent proofs of wage and displacement attestations.

In the meantime, it would not be surprising to see an increase in unannounced worksite visits and audits by government agencies, including USCIS and the Department of Labor. USCIS has announced on its website, Putting American Workers First, that it is currently targeting enforcement actions at employers whose basic business information cannot be validated through commercially available data; who have a high ratio of H-1B workers as compared to U.S. workers; and who petition for H-1B workers to work off‑site at another company or at another organization’s location (i.e., outsourcing companies).

See also: The Future of the H-1B Visa Program Under The Trump Administration, a 5-minute video in which Adam Rosser and Emily Burkhardt Vicente discuss the future of the H-1B visa program and concerns of the business community.