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Over the past two years, opponents of high-skilled immigration have put a bull’s-eye on H-1B visas. They have successfully advocated for policy changes that restrict the ability of U.S. companies to apply for the category, premised on the perception that high-skilled foreign workers are taking jobs away from Americans and that companies are abusing the system by importing “cheap” foreign labor to undercut American wages.
The fact is that H-1Bs are regulated to protect American workers through wage requirements and rigid numerical quotas, making the H-1B category one of the strictest programs for high-skilled workers in the world.
American companies do not choose H-1B visas to save money by hiring foreign workers. H-1Bs are not cheap, and employers spend thousands of dollars on legal fees and government filing fees to sponsor employees for an H-1B worker’s initial petition, as well as on renewals and visas for family dependents. By law, companies must fulfill multiple requirements to ensure they are paying foreign workers appropriately — by paying not just a threshold minimum salary, but the prevailing wage for the particular job. These requirements include certifying with the U.S. Department of Labor that the wages paid to a foreign job candidate are on par with those paid to American workers in the same job and location; attesting the foreign worker’s salary, job details, work location, and qualifications; and posting a notice to U.S. workers that the company is seeking to sponsor an H-1B worker. According to several studies, H-1B employees earn significantly higher wages than Americans in the same field.1
Capped at 85,000 visas per year, H-1B visas are extremely limited when compared with demand that has risen sharply since the cap was introduced in the 1990s. The odds of selection in the lottery have been well below 50 percent for the past several years, creating huge uncertainty for business planning. Even if selected for adjudication, the intense scrutiny on H-1B petitions creates additional hurdles with no guarantee of success. Requests for evidence shot up by more than 40 percent shortly after Trump issued the “Buy American and Hire American” executive order and the rate of H-1B denials2 continues to climb. In the end, H-1B workers hold only 0.6 to 0.7 percent of U.S. jobs, a proverbial drop in the bucket for the U.S. labor force.3
What’s more, H-1Bs are inconvenient, and companies incur indirect business costs because H-1B visas are tied to a specific job and work location. Foreign employees sponsored on H-1Bs are not as mobile as American workers. If an H-1B worker changes job locations, the company must file an amended H-1B petition with the government at additional cost. Unlike U.S. workers, H-1B workers cannot be hired on a contractual basis and companies are prohibited from “benching” H-1B employees during periods of slow productivity. Therefore, they must continue to pay them even if they are not performing billable work.
Inevitably, H-1Bs add to companies’ administrative hassles. Employers must keep meticulous records of H-1B employees and be prepared for inspection without notice. USCIS operates a Fraud and Detection and National Security (FDNS) unit that conducts unannounced visits to investigate employers for fraud and abuse. The Labor Department also conducts audits of H-1B employers to make sure they are in compliance with the wage requirements and documents related to the labor condition application. Both agencies have stepped up the number of audits and opened tip lines for reporting fraud and abuse. The audit process and potential liability for noncompliance requires H-1B employers to understand the record-retention requirements for each type of document, put in place separate policies and protocols for their HR personnel for each type of inspection, and train staff regarding how to receive inspectors and which documents they are permitted to turn over.
So why would employers hire workers on H-1B visas in the face of increasing wage requirements, decreasing odds of success, and added compliance burdens? Companies turn to foreign job candidates, many of whom are graduates of top U.S. universities, because they have skills that employers need, especially in the IT and STEM fields. In fiscal year 2017, 69 percent of H-1B petitions were filed in the STEM and IT fields, according to USCIS.4 In these and other fields, demand remains high and American workers are often not available, either because they are not graduating in numbers that meet demand or because they have moved on to better opportunities outside those fields.
Opponents of high-skilled immigration aren’t worried about U.S. companies and their ability to compete in a global economy. Their goal is to reduce immigration, and restricting the H-1B visa category is a means to that end. But the facts refute their rationale for restricting high-skilled immigration, as there is no evidence of widespread abuse. The vast majority of employers follow the rules and comply with wage safeguards aimed at protecting U.S. workers. The reality is that opponents of high-skilled immigration who continue to push for further restrictions to H-1B access are trying to solve a problem that doesn’t exist — and hurting U.S. companies in the process.
Kortney Gibson is a Partner in the Dallas office of Berry Appleman & Leiden LLP.
1“H-1Bs: How do they stack up against US-born workers?” Public Policy Institute of California, December 2011, http://ftp.iza.org/dp6259.pdf; “Report: H-1Bs and the STEM shortage,” The Brookings Institution, May 10, 2013, https://www.brookings.edu/research/h-1b-visas-and-the-stem-shortage/. See also Glass Door, “Dispelling Myths: What H-1B visa workers are really paid,” April 3, 2017, https://www.glassdoor.com/research/h1b-workers/ 2“H-1B Denial and RFE Increase,” National Foundation for American Policy, July 2018, https://nfap.com/wp-content/uploads/2018/07/H-1B-Denial-and-RFE-Increase.NFAP-Policy-Brief.July-2018.pdf 3“The H-1B Visa Debate Explained,” Harvard Business Review, May 4, 2017, https://hbr.org/2017/05/the-h-1b-visa-debate-explained 4“Characteristics of H-1B Specialty Occupation Workers, Report to Congress,” U.S. Citizenship and Immigration Services, April 6, 2018, https://www.uscis.gov/sites/default/files/files/nativedocuments/Characteristics_of_H-1B_Specialty_Occupation_Workers_FY17.pdf
The information contained here is meant to be informational, and while BAL has made every effort to ensure the accuracy of the information, it is not promised or guaranteed to be complete. Readers of this information should not act upon any information contained on this alert/blog without seeking professional counsel. This alert does not constitute legal advice or create an attorney-client relationship. Any reference to prior results, does not imply or guarantee similar future outcomes.
A proposed regulation that is expected to end work authorization eligibility for H-4 spouses of H-1B workers is close to being published. The proposal was sent to the Office of Management and Budget (OMB) on Wednesday, the last step before the Department of Homeland Security publishes a proposed rule.
Key points:
Background: The H-4 Employment Authorization Document (EAD) regulation currently allows certain H-4 spouses of H-1B workers to apply for employment authorization in the U.S., but rescission of the Obama-era rule has been on the DHS agenda since late 2017. A lawsuit challenging the Obama rule, Save Jobs v. DHS, was put on hold for months as DHS told the courts that it was in the process of rescinding the rule. In January, however, a federal appeals court removed the hold and set a briefing schedule requiring DHS to submit arguments by March 18, and the agency has now taken steps toward issuing the rescission rule in light of that deadline.
BAL Analysis: The current H-4 regulation remains in effect today, meaning eligible H-4 visa holders may continue to apply for new and renewal EAD cards. The OMB review indicates that the rescission rule is in progress and DHS is working toward issuing a proposed regulation. Following publication of the proposed rule, members of the public will have an opportunity to submit comments to the government, and it typically takes several months for the agency to issue a final rule. The agency has not indicated whether the rule will allow a transition period for current H-4 EAD holders to continue working for a designated period. BAL is closely following the H-4 rescission rule and will report any developments as the rule progresses.
This alert has been provided by the BAL U.S. Practice group. For additional information, please contact berryapplemanleiden@bal.com.
Copyright © 2019 Berry Appleman & Leiden LLP. All rights reserved. Reprinting or digital redistribution to the public is permitted only with the express written permission of Berry Appleman & Leiden LLP. For inquiries please contact copyright@bal.com.
U.S. Citizenship and Immigration Services has announced it will use the Final Action Dates chart for employment-based adjustment of status applicants in March. Final Action priority-date cutoffs for all EB-1 categories will advance moderately in March, according to the State Department’s March Visa Bulletin. EB-2 China will advance by three months, while EB-3 China will advance by only one week. For Indian nationals, the EB-2 category will advance only three days, while EB-3 will advance by one month.
Key movements based on Final Action Dates:
EB-1
EB-2
EB-3
Additional notes: The EB-4 category for religious workers (other than ministers) and the EB-5 Regional Center (I5 and R5) Immigrant Investor program will be funded through the remainder of the fiscal year under the budget bill Congress passed late Thursday and the president signed Friday. The EB-4 category will become current for March for all countries except El Salvador, Guatemala, and Honduras which will be subject to a March 1, 2016 final action date, and for Mexico will be subject to a January 1, 2018 date. In the EB-5 category, final action dates will become current for March for all countries except China I5 and R5 which will be subject to a September 8, 2014 final action date, and Vietnam, which will be subject to a July 15, 2016 final action date.
Application Final Action Dates for Employment-Based Preference Cases:
USCIS has confirmed it will use the State Department’s Final Action Dates chart for March in determining filing eligibility for adjustment of status applicants. Applicants whose priority date is earlier than the applicable cutoff date in the above chart will be eligible to apply for adjustment of status in March.
Congress passed a budget late Thursday to avoid another government shutdown and that will continue to fund the federal government for the remainder of fiscal year 2019. The bill provides $1.375 billion for border fencing and barriers, well short of the $5.7 billion President Trump has been seeking for a wall along the U.S.-Mexico border. White House officials reported that Trump signed the bill Friday afternoon, after announcing that he is declaring a national emergency to build the wall without Congressional consent.
BAL Analysis: The budget agreement will avert a shutdown and lapses in immigration and other government services until Sept. 30, the end of the fiscal year. Trump’s decision to bypass Congress by declaring a national emergency would shift money from other areas such as disaster relief to build the wall, and is certain to face numerous lawsuits and protracted litigation that would at least delay if not block the executive action.
U.S. Citizenship and Immigration Services (USCIS) announced that beginning Tuesday, Feb. 19, it will resume premium processing for all H-1B petitions filed on or before Dec. 21, 2018.
Background: Premium processing allows petitioners to request faster service for an additional government fee. USCIS must respond within 15 days or refund the fee. USCIS suspended premium processing for H-1B cap cases just before fiscal year 2019 cap season opened in April 2018. In August 2018, the agency expanded the suspension to encompass nearly all H-1B petitions. On Jan. 28, 2019, USCIS lifted the suspension on premium processing for FY2019 H-1B cap subject-petitions only. The agency is now lifting the suspension of non-cap H-1B petitions filed before Dec. 22, 2018.
BAL Analysis: Petitioners who filed H-1B petitions before Dec. 22, 2018 should identify cases that require expedited service and request premium processing as soon as possible. To avoid delays, petitioners should include RFE responses and the transfer notice (if applicable); if the premium processing request for a transferred case sent to the wrong service center, USCIS will forward the request to the correct center but the 15-day clock will only start on the date the petition is received by the correct service center.
U.S. Citizenship and Immigration Services will publish a revised Form I-539 Change/Extension of Status on March 11 and will begin requiring biometrics appointments for applicants. Form I-539 is required for change or extension of status for certain visa holders and for derivative family members of nonimmigrant visa holders, including H-4 spouses of H-1B workers.
Background: Form I-539 Extend/Change Nonimmigrant Status is filed by dependents of nonimmigrant visa holders, including H, L, E, O and others such as B-1/B-2 visitors, as well as individuals changing to F, J or M status. The full list is available on the instructions to Form I-539.
BAL Analysis: H-1B employees and other nonimmigrant visa holders and their family dependents should be prepared to work with their BAL professional to sign the new forms soon after they are released on March 11, particularly H-4 spouses, as the release date of the form leaves only three weeks to gather all signatures before H-1B cap season opens on April 1. Derivative family members filing the new Form I-539/I-539A will need to appear in person for their biometrics appointments and should anticipate delays, as USCIS introduces the new process. Processing of Employment Authorization Documents (EAD’s) when filed concurrently with I-539 applications may also be delayed.
The Labor Department has posted processing times current as of Jan. 31 for permanent labor certification (PERM) applications and prevailing wage determination (PWD) requests.
PERM Processing: Applications filed in October and earlier are now being adjudicated, according to the department. Audit reviews are being conducted on applications filed in July and earlier, and appeals filed in October and earlier are being reviewed for reconsideration.
Average PERM processing times in January:
PWD Processing: The National Prevailing Wage Center is currently processing requests filed in September and earlier for H-1B and PERM cases. Redeterminations are being considered on appeals filed in November and earlier for H-1B and PERM cases. Center director reviews are being conducted on appeals filed in December and earlier for PERM cases. The department reported that it had no center director reviews pending for H-1B cases.
Average times for issuance of prevailing wage determinations:
The Labor Department reports PERM and PWD processing time frames on its iCERT page.
BAL Analysis: BAL’s internal case tracking is mostly consistent with the Labor Department’s published processing times. BAL is seeing approvals for PERM applications filed in October and earlier, but is seeing PWDs for requests filed in October, as well as September and earlier.
Copyright © 2018 Berry Appleman & Leiden LLP. All rights reserved. Reprinting or digital redistribution to the public is permitted only with the express written permission of Berry Appleman & Leiden LLP. For inquiries please contact copyright@bal.com.
IMPACT – HIGH
What is the Brexit news? The Swiss Federal Council has approved a bilateral Swiss-U.K. agreement that will administer the status of U.K. nationals in Switzerland and Swiss nationals in the U.K.
What does the news mean? The effective date of the agreement depends on the outcome of negotiations between the EU and the U.K.
Key points of the Swiss-U.K. agreement:
Background: While many EU member states are currently establishing unilateral measures to protect U.K. citizens’ rights under a no-deal Brexit, Switzerland must take a bilateral approach to its Brexit planning, as the country’s immigration regime does not fully fall under EU mobility regulations. Switzerland is not part of the EU but is a member of Schengen, a peculiarity which distinguishes Switzerland’s immigration regime from that of its European neighbors.
Switzerland has established various bilateral agreements that support free movement to and from the country. Currently, relations between the U.K. and Switzerland are governed by FMOPA. After Brexit, the U.K. will no longer be an EU member and the agreement will not cover U.K. citizens.
Analysis & Comments: The agreement, if ratified by both countries, will provide some certainty to employers as well as to U.K. and Swiss nationals residing in each other’s country. While some post-Brexit and post-transition procedures remain unclear, it is likely that employees will be able to continue working and residing in their respective host country based on their current status. Employers should ensure that sufficient preparation is afforded to those nationals who will require work and residence permit in a post-Brexit scenario.
Source: Deloitte LLP. Deloitte LLP is a limited liability partnership registered in England and Wales with registered number OC303675 and its registered office at 1 New Street Square, London EC4A 3HQ, United Kingdom.
U.S. Citizenship and Immigration Services (USCIS) processing delays have reached a “crisis” level, hurting the ability of U.S. companies to recruit and retain foreign workers, according to a recent analysis of USCIS data.
The American Immigration Lawyers Association (AILA) analyzed USCIS data for each of the past five fiscal years, finding that processing times have significantly increased. In a report released Jan. 30, AILA found:
AILA said adjudication delays have “undermined the ability of U.S. companies to hire and retain essential workers and fill critical workforce gaps.” A set of new Trump administration policies “act as bricks in the Trump administration’s ‘invisible wall’ curbing legal immigration in the United States,” AILA said. The organization recommended greater Congressional oversight of USCIS, increased transparency and urged the administration to reverse policies that are helping cause the delays, including USCIS’s rescission in 2017 of a policy of giving deference to prior determinations and a move in 2017 to a new in-person interview requirement for employment-based green card applications.
BAL Analysis: USCIS processing times grew significantly longer in the first two years of the Trump administration. BAL has also seen an increase in petition denials and requests for evidence. BAL continues to lobby on behalf of its clients for business-friendly immigration policies and is available to provide counsel on how best to plan for the possibility of processing delays and other challenges associated with new administration policies and procedures.
By David Berry and Eileen Lohmann
Law360 (February 5, 2019, 1:34 PM EST) ‒ While Washington continues to look for a long-term solution on the budget, it has already created a potential long-term problem on immigration.
On Jan. 31, 2019, the Trump administration issued a regulation to reform the H-1B lottery. Despite receiving hundreds of comments urging slower, more thoughtful action. This new rule will only make the challenge of regulating high-skilled immigration worse.
Here is the issue: American companies representing a wide range of industries rely on the H-1B visa to secure desperately needed talent. International students are frequently the most promising individuals studying in science, technology, engineering and math, or STEM, fields at U.S. universities, and they need visa sponsorship to work here. At a time when unemployment is low and key positions remain unfilled, a U.S. company that identifies a talented individual at a U.S. university, and has promised to pay the prevailing wage for the position, should be able to hire that person regardless of country of origin.
Only Congress can increase the number of H-1B visas, but U.S. Citizenship and Immigration Services has introduced changes to the visa program intended to reduce bureaucratic obstacles. Instead, the new regulation threatens the entire program’s integrity.
Because the H-1B program is so important to the U.S. economy, the government has built in multiple safeguards to protect it from fraud and abuse. A company seeking to hire an H-1B professional must make attestations under oath to the U.S. Departments of Labor and Homeland Security about the intended job location, salary, position and the employee’s qualifications. Wages must be prevailing to the local labor market. And employers must provide notice to U.S. workers before filing H-1B petitions. Compliance is assured by frequent government visits to confirm that employees are doing what the employer said they would be doing, and that they are paid the proper wage. The government prosecutes companies for misrepresentations and violations.
Despite the administrative hurdles a company must clear to apply for an H-1B visa, USCIS receives upwards of 200,000 applications each year for 85,000 total visas. To manage the outsized demand, USCIS conducts a random lottery, accepts about 85,000 applications and returns the rest.
The government proposed to reform the lottery process to achieve important goals that companies share: reducing costs for employers, alleviating administrative burdens on USCIS, and bringing the process into the 21st century. The regulation creates a new method of allocating the limited supply of H-1B visas that sounds effective in theory: companies submit online “registrations” containing basic information about the company and each person they seek to sponsor. Then the government selects 85,000 registrations, enabling those companies to file complete applications for each “winner” of the registration lottery.
Good idea, yes. But terrible execution. The regulation changes how the agency distributes visas without putting up a single safeguard to prevent bad actors from manipulating the system. Existing controls would no longer be effective because employers could game the new online lottery before those controls kick in. USCIS even mentioned in its proposal the risk of companies “flooding the system with non-meritorious registrations,” but acknowledged that it does not have a solution.
The community that this rule would affect voiced this concern during the comment period and resoundingly urged the agency to wait to make changes until it is confident it can protect the H-1B program’s integrity. Microsoft Corporation wrote, “One of the primary concerns with the proposed rule’s registration process is the ease with which unscrupulous users would be able to inflate artificially their H-1B lottery selection outcomes by ‘flooding the system’ with as many registrations as possible. The shift of H-1B lottery outcomes would reward — and potentially even incentivize — bad behavior, while suppressing legitimate successful outcomes for good faith users of the system.” The U.S. Small Business Administration expressed the same worry, noting that “[t]his increase of registrations would ‘flood’ the registration pool and it more difficult for small businesses to obtain vital H-1B workers.”
Our firm works with hundreds of companies in addressing employment shortages and securing authorization for exceptional talent to work in the United States. We and our clients, along with all Americans, welcome the government’s efforts to modernize the lottery process and thereby reduce the burdens of administering and participating in the H-1B program. The system can be improved in a thoughtful way that preserves the integrity of this vital program. However, the government’s attempt at reform creates a greater problem than it aimed to solve.
To read the full, original article on Law360’s website, please click here.
David Berry is a founding partner and Eileen Lohmann is an associate at Berry Appleman & Leiden LLP.
The opinions expressed are those of the author(s) and do not necessarily reflect the views of the firm, its clients, or Portfolio Media Inc., or any of its or their respective affiliates. This article is for general information purposes and is not intended to be and should not be taken as legal advice.