The Scandal of H-1B Visas — The Outsourcing Of American Jobs To Foreign Workers — End The Cheap Labor Racket — Abolish H-1B Visas — Videos
The Pronk Pops Show Podcasts
Story 2: The Scandal of H-1B Visas — The Outsourcing Of American Jobs To Foreign Workers — End The Cheap Labor Racket — Abolish H-1B Visas — Videos
Obama Admin Gives Company H-1B Workers To Replace Its American Workers
ABC10: American Workers Hurt By H-1B Visa Program
U.S. Worker Replaced By Lower-Cost Foreign Worker Makes Impassioned Plea To Senators
Sessions Details Case Of American Tech Workers Being Forced To Train Their Guest-Worker Replacements
Professor Salzman Testifies At Hearing On Protecting High-Skilled American Workers
ITIF Debate: Is There a STEM Worker Shortage?
The issue of high skill immigration is receiving increased attention as Congress considers comprehensive immigration legislation. Underlying this issue is an ongoing debate surrounding the U.S. labor market for high-skill workers, including those in science, technology, engineering and math (STEM) fields. The key policy questions being discussed include: is there a shortage of STEM workers in the U.S. economy; is the U.S. education system producing enough STEM graduates with requisite STEM education; and does high-skill immigration negatively affect the domestic supply of STEM talent?
ITIF will host a lively debate on this critical policy issue. Robert Atkinson, President of ITIF, and Jonathan Rothwell, an Associate Fellow at the Brookings Institution, will argue that the United States does face a STEM worker shortage, which is hampering the development of the innovation economy, and high-skill immigration should be used as a tool to address the skills gap. Hal Salzman, Professor of Planning and Public Policy at Rutgers University and Ron Hira, Associate Professor of Public Policy at Rochester Institute of Technology, will counter that the country is not experiencing a STEM shortage, and increased immigration will simply exacerbate unemployment and hurt U.S. workers. The debate will be moderated by Kevin Finneran, editor of the National Academies’ Issues in Science and Technology.
Sen. Cruz Amendment to Immigration Legislation to Increase H-1B Visas
Sen Ted Cruz Wants to DOUBLE Immigration
Bjorn Billhardt testifies to Senate Judiciary Committee
Experts: Proposed Guest Worker Expansions Would Let Tech Companies Import 100% Of New Hires
Attorney For Displaced Tech Workers: H-1B Increase Would Put Countless More Americans Out Of Work
Professor Hira Testifies At Hearing On Protecting High-Skilled American Workers
Ron Hira – Domestic IT & BPO Sourcing Can Generate Good American Jobs: The Role for Policy
Ron Hira Associate Professor of Public Policy at Rochester Institute of Technology, Research Associate at Economic Policy Institute and co-author of the book, Outsourcing America, giving the opening keynote at Momentum 2013
MidPoint | Ron Hira discusses his column in The Hill calling the H-1B visa the “Outsourcing Visa.”
Ron Hira on H1B Immigration Visas Current Debate – Point of View
The Future of American Jobs – A Discussion about Outsourcing
Reality of H-1B
Bill Gates Asks Senate For Infinite Number Of H 1B Visas
Lou Dobbs on Post Docs & PhDs Being Paid Peanuts & Exploited Through H-1B
Outsourcing America – Sen Byron Jorgan
LOU DOBBS TONIGHT 04.05.07 – H1B Visa Abuse
H-1B Work Visas: Basic Requirements
Silenced workers who lost jobs to H-1B visa abuse (quietly) speak out
BY BYRON YORK
The Senate Judiciary Committee recently held a hearing into abuses of the H-1B skilled guest worker visa program. Lawmakers heard experts describe how the use of foreign workers has come to dominate the IT industry, with many tech giants using the program to fire well-paid current workers and replace them with workers from abroad at significantly lower pay.
“The current system to bring in high-skill guest workers … has become primarily a process for supplying lower-cost labor to the IT industry,” two experts who testified at the hearing, Howard University’s Ron Hira and Rutgers’ Hal Salzman, wrote recently. “Although a small number of workers and students are brought in as the ‘best and brightest,’ most high-skill guest workers are here to fill ordinary tech jobs at lower wages.”
Exhibit A in the abuse of H-1Bs was the case of Southern California Edison, which recently got rid of between 400 and 500 IT employees and replaced them with a smaller force of lower-paid workers brought in from overseas through the H-1B program. The original employees were making an average of about $110,000 a year, the committee heard; the replacements were brought to Southern California Edison by outsourcing firms that pay an average of between $65,000 and $75,000.
“Simply put, the H-1B program has become a cheap labor program,” Hira, author of the bookOutsourcing America, testified. “To add insult to injury, Southern California Edison forced its American workers to train their H-1B replacements as a condition of receiving their severance packages.”
It was a powerful presentation, especially in light of the fact that many Republicans and Democrats in Congress do not want to address abuses of the H-1B problem but rather want to greatly increase the number of H-1B visa workers allowed into the United States.
But one voice was missing from the hearing, and that was the voice of laid-off workers. That was no accident. In addition to losing their jobs and being forced to train their foreign replacements, many fired workers are required to sign non-disparagement agreements as a condition of their severance. They are workers with families and bills to pay, and they are told that if they do not agree to remain silent, they will be terminated with cause, meaning they will receive no severance pay or other benefits and will face an even tougher search for a new job and a continued career. So they remain silent.
A longtime feature of the Capitol Hill hearing into this or that unfair practice is to hear from the victims of this or that unfair practice. The IT industry has worked to make sure that does not happen in the case of H-1B visa abuse. Still, the Judiciary Committee managed to receive testimonials from four laid-off workers, three from Southern California Edison and one from another company. So to flesh out the H-1B story with the perspective of those who are actually paying the price when H-1B visas are used to displace American workers, here are their anonymous testimonials:
My former company, a large utility company, replaced 220 American IT workers with H-1Bs…we would have to train them in order to receive our severance packages. This was one of the most humiliating situations that I have ever been in as an IT professional.
The whole IT department was going through the same fate as myself. Those were the longest and hardest five months of my life. Not only did I lose a work family, but I lost my job and my self-esteem. We had constant emails sent by HR that we could not talk about this situation to anyone or make posts to social media. If we did, we would be fired immediately and not get our severance.
We had jobs and there was no shortage of skilled labor that would make it necessary to bring in H-1Bs. We were let go and replaced by foreign workers who certainly weren’t skilled to take our positions.
I am an IT professional and worked for Southern California Edison for over two decades. I was a loyal employee and always received outstanding reviews. A foreign worker with a H-1B visa recently replaced me.
I am the sole provider of my children. Due to a disability, finding employment at the same wage and with a work modification will be very difficult…It is an ominous possibility that in five years or less I may have no assets, suffer from severe pain and will need to go on full disability with a catastrophic decrease in income. The loss of my job may rob me of a secure retirement.
My layoff has made my children fearful of their future and the security of their home. If I stay in the IT field I run a high risk of again being replaced by a foreign worker.
It’s a farce teaching our kids STEM when the government is permitting U.S. companies to abuse the H-1B visa program, which allows foreigners to take these future jobs from them.
I voted for President Obama and was appalled that he implemented a rule change, which allows work permits to H-1B spouses. My future votes will only go to candidates that support reforms to the H-1B visa program that preserve the American worker.
I started working at Southern California Edison several decades ago. SCE was a company that many people started with at a young age, could work there through their lifetimes, and retire with a good pension and benefits. That was my plan. And I would have been able to do exactly that — until an executive announced a couple years ago that my department was going to be outsourced.
We were forced to train the less qualified foreign workers hired to take our jobs.
Over 400 hardworking, intelligent people have lost their jobs due to the H-1B visa program. Many of us, and countless more like us, face enormous hurdles to find new jobs — why would companies want to hire us when they can hire cheaper workers on the H-1B visa to do our jobs for us?
As longtime employees we loved the work we were doing and the people we were working with. We did a great job. Our work mattered. The work we performed was instrumental in building a world-class business unit.
Through no fault of my own my job was just given to someone else with a lot less experience, knowledge and skills, lowering my standard of living and raising theirs so Edison could save a few dollars and reward stockholders with a few more pennies on their dividends.
I and most of my co-workers are completely disgusted that Edison can fire us and replace us with foreign workers, abusing the H1-B program. We cannot understand how the CPUC (California Public Utilities Commission), Governor and Congress, President and media can all ignore this abuse and just pretend it doesn’t matter. It’s as if we no longer matter or have value as human beings or American citizens.
It’s certainly true that other workers in other industries have lost jobs because companies wanted to cut costs. Highly-paid middle-aged workers have been replaced by younger employees working for less. That can be an unhappy fact of life in today’s economy. But in the case of H-1Bs, the federal government is expressly giving a special permit to foreign workers — actually, to large outsourcing firms that use H-1Bs to bring those workers to the U.S. — in order to displace American workers. And now many lawmakers in both parties — their task made simpler by the enforced silence of fired and angry workers — want even more H-1Bs. Is that something the government should do?
As tech giant calls for more foreign workers, Senate hears of displaced Americans
Eric Schmidt, CEO of Google, believes passionately that the United States needs more skilled foreign workers. He has long advocated increasing the number of so-called H-1B visas, which allow those workers to come to the U.S. for several years and, in many cases, work for lower wages than current employees. Schmidt is frustrated that Congress hasn’t done as he and other tech moguls want.
“In the long list of stupid policies of the U.S. government, I think our attitude toward immigration has got to be near the top,” Schmidt said during an appearance this week at the American Enterprise Institute in Washington. “Everyone actually agrees that there should be more H-1B visas in order to create more tech, more science, more analytical jobs. Everyone agrees, in both parties.”
The Eric Schmidt pleading for more foreign workers is the same Eric Schmidt who boasts of turning away thousands upon thousands of job seekers who apply for a few prized positions at Google. For example, at an appearance in Cleveland last October to promote his book, How Google Works, Schmidt explained that his company receives at least 1,000 applications for every job opening. “The good news is that we have computers to do the initial vetting,” Schmidt explained, according to an account in the Cleveland Plain Dealer.
Other tech leaders join Schmidt in calling for more foreign workers. Some companies are actually lobbying for more H-1Bs and laying off American staff at the same time. For example, last year Microsoft announced the layoff of 18,000 people at the very moment it was pushing Congress for more guest worker visas.
Given all that, there’s not quite the unanimous agreement on the need for more foreign workers that Schmidt claims. At a hearing this week before the Senate Judiciary Committee, a number of experts testified that the H-1B program, so sought-after by CEOs, is being abused to harm American workers.
Ron Hira, a Howard University professor and author of the book Outsourcing America, told the story of Southern California Edison, which recently got rid of 500 IT employees and replaced them with a smaller force of lower-paid workers brought in from overseas through the H-1B program. The original employees were making an average of about $110,000 a year, Hira testified; the replacements were brought to Southern California Edison by outsourcing firms that pay an average of between $65,000 and $75,000.
“To add insult to injury,” Hira said, “SCE forced its American workers to train their H-1B replacements as a condition of receiving their severance packages.”
Hira testified that such situations are not unusual. And on the larger issue of whether there is, as many tech executives claim, a critical shortage of labor in what are called the STEM fields — science, technology, engineering and math — another professor, Hal Salzman of Rutgers, testified that the shortage simply does not exist.
“The U.S. supply of top-performing graduates is large and far exceeds the hiring needs of the STEM industries, with only one of every two STEM graduates finding a STEM job,” Salzman testified. “The guest worker supply is very large [and] it is highly concentrated in the IT industry, leading to both stagnant wages and job insecurity.”
The hearing also featured Jay Palmer, a former Infosys project manager who blew the whistle on a case in which the big outsourcing firm paid $34 million in fines for worker visa violations. “I watched this on a daily basis,” Palmer told the Judiciary Committee. “I sat in the offices in meetings with companies that displaced American workers only because the Americans who had been there 15 or 20 years were being paid too much money.”
So not everyone agrees with Schmidt on the need for more H-1B workers. Certainly not the laid-off IT employees at Southern California Edison. And not the workers reportedly displaced by similar practices at Disney, Harley Davidson, Cargill, Pfizer and other companies. Who knows? Maybe some of those workers have been among the 1,000-plus who apply for every Google opening.
To hear the witnesses before the Senate Judiciary Committee tell it, Congress needs to act — not to increase the number of H-1Bs but to close the loopholes that allow them to be so badly abused at such a cost to American workers. “Congress and multiple administrations have inadvertently created a highly lucrative business model of bringing in cheaper H-1B workers to substitute for Americans,” Hira told the committee. “Simply put, the H-1B program has become a cheap labor program.”
||This article possibly contains original research. (November 2009)|
The H-1B is a non-immigrant visa in the United States under the Immigration and Nationality Act, section 101(a)(15)(H). It allows U.S. employers to temporarily employ foreign workers in specialty occupations. If a foreign worker in H-1B status quits or is dismissed from the sponsoring employer, the worker must either apply for and be granted a change of status to another non-immigrant status, find another employer (subject to application for adjustment of status and/or change of visa), or leave the U.S.
The regulations define a “specialty occupation” as requiring theoretical and practical application of a body of highly specialized knowledge in a field of human endeavor including but not limited to biotechnology, chemistry, architecture, engineering, mathematics, physical sciences, social sciences, medicine and health, education, law, accounting, business specialties, theology, and the arts, and requiring the attainment of a bachelor’s degree or its equivalent as a minimum (with the exception of fashion models, who must be “of distinguished merit and ability”). Likewise, the foreign worker must possess at least a bachelor’s degree or its equivalent and state licensure, if required to practice in that field. H-1B work-authorization is strictly limited to employment by the sponsoring employer.
Structure of the program
Duration of stay
The duration of stay is three years, extendable to six years. An exception to maximum length of stay applies in certain circumstances
- If a visa holder has submitted an I-140 immigrant petition or a labor certification prior to their fifth year anniversary of having the H-1B visa, they are entitled to renew their H-1B visa in one-year or three-year increments until a decision has been rendered on their application for permanent residence.
- If the visa holder has an approved I-140 immigrant petition, but is unable to initiate the final step of the green card process due to their priority date not being current, they may be entitled to a three-year extension of their H-1B visa. This exception originated with the American Competitiveness in the Twenty-First Century Act of 2000.
- The maximum duration of the H-1B visa is ten years for exceptional United States Department of Defense project related work.
H-1B holders who want to continue to work in the U.S. after six years, but who have not obtained permanent residency status, must remain outside of the U.S. for one year before reapplying for another H-1B visa. Despite a limit on length of stay, no requirement exists that the individual remain for any period in the job the visa was originally issued for. This is known as H-1B portability or transfer, provided the new employer sponsors another H-1B visa, which may or may not be subjected to the quota. Under current law, H-1B visa has no stipulated grace period in the event the employer-employee relationship ceases to exist.
Congressional yearly numerical cap and exemptions
The current law limits to 65,000 the number of foreign nationals who may be issued a visa or otherwise provided H-1B status each fiscal year (FY). Laws exempt up to 20,000 foreign nationals holding a master’s or higher degree from U.S. universities from the cap on H-1B visas. In addition, excluded from the ceiling are all H-1B non-immigrants who work at (but not necessarily for) universities, non-profit research facilities associated with universities, and government research facilities. Universities can employ an unlimited number of foreign workers as cap-exempt. This also means that contractors working at but not directly employed by the institutions may be exempt from the cap as well. Free Trade Agreements carve out 1,400 H-1B1 visas for Chilean nationals and 5,400 H-1B1 visas for Singapore nationals. However, if these reserved visas are not used, then they are made available in the next fiscal year to applicants from other countries. Due to these unlimited exemptions and roll-overs, the number of H-1B visas issued each year is significantly more than the 65,000 cap, with 117,828 having been issued in FY2010, 129,552 in FY2011, and 135,991 in FY2012.
The United States Citizenship and Immigration Services starts accepting applications on the first business day of April for visas that count against the fiscal year starting in October. For instance, H-1B visa applications that count against the FY 2013 cap could be submitted starting from Monday, 2012 April 2. USCIS accepts H-1B visa applications no more than 6 months in advance of the requested start date. Beneficiaries not subject to the annual cap are those who currently hold cap-subject H-1B status or have heldcap-subject H-1B status at some point in the past six years.
Tax status of H-1B workers
The taxation of income for H-1B employees depends on whether they are categorized as either non-resident aliens or resident aliens for tax purposes. A non-resident alien for tax purposes is only taxed on income from the United States, while a resident alien for tax purposes is taxed on all income, including income from outside the US.
The classification is determined based on the “substantial presence test“: If the substantial presence test indicates that the H-1B visa holder is a resident, then income taxation is like any other U.S. person and may be filed using Form 1040 and the necessary schedules; otherwise, the visa-holder must file as a non-resident alien using tax form 1040NR or 1040NR-EZ; he or she may claim benefit from tax treaties if they exist between the United States and the visa holder’s country of citizenship.
Persons in their first year in the U.S. may choose to be considered a resident for taxation purposes for the entire year, and must pay taxes on their worldwide income for that year. This “First Year Choice” is described in IRS Publication 519 and can only be made once in a person’s lifetime. A spouse, regardless of visa status, must include a valid Individual Taxpayer Identification Number (ITIN) or Social Security number (SSN) on a joint tax return with the H-1B holder.
Tax filing rules for H-1B holders may be complex, depending on the individual situation. Besides consulting a professional tax preparer knowledgeable about the rules for foreigners, the IRS Publication 519, U.S. Tax Guide for Aliens, may be consulted. Apart from state and federal taxes, H-1B visa holders pay Medicare and Social Security taxes, and are eligible for Social Security benefits.
H-1B and legal immigration
Even though the H-1B visa is a non-immigrant visa, it is one of the few visa categories recognized as dual intent, meaning an H-1B holder can have legal immigration intent (apply for and obtain the green card) while still a holder of the visa. In the past the employment-based green card process used to take only a few years, less than the duration of the H-1B visa itself. However, in recent times the legal employment-based immigration process has backlogged and retrogressed to the extent that it now takes many years for guest-work visa holders from certain countries to obtain green cards. Since the duration of the H-1B visa hasn’t changed, this has meant that many more H-1B visa holders must renew their visas in one or three-year increments for continued legal status while their green card application is in process.
Dependents of H-1B visa holders
H-1B visa holders can bring immediate family members (spouse and children under 21) to the U.S. under the H4 Visa category as dependents. An H4 Visa holder may remain in the U.S. as long as the H-1B visa holder retains legal status. An H4 visa holder is not eligible to work or get a Social Security number (SSN). However, a DHS ruling made on Feb 24, 2015 provides certain H4 visa holders with eligibility to work, starting May 26, 2015. An H4 Visa holder may attend school, get a driver’s license, and open a bank account in the U.S. To claim a dependent on a tax return or file a joint tax return, the dependent must obtain an Individual Tax Identification Number (ITIN), which is only used for tax filing purposes.
When an H-1B worker goes outside of U.S. for vacation, he or she has to get the visa stamped on his passport unless he has already done so for re-entry in the United States. The interview is taken in U.S. Embassy by a visa officer. In some cases, H-1B workers can be required to undergo “administrative processing”, involving extra, lengthy background checks. Under current rules, these checks are supposed to take ten days or less, but in some cases, have lasted years.
Evolution of the program
Changes in the cap, number of applications received, and numbers of applications approved vs. visas issued
During the early 1990s, the cap was rarely reached. By the mid-1990s, however, the allocation tended fill each year on a first come, first served basis, resulting in frequent denials or delays of H-1Bs because the annual cap had been reached. In 1998, the cap increased to 115,000.
American Competitiveness in the Twenty-First Century Act of 2000 (Hatch-Abraham-Gramm; PL106-313 sections102 and 103; 114 Stat 1251; enacted 2000-10-03; signed by Bill Clinton 2000-10-17) granted government functionaries amnesty for over-shooting the H-1B limit by 22,500 in FY1999 and by about 30,000 in FY2000; temporarily increased H-1B “cap”/”limit” to 195K for FY2001 through FY2003; exempted all individuals being hired by institutions of higher education, as well as non-profit and government-research organizations, from the cap, and § 105, 114 Stat. 1253 permitted portability, i.e. employer/sponsor change.
The H-1B Visa Reform Act of 2004 mandated that, “…the first 20,000 H-1B petitions filed on behalf of aliens with U.S.-earned masters’ or higher degrees will be exempt from any fiscal year cap…” Additionally, universities, nonprofit research organizations affiliated with universities, and governmental research organizations are exempt from the H-1B cap. For all other new H-1B applicants, the congressionally mandated H-1B visa cap is 65,000 annually.
For FY2007, with applications accepted from 2006 April 1, the entire quota of visas for the year was exhausted within a span of 2 months on May 26, well before the beginning of the financial year concerned. The additional 20,000 Advanced Degree H-1B visas were exhausted on July 26.
For FY2008, the entire quota was exhausted before the end of the first day that applications were accepted, April 2. Under USCIS rules, the 123,480 petitions received on April 2 and April 3 that were subject to the cap were pooled, and then 65,000 of these were selected at random for further processing. The additional 20,000 Advanced Degree H-1B visas for FY2008 was exhausted on April 30.
For FY2009, USCIS announced on 2008 April 8, that the entire quota for visas for the year had been reached, for both 20,000 Advanced and the 65,000 quota. USCIS would complete initial data entry for all filing received during 2008 April 1 to April 7, before running the lottery, while 86,300 new visas were approved.
For FY2010, USCIS announced on 2009 December 21, that enough petitions were received to reach that year’s cap.
For FY2011, USCIS announced on 2011 January 27, that enough petitions were received to reach that year’s cap on January 26.
For FY2015, USCIS announced on 2014 April 10 that received about 172,500 H-1B petitions during the filing period which began April 1, including petitions filed for the advanced degree exemption.
Numbers of applications approved
The applications received are evaluated by USCIS, and some subset are approved each year. It is possible for an individual to file multiple applications, for multiple job opportunities with a single employer/sponsor or with multiple employer/sponsors. It is possible for an individual applicant to have multiple applications approved and to be able to choose which one to take.
In its annual report on H-1B visas, released in 2006 November, USCIS stated that it approved 130,497 H-1B visa applications in FY2004 (while 138,965 new visas were issued through consular offices) and 116,927 in FY2005 (while 124,099 new visas were issued via consular offices).
In FY2008, a total of 276,252 visa applications (109,335 initial, 166,917 renewals and extensions) were approved, and 130,183 new initial visas were issued through consular offices.
In FY2010, 192,990 new visas were approved, with 76,627 being for initial employment and 116,363 being for continuing employment. 117,828 new visas were issued through consular offices
In FY2011, 269,653 new visas were approved, with 106,445 being for initial employment and 163,208 being for continued employment. 129,552 new visas were issued through consular offices.
American Competitiveness in the Twenty-First Century Act of 2000
The American Competitiveness in the Twenty-First Century Act of 2000 (AC21) and the U.S. Department of Labor’s PERM system for labor certification erased most of the earlier claimed arguments for H-1Bs as indentured servants during the green card process. With PERM, labor certification processing time is now approximately 9 months (as of Mar 2010).
Because of AC21, the H-1B employee is free to change jobs if they have an I-485 application pending for six months and an approved I-140, and if the position they move to is substantially comparable to their current position. In some cases, if those labor certifications are withdrawn and replaced with PERM applications, processing times improve, but the person also loses their favorable priority date. In those cases, employers’ incentive to attempt to lock in H-1B employees to a job by offering a green card is reduced, because the employer bears the high legal costs and fees associated with labor certification and I-140 processing, but the H-1B employee is still free to change jobs.
However, many people are ineligible to file I-485 at the current time due to the widespread retrogression in priority dates. Thus, they may well still be stuck with their sponsoring employer for many years. There are also many old labor certification cases pending under pre-PERM rules.
Consolidated Natural Resources Act of 2008
The Consolidated Natural Resources Act of 2008, which, among other issues, federalizes immigration in the Commonwealth of the Northern Mariana Islands, stipulates that during a transition period, numerical limitations do not apply to otherwise qualified workers in the H visa category in the CNMI and Guam.
American Recovery and Reinvestment Act of 2009
On Feb. 17, 2009, President Obama signed into law the American Recovery and Reinvestment Act of 2009 (“stimulus bill”), Public Law 111-5. Section 1661 of the ARRA incorporates the Employ American Workers Act (EAWA) by Senators Sanders (I-Vt.) and Grassley (R-Iowa) to limit certain banks and other financial institutions from hiring H-1B workers unless they had offered positions to equally or better-qualified U.S. workers, and to prevent banks from hiring H-1B workers in occupations they had laid off U.S. workers from. These restrictions include:
- The employer must, prior to filing the H-1B petition, take good-faith steps to recruit U.S. workers for the position for which the H-1B worker is sought, offering a wage at least as high as what the law requires for the H-1B worker. The employer must also attest that, in connection with this recruitment, it has offered the job to any U.S. worker who applies who is equally or better qualified for the position.
- The employer must not have laid off, and will not lay off, any U.S. worker in a job essentially equivalent to the H-1B position in the area of intended employment of the H-1B worker within the period beginning 90 days prior to the filing of the H-1B petition and ending 90 days after its filing.
Changes in USCIS policy
After completing a policy review, the USCIS clarified that individuals who spent more than one year outside of U.S. and did not exhaust their entire six-year term can choose to be re-admitted for the “remainder” of initial six-year period without being subject to the H-1B cap.
After completing a policy review, the USCIS clarified that, “Any time spent in H-4 status will not count against the six-year maximum period of admission applicable to H-1B aliens.”
USCIS recently issued a memorandum dated 8 Jan 2010. The memorandum effectively states that there must be a clear “employee employer relationship” between the petitioner (employer) and the beneficiary (prospective visa holder). It simply outlines what the employer must do to be considered in compliance as well as putting forth the documentation requirements to back up the employer’s assertion that a valid relationship exists.
The memorandum gives three clear examples of what is considered a valid “employee employer relationship”:
- a fashion model
- a computer software engineer working off-site/on-site
- a company or a contractor which is working on a co-production product in collaboration with DOD
In the case of the software engineer, the petitioner (employer) must agree to do (some of) the following among others:
- Supervise the beneficiary on and off-site
- Maintain such supervision through calls, reports, or visits
- Have a “right” to control the work on a day-to-day basis if such control is required
- Provide tools for the job
- Hire, pay, and have the ability to fire the beneficiary
- Evaluate work products and perform progress/performance reviews
- Claim them for tax purposes
- Provide (some type of) employee benefits
- Use “proprietary information” to perform work
- Produce an end product related to the business
- Have an “ability to” control the manner and means in which the worker accomplishes tasks
It further states that “common law is flexible” in how to weigh these factors. Though this memorandum cites legal cases and provides examples, such a memorandum in itself is not law and future memoranda could change this.
Protections for U.S. workers
Labor Condition Application
The U.S. Department of Labor (DOL) is responsible for ensuring that foreign workers do not displace or adversely affect wages or working conditions of U.S. workers. For every H-1B petition filed with the USCIS, there must be included a Labor Condition Application (LCA) (not to be confused with the labor certification), certified by the U.S. Department of Labor. The LCA is designed to ensure that the wage offered to the non-immigrant worker meets or exceeds the “prevailing wage” in the area of employment. (“Immigration law has a number of highly technical terms that may not mean the same thing to the average reader.” last updated 2011 March 31, visited 2012 November 5) The LCA also contains an attestation section designed to prevent the program from being used to import foreign workers to break a strike or replace U.S. citizen workers.
While an employer is not required to advertise the position before hiring an H-1B non-immigrant pursuant to the H-1B visa approval, the employer must notify the employee representative about the Labor Condition Application (LCA)—or if there is no such representation, the employer must publish the LCA at the workplace and the employer’s office. Under the regulations, LCAs are a matter of public record. Corporations hiring H-1B workers are required to make these records available to any member of the public who requests to look at them. Copies of the relevant records are also available from various web sites, including the Department of Labor.
History of the Labor Condition Application form
The LCA must be filed electronically using Form ETA 9035E. Over the years, the complexity of the form increased from one page in 1997 to three pages in 2008, to five pages as of August 2012.
By signing the LCA, the employer attests that:
- The employer pays H-1B non-immigrants the same wage level paid to all other individuals with similar experience and qualifications for that specific employment, or the prevailing wage for the occupation in the area of employment, whichever is higher.
- The employment of H-1B non-immigrants does not adversely affect working conditions of workers similarly employed.
- On the date the application is signed and submitted, there is not a strike, lockout, or work stoppage in the course of a labor dispute in the occupation in which H-1B non-immigrants will be employed at the place of employment. If such a strike or lockout occurs after this application is submitted, the employer must notify ETA within three days, and the application is not used to support petition filings with INS for H-1B non-immigrants to work in the same occupation at the place of employment until ETA determines the strike or lockout is over.
- A copy of this application has been, or will be, provided to each H-1B non-immigrant employed pursuant to this application, and, as of the application date, notice of this application has been provided to workers employed in the occupation in which H-1B non-immigrants will be employed:
- Notice of this filing has been provided to bargaining representative of workers in the occupation in which H-1B non-immigrants will be employed; or
- There is no such bargaining representative; therefore, a notice of this filing has been posted and was, or will remain, posted for 10 days in at least two conspicuous locations where H-1B non-immigrants will be employed.
The law requires H-1B workers to be paid the higher of the prevailing wage for the same occupation and geographic location, or the same as the employer pays to similarly situated employees. Other factors, such as age and skill were not permitted to be taken into account for the prevailing wage. Congress changed the program in 2004 to require the Department of Labor to provide four skill-based prevailing wage levels for employers to use. This is the only prevailing wage mechanism the law permits that incorporates factors other than occupation and location.
The approval process for these applications are based on employer attestations and documentary evidence submitted. The employer is advised of their liability if they are replacing a U.S. worker.
Limits on employment
According to the USCIS, “H-1B nonimmigrants may only work for the petitioning U.S. employer and only in the H-1B activities described in the petition. The petitioning U.S. employer may place the H-1B worker on the worksite of another employer if all applicable rules (e.g., Department of Labor rules) are followed. Generally, a nonimmigrant employee may work for more than one employer at the same time. However, each employer must follow the process for initially applying for a nonimmigrant employee.”
H-1B fees earmarked for U.S. worker education and training
In 2007, the U.S. Department of Labor, Employment and Training Administration (ETA), reported on two programs, the High Growth Training Initiative and Workforce Innovation Regional Economic Development (WIRED), which have received or will receive $284 million and $260 million, respectively, from H-1B training fees to educate and train U.S. workers. According to the Seattle Times $1 billion from H1-B fees have been distributed by the Labor Department to further train the U.S. workforce since 2001.
Criticisms of the program
The H-1B program has caused a number of criticisms.
No labor shortages
Paul Donnelly, in a 2002 article in Computerworld, cited Milton Friedman as stating that the H-1B program acts as a subsidy for corporations. Others holding this view include Dr. Norman Matloff, who testified to the U.S. House Judiciary Committee Subcommittee on Immigration on the H-1B subject. Matloff’s paper for the University of Michigan Journal of Law Reform claims that there has been no shortage of qualified American citizens to fill American computer-related jobs, and that the data offered as evidence of American corporations needing H-1B visas to address labor shortages was erroneous. The United States General Accounting Office found in a report in 2000 that controls on the H-1B program lacked effectiveness. The GAO report’s recommendations were subsequently implemented.
High-tech companies often cite a tech-worker shortage when asking Congress to raise the annual cap on H-1B visas, and have succeeded in getting various exemptions passed. The American Immigration Lawyers Association (AILA), described the situation as a crisis, and the situation was reported on by the Wall Street Journal, BusinessWeek and Washington Post. Employers applied pressure on Congress. Microsoft chairman Bill Gates testified in 2007 on behalf of the expanded visa program on Capitol Hill, “warning of dangers to the U.S. economy if employers can’t import skilled workers to fill job gaps”. Congress considered a bill to address the claims of shortfall but in the end did not revise the program.
According to a study conducted by John Miano and the Center for Immigration Studies, there is no empirical data to support a claim of employee worker shortage. Citing studies from Duke, Alfred P. Sloan Foundation, Georgetown University and others, critics have also argued that in some years, the number of foreign programmers and engineers imported outnumbered the number of jobs created by the industry. Organizations have also posted hundreds of first hand accounts of H-1B Visa Harm reports directly from individuals negatively impacted by the program, many of whom are willing to speak with the media.
Studies carried out from the 1990s through 2011 by researchers from Columbia U, Computing Research Association (CRA), Duke U, Georgetown U, Harvard U, National Research Council of the NAS, RAND Corporation, Rochester Institute of Technology, Rutgers U, Alfred P. Sloan Foundation, Stanford U, SUNY Buffalo, UC Davis, UPenn Wharton School, Urban Institute, and U.S. Dept. of Education Office of Education Research & Improvement have reported that the U.S. has been producing sufficient numbers of able and willing STEM (Science, Technology, Engineering and Mathematics) workers, while several studies from Hal Salzman, B. Lindsay Lowell, Daniel Kuehn, Michael Teitelbaum and others have concluded that the U.S. has been employing only 30% to 50% of its newly degreed able and willing STEM workers to work in STEM fields. A 2012 IEEE announcement of a conference on STEM education funding and job markets stated “only about half of those with under-graduate STEM degrees actually work in the STEM-related fields after college, and after 10 years, only some 8% still do”.
Wage depression is a chronic complaint critics have about the H-1B program: some studies have found that H-1B workers are paid significantly less than U.S. workers. It is claimed that the H-1B program is primarily used as a source of cheap labor. A paper by George J. Borjas for the National Bureau of Economic Research found that “a 10 percent immigration-induced increase in the supply of doctorates lowers the wage of competing workers by about 3 to 4 percent.”
The Labor Condition Application (LCA) included in the H-1B petition is supposed to ensure that H-1B workers are paid the prevailing wage in the labor market, or the employer’s actual average wage (whichever is higher), but evidence exists that some employers do not abide by these provisions and avoid paying the actual prevailing wage despite stiff penalties for abusers.
Theoretically, the LCA process appears to offer protection to both U.S. and H-1B workers. However, according to the U.S. General Accounting Office, enforcement limitations and procedural problems render these protections ineffective. Ultimately, the employer, not the Department of Labor, determines what sources determine the prevailing wage for an offered position, and it may choose among a variety of competing surveys, including its own wage surveys, provided that such surveys follow certain defined rules and regulations.
The law specifically restricts the Department of Labor’s approval process of LCAs to checking for “completeness and obvious inaccuracies”. In FY 2005, only about 800 LCAs were rejected out of over 300,000 submitted. Hire Americans First has posted several hundred first hand accounts of individuals negatively impacted by the program, many of whom are willing to speak with the media.
DOL has split the prevailing wage into four levels, with Level One representing about the 17th percentile of wage average Americans earn. About 80 percent of LCAs are filed at this 17th percentile level. This four-level prevailing wage can be obtained from the DOL website, and is generally far lower than average wages.
The “prevailing wage” stipulation is allegedly vague and thus easy to manipulate, resulting in employers underpaying visa workers. According to Ron Hira, assistant professor of public policy at the Rochester Institute of Technology, the median wage in 2005 for new H-1B information technology (IT) was just $50,000, which is even lower than starting wages for IT graduates with a B.S. degree. The U.S. government OES office’s data indicates that 90 percent of H-1B IT wages were below the median U.S. wage for the same occupation.
In 2002, the U.S. government began an investigation into Sun Microsystems’ hiring practices after an ex-employee, Guy Santiglia, filed complaints with the U.S. Department of Justice and U.S. Department of Labor alleging that the Santa Clara firm discriminates against American citizens in favor of foreign workers on H-1B visas. Santiglia accused the company of bias against U.S. citizens when it laid off 3,900 workers in late 2001 and at the same time applied for thousands of visas. In 2002, about 5 percent of Sun’s 39,000 employees had temporary work visas, he said. In 2005, it was decided that Sun violated only minor requirements and that neither of these violations was substantial or willful. Thus, the judge only ordered Sun to change its posting practices.
Risks for employees
Historically, H-1B holders have sometimes been described as indentured servants, and while the comparison is no longer as compelling, it had more validity prior to the passage of American Competitiveness in the Twenty-First Century Act of 2000. Although immigration generally requires short- and long-term visitors to disavow any ambition to seek the green card (permanent residency), H-1B visa holders are an important exception, in that the H-1B is legally acknowledged as a possible step towards a green card under what is called the doctrine of dual intent.
H-1B visa holders may be sponsored for their green cards by their employers through an Application for Alien Labor Certification, filed with the U.S. Department of Labor. In the past, the sponsorship process has taken several years, and for much of that time the H-1B visa holder was unable to change jobs without losing their place in line for the green card. This created an element of enforced loyalty to an employer by an H-1B visa holder. Critics[who?] alleged that employers benefit from this enforced loyalty because it reduced the risk that the H-1B employee might leave the job and go work for a competitor, and that it put citizen workers at a disadvantage in the job market, since the employer has less assurance that the citizen will stay at the job for an extended period of time, especially if the work conditions are tough, wages are lower or the work is difficult or complex. It has been argued that this makes the H-1B program extremely attractive to employers, and that labor legislation in this regard has been influenced by corporations seeking and benefiting from such advantages.
Some recent news reports suggest that the recession that started in 2008 will exacerbate the H-1B visa situation, both for supporters of the program and for those who oppose it. The process to obtain the green card has become so long that during these recession years it has not been unusual that sponsoring companies fail and disappear, thus forcing the H-1B employee to find another sponsor, and lose their place in line for the green card. An H-1B employee could be just one month from obtaining their green card, but if the employee is laid off, he or she may have to leave the country, or go to the end of the line and start over the process to get the green card, and wait as much as 10 more years, depending on the nationality and visa category.
The American Competitiveness in the Twenty-First Century Act of 2000 provides some relief for people waiting for a long time for a green card, by allowing H-1B extensions past the normal 6 years, as well as by making it easier to change the sponsoring employer.
The Out-Sourcing/Off-Shoring Visa
In his floor statement on H-1B Visa Reform, Senator Dick Durbin stated “The H-1B job visa lasts for 3 years and can be renewed for 3 years. What happens to those workers after that? Well, they could stay. It is possible. But these new companies have a much better idea for making money. They send the engineers to America to fill spots–and get money to do it—and then after the 3 to 6 years, they bring them back to work for the companies that are competing with American companies. They call it their outsourcing visa. They are sending their talented engineers to learn how Americans do business and then bring them back and compete with those American companies.” Critics of H-1B use for outsourcing have also noted that more H-1B visas are granted to companies headquartered in India than companies headquartered in the United States.
Of all Computer Systems Analysts and programmers on H-1B visas in the U.S., 74 percent were from Asia. This large scale migration of Asian IT professionals to the United States has been cited as a central cause for the quick emergence of the offshore outsourcing industry.
In FY 2009, due to the worldwide recession, applications for H-1B visas by off-shore out-sourcing firms were significantly lower than in previous years, yet 110,367 H-1B visas were issued, and 117,409 were issued in FY2010.
Social Security and Medicare taxes
H-1B employees have to pay Social Security and Medicare taxes as part of their payroll. Like U.S. citizens, they are eligible to receive Social Security benefits even if they leave the United States, provided they have paid Social Security payroll taxes for at least 10 years. Further, the U.S. has bilateral agreements with several countries to ensure that the time paid into the U.S. Social Security system, even if it is less than 10 years, is taken into account in the foreign country’s comparable system and vice versa.
Departure Requirement on Job Loss
If an employer lays off an H-1B worker, the employer is required to pay for the laid-off worker’s transportation outside the United States.
If an H-1B worker is laid off for any reason, the H-1B program technically does not specify a time allowance or grace period to round up one’s affairs irrespective of how long the H-1B worker might have lived in the United States. To round up one’s affairs, filing an application to change to another non-immigrant status may therefore become a necessity.
If an H-1B worker is laid off and attempts to find a new H-1B employer to file a petition for him, the individual is considered out of status if there is even a one-day gap between the last day of employment and the date that the new H-1B petition is filed. While some attorneys claim that there is a grace period of 30 days, 60 days, or sometimes 10 days, that is not true according to the law. In practice, USCIS has accepted H-1B transfer applications even with a gap in employment up to 60 days, but that is by no means guaranteed.
Some of the confusion regarding the alleged grace period arose because there is a 10-day grace period for an H-1B worker to depart the United States at the end of his authorized period of stay (does not apply for laid-off workers). This grace period only applies if the worker works until the H-1B expiration date listed on his I-797 approval notice, or I-94 card. 8 CFR 214.2(h)(13)(i)(A).
American workers are ordered to train their foreign replacements
Although the alleged reason for the H-1B program is to fill jobs that Americans don’t want to work at, there have been cases where employers used the program to replace their American employees with H-1B employees, and in some of those cases, the American employees were even ordered to train their replacements.
The United States Citizenship and Immigration Services “H-1B Benefit Fraud & Compliance Assessment” of September 2008 concluded 21% of H-1B visas granted originate from fraudulent applications or applications with technical violations. Fraud was defined as a willful misrepresentation, falsification, or omission of a material fact. Technical violations, errors, omissions, and failures to comply that are not within the fraud definition were included in the 21% rate. Subsequently, USCIS has made procedural changes to reduce the number of fraud and technical violations on H-1B applications.
In 2009, federal authorities busted a nationwide H-1B Visa Scam.
In addition to H-1B visas, there are a variety of other visa categories that allow foreign workers to come into the U.S. to work for some period of time.
L-1 visas are issued to foreign employees of a corporation. Under recent rules, the foreign worker must have worked for the corporation for at least one year in the preceding three years prior to getting the visa. An L-1B visa is appropriate for non-immigrant workers who are being temporarily transferred to the United States based on their specialized knowledge of the company’s techniques and methodologies. An L-1A visa is for managers or executives who either manage people or an essential function of the company. There is no requirement to pay prevailing wages for the L-1 visa holders. For Canadian residents, a special L visa category is available.
TN-1 visas are part of the North American Free Trade Agreement (NAFTA), and are issued to Canadian and Mexican citizens. TN visas are only available to workers who fall into one of a pre-set list of occupations determined by the NAFTA treaty. There are specific eligibility requirements for the TN Visa.
H-1B1 visas are a sub-set of H-1B issued to residents of Chile and Singapore under the United States-Chile Free Trade Agreement of 2003; PL108-77 § 402(a)(2)(B), 117 Stat. 909, 940; S1416, HR2738; passed in House 2003-07-24 and the United States-Singapore Free Trade Agreement of 2003; PL108-78 § 402(2), 117 Stat. 948, 970-971; S1417, HR2739; passed in House 2003-07-24, passed in senate 2003-07-31, signed by executive (GWBush) 2003-05-06. According to USCIS, unused H-1B1 visas are added into the next year’s H-1B base quota of 58,200.
One recent trend in work visas is that various countries attempt to get special preference for their nationals as part of treaty negotiations. Another trend is for changes in immigration law to be embedded in large Authorization or Omnibus bills to avoid the controversy that might accompany a separate vote.
H-2B visa: The H-2B non-immigrant program permits employers to hire foreign workers to come to the U.S. and perform temporary nonagricultural work, which may be one-time, seasonal, peak load or intermittent. There is a 66,000 per year limit on the number of foreign workers who may receive H-2B status.
H-1B Applications Approved
|Year||No HS Diploma||Only HS Diploma||Less Than 1 year of College||1+ years of College||Equivalent of Associate’s||Total Less Than Equivalent of U.S. Bachelor’s|
H-1B visas issued per year
Top H-1B rankings
|School||H-1Bs Received 2006|
|New York City Public Schools||642|
|University of Michigan||437|
|University of Illinois at Chicago||434|
|University of Pennsylvania||432|
|Johns Hopkins University School of Medicine||432|
|University of Maryland||404|
|Washington University in St. Louis||278|
|University of Pittsburgh||275|
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