H-1B, L-1 Visa Program Overhaul Proposed by Democratic Lawmakers

A proposal by three U.S. senators would stiffen many of the regulations surrounding H-1B and L-1 visas, including an increase in U.S. worker displacement protection and restricting the number of H-1B and L-1 employees that certain U.S. companies could hire. While many companies in Silicon Valley have lobbied Congress to raise the cap on H-1B visa holders, many lawmakers have pushed back, arguing that the system is rifled with fraud issues. In 2008, a USCIS report found the H-1B program had a more than 20 percent violation rate.

A new proposal by U.S. Sens. Harry Reid, D-Nev., Charles Schumer, D-N.Y., and Bob Menendez, D-N.J., would see a stiffening of the regulations surrounding H-1B and L-1 visas, including restricting the number of H-1B and L-1 employees that U.S. companies of a certain size could hire. While the plan currently circulating on Capitol Hill is more informal than an actual piece of legislation, its provisions suggest the ways in which a final immigration bill could affect future hiring of foreign tech workers.

The H-1B visa program allows U.S. companies and universities to employ foreign guest workers in jobs that fall under the category of "specialty occupation," as defined by the USCIS (U.S. Citizenship and Immigration Services). Previous legislation introduced by federal legislators has proposed that employers make a "good faith" effort to hire American workers before considering H-1B workers.

The wide-ranging proposal advocates a number of alterations to immigration policy, including the introduction of three-year provisional visas (H-2Cs) for "non-seasonal, non-agricultural workers to enter the United States." Those visas would give workers the ability to change employers after one year, and allow them to "earn lawful permanent residence if they meet sufficient integration metrics to demonstrate that they have successfully come part of the American economy and society."

As a caveat, however, employers would not be able to hire an H-2C worker "before an employer takes affirmative steps to recruit and hire American workers, including through America's Job Bank and recruiting through State Workforce Agencies."

The parts of the proposal dealing with H-1B and L-1 visas are considerably more detailed:

"This proposal also adds fraud and abuse protections for existing temporary high-skilled work visas," the document reads. "It will amend current law regarding H-1B employer application requirements to: (1) revise wage determination requirements; (2) require Internet posting and description of employment positions; (3) lengthen U.S. worker displacement protection: (4) apply certain requirements to all H-1B employers rather than only to H-1B dependent employers; (5) prohibit employer advertising that makes a position available only to, or gives priority to, H-1B [non-immigrants]; and (6) limit the number of H-1B and L-1 employees that an employer of 50 or more workers in the United States may hire."

In addition, the proposal authorizes the Department of Labor (DOL) to: "(1) investigate applications for fraud; and (2) conduct H-1B compliance audits. DOL will also be required to conduct annual audits of companies with large numbers of H-1B workers and initiate H-1B employer application investigations. Penalties for employers who violate the law will be increased."

The proposal's focus on L-1 visas includes a prohibition from employers "hiring an L-1 [non-immigrant] for more than one year who will: (1) serve in a capacity involving specialized knowledge; and (2) be stationed primarily at the worksite of an employer other than the petitioning employer."

Even as the United States continues to dig its way out from the wreckage of a multiyear global recession, the presence of H-1B and L-1 workers continues to be a point of contention for a number of critics within the tech industry, who see the visa program as riddled with problems and prone to loopholes that allow employers to import lower-wage technology workers under the guise of skill-set shortages.

According to an analysis of U.S. immigration data by the National Foundation for American Policy (NFAP), a nonprofit public policy group, H-1B visa holders made up 0.06 percent of the national labor force in fiscal 2009. During that same time period, the United States Citizenship and Immigration Services approved 85,133 H-1B visa petitions.

The NFAP used its analysis to argue for an increase in annual H-1B visas and green cards, arguing that current quotas-including a cap of 65,000 H-1B visas and 20,000 exemptions for foreign graduate students-do not present a threat to opportunities for American workers.

"Almost all companies that employ H-1B visa holders have a workforce with U.S. workers accounting for 85 percent to 99 percent," read the NFAP report. "The relatively few businesses with more than 15 percent of workers on H-1B visas are -H-1B dependent' and must adhere to a stricter set of labor rules."

The federal government has made some highly publicized moves to crack down on H-1B scams, including the 2009 arrests of 11 people in seven states for submitting false documents and statements in support of visa petitions. The Department of Justice also leveled a 10-count indictment against Vision Systems Group, a New Jersey IT services firm, arguing that the company abused the H-1B system to put foreign workers on non-pay status once entering the United States; that case came under fire earlier in 2010 from a judge who argued the search warrants were "over-inclusive."

Silicon Valley companies have been lobbying Congress to raise the H-1B cap, meeting resistance from legislators concerned over perceived fraud. In 2008, a USCIS report found the H-1B program had a more than 20 percent violation rate, including but not limited to forged documents, fraudulent degrees and workers not being paid the perceived wage.

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