Hiring H-1B Visa Holders: Navigating Muddied Waters 10 Feb 2017

Much noise has been made over President Trump’s immigration order, a ban that includes people who enter as employees under the H-1B Visa program. A federal appellate court just extended the lower federal court’s temporary stay of the order, and every U.S. business affected is watching closely as the case heads to the Supreme Court.

Major Issue for Employers Who Hire Foreign Talent

An amicus brief filed in the case Feb. 6 by 127 tech companies says “The Order makes it more difficult and expensive for U.S. companies to recruit, hire, and retain some of the world’s best employees. It disrupts ongoing business operations. And it threat-ens companies’ ability to attract talent, business, and investment to the U.S.”

But the judicial action isn’t the only pending federal decision affecting employers thinking of hiring H-1B visa holders. Both of the other branches of government are debating further changes.

A new draft executive order is currently circulating, this time directly addressing H-1B visas. The draft mandates that the Secretary of Homeland Security produce a report within 90 days of reviewing regulations of all work visa programs, including the H-1B. It aims to find ways to make the program “more efficient” and ensure that it’s admitting “the best and the brightest,” according to the draft.

“Currently, the visas are doled out by a lottery, and the number of applicants continues to swell each year. In 2016, demand was three times more than the quota.” Source: CNN Money

Rep. Zoe Lofgren, who represents Silicon Valley, has just introduced a bill which more than doubles the minimum wage requirement for hiring H-1B visa holders from $60,000 to $130,000. Another provision would award visas to companies willing to pay the high-est salaries, creating a system for dependent companies that prioritizes a market-based quota of H1-B visas to companies willing to pay 200 percent of a fixed wage.

Think of it like an extra import tax on foreign workers to make them less attractive to employers. “Dependent companies” are those whose workforce is 15% or more foreign workers, many of whom are IT outsourcing firms supplying services to American companies.

Rep. Darrell Issa has a competing bill that would raise the salary requirement for the positions to $100,000 a year, up from $60,000, and eliminate a master’s degree exemption.

On the Senate side, there’s another measure aimed at creating a “preference system” so that foreign students educated in the U.S. get priority on visas.

Many Policy Issues at Play

There is some resentment from U.S. workers who say that these H-1B visa holders unfairly compete for the same jobs. Diversity proponents charge that tech firms reflexively look to hire foreigners, and overlook a growing domestic pipeline of women and people of color who are developing programming skills.

All of these measures have the potential to be highly disruptive to what is a natural part of the recruitment process for the tech industry, universities, hospitals and biotech – a process that begins on April 1, opening day for H-1B visa applications.

According to December 2015 projections by the US Labor Department, employment of computer and information technology occupations will grow 12 percent from 2014 to 2024. Since there is a shortage of native STEM skill experts, as many 2.4 million STEM jobs in the US would not be filled by 2018.

All of these measures have the potential to be highly disruptive to the recruitment and employee hiring process for the tech industry, universities, hospitals and biotech – and time is short. That process begins on April 1, the day applications for H-1B visas are opened.