US President Donald Trump and members of Congress from both parties have vowed to overhaul the visa programmes used by corporations to bring overseas workers to the US. That’s left companies that rely on such workers and those that source them bracing for change.
A first step came at the end of March, when the US Citizenship and Immigration Services (USCIS) department issued guidelines making it harder for companies to bring foreign technology workers to the US using the H-1B visa programme.
What’s the H-1B programme do?
It allows companies to recruit 85,000 employees from abroad each year for specialty positions in fields including technology, science, medicine, architecture—even fashion modelling. It took less than a week for applicants to exhaust that allotment in 2016, and technology companies including Facebook Inc., Google Inc., Intel Corp. and Cisco Systems Inc. have sought to increase the number available. People from India receive more H-1B vis’s than any other nationality.
What changes were made?
For H-1B visas given out in the 2017 lottery beginning 3 April, the government now requires additional information for entry-level computer programmers, to prove the jobs are complicated and require advanced knowledge and experience. Computer programmers made up about 12% of all H-1B applications certified by the department of labour in 2015.
In March, the immigration department suspended a program that expedited visa processing for certain skilled workers who paid extra, which some analysts saw as a first step to dismantling the H-1B program altogether.
Which other programs are under scrutiny?
Apart from the best-known H-1B visa, companies use a variety of visas to bring in workers from abroad, including the B-1 for temporary business visitors and the L-1 for managers, executives and specialized workers of international companies.
Why does the US have these programmes?
They were designed to allow US companies to hire temporary workers from other countries when they couldn’t find qualified people domestically. These temporary visas were established under the Immigration and Nationality Act of 1952. The programs have morphed over the years, and many of the visas now go to companies that pay foreign workers less than their American counterparts would receive. The total number of visas issued for temporary employment-based admission to the US grew to more than 1 million in 2014 from just over 400,000 in 1994, according to the Congressional Research Service. Those numbers included some unskilled and low-skilled workers, plus accompanying family members.
Do the programmes need reform?
It’s pretty clear the H-1B program and others have been used in ways that contradict their original intent. There have been allegations of abuse and at least one big settlement: In 2013, a Bangalore-based outsourcing company, Infosys Ltd., agreed to pay a record fine of $34 million to settle US allegations that it sent employees to the US with B-1 visitor visas to sidestep the caps on H-1Bs.
What does Trump propose?
During his presidential campaign, he said the H-1B program is a “cheap labour program” that takes jobs from Americans. He hasn’t yet detailed his ideas as president, but based on a draft executive order, his administration may push companies to try hiring American workers before turning to foreign ones—a step that isn’t necessary now. He’s also asked that the programmes prioritize giving visas to the most highly paid workers from abroad.
Who gets priority now?
Currently, H-1B visas are allocated by random lottery, with no priority given to companies that pay workers more. The biggest recipients of the visas are outsourcing companies, including India’s Tata Consultancy Services Ltd., Wipro Ltd. and Infosys. They pay workers in the programme an average of about $65,000 a year, while Apple Inc., Google and Microsoft Corp. pay their H-1B employees more than $100,000.
Can Trump act on his own?
An executive order can begin the reform process, but Trump lacks the broad powers of Congress. For example, he can’t change the number of H-1B visas that are given out each year, but he probably can change the way they’re allocated. So he could order that priority be given to higher-paid workers.
What might Congress do?
Congress has tried many times in the past decade to change the work visa programmes, with limited effect. Bills offered in the House by two California lawmakers, Republican Darrell Issa and Democrat Zoe Lofgren, aim to do so by raising the wages for some H-1B workers.
In Lofgren’s proposal, companies that are the heaviest users of the programme would have to pay salaries of at least $130,000, up from the current $60,000, or attest that they are not displacing American workers and making a good faith effort to recruit US workers if they pay less than that.
The legislative push has spooked India’s tech companies, weighing on their stocks. There’s also a bipartisan proposal in the Senate, long pushed by Republican Chuck Grassley and Democrat Richard Durbin, that would forbid replacing US workers with H-1B hires and prioritize visa applications from people who earned degrees at American colleges.
Will Silicon Valley be hurt by the changes?
It depends on the details, of course, but the US tech industry may well come out on top. Because so many H-1B visas go to outsourcing firms, American employers like Apple, Google, Microsoft Corp. and Facebook haven’t been able to get as many as they would like. They could be benefit if outsourcers face more restrictions. Bloomberg