Trump administration overhaul of H-1B visa program challenged in court2 min read . Updated: 17 Oct 2020, 08:28 PM IST
- New rule targeted by tech firms requires much higher wages for foreign professionals
WASHINGTON—A group of information technology companies filed a lawsuit on Friday evening challenging a Trump administration rule raising the salaries that employers must pay to their foreign workers on H-1B visas, aimed at tightening eligibility for the visas.
The Trump administration rolled out its long-anticipated overhaul of the H-1B visa program for high-skilled workers last week, a program highly valued by U.S. high-tech firms and other employers.
One piece of that revamp issued by the Department of Labor took effect last Thursday, bypassing the customary public-comment period. The department’s rule significantly raises the minimum salaries companies are required to pay their H-1B employees.
The suit by ITServe Alliance, a trade group representing information companies, was filed against the department in the U.S. District Court in New Jersey.
“Without providing prior notice and without affording Plaintiffs or the general public an opportunity to comment, the Department of Labor dramatically altered the manner in which it calculates prevailing wage rates for the H-1B program," the suit states.
The suit argues that the Trump administration cut corners by issuing the rule on an emergency basis, rather than conducting a full analysis of its impact on current visa holders and the economy, and incorporating potential changes based on public feedback.
The Labor Department didn’t immediately respond to a request for comment.
Separate lawsuits are expected as soon as next week against another set of rules, issued by the Department of Homeland Security. Those rules narrow the eligibility to qualify for an H-1B visa and shorten its duration for certain contract workers. That rule is set to take effect in December.
Under the Labor Department’s new wage requirements, which rely on surveys of wages across profession and location, companies would be required to pay entry-level workers at the 45th percentile, compared with the current obligation they be paid at least at the 17th percentile. Top-level employees, who are currently required to receive salaries at the 67th percentile, would need to be paid at the 95th.
An entry-level electrical engineer in San Jose, Calif., for example, would be paid at least $127,042, compared with $88,712 before the new rule took effect, according to Labor Department data.
The new rule has likely only affected a small subset of H-1B holders so far—only those who are in the early stages of filing renewal applications. Should it remain in effect, though, it could have an outsize impact on smaller firms such as tech start-ups that have limited cash to pay the higher mandated wages.