H 1b Quota Effects on the Legal Field

H-1B Visa

In recent years the debate over immigration has taken center stage. In particular, the federal government's H1B visa program has become a particularly contentious issue.

Those who oppose the program or the size of the program believe that it takes jobs away from American citizens in fields that have traditionally high pay such as technology. Those who are proponents of the program believe that it is beneficial because it provides diversity in the workplace, and it assist people who may not be able to make as much money in their home countries. The purpose of this discussion is to analyze the policy implications in the legal field of the H-1B visa problem and solutions, paying close attention to Bill Gates proposal for how to remedy the H-1B shortage

H-1B Visa

The H-1B visa is a component of the Immigration and Nationality Act (INA) and was originally created by the Immigration Act of 1990. According to an article entitled "H-1B VISA PROGRAM Labor Could Improve Its Oversight and Increase Information Sharing with Homeland Security" there have been a number of changes related the number of H-1b visas that are granted annually. The article explains,

Congress passed the American Competitiveness and Workforce Improvement Act of 1998 (ACWIA), which increased the limit to 115,000 for fiscal years 1999 and 2000. In 2000, Congress passed the American Competitiveness in the Twenty-First Century Act, which raised the limit to 195,000 for fiscal year 2001 and maintained that level through fiscal years 2002 and 2003. The number of H-1B visas reverted back to 65,000 thereafter. An H-1B visa generally is valid for 3 years of employment and is renewable for an additional 3 years ("H-1B VISA PROGRAM Labor Could Improve Its Oversight and Increase Information Sharing with Homeland Security")."

The Sections of the act associated with H1B visas are 101(a)(15)(H)(i)(b) and (b1); 212(n) and (t), and 214(g) of the Immigration and Nationality Act (INA) as amended (8 USC 1101(a)(15)(H)(i)(b) and (b1), 1182(n) and (t), 1184(g); 20 CFR Part 655 Subparts H. And I,) ("Employment Law Guide").

The Act quantifies the H-1B program as a plan of action that allows employers who want to hire nonimmigrant aliens to work in specialty occupations in addition to fashion models of "distinguished merit" ("Employment Law Guide"). Employers can issue H-1B visas to employees that meet these qualifications ("Employment Law Guide"). In addition to the H-1B visa the act also designates a H-1B1 visa that employers can give to nonimmigrant aliens from Singapore and Chile ("Employment Law Guide"). These individuals must meet the requirements as it pertains to specialty occupations ("Employment Law Guide").

Specialty occupations are defined as those occupations that require a bachelors degree ("Employment Law Guide"). Workers who get H-1B visas include teachers, engineers, and computer programmers. In order to gain access to H1-B visas for employees, employers must file a special form called the Labor Condition Application. In addition the employer must complete state department forms known as ETA 9035 or ETA 9035E ("Employment Law Guide"). In addition to these conditions, the employer has to make several promises as it pertains to the employee payment, working conditions and intent to hire. More specifically the employers must promise to do the following:

1. Compensate the nonimmigrant workers in a manner that is consistent with or equal to the local wage or the same as the wage of the employer ("Employment Law Guide"). Under certain conditions the employer must also pay for time that is not productive ("Employment Law Guide"). The employers must also offer those with H-1B visit's the same types of benefits given to American Workers ("Employment Law Guide").

This particular regulation is designed to ensure that workers with H-1B visas are treated fairly in the workplace. The federal government want to ensure that these workers are not exploited as a means to cheap labor. This also designed to protect that American workers from being overlooked for certain jobs because the compensation must be identical. Although this is a good regulation to have there are ways that employers have been able to curtail the implementation of some of these rules. This will be examined later on in the discussion.

2. Supply working conditions to those with H-1B visas that do not impact other employees that are employed in a similar capacity ("Employment Law Guide").

This is another rule that was designed to protect both the American workers and those workers participating in the H-1B program. Under this regulation, American workers are not to be inconvenienced by the addition of workers in the H-1B program. Therefore the conditions of those in the H-1B program must not disrupt the job duties of American employees.

3. Those holding H-1b visas cannot be employed in locations that have a strike or lockout as it pertains to occupational classification ("Employment Law Guide"). In addition the employer is obligated to inform the ETA if a strike or lockout is going to take place a specific location ("Employment Law Guide").

In an effort to protect all workers, those with H-1B visas cannot be sent to work in places where a strike or a lockout is occurring. The employer cannot create a scenario in which foreign workers take the place of American workers who have some type of grievance with their employer. This particular provision is designed to assist employers and striking workers in ensuring that grievances are handled in a timely manner and there are not outside influences that hamper the ability of employees or their unions in settling disputes.

4. Within a month of completing the Labor condition Application the employer must notify the bargaining representative that the organization wishes to hire H-1b employees ("Employment Law Guide"). If for some reason such a representative is unavailable the notification should be sent electronically or placed in the location for which the employer wishes to hire H-1b employees ("Employment Law Guide").

Applying for H-1B visa status is not something that can be done without notifying the proper authorities. One of the reasons that this must occur is because the government wants to ensure that the proper conditions are present and that the employer is not attempting to circumvent any laws or regulations associated with the program or other laws.

The article further explains that H-1B visas are capped at 65,000 during a fiscal year, subject to certain exceptions. H-1B1 visas are limited to 1,400 nationals of Chile and 5,400 nationals of Singapore. Additional rules apply to H-1B dependent employers and willful violators of the H-1B rules. These rules sunsetted for H-1B employment under LCAs filed after September 30, 2003 but were restored effective March 8, 2005 by the H-1B Visa Reform Act of 2004. An H-1B dependent employer is, roughly, one whose H-1B workers comprise 15% or more of the employer's total workforce. H-1B dependent employers who wish to hire only H-1B workers who are paid at least $60,000 per year or have a master's degree or higher in a specialty related to the employment can be exempted from these additional rules ("Employment Law Guide")."

In addition to the aforementioned regulations that govern the H-1B visa program, the program also has regulations that are designed to protect American workers from becoming displaced as a result of the hiring of H-1B visa employees ("Employment Law Guide"). According to the INA there are three main vehicles that the employer must employ to ensure American workers are recruited and not displaced. These vehicles are as follows.

1. During the 90 days prior to applying for H-1b visa status, the employer cannot terminate an American work with the same or similar job position ("Employment Law Guide"). This rule also applies to extending the H-1B visa for an employee ("Employment Law Guide").

This particular law is designed to ensure that American workers are not simply replaced by those workers participating in the H-1B visa program. It is designed to make certain that American workers are not displaced when employees participate in the H-1b program.

2. According to the rules and regulations presented by the LCA the company or firm hiring someone with an H-1B visa is not allowed to place the H-1b employee at the worksite of another ("Employment Law Guide"). However there is an exception to this rule. The exception asserts that if an employer makes a sincere attempt to ensure that the other company of firm has terminated or desires to terminate an American worker 90 days prior to or after placing an H-1B worker ("Employment Law Guide").

This particular aspect of the act guarantees that the employer applying for the H-1b status is the same employer that will be employing the H-1B worker. This is designed to assist the government in keeping track of H-1b workers. In addition the exception to the rule also has stipulations that are designed to ensure that the H-1B worker is needed.

3. The third and final regulation asserts that the employer must make a concerted effort to recruit an American worker for a job position before seeking an alien worker ("Employment Law Guide"). This effort must include the offering of compensation that is at least equal to the compensation offered to H-1B workers ("Employment Law Guide"). This particular provision also states that if there is an American worker who is better qualified or equally qualified, the job must go to the American worker ("Employment Law Guide").

Again this final regulation is designed to offer some protection to American Workers. The provision seeks to ensure that qualified American employees are given the same employment opportunities as alien workers. The law want to ensure that an alien workforce does not replace an American workforce.

Just as there are regulations associated with employers, the!-1B workers also have rights that must be considered and implemented. For instance, those working under an H-1B visa must be given a copy of the Labor Condition Application. In addition, the H-1b worker has a right to recive all of the aforementioned compensations such as equal pay, equal benefits and payment during non-productive time that occurs as a result of not having a permit or license ("Employment Law Guide").

The H-1B visa worker also has rights as it pertains to the breaching of the employment contract ("Employment Law Guide").

Namely if the worker decides to leave the job at a time that is earlier than the time stated in the contract, he or she does not have to pay a penalty ("Employment Law Guide"). However, the worker may be liable to award to employer liquid damages. These terms are made available to the worker in the contract according to individual state laws.

There are also certain right afforded to American workers as it relates to H-1B visas. According to the United States department of labor article

U.S. workers employed by an H-1B dependent or willful violator employer may not be laid off within 90 days before or after the employer files a USCIS petition to employ an H-1B worker in an essentially equivalent job. In addition, an H-1B dependent employer or willful violator must offer the j job to any U.S. worker who applies and is equally or better qualified for the job than the H-1B alien worker. The U.S. Department of Justice has the authority to investigate complaints of failure to hire qualified U.S. workers ("Employment Law Guide")."

It is evident that the provisions of the H1B visa program established in the INA has rules designed to protect employers, American workers and alien workers. Although these provisions seem to be extremely strict there has been a great deal of debate over the proper enforcement of these rules in recent years.

In addition there has been controversy concerning whether or not H-1B visas are still fulfilling the original intent of the program. These issues will be discussed over the next few paragraphs.

The original intent of the H-1B visa program

The original intent of the H-1B visa program was to provide American employers with the means to hire temporary workers in areas associated with specialty occupations ("H-1B visa Program"). The program was also originally designed to host those individuals with highly specialized knowledge associated with demanding theoretical and practical applications ("H-1B visa Program").

In addition, according to Sherk (2008) the original intent of the H-1B visa program was to avoid a shortage of skilled workers which could damage the economy.

Although the original intent of the program was to help and not harm, the many loopholes in the program have caused a backlash because many believe American workers are being harmed as a result of these loopholes.

In many cases these loopholes lead to fraud. According to an article entitled "How Companies Abuse Work Visas" although the original design of the H-1B visa program was to prevent a shortage of workers, companies have used the program to lower wages on all employees (Herbst, 2008). The article explains that a recent study of 246 H-1B applications conducted by U.S. Citizenship & Immigration Services, discovered that around 13% of all of the applications for H-1B visas are fraudulent (Herbst, 2008).

In addition the study concluded that around 7% of the applications had technical violations (Herbst, 2008). In fact the study found that in one instance a business requested an H-1B visa for a person who would be working as a launderer, this person was referred to as a "business development analyst" on the application because H-1B visas require that the workers occupation is specialized and that they have a bachelors degree (Herbst, 2008).

Among the most common violations found in the study were a lack of proper academic credentials and lack of proper experience (Herbst, 2008). In addition some of the locations listed on the application were inaccurate and some workers receiving H-1B visas were not compensated in a manner consistent with the local wage.

Although these violations may seem insignificant, they can create a serious problem for American workers who want to receive pay commensurate with their talent (Herbst, 2008).

Interestingly enough the article reports that many businesses that do follow the rules are the chief proponents of fixing loopholes and ensuring that the program is strictly followed (Herbst, 2008). These companies recognize the benefits associated with the program when it is lawfully used and they do not want it to end just because some businesses violate the law or take advantage of loopholes (Herbst, 2008).

Many have concluded that this report simply confirms what many have been asserting all along concerning the use of H-1B visas. The assertion is that many companies in America use the program to obtain cheap workers from foreign countries and in doing so the pay and benefits of American workers is decreased considerably (Herbst, 2008). In fact the study insists that the entire program is in need of an overhaul as it is filled with misuse and abuse (Herbst, 2008).

It is obvious that some companies violate the laws and take advantage of the loopholes established by the Immigration and Nationality Act (INA) and the Immigration Act of 1990. In doing so the original intent of the H-1B visa program is lost. Not only is the original intent lost but American workers are also hurt because their wages and benefits decrease. The decrease in benefits and wages are not only seen at the individual companies but also in a broader context throughout entire industries. This is detrimental to the American worker because the cost of education and living cost are not decreasing they are increasing.

As such, individuals need to make more money not less money. When employees use the H-1B visa program to reduce their own costs therefore increasing profit, individual employees pay the ultimate price. These employees have to work more hours which can decrease productivity. In addition, in some cases American employees have to find a new line of work so that they can meet their financial obligations. This in turn decreases the number of skilled American workers, which is almost the opposite of the original intent of the H-1B visa program when it began.

So then, how can American businesses ensure that they have access to skilled workers, while still ensuring that wages and benefits will not decrease for American Workers. According to Bill Gates, there is a real shortage of both engineers and scientists and this shortage is caused in part by immigration policies (Gates, 2008).

Gates explains that the need for scientists and engineers is an important as the need for raw materials.

Gates also asserts that the global economy is dependent upon highly sophisticated innovations that require expertise that only scientists and engineers can provide. Gates explains that American businesses must attract the best talent they possibly can in order to compete on a global scale. He concludes that America's immigration policy is a major reason why some businesses in America are having difficulty attracting highly skilled workers in the areas of science and engineering. Gates further explains that Congress's failure to pass high-skilled immigration reform has exacerbated an already grave situation. For example, the current base cap of 65,000 H-1B visas is arbitrarily set and bears no relation to the U.S. economy's demand for skilled professionals. For fiscal year 2007, the supply ran out more than four months before that fiscal year even began. For fiscal year 2008, the supply of H- 1B visas ran out on April 2, 2007, the first day that petitions could be filed and 6 months before the visas would even be issued. Nearly half of those who sought a visa on that day did not receive one (Gates, 2008 page13)."

According to Bill Gates the aforementioned situation has resulted in a shortage in the amount of STEM graduates entering the American workforce from other countries. Gates also asserts that the cap is a difficult hurdle for some businesses to overcome because the applications are all received at the same time, in the beginning of the year. This makes it difficult for foreign students who receive their degrees in May because by that time, the cap has likely been filled. These graduates and the companies that need them have to wait until the next year to apply for H-1B visas for these particular students.

This scenario causes U.S. firms to seek workers a in foreign countries and have them work in their countries, performing jobs that could have been performed in America. For instance, Gates explains that nearly one third of the foreign board candidates the company wanted to hire were not able to come into the country on H-1B visas because the cap had been reached.

Gates argues fervently for the increase in the number of H-1B visas that are available to companies each year. He also asserts that increasing the number of foreign born individuals who are allowed to work in America, would also increase the number of American citizen who have jobs (Gates, 2008). He insists that in his own company, Microsoft, every 1 H-1B worker translates to four American workers that are hired. Gates argues that this addition of American workers as a result of hiring H-1B workers is a wide spread phenomenon, not only in his industry but industries across the board (Gates, 2008).

Gates argues further that it is important to have foreign born employees working in American companies because of the diversity and the perspective that they provide. He points to a survey conducted by Duke University that found about 25% of all the new companies in America during the ten-year time period of 1995-2005 had a founder who was not born in America (Gates, 2008). In the year 2005 these firms had $52 billion in sales and provided jobs for nearly half a million workers.

Bill Gates also explains the dire need to adjust the H-1B visa laws. He explains that over the next few decades, America will have a difficult time competing with the rest of the world if it does not permit more foreign talent to enter positions at American companies. Not only is America's policies inconsistent with the condition of the global economy, but other countries are beginning to recognize the need to recruit talent and are attracting the individuals that American companies need to compete on a global scale.

To address the problem, Gates proposes three strategies. The first strategy is to make American universities and colleges more attractive to foreign students. He also asserts that American laws should be more liberal in allowing foreign students to remain in America after receiving a degree. Gates posits that one way to accomplish this is through an extension of a strategy known as Optional Practical Training (OPT). The OPT is a limited amount of time that foreign students are allowed to work in conjunction with earning a degree (Gates, 2008).