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Trump Administration Takes Aim at H-1Bs - April 6, 2017

Besides the wall, another immigration-related theme made a frequent appearance in the presidential campaign: the H-1B visa. This program allows foreign nationals with a bachelor’s degree or higher (or the equivalent in education and/or work experience) to perform “specialty occupations.” Specialty occupations are those requiring at least a bachelor’s degree in a particular field as the minimum qualification. This relatively small program has drawn out-sized attention over the years, but nothing like its recent fame.


Although most H-1B jobs are not unionized, unions successfully pushed for Department of Labor (DOL) involvement in the H-1B process. H-1B applications must meet prevailing wage rules and be posted at the worksite. The employer sponsoring the H-1B must attest that it is not using an H-1B worker to undercut wages or working conditions for U.S. workers and not breaking a strike or lockout or otherwise harming U.S. workers in the process.


Only 85,000 new H-1Bs are granted each fiscal year for most employers and most jobs (some notable exceptions apply, such as college and university jobs, and physicians serving in health care shortage areas, among others).  The 85,000 limitation is referred to as the “H-1B cap.”H-1B cap applications are filed the first five days in April for an October 1 start date.


Because of the shortage of H-1Bs, which jobs qualify for one is a point of contention between the U.S. Citizenship and Immigration Service (USCIS), which administers the H-1B program, and applicants (or really their lawyers). USCIS relies heavily on the DOL’s job descriptions published in the Occupational Outlook Handbook (OOH).  This publication is compiled for purposes of helping job seekers and students prepare for careers, and is not an up-to-the-minute source.  Other proof can be (and usually is) provided regarding the specialty nature of an H-1B occupation.  However, the OOH is given considerable weight.


In the presidential campaign, the H-1B program was, at times, vilified as taking U.S. jobs.  Particularly in IT, the fast pace of development has led to the growth of IT contractors, who place workers temporarily at companies undertaking IT development projects that do not justify permanent hires.  Contractors – many of whom are foreign-based – often employ H-1B workers. While a legal business, the model has drawn criticism in general and specific concern has been aimed at large contractors who use up a significant portion of the H-1B allotment each year. Various tweaks to the H-1B program have been made to address these concerns. Recent high-profile choices by a few large companies to contract out their IT work has caused renewed concern.


Although President Trump’s statements have varied regarding the program, many in his administration are long-time critics, including Attorney General Jeff Sessions.


On Monday, April 3, the first day H-1B cap filings were accepted, both USCIS and the Department of Justice (DOJ) made announcements signaling the direction this administration will take on this topic.


H-1B Computer Programmers:  A substantial change?


In a policy memo dated March 31, 2017 (issued April 3, 2017), USCIS discussed the standard for determining whether a computer programmer qualifies as an H-1B specialty occupation, causing concern about how the H-1B cap cases will be decided.


The memo (the “New Memo”) starts by rescinding another memo issued in 2000 regarding H-1Bs for computer programmers (the “Old Memo”).  The Old Memo was issued after intense national liaison activity in the late 1990’s  after the Nebraska Service Center (NSC) refused to recognize computer programming as a specialty occupation.  Immigration lawyers from around the country (including me!) traveled to NSC to discuss this position.  At that time, computer-related occupations were developing and the government resources describing the occupation were not keeping up. Although the concern was largely addressed in the run-up to Y2K (remember when we thought all the lights would go out at the turn of the new century and had to fix many computer programs?), the Old Memo was issued to confirm the position that computer programmers were indeed eligible for H-1Bs.


No one has relied on the Old Memo for years.  However, its rescission provided an opportunity to clarify the standard for H-1Bs in relation to computer programmers. Specifically, the New Memo recognizes that the OOH says it is possible for a person with a two-year degree to qualify for entry-level computer programming jobs. Therefore, per the New Memo, not all computer programmer jobs will qualify for H-1B. To prove that a particular job does qualify, proof of the specific nature of the position from other sources will be needed. 


While making these applications more challenging, the main affect will be on wages.  If an entry-level computer programmer does not require a four-year degree, then by definition an H-1B computer programmer would not be entry level.  This means that using a Level 1 wage under the DOL prevailing wage system for a computer programmer may no longer be practically possible.  The result is to raise H-1B computer programmer wages.


If the administration is correct that companies are using H-1B workers only because they can be paid less, fewer H-1Bs may be filed.  In our experience, this is not the case.  We hear from employers that it is extremely difficult to find qualified workers.  The new approach is meant to push the point, particularly for IT contractors.


New Approach to Detecting H-1B Fraud


USCIS also announced a new approach to policing H-1B fraud.  USCIS has long included the Fraud Detection and National Security (FDNS) unit.  FDNS conducts site visits to determine that statements made in applications are valid.  It has focused mostly on H-1Bs, but has also investigated other visas, such as L-1s.


The announcement’s title, “Putting American Workers First: USCIS Announces Further Measures to Detect H-1B Visa Fraud and Abuse,” clearly indicates the intent of the program.


Per the April 3 announcement, FDNS will now be targeted at:

  • Employers whose business information cannot be verified through commercially available data
  • H-1B “dependent” employers; and
  • Employers placing H-1B workers at third-party locations.

H-1B dependent employers are those with a high ratio of H-1B workers as compared to their U.S. workers.  IT contractors are clearly a target.  “Employers whose business information cannot be verified through commercially available data,” is likely meant to capture questionable business operations. In our experience, the data sources USCIS uses fail to capture new entities, but also some well-established entities, and those created in corporate reorganizations, for example.


Besides potentially increasing FDNS audits, USCIS has established an email address and forms for aggrieved U.S. or foreign workers to report abuse of the H-1B program.  USCIS may provide information received in such investigations to Immigration and Customs Enforcement (ICE) and can revoke H-1Bs if fraud is found.


DOJ’s “Reverse Discrimination” Focus


Meanwhile, the DOJ’s Immigrant and Employee Rights division (formerly the Office of Special Counsel for Immigration-Related Unfair Employment Practices) issued a press release “reminding” employers hiring H-1B workers that they should not discriminate against U.S. workers.


As stated in the press release:


“The Justice Department will not tolerate employers misusing the H-1B visa process to discriminate against U.S. workers,” said Acting Assistant Attorney General Tom Wheeler of the Civil Rights Division. “U.S. workers should not be placed in a disfavored status, and the department is wholeheartedly committed to investigating and vigorously prosecuting these claims.”


No guidance was provided about specifics of such discrimination.


What Are Employers To Do?


Regarding the “clarification” of computer programming occupations, we will have to wait to see how USCIS adjudicates H-1Bs already filed.  New H-1B petitions should be bolstered with more evidence to show the specialty nature of the occupation.


Regarding the new enforcement focus, if FDNS comes knocking we recommend:

  • Call immigration counsel immediately.  If you do not have a policy addressing law enforcement encounters in the workplace, now is the time to enact one.
  • If it is not possible for counsel to be present (which is highly recommended), record the FDNS visit on your cell phone. Accompany the inspector at all times.
  • Neither company representatives nor the H-1B worker are required to answer questions without an attorney present. If you choose to answer questions, record the conversation.  If you become uncomfortable, stop and ask that your attorney be brought into the discussion.
  • Write down your recollection of the visit immediately even if it was recorded.  This will assist your attorney in responding if the inspector misunderstood something you said or characterizes what she observed differently than you intended.

Regarding the DOJ warning, at this point you should continue to follow the H-1B rules. It is always a good idea to clearly document hiring decisions, especially if a foreign worker was chosen when a U.S. worker also applied.  While H-1B workers often address labor shortages, other reasons for hiring a foreign worker are legitimate and contemplated under the law. The important take-away is to be able to explain your reasons and back them up with documentation where possible. If contacted by DOJ it is important to contact counsel immediately.