Left to their own preferences, it seems Trump Administration officials would not allow any H-1B visa holders to work in the United States. For the past two years, every administration measure on high-skilled immigration has made life more difficult for high-skilled foreign nationals and their employers – and there is more to come.
As part of its regulatory agenda, the Department of Homeland Security (DHS) has pledged to enact a new rule that has gone largely unnoticed. The rule would limit who would qualify for an H-1B visa and also restrict which companies would be eligible for an H-1B based on the “employer-employee relationship.” This matters because an H-1B visa is typically the only practical way for an international student or a high-skilled foreign national to work long-term in the United States.
While the regulation has not been issued yet by DHS, it has been given a title: “Strengthening the H-1B Nonimmigrant Visa Classification Program.” Here is how DHS summarizes the future rule: “The Department of Homeland Security will propose to revise the definition of specialty occupation to increase focus on obtaining the best and the brightest foreign nationals via the H-1B program, and revise the definition of employment and employer-employee relationship to better protect U.S. workers and wages. In addition, DHS will propose additional requirements designed to ensure employers pay appropriate wages to H-1B visa holders.”
I interviewed a number of immigration attorneys to get a more accurate picture of what this regulation will look like and its potential impact on workers, employers and the U.S. economy.
“This is another in a long line of attempts by the Trump Administration to circumvent Congress and the required legislative process and unilaterally make changes to curtail skilled immigration to the United States,” said Noah Klug, principal, the Klug Law Firm. He doesn’t believe it is within the authority of the Department of Homeland Security to “revise the definition of specialty occupation.”
What does the law say about specialty occupations? Section 214(i)(1) of the Immigration and Nationality Act states, “[T]he term ‘specialty occupation’ means an occupation that requires theoretical and practical application of a body of highly specialized knowledge, and attainment of a bachelor’s or higher degree in the specific specialty (or its equivalent) as a minimum for entry into the occupation in the United States.”
However, just because it may not be legally advisable to revise the definition of an H-1B specialty occupation, does not mean the Administration won’t attempt to do it. “As an initial matter I would think it will have a qualitative component,” said Dagmar Butte, partner, Parker, Butte & Lane. “The drumbeat of an H-1B being intended to only bring the best and the brightest has been incessant the last three years or so. The problem is, of course, that was not the purpose of the H-1B and we already have a temporary visa for that – the O-1.”
What might Trump officials include in the regulation? “I think they will eliminate the Level 1 wage. That would be contrary to the statute, which mandates 4 wage levels,” said Butte. “This would definitely buy them a lawsuit unless Congress changes the statute. I also think they will attempt to eliminate certain kinds of third-party employment or require formal co-employment. However, I am not sure how they’ll do it . . . All of this will hit employers and ‘entry-level’ foreign national workers the hardest.”
Butte explains that most new graduates, whether foreign-born or native-born, are considered entry-level workers. “If the Level 1 or entry level wage is eliminated employers are not likely to hire an entry-level worker at the next wage level, which in almost all H-1B occupations is significantly greater when you look at the DOL wage ranges,” said Butte. “Therefore, a foreign student would not be able to obtain entry level work in the U.S. upon graduation. This would be true even for many advanced degree graduates.”
She also warns that revising the definition of a specialty occupation to include achievement beyond the existence of a degree will make the process too arbitrary for employers. She notes a separate problem would emerge if a revised definition focuses narrowly on the title of the degree and overlooks the individual’s body of knowledge, since that would ignore what employers seek in a competitive labor market.
Jennifer Minear, a director in the immigration practice group at McCandlish Holton, agrees that it is hard to envision how DHS would lawfully change the definition of the term “specialty occupation.”
Minear believes the goal of one part of the regulation is obvious. “The reference to re-defining ‘employer-employee relationship’ is almost certainly aimed at preventing staffing companies and other third-party placement scenarios from qualifying for the H-1B category,” said Minear. “However, depending on how broadly they draft the new language, it may have all sorts of unintended consequences. It’s not just staffing companies that place workers at third-party sites.”
She and others see major disruptions from this type of regulatory change. “Almost every doctor or physical therapist works at multiple sites and locations that may or may not be controlled by the sponsoring employer,” she said. “That doesn’t mean there isn’t a legitimate employer-employee relationship. Will the regulation be written in such a way that those types of occupations are also shut out of H-1B eligibility?”
One impact, notes Minear, would be that information technology companies would increase their use of offshoring, while patients at rural and other hospitals that rely on international medical graduates will suffer from a lack of health care providers.
While the timing on the regulation is unclear, Minear has a prediction: “Whatever they do, we can be sure that it will be an overbroad effort that will do with a sledgehammer what should be done with a scalpel – and it will be aimed at gutting America’s most commonly used business visa category.”
