INFOTECH AND THE LAW

Immigration Proposals Hinder Hiring Foreign Professionals

P> Committees of both houses of Congress, supported by the administration, are proposing U.S. immigration law amendments to further restrict employment of foreign professionals in the United States. The committee debates reflect a congressional view that high-tech companies employ foreign nationals because they are willing to accept lower wages and poorer working conditions. Information technology companies dispute this assertion and say they are likely to suffer because they need to integrate skilled foreign nationals with U.S. workers to create a diverse, globally competitive work force.


Passage of the House bill, HR 2202, may result in no more than new procedures for U.S. employers hiring skilled professionals, provided they are not too heavily dependent on foreign labor and keep competitive wage rates uniform for U.S. and foreign hires. In contrast, the Senate bill, S 1394, is immensely restrictive and would, if adopted in its current form, burden high-tech companies engaging foreign workers with monetary penalties.

The House bill reduces employment-based immigrant visas by only 5,000 and leaves the cap on H-1B visas (the visa sought by foreign infotech professionals) unchanged. Instead, HR 2202 imposes additional eligibility criteria on foreign employees seeking permanent residence and sets up new regulations for issuing H-1B visas.

HR 2202 also would require foreign nationals seeking permanent residence to have two years of experience in addition to a bachelor's degree to qualify for classification as an immigrant professional. The current law has no minimum experience requirement. This means computer science graduates of U.S. universities will no longer be eligible for immediate permanent residence sponsorship. Because U.S. labor authorities typically question the validity of experience with the company seeking the candidate's permanent residence, business representatives will need to persuade Congress that this prerequisite may be met through H-1B employment with the permanent-residence sponsor company. Skilled workers would need a minimum of four years of experience rather than the currently required two years. Unskilled workers would be ineligible for employment-based permanent residence.

HR 2202 envisions a new system for awarding H-1B visas. Employers who hire foreign professionals would be classified as "H-1B dependent" or "non-H-1B dependent." Dependent employers are those with 15 percent of their U.S. work force holding H-1B visas. Dependent employers would face more restrictive requirements when employing foreign professionals and would be subject to investigation by the Department of Labor for wage inequities between foreign and U.S. workers. Dependent employers could petition the Department of Labor to classify them as non-dependent if they demonstrate that they will reduce their reliance on H-1B workers to the non-dependent level within five years.

HR 2202 also would prohibit replacing a U.S. employee with an H-1B worker during the six months before and 90 days after filing the wage attestation with the Department of Labor, even if the H-1B worker is more skilled. If the employer, in fact, engages in a prohibited layoff, the House bill requires the company to pay the H-1B worker 110 percent of the last wage earned by the laid-off employee.

The Senate bill is much more restrictive and has been heavily criticized by trade associations and other business interests as a handicap on the growth of U.S. business. S 1394 would reduce annual legal immigration through employer sponsorship from 140,000 to 90,000, a 36 percent reduction. It establishes two categories of employment-based immigrant visas: those exempt from labor certification and those subject to labor screening.

The "exempt" category includes foreign nationals of extraordinary ability, multinational executives and managers, investors and special immigrants (including religious workers). The "subject" category includes advanced degree professionals, bachelor's degree professionals, skilled workers and outstanding researchers.

The most controversial provision of S 1394 requires employers of "subject" foreign nationals to pay a fee of $10,000 or 10 percent of the compensation package. The tax will be used to fund scholarships and training of U.S. workers. Companies that demonstrate that they already make a substantial investment toward training their U.S. work force may offset up to 25 percent of the tax.

S 1394, like the House bill, groups employers into "dependent" or "non-dependent" categories. Dependent employers would be required to pay fees equal to 5 percent of each H-1B worker's compensation package in the first year, 7.5 percent in the second year and 10 percent in the third year. In addition, all employers of H-1B workers would pay a fee determined by the Department of Labor to offset the costs to the department of conducting random audits of H-1B employers.

Liz Espin Stern heads the immigration practice at Shaw Pittman Potts & Trowbridge in Washington, D.C. She may be reached by e-mail at: elizabeth_stern@shawpittman.com


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