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New H1-B Rule Will Make It More Difficult For Companies To Hire Nonimmigrant Highly Skilled Workers

Updated on
December 29, 2020
Article written by
Attorney Kevin O'Flaherty

In this article, we will discuss one of two new rules released by the Department of Homeland Security (DHS) that seeks to modify the H1-B Nonimmigrant Visa Classification, a visa commonly used by employers to acquire highly skilled workers from other countries. We will answer the following questions:


  • What is an H1-B Visa?
  • What is the” Interim Final Rule Making” process?
  • How will this new rule affect those seeking an H1-B visa?
  • How are employers responding to this new rule?


Many large and small tech companies, universities, manufactures, and a host of other U.S. businesses utilize the H1-B visa to hire skilled workers from other countries. These types of visas, and immigration in general, have been scrutinized under the Trump administration in an attempt to strengthen American policy on immigration and return more jobs stateside. The new rule from the DHS affecting the H1-B visa program will go into effect on December 8, 2020.


What Is An H1-B Visa?


An H1-B is a nonimmigrant visa that enables U.S. companies to employ graduate-level workers in highly specialized roles requiring theoretical or technical expertise. Industries that commonly utilize H1-B visas include information technology, accounting, finance, engineering, agriculture, mathematics, medicine, etc. As long as an employer can prove the job requires a specialized skill set and/or specific level of education, the position can fall under the H1-B visa specialty for occupations. Normally, a bachelor's degree is not an absolute requirement if a potential worker has an “equivalent level” of experience; however, the new rule change affecting H1-B visas requires that the petitioner bear the burden of showing that a specific bachelor’s degree is part of the requirement for the position, a stipulation that could make the hiring process much more difficult.


What Is The “Interim Final Rule Making” Process?


An Interim Final Rule is a way of publishing a new rule or modification of an existing rule within a governing body, such as the Department of Homeland Defense, that makes the rule final while it is being communicated to the general public. It is one way for the government to say, “Here’s this new rule, its current form is the final iteration. You can comment on it, dislike it, etc, but it’s going into effect on this date.” That doesn’t mean it’s automatically set in stone, many rules that are interim final rules are challenged in court. 


Introducing a new or modified rule this way is often used by an agency that wants the rule to take effect within a certain period and argues that going through the usual channels is “impracticable, unnecessary, or contrary to the public interest.”


How Will This New Rule Affect Those Seeking An H1-B Visa?


The new rule will have a significant impact on employers and workers that depend on H1-B visas. Some of the key takeaways for employers and workers include:


  • Under the new rule, the definition of “specialty occupation” has been modified to place more weight on the relationship between the degree requirements and the duties of the position. This has the potential to create problems for positions in new and innovative fields where a specialty is not yet available.
  • Under the old rule, there was a lot of flexibility for the requirement of a bachelor’s degree and most employers could get around the stipulation as long as the worker had a certain amount of experience. But under the new rule, petitioners must show that a position requires a bachelor’s degree, immediately diminishing the number of eligible candidates.
  • Contractors are not automatically considered U.S. employers, but can still qualify as U.S. employers by showing a clear employer-employee relationship with any new workers. This ultimately increases the administrative responsibilities of the employer.
  • Petitioning employers looking for workers at third party locations are not limited to one-year contracts, versus the old rule of three years. Employers must also provide evidence proving that work will be available throughout the totality of the requested period. Like other changes in the new rule, this will have a significant impact on certain employers’ administrative workload.


How Are Employers Responding To This New Rule?


As expected, several employers, in conjunction with the Chamber of Commerce of the United States of America, have filed suit against the Department of Homeland Security seeking an injunction against this new rule and its partner. Some of their arguments include:


  • An injunction is necessary to preserve the current and relied upon employment-based immigration programs that are integral to the economy, and to protect employers that traditionally struggle to find highly skilled workers;
  • DHS’s argument that COVID-19 and the resultant damage to the economy further necessitate the implementation of the new rules is baseless as the rule change has been on the table since 2017. Furthermore, the claim directly contradicts the president’s assertion that the economy is booming again;
  • The language of the new H1-B rule does not align with current statutes;
  • There was no good reason for the administration to introduce it via an interim final rule;
  • Evidence that the new rule will protect U.S. jobs is thin, as the industries that most utlizie H1-B have historically low levels of unemployment;
  • The wages set under the new bill, some as high as 200% of the current wage level, are unrealistic.


DHS estimates that under the new guidelines at least one-third of applicants will be denied. With 580,000 workers utilizing the H1-B status—and that number continues to grow as the tech sector booms—the new rules will certainly have a ripple effect on employers and the economy.


New H1-B Rule Will Make It More Difficult For Companies To Hire Nonimmigrant Highly Skilled Workers
Author

Attorney Kevin O'Flaherty

Kevin O’Flaherty is a graduate of the University of Iowa and Chicago-Kent College of Law. He has experience in litigation, estate planning, bankruptcy, real estate, and comprehensive business representation.

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