On October 21, 1998, President Clinton signed legislation substantially increasing the number of H-1B visas available for foreign professional workers. The new law is designed to temporarily alleviate a problem that occurred in early May 1998, when the Immigration and Naturalization Service reached the quota of 65,000 H-1B visas established by law and could not approve new H-1B visas until October 1, 1998. The new law also includes strict new rules for hiring H-1B workers and significant penalties for employers that fail to comply.
The H-1B visa is a nonimmigrant visa, intended for temporary employees working in specialty occupations involving the application of highly specialized knowledge. Generally, to be considered a specialty occupation, the position must involve complex job duties for which the employer requires a bachelor's degree. Certain professional occupations -- such as engineering, law, medicine, accounting, and teaching - automatically qualify as specialty occupations.
According to government statistics, approximately 41% of H-1B workers are hired in the fast-growing high-technology industry, primarily as systems analysts and software application developers. Approximately 29% are hired for positions in the health care industry, and approximately 3% are hired for college and university faculty positions.
The new law raises the H-1B cap to 115,000 in fiscal years 1999 and 2000, 107,500 in fiscal year 2001, and back to 65,000 thereafter. (The INS fiscal year begins on October 1 and ends on September 30.) Nevertheless, it is expected that the new fiscal year 1999 quota may be reached before September 30,1999.
A number of new rules come with the increase in visa availability. For example:
- Certain employers must attest that they have not, and will not, lay off any U.S. worker employed by them within a period spanning 90 days before and 90 days after the filing of an H-1B visa petition.
- Certain employers must also attest that they have taken good faith steps to recruit in the United States using industry-wide standards and offering prevailing wages, and that they have offered the position to any U.S. worker who applies and is equally or better qualified than the H-1B nonimmigrant.
- All employers must attest that they will offer H-1B nonimmigrants benefits and eligibility for benefits on the same basis, and in accordance with the same criteria, as are offered to U.S. workers.
The law imposes the following new penalties for violations of the H-1B program:
- A $5,000 fine and not less than 2-year debarment for any willful failure to meet any attestation condition, or willful misrepresentation of a material fact.
- A $35,000 fine and not less than 3-year debarment for willful failure or willful misrepresentation of a material fact in connection with the lay-off attestation.
- A $1,000 fine for requiring an H-1B nonimmigrant to pay a penalty for leaving the employer's employ prior to a date agreed upon by the nonimmigrant and the employer. The employer also would be required to return the penalty to the nonimmigrant.
The law also imposes a new $500 fee (over and above the filing fee) on petitioning employers to fund scholarship and training programs, and to fund the U.S. Department of Labor's administration and enforcement activities under the H-1B program. Employers may not require an alien to reimburse or otherwise compensate the employer for the cost of this fee or they are subject to a $1,000 fine.
Finally, under what is termed a "benching" provision, an H-1B worker is due his or her full-time wages even if the employer places the worker in a non-productive status due to a decision made by the employer or due to problems with the worker's licensing or permits.
While the increase in the number of H-1B visas should be of benefit to employers, especially those in the field of computer and data processing services, the cost for failing to comply with the legal requirements of employing H-1B workers is now higher than ever before.