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The H-1B is a non-immigrant visa in the United States under the Immigration and Nationality Act, section 101(a)(15)(H). It allows U.S. employers to temporarily employ foreign workers in specialty occupations. If a foreign worker in H-1B status quits or is dismissed from the sponsoring employer, the worker can apply for a change of status to another non-immigrant status, find another employer (subject to application for adjustment of status and/or change of visa), or must leave the US.

The regulations define a “specialty occupation” as requiring theoretical and practical application of a body of highly specialized knowledge in a field of human endeavor including, but not limited to, architecture, engineering, mathematics, physical sciences, social sciences, biotechnology, medicine and health, education, law, accounting, business specialties, theology, and the arts, and requiring the attainment of a bachelor’s degree or its equivalent as a minimum (with the exception of fashion models, who must be "of distinguished merit and ability".) Likewise, the foreign worker must possess at least a bachelor’s degree or its equivalent and state licensure, if required to practice in that field. H-1B work-authorization is strictly limited to employment by the sponsoring employer.

Duration of stay

The duration of stay is three years, extendable to six. An exception to maximum length of stay applies in certain circumstances:

1. one-year extensions if a labor certification application has been filed and is pending for at least 365 days; and
2. three-year extensions if an I-140 Immigrant Petition has been approved.

Despite a limit on length of stay, no requirement exists that the individual remain for any period in the job the visa was originally issued for. This is known as H1B portability or transfer, provided the new employer sponsors another H1B visa, which may or may not be subjected to the quota. Under current law, H1B visa has no grace period in the event the employer-employee relationship ceases to exist.

Congressional yearly numerical cap

The current law limits to 65,000 the number of aliens who may be issued a visa or otherwise provided H-1B status each fiscal year (FY). The numerical limitation was temporarily raised to 195,000 in FY2001, FY2002 and FY2003. In addition, excluded from the ceiling are all H-1B non-immigrants who work at (but not necessarily for) universities and non-profit research facilities. This means that contractors working at, but not directly employed by the institution may be exempt from the cap. Free Trade Agreements allow a carve out from the numerical limit of 1,400 for Chilean nationals and 5,400 for Singapore nationals. Laws also exempt up to 20,000 foreign nationals holding a master’s or higher degree from U.S. universities from the cap on H-1B visas.

The Department of Homeland Security approved about 132,000 H-1B visas in 2004 and 117,000 in 2005.

Employer attestations to protect U.S. workers

The U.S. Department of Labor (DOL) is responsible for ensuring that foreign workers do not displace or adversely affect wages or working conditions of U.S. workers.

The Department of Labor states that the H-1B employer must first advertise the position at the workplace and the employer's office before hiring an H-1B non-immigrant pursuant to the H-1B visa approval.

Employers must attest that wages offered are at least equal to the actual wage paid by the employer to other workers with similar experience and qualifications for the job in question, or alternatively, pay the prevailing wage for the occupation in the area of intended employment, whichever is greater. By signing the LCA (Labor Condition Application), the employer attests that: prevailing wage rate for area of employment will be paid; working conditions of position will not adversely affect conditions of similarly employed American workers; place of employment not experiencing labor dispute involving a strike or lockout.

The law requires H-1B workers to be paid the higher of the prevailing wage for the same occupation and geographic location, or the same as the employer pays to similarly situated employees. Other factors, such as age and skill were not permitted to be taken into account for the prevailing wage. Congress changed the program in 2004 to require the Department of Labor to provide four skill-based prevailing wage levels for employers to use. This is the only prevailing wage mechanism the law permits that incorporates factors other than occupation and location.

The approval process for these applications are based on employer attestations and documentary evidence submitted. The employer is advised of their liability if they are replacing a US worker.

H-1B fees earmarked for U.S. worker education and training

In 2007, the U.S. Department of Labor, Employment and Training Administration (ETA), reported on two programs, the High Growth Training Initiative and Workforce Innovation Regional Economic Development (WIRED), which have received or will receive $284 million and $260 million, respectively, from H-1B training fees to educate and train U.S. workers.

Income taxation status of H-1B workers

The taxation of income for H-1B employees depends on whether they are categorized as Resident Aliens or Non Resident Aliens for tax purposes. A non resident alien for tax purposes is only taxed on income from the US. A resident alien for tax purposes is taxed on income both from inside, and outside, the US.

The tax residency can be determined based on the "substantial presence test".

If the substantial presence test indicates that the H-1B visa holder is a resident, then income taxation is like any other US person and may be filed using Form 1040 and the necessary schedules. Otherwise the visa holder must file as a non-resident alien using tax form 1040NR or 1040NR-EZ; he or she may claim benefit from Tax Treaties if they exist between the US and the visa holder's country of citizenship.

Persons who are in their first year within the US may choose to be considered a resident for taxation purposes for the entire year, and must pay taxes on their worldwide income for that year. This "First Year Choice" is described in IRS Publication 519 and can only be made once in a person's lifetime.

A spouse, regardless of visa status, must have a valid ITIN or Social Security Number in order to be included on a joint tax return with the H-1B holder.

The rules to file taxes for H-1B holders may be complex, depending on the individual situation. Besides consulting a professional tax preparer knowledgeable about the rules for foreigners, the IRS Publication 519, U.S. Tax Guide for Aliens, may be consulted.

H-1B employment

According to the USCIS, "H-1B aliens may only work for the petitioning U.S. employer and only in the H-1B activities described in the petition. The petitioning U.S. employer may place the H-1B worker on the worksite of another employer if all applicable rules (e.g., Department of Labor rules) are followed. H-1B aliens may work for more than one U.S. employer, but must have a Form I-129 petition approved by each employer."

H-1B visa holders pay Medicare and Social Security taxes, and are eligible for Social Security benefits. They also pay state and federal taxes.

U.S. policy on maximum duration

In theory, the maximum duration of the H-1B visa is six years (ten years for exceptional Defense Department project-related work). H-1B holders who want to continue to work in the U.S. after six years, but who have not obtained permanent residency status, must remain outside of the U.S. for one year before reapplying for another H-1B visa.

There are generally two exceptions to the six-year duration of the H-1B visa::

• If a visa holder has submitted an I-140 immigrant petition or a labor certification prior to their fifth year anniversary of having the H-1B visa, they are entitled to renew their H-1B visa in one-year or three-year increments until a decision has been rendered on their application for permanent residence.

• If the visa holder has an approved I-140 immigrant petition, but is unable to initiate the final step of the green card process due to their priority date not being current, they may be entitled to a 3 year extension of their H-1B visa. This exception originated with the American Competitiveness in the Twenty-First Century Act of 2000.

H-1B and legal immigration

Even though the H-1B visa is a non-immigrant visa, it is one of the few visa categories recognized as dual intent, meaning an H-1B holder can have legal immigration intent (apply for and obtain the green card) while still a holder of the visa. In the past the employment-based green card process used to take only a few years, less than the duration of the H-1B visa itself. However, in recent times the legal employment-based immigration process has backlogged and retrogressed to the extent that it now takes many years for skilled professional applicants from certain countries to obtain their green cards. Since the duration of the H-1B visa hasn't changed, this has meant a lot more H-1B visa holders have to renew their visas in 1 year or 3 year increments to continue to be in legal status while their green card application is in process.

Quotas and changes in quotas

The number of new H-1Bs issued each year in the United States is subject to an annual congressionally-mandated quota. Each H-1B quota applies to a particular Financial Year which begins on October 1. Applications for the upcoming Financial Year are accepted beginning on the preceding April 1 (or the first working day after that date). Those beneficiaries not subject to the annual quota are those who currently hold H-1B status or have held H-1B status at some point in the past six years and have not been outside the United States for more than 365 consecutive days. This annual quota has had a significant impact on the high tech industry. It has generally been set at 65,000 visas per year, with some exceptions for workers at exempt organizations like universities and colleges (note: contrary to popular belief, non-profit organizations are not automatically exempt, but may be so if affiliated with a university or college). In 2000, Congress permanently exempted H-1B visas going to Universities and Government Research Laboratories from the quota.

During the early years of this quota in the early 1990s, this quota was rarely actually reached. By the mid-1990s, however, the quota tended to be filled each year on a first come, first served basis, resulting in new H-1Bs often being denied or delayed because the annual quota was already filled. In 1998 the quota was increased first to 115,000 and then, in 2000, to 195,000 visas per year. During the years the quota was 195,000, it was never reached.

In FY 2004, the quota reverted to 90,000 when the temporary increase passed by Congress in 1999 expired. Since then, the quota is again filling up rapidly every year, making H-1Bs again increasingly hard to get. More recently, the basic quota was left at 65,000 but with an additional 20,000 visas possible for foreign workers with U.S. advanced degrees. Of the 65,000 total, 6,800 are initially reserved for citizens of Chile and Singapore under free trade agreements with those countries; however, if these reserved visas are not used under the agreements, they go back to the general pool. Outside of the 65,000 quota, another 10,500 visas annually are available to Australian citizens under a similar but more flexible program, the E-3 visa program.

For FY 2007, beginning on October 1, 2006, the entire quota of visas for the year was exhausted within a span of less than 2 months on May 26, 2006, well before the beginning of the financial year concerned. The additional 20,000 Advanced Degree H-1B visas were exhausted on July 26. For FY 2008, the entire quota was exhausted before the end of the first day on which applications were accepted, April 2. Under USCIS rules, the 123,480 petitions received on April 2 and April 3 that were subject to the cap were pooled, and then 65,000 of these were selected at random for further processing. The additional 20,000 Advanced Degree H-1B visas for FY 2008 was exhausted on April 30.

In its annual report on H-1B visas released in November 2006, USCIS stated that it approved 131,000 H-1B visas in FY 2004 and 117,000 in FY 2005. The inflation in numbers is because H-1B visas can be exempt from the caps if the employer is a University or Research Lab.

For FY 2009, USCIS announced on April 8, 2008 that the entire quota for visas for the year has been reached, for both 20,000 Advanced and the 65,000 quota. USCIS would complete initial data entry for all filing received during April 1 to April 7, 2008 before running the lottery .

For FY 2010, USCIS announced on December 21, 2009, that enough petitions were received to reach the year quota. . Trend analysis indicates that the FY 2011 cap may be reached sometime between early October and November since the economy is picking up and the recession is easing.

H-1B-dependent employers

Recent H-1B legislation requires certain employers, called H-1B dependent employers to advertise positions in the USA before petitioning to employ H-1B workers for those positions.

For firms of 50 employees, an H-1B dependent employer is defined as having more than 15% of their employees in H-1B status. Smaller firms are allowed to have a higher percentage of H-1B employees before becoming 'dependent'.

Criticisms of the program

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The H-1B program has caused a number of criticisms.

Employees made to pay H1-B sponsorship costs

Although the practice is unlawful, it is widely believed that some employers make their H1-B employees pay for most, all or in excess of the costs associated with sponsoring and processing an H1-B application. These fees are usually under the guise of bond or other instruments, in a futile attempt to serve as a legal workaround to the law.

No labor shortages

Nobel Prize winning economist Milton Friedman called the program a corporate subsidy, as quoted in a 2002 article in Computerworld. The accuracy of this quote can not be ascertained, however, as Mr. Friedman has since died. Others holding this view include Dr. Norman Matloff, who testified to the U.S. House Judiciary Committee Subcommittee on Immigration on the H-1B subject. Matloff's paper for the University of Michigan Journal of Law Reform claims that there has been no shortage of qualified American citizens to fill American computer-related jobs, and that the data offered as evidence of American corporations needing H-1B visas to address labor shortages was erroneous. The United States General Accounting Office found in a report in 2000 that controls on the H-1B program lacked effectiveness. The GAO report's recommendations were subsequently implemented. High-tech companies often cite a tech-worker shortage when asking Congress to raise the 65,000 annual cap on H-1B visas, but according to a study conducted by John Miano and the Center for Immigration Studies there is no empirical data to support that claim. . Citing studies done at Duke, Alfred P. Sloan Foundation, Georgetown University and others, critics have also argued that in some years, the number of foreign programmers and engineers imported outnumbered the number of jobs created by the industry. . Organizations have also posted hundreds of first hand accounts of H1-B Visa Harm reports directly from individuals negatively impacted by the program, many of whom are willing to speak with the media.

Relatively low skills required

Another criticism of the H-1B program is its vague eligibility requirements, but specific guidelines, upheld by a body of case law, define the requirements. While frequently described as a program for highly skilled workers, the H-1B nonimmigrant visa category specifically applies to specialty occupations. It can be argued that any job that requires a minimum of a bachelor's degree is "highly skilled".

Specialty occupations have been defined as positions that require theoretical or technical expertise in a specialized field and have generally been interpreted as being those that normally require the attainment of a Bachelor's degree. Typical H-1B occupations include architects, engineers, computer programmers, accountants, doctors, business managers, and college professors. The H-1B visa program also includes fashion models.

Wage depression

Wage depression is a chronic complaint critics have about the H-1B program: some studies have found that H-1B workers are paid significantly less than U.S. workers. It is claimed that the H-1B program is primarily used as a source of cheap labor. Although, these studies are often conducted and reported by special interest groups that oppose the H-1B program. No definitive governmental study, either by the Government Accounting Office or the Congressional Research Agency has proven these statistics to be true. A paper by Harvard Professor George J. Borjas for the National Bureau of Economic Research found that "a 10 percent immigration-induced increase in the supply of doctorates lowers the wage of competing workers by about 3 to 4 percent."

The Labor Condition Application (LCA) included in the H-1B petition is supposed to ensure that H-1B workers are paid the prevailing wage in the labor market, or the employer's actual average wage (whichever is higher), but evidence exists that some employers do not abide by these provisions and avoid paying the actual prevailing wage. However, studies show that the majority of employers do pay prevailing wages and the law provides stiff penalties for abusers.

DOL has split the prevailing wage into four levels, with Level One representing about the 17th percentile of wage average Americans earn. About 80 percent of LCAs are filed at this 17th percentile level. This four-level prevailing wage can be obtained the DOL website, and is generally far lower than average wages.

The "prevailing wage" stipulation is allegedly vague and thus easy to manipulate, resulting in employers underpaying visa workers. According to Ron Hira, assistant professor of public policy at the Rochester Institute of Technology, the median wage in 2005 for new H-1B information technology (IT) was just $50,000, which is even lower than starting wages for IT graduates with a B.S. degree. The U.S. government OES office's data indicates that 90 percent of H-1B IT wages were below the median U.S. wage for the same occupation.

In 2002, The U.S. government began an investigation into Sun Microsystems' hiring practices after an ex-employee, Guy Santiglia, filed complaints with the U.S. Department of Justice and U.S. Department of Labor alleging that the Santa Clara firm discriminates against American citizens in favor of foreign workers on H-1B visas. Santiglia accused the company of bias against U.S. citizens when it laid off 3,900 workers in late 2001 and at the same time applied for thousands of visas. In 2002, about 5 percent of Sun's 39,000 employees had temporary work visas, he said. In 2005, it was decided that Sun violated only minor requirements and that neither of these violations was substantial or willful. Thus, the judge only ordered Sun to change its posting practices.

Hidden costs and risks for employers

Although, lower wages do not necessarily mean lower costs for employers. The costs for a company to apply for an H-1B visa can be significant, and it varies between $1,440 and $3,000, depending on the attorney's fees(if used), the number of employees in the company, and if a faster premium service is paid, without including the cost of a possible trip to the border of the country of origin, nor the renewal costs. Besides that, there is no guarantee that the prospective employee will be granted the visa due to high demand, and the expenses are sometimes non-refundable. In addition to that, if the employer should dismiss the employee, the company is liable for any reasonable costs that the employee incurs in moving him/herself, his/her effects, back to his/her last foreign residence. This provision covers only dismissal, it is not relevant when an employee chooses to resign.

Risks for employees

Historically, H-1B holders have sometimes been described as indentured servants, and while the comparison is no longer totally accurate, it had more validity prior to the passage of American Competitiveness in the Twenty-First Century Act of 2000. Although immigration generally requires short- and long-term visitors to disavow any ambition to seek the green card (permanent residency), H-1B visa holders are an important exception, in that the H-1B is legally acknowledged as a possible step towards a green card under what is called the doctrine of dual intent.

H-1B visa holders may be sponsored for their green cards by their employers through an Application for Alien Labor Certification, filed with the U.S. Department of Labor. In the past, the sponsorship process has taken several years, and for much of that time the H-1B visa holder was unable to change jobs without losing their place in line for the green card. This created an element of enforced loyalty to an employer by an H-1B visa holder. Critics alleged that employers benefit from this enforced loyalty because it reduced the risk that the H-1B employee might leave the job and go work for a competitor, and that it put citizen workers at a disadvantage in the job market, since the employer has less assurance that the citizen will stay at his job for an extended period of time, especially if the work conditions are tough, wages are lower or the work is difficult or complex. It has been argued that this makes the H-1B program extremely attractive to employers, and that labor legislation in this regard has been influenced by corporations seeking and benefiting from such advantages.

Some recent news reports suggest that the recession started in 2008 will exacerbate the H-1B visa situation, both for supporters of the program and for those who oppose it. The process to obtain the green card has become so long, that during these recession years it has not been unusual that sponsoring companies fail and disappear, thus forcing the H-1B employee to find another sponsor, and losing their place in line for the green card. An H-1B employee could be just one month from obtaining their green card, but if he or she are laid off, he or she will have to leave the country, or go to the end of the line and start over the process to get the green card, and wait as much as 10 more years, depending on their nationality and visa category.

Criticisms by H-1B holders

Payment of out-of-state tuition

In most states, H-1B workers and their dependents do not qualify for in-state tuition regardless of the amount of time spent in the US. However, for more than a decade, a few states such as California, New York, Washington and Texas have extended in-state tuition to H-1B workers and dependents. Typically the decision to offer in-state tuition to H-1B and H4 residents is taken as a result of an adverse state court decision that uses the precedent established for G-4 visas in the Supreme Court decision in TOLL v. MORENO, 441 U.S. 458 (1979).

Social Security and Medicare taxes

H1B employees have to pay Social Security and Medicare taxes as part of their payroll. Like US citizens, they are eligible to receive Social Security benefits even if they leave the United States, provided they have paid Social Security benefits for at least 10 years. Further, the US has bilateral agreements with several countries to ensure that the time paid into the US Social Security system, even if it is less than 10 years, is taken into account in the foreign country's comparable system and vice versa.

Spouses cannot work

H-1B's spouse who generally come on H-4 (dependent visa) cannot work in the United States.

Unrealistic Depature Requirement on Job Loss

If an H-1B worker is laid off for any reason, he has to leave the United States on the same day, or file an application to change to another non-immigrant status before his last official day of employment (including change of status to allow him to work for another employer). The H-1B program technically does not have a time allowance or grace period to round up one's affairs irrespective of how long the H-1B worker might have lived in the United States. To round up one's affairs, filing an application to change to another non-immigrant status is therefore a necessity.

An H-1B worker who is laid off and attempts to find a new H-1B employer to file a petition for him is considered out of status if there is even a one day gap between the last day of employment and the date that the new H-1B petition is filed. While some attorneys claim that there is a grace period of 30 days, 60 days, or sometimes 10 days, that is not true according to the law. However, in practice, CIS has accepted H-1B transfer applications even with a gap in employment up to 60 days, but that is by no means guaranteed.

Some of the confusion regarding the "grace period" arose because there is a 10 day grace period for an H-1B worker to depart the United States at the end of his authorized period of stay (does not apply for laid off workers). This grace period only applies if the worker works until the H-1B expiration date listed on his I-797 approval notice, or I-94 card. 8 CFR 214.2(h)(13)(i)(A). It is therefore recommended that an H-1B worker who is laid off and can't immediately leave the US applies for a change of status to another non-immigrant status as soon as he receives his notice of termination/lay-off, e.g., B1 or B2.

The employer has the legal obligation to pay the laid off worker's return transportation. The worker can only avoid leaving the country by finding another employer that will sponsor a new H-1B, which is sometimes impossible in the short amount of time available. If unhappy with the workplace, a U.S. citizen or green card holder can simply quit his or her job, whereas a H-1B's right to remain in the U.S. is tied to the job.

An H-1B worker faces additional obstacles at his/her workplace

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Any H-1B worker essentially has the following weakness: his ability to remain in U.S. is directly linked to his current job. H-1B holders can change jobs only with difficulty. In some cases, the holders of H-1B visas find their employers have not completely accurately represented the terms of employment; they find themselves in a foreign land with only a limited understanding of the legal system. H-1B workers can be disciplined at any time, by being laid off.

Worker protection and law enforcement

For every H-1B petition filed with the USCIS, there must be included a Labor Condition Application (LCA) certified by the U.S. Department of Labor. The LCA is designed to ensure that the wage offered to the non-immigrant worker must meet or exceed the "prevailing wage" in the area of employment. The LCA also contains an attestation section designed to prevent the program from being used to import foreign workers for the purpose of breaking a strike, or for the purpose of replacing U.S. citizen workers. Under the regulations, LCAs are a matter of public record. Corporations hiring H-1B workers are required to make these records available to any member of the public who requests to look at them. Copies of the relevant records are also available from various web sites, including the Department of Labor.

Theoretically, the LCA process appears to offer protection to both U.S. and H-1B workers. However, according to the U.S. General Accounting Office, enforcement limitations and procedural problems render these protections ineffective. Ultimately, the employer, not the Department of Labor, determines what source it will use to determine the prevailing wage for an offered position, and it may choose among a variety of competing surveys, including its own wage surveys, provided that such surveys follow certain defined rules and regulations.

The law specifically restricts the Department of Labor's approval process of LCAs to checking for "completeness and obvious inaccuracies".. In FY 2005, only about 800 LCAs were rejected out of over 300,000 submitted. Hire Americans First has posted several hundred first hand accounts of H1-B Visa Harm reports directly from individuals negatively impacted by the program, many of whom are willing to speak with the media.

Enforcement is substandard and there are reports of abusers surviving INS audits unscathed.

In 2009 Federal authorities busted a nationwide H-1B Visa Scam. In October 2008, a USCIS report found that the H-1B program has more than a 20 percent violation rate.

Recent changes to U.S. law

The American Competitiveness in the Twenty-First Century Act of 2000 (AC21) and the U.S. Department of Labor's PERM system for labor certification erased most of the earlier claimed arguments for H-1B's as indentured servants during the green card process. With PERM, labor certification processing times are now approx 9 months (as of Mar 2010).

Because of AC21, the H-1B employee is free to change jobs if they have an I-485 application pending for six months and an approved I-140, if the position they are moving to is substantially comparable to their current position. In some cases, if those labor certifications are withdrawn and replaced with PERM applications, processing times will improve, but the person will also lose their favorable priority date. In those cases, employers' incentive to attempt to lock in H-1B employees to a job by offering a green card is reduced, because the employer bears the high legal costs and fees associated with labor certification and I-140 processing, but the H-1B employee is still free to change jobs.

However, many people are ineligible to file I-485 at the current time due to the widespread retrogression in priority dates. Thus, they may well still be stuck with their sponsoring employer for many years. There are also many old labor certification cases pending under pre-PERM rules.

On May 25, 2006 the U.S. Senate passed immigration bill 2611, which contained several increases in the number of H-1B visas, including:

1. raising the base quota from 65,000 to 115,000,
2. Automatically increasing the base quota by 20% whenever it is reached with no provision for lowering it,
3. Adding 6,800 visas for trade agreements separate from the base quota,
4. Adding 20,000 visas for those with foreign graduate degrees,
5. Raising from 20,000 to unlimited the number of visas for those with U.S. graduate degrees, and
6. Making visas to non-profit organizations exempt from the quota.

However, as the House refused to consider the measure, it died in conference and no H-1B increase was approved in time for the elections.

The USCIS has announced that after completing a policy review that it was clarifying that to avoid H-1B quota limits, individuals who spent one year outside of U.S. and did not exhaust their entire six year term can choose to be re-admitted for “remainder” of initial six-year period without being subject to the H-1B cap.

The USCIS has also announced that after completing a policy review that it was clarifying that “any time spent in H-4 status will not count against the six-year maximum period of admission applicable to H-1B aliens.

On May 24, 2007, the Senate considered amendments to the Comprehensive Immigration Reform bill (S. 1348) including the Sanders Amendment to increase the H-1B Scholarship & Training Fee from $1500 to $8500 (for H-1B employers with more than 25 full time employees). The additional fee was to be used for training and scholarship programs and in addition to other existing fees. Senator Sanders listed the Teamsters Union and the AFL-CIO among supporters of his amendment. Without this amendment, Senator Sanders (I-VT) said, "skilled middle class and upper middle class Americans" would be hurt, and their wages would continue to be suppressed. Just prior to the vote, Senator Sanders announced that he had made changes to his amendment, dropping the fee for H-1B visas from the $8500 he proposed earlier, down to $5000. Following Senator Sanders’ announcement, Senators Kennedy and Specter expressed their support for the bill and the amendment passed by a vote of 59–35. Compete America, a coalition of U.S. tech companies, reported the passage of the Sanders amendment will "accelerate outsourcing and undermine U.S. economic growth."

The Consolidated Natural Resources Act of 2008, which, among other issues, federalizes immigration in the Commonwealth of the Northern Mariana Islands, stipulates that during a transition period, numerical limitations will not apply to otherwise qualified workers in the H visa category in the CNMI and Guam.

On Feb. 17, 2009, President Obama signed into law the American Recovery and Reinvestment Act of 2009 (“stimulus bill”), Public Law 111-5 . Section 1661 of the ARRA incorporates the Employ American Workers Act (“EAWA”) by Senators Sanders (I-Vt.) and Grassley (R-Iowa) to limit certain banks and other financial institutions from hiring H-1B workers unless they had offered positions to equally- or better-qualified US workers, and to prevent banks from hiring H-1B workers in occupations they had laid off US workers from. These restrictions include:

1. The employer must, prior to filing the H-1B petition, take good-faith steps to recruit U.S. workers for the position for which the H-1B worker is sought, offering a wage at least as high as what the law requires for the H-1B worker. The employer must also attest that, in connection with this recruitment, it has offered the job to any U.S. worker who applies who is equally or better qualified for the position.
2. The employer must not have laid off, and will not lay off, any U.S. worker in a job essentially equivalent to the H-1B position in the area of intended employment of the H-1B worker within the period beginning 90 days prior to the filing of the H-1B petition and ending 90 days after its filing.

Recent Changes to U.S. Policy

USCIS (U.S. Citizenship & Immigration Services) recently issued a Memoranda dated 8 Jan 2010. The memoranda effectively states that there must be a clear "employee employer relationship" between the petitioner (employer) and the beneficiary (potential Visa holder). It simply outlines what the employer must do to be considered in compliance as well as putting forth the documentation requirements to back up the employer's assertion that a valid relationship exists.

Some argue that this has effectively "killed the bodyshop industry". While it is clear that the number of Visa petitions granted has declined (or is slower than normal to reach the full quota), it is not clear whether or not this is a result of simple political pressure to put the program on "hold", or a long-term result from real economic realities. The Memoranda gives three clear examples of what is and is NOT considered a valid "employee employer relationship".

• an accountant working on and off-site to work
• a fashion model
• a computer software engineer working off-site

In the case of the software engineer the petitioner (employer) must simply agree to do (some of) the following among others:

• supervise the beneficiary off-site & on-site
• maintain such supervision through calls, reports, or visits
• have a "right" to control the work on a day-to-day basis if such control is required.
• provide tools for the job
• hire, pay and have the ability to fire the beneficiary
• evaluate work products and perform progress/performance reviews
• claim them for tax purposes
• provide (some type of) employee benefits
• use "proprietary information" to perform work
• produce an end product related to the business
• have an "ability to" control the manner and means in which the work product is accomplished.

It further states that "common law is flexible" in how these factors are to be weighed.

Many body shops already meet most, if not all of the above requirements. WiPro, InfoSys, and Tata Systems being prime examples in the IT industry (since they have been documented to be among the highest visa holders in the past).

Although this memoranda cites legal cases and provides examples, such a memoranda in itself is not law and future memoranda(s) could easily be issued that could change this.

Similar programs

In addition to H-1B visas, there are a variety of other visa categories that allow foreign workers to come into the U.S. to work for some period of time.

L-1 visas are issued to foreign employees of a corporation. Under recent rules, the foreign worker must have worked for the corporation for at least one year in the preceding three years prior to getting the visa. An L-1B visa is appropriate for nonimmigrant workers who are being temporarily transferred to the United States based on their specialized knowledge of the company's techniques and methodologies. An L-1A visa is for managers or executives who will either manage people or an essential function of the company. There is no requirement to pay prevailing wages for the L-1 visa holders. For Canadian residents, a special L visa category is available.

TN-1 visas are part of the North American Free Trade Agreement (NAFTA), and are issued to Canadian and Mexican citizens. TN visas are only available to workers who fall into one of a pre-set list of occupations determined by the NAFTA treaty. There are specific eligibility requirements for the TN Visa.

E-3 visas are issued to citizens of Australia under the Australia free-trade treaty.

H-1B1 visas are issued to residents of Chile and Singapore under the amended NAFTA treaty.

One recent trend in work visas is that various countries attempt to get special preference for their nationals as part of treaty negotiations. Another trend is for changes in immigration law to be embedded in large Authorization or Omnibus bills to avoid the controversy that might accompany a separate vote.

H-2B: The H-2B nonimmigrant program permits employers to hire foreign workers to come to the U.S. and perform temporary nonagricultural work, which may be one-time, seasonal, peak load or intermittent. There is a 66,000 per year limit on the number of foreign workers who may receive H-2B status

Alternatives to H-1B visa:

• Green Card for medical doctors and physicians.
  • Pre-requisite: National Interest Waiver.
  • Alternatively, a Medical Doctor or Physician may enter the U.S. for a temporary period through a temporary visa.
• Green Cards for Nurses and Physical Therapists
• Employment Visa for Professors and Researchers.

Dependents of H-1B visa holders

H-1B visa holders are allowed to bring their immediate family members (spouse and children under 21) to the United States under the H4 Visa category as dependents. An H4 Visa holder may remain in the U.S. as long as the H-1B visa holder remains in legal status. An H4 visa holder is not eligible to work in the U.S. and is not eligible for a Social Security number (SSN). An H4 Visa holder may attend school, obtain a driver's license and open a bank account while in the US. In order to claim a dependent on a tax return or file a joint tax return, the dependent will have to obtain an Individual Tax Identification Number (ITIN) which is used only for tax filing purposes.

H-1B demographics

File:H1b demographics.jpg

Of all Computer Systems Analysts and programmers on H-1B visas in the US, 74 percent were from Asia. This large scale migration of Asian IT professionals to the United States has been cited as a central cause of the quick emergence of the offshore outsourcing industry.

Usage of H-1B by outsourcing firms

In 2006, these firms collectively were issued 19,512 of the 65,000 H-1B visas granted, with 4 outsourcing firms among the top 5 receivers of H-1B visas. Among the top of the list were some of the most well known outsourcing firms: Infosys, Satyam Computer Services, Tata Consultancy Services, and Wipro Technologies. Critics have argued that granting H-1B visas to these outsourcing firms is not the real intent of the H-1B Visa program. One reason given is: Critics claim that the Indian firms skirt regulations and use the visas to train workers in the U.S. to facilitate moving jobs offshore.

In 2006, Wipro applied for 20,000 H-1B visas and 160 Green Cards; and Infosys applied for 20,000 H-1B visas and only 50 Green Cards. Of the Applied H-1B visas, Wipro and Infosys were granted, 4,002 and 4,108 visas respectively, an acceptance rate of 20% and 24%. Given that both companies have a work force of approximately 100,000 employees, and a U.S. employment base of roughly 20,000 H-1B holders, this indicates that roughly 1/5th of the Indian workforce of Infosys & Wipro applied for a visa in 2006. A 2009 Business Week article cited a ComputerWorld article indicating that WiPro was the top user of the program with 1,964 Visas.

Critics have argues against this trend, stating that there is no dearth of qualified workers in the United States.

In 2009, due to the worldwide recession, applications for H1B visas by outsourcing firms were significantly lower than in previous years.

Top ten H-1B rankings

See also

• SKIL Bill
• Free trade debate
• Labor shortage
• Immigration Voice
• L-1 visa

References

1. United States Citizenship and Immigration Service, "Characteristics of Specialty Occupation Workers (H-1B)", for FY 2004 and FY 2005, November 2006.
2. Bloomberg Bloomberg, Microsoft Cuts 5,000 Jobs as Recession Curbs Growth (Update5), 22 Jan 2009 (Microsoft Lays off 5,000 even as they use 3,117 visas in 2006.)
3. Bill Gates, Chairman of Microsoft, Testimony to the U.S. Senate Committee Health, Education, Labor, and Pensions. Hearing "Strengthening American Competitiveness for the 21st Century". March 7, 2007
4. Business Week, Immigration: Google Makes Its Case, 7 Jun 2007.
5. Business Week, Who Gets Temp Work Visas? 7 Jun 2007 (Top 200 H1B Visa Users Chart)
6. Business Week, Immigration Fight: Tech vs. Tech, 25 May 2007.
7. Business Week, Crackdown on Indian Outsourcing Firms, 15 May 2007.
8. Dr. Norman Matloff, Debunking the Myth of a Desperate Software Labor Shortage, Testimony to the U.S. House Judiciary Committee, April 1998, updated December 2002
9. Programmer's Guild, PERM Fake Job Ads defraud Americans to secure green cards, Immigration attorneys from Cohen & Grigsby explains how they assist employers in running classified ads with the goal of NOT finding any qualified applicants.
10. Lou Dobbs: Cook County Resolution against H-1b
11. PRWeb, The Programmers Guild Calls on Congress to include U.S. Worker Protections in the Pending SKIL Bill H-1b Visa Legislation
12. CNN, Lou Dobbs, Programmer's Guild Interview & Transcript, August 26, 2005
13. Congressional Record: ILLEGAL ALIENS TAKING AMERICAN JOBS, June 18, 2003 (House)
14. Center for Immigration Studies, Backgrounder: The bottom of the pay scale, Wages for H1-B Computer Programmer's, John Milano, 2005.
15. U.S. Government Accountability Office (GAO), Report, EXPORT CONTROLS: Department of Commerce Controls over Transfers of Technology to Foreign Nationals Need Improvement

Notes

1. 8 U.S.C. 1184(i)(1)(A)
2. 8 U.S.C. 1184(i)(1)(B)
3. 8 U.S.C. 1101(a)(15)(H)(i)
4. American Competitiveness in the 21st Century Act, Pub. L.No.106-313, 114 Stat.1251, 2000 S. 2045; Pub. L. No. 106-311, 114 Stat. 1247 (Oct 17, 2000), 2000 HR 5362; 146 Cong. Rec. H9004-06 (October 5, 2000)
5. Department of Homeland Security Annual Reports on the H-1B visa program for 2004 and 2005
6. H-1B Frequently Asked Questions
7. American Competitiveness in the Twenty-First Century Act of 2000
8. 2007 H-1B visa limit already reached
9. USCIS REACHES FY 2008 H-1B CAP
10. USCIS Runs Random Selection Process For H-1B, USCIS, April 13, 2007
11. USCIS Reaches FY 2009 H-1B Cap
12. USCIS FY 2010 H1-B Cap Count
13. H1-B Visa Petitions Cap Reach Dates By Year from 1999 to 2010
14. H-1B Is Just Another Gov't. Subsidy
15. ON THE NEED FOR REFORM OF THE H-1B NON-IMMIGRANT WORK VISA IN COMPUTER-RELATED OCCUPATIONS
16. http://www.gao.gov/archive/2000/he00157.pdf
17. John Miano (June 2008). "H-1B Visa Numbers: No Relationship to Economic Need". Center for Immigration Studies. Retrieved 04/07/2010. {{cite web}}: Check date values in: |accessdate= (help)
18. Numbers USA (2010). "There Is No Tech Worker Shortage". Numbers USA. Retrieved 04/07/2010. {{cite web}}: Check date values in: |accessdate= (help)
19. ^ Hire Americans First (2010). "H-1B Visa Harm Report". Hire Americans First. Retrieved 04/07/2010. {{cite web}}: Check date values in: |accessdate= (help)
20. United Department of Labor Office of Inspector General, The Department of Labor's Foreign Labor Certification Programs: The System Is Broken and Needs To Be Fixed, May 22, 1996, p. 20
21. Low Salaries for Low Skills: Wages and Skill Levels for H-1B Computer Workers, 2005 John M. Miano
22. The Bottom of the Pay Scale: Wages for H-1B Computer Programmers John M. Miano
23. Programmer's Guild (2001). "How to Underpay H-1B Workers". Programmer's Guild. Retrieved 04/02/2010. {{cite web}}: Check date values in: |accessdate= (help)
24. NumbersUSA (2010). "Numbers USA". NumbersUSA. Retrieved 04/02/2010. {{cite web}}: Check date values in: |accessdate= (help)
25. OutlookIndia.com (February 18, 2009). "H-1B Visa Ban for Bailed-out US Firms is Irrational: Montek". OutlookIndia.com. Retrieved 04/02/2010. {{cite web}}: Check date values in: |accessdate= (help)
26. Ron Hira (Jan 12, 2008). "No, The Tech Skills Shortage Doesn't Exist". Information Week. Retrieved 04/02/2010. {{cite web}}: Check date values in: |accessdate= (help)
27. ^ B. Lindsay Lowell, Georgetown University (October 2007). "Into the Eye of the Storm: Assessing the Evidence on Science and Engineering, Education, Quality, and Workforce Demand" (PDF). Urban.org, The Urban Institute. Retrieved 04/02/2010. {{cite web}}: Check date values in: |accessdate= (help) Cite error: The named reference "lowell" was defined multiple times with different content (see the help page).
28. http://www.millerjohnson.com/pubs/xprPubDetail.aspx?xpST=PubDetail&pub=1406 H-1B Prevailing Wage Enforcement On The Rise – Millions In Back Wages And Fines Ordered
29. DOL Foreign Labor Certification Online Wage Library
30. Alice LaPlante (July 14, 2007). "To H-1B Or Not To H-1B?". InformationWeek.com. Retrieved 04/02/2010. {{cite web}}: Check date values in: |accessdate= (help)
31. Sun Accused of Worker Discrimination, San Francisco chronicle, June 25, 2002, online text
32. Santiglia v. Sun Microsystems, Inc., ARB No. 03-076, ALJ No. 2003-LCA-2 (ARB July 29, 2005)
33. http://www.workpermit.com/us/us_h1b_faq.htm
34. http://www.workpermit.com/us/us_h1b.htm
35. Grow, Brian (June 6, 2003). "Skilled Workers – or Indentured Servants?". BusinessWeek.
37. http://www.travel.state.gov/visa/frvi/bulletin/bulletin_4597.html visa bulletin
38. Social Security Administration: International Agreements
39. 8 CFR 214.2(h)(9)(iv)
40. United States General Accounting Office, H-1B Foreign Workers: Better Controls Needed to Help Employers and Protect Workers
41. 8 USC 1182 (n)
42. Programmer's Guild (1999-2000). "The Reddy Case". Programmer's Guild. Retrieved 04/02/2010. {{cite web}}: Check date values in: |accessdate= (help)
43. Roy Mark (13 Feb 2009). "Feds Bust Nationwide H-1B Visa Scam". eWeek. Retrieved 04/07/2010. {{cite web}}: Check date values in: |accessdate= (help)
45. U.S. Senate: Legislation & Records Home > Votes > Roll Call Vote
46. H-1B visas hit roadblock in Congress | TalkBack on ZDNet
47. ^ USCIS Interoffice Memorandum from Michael Aytes, Associate Director, Domestic Operations, to all Regional Directors and Service Center Directors, dated December 5, 2006
48. Search Results – THOMAS (Library of Congress)
49. U.S. Senate: Legislation & Records Home > Votes > Roll Call Vote
50. Consolidated Natural Resources Act of 2008
53. Mexican and Canadian NAFTA Professional Worker
54. http://www.ssa.gov/pubs/10096.html#4
55. Yeoh et al., 'State/Nation/trasnation: Perspectives on Transnationalism in the Asia-Pacific', Routledge, 2004, ISBN 041540279X, page 167
56. ^ Marianne Kolbasuk McGee (May 17, 2007). "Who Gets H-1B Visas? Check Out This List". InformationWeek. Retrieved 06/02/2007. {{cite web}}: Check date values in: |accessdate= (help)
57. ^ Peter Elstrom (June 7, 2007). "Immigration: Google Makes Its Case". BusinessWeek. Retrieved 04/02/2010. {{cite web}}: Check date values in: |accessdate= (help)
58. Prithiv Patel, Infosys, Wipro and TCS under investigation for misuse of H1B visas, India Daily, May 15, 2007
59. ^ Peter Elstrom (June 7, 2007). "Immigration: Who Gets Temp Work Visas?". BusinessWeek. Retrieved 04/02/2010. {{cite web}}: Check date values in: |accessdate= (help)
60. ^ Jacob Sapochnick, Patrick Thibodea (2009). "List of H-1B visa employers for 2009". ComputerWorld, BusinessWeek. Retrieved 04/07/2010. {{cite web}}: Check date values in: |accessdate= (help)
61. 'To H-1B Or Not To H-1B?', Information Week, July 14, 2007.
62. '25% H-1B visas still left!', Times of India, Oct 2, 2009.
63. "Cognizant Technology Solutions : Contacts". Retrieved 2007-07-05.

External links for H-1B information

• U.S. Department of State information on H-1B visa
• U.S. GAO Report on H-1B Problems, PDF format
• H1-B Visa Petitions Cap Reach Dates Analysis from 1999 to 2010 including 2009 Recession Impact
• 2010 H1B Visa Reports: Top H1B Visa Sponsors by Industry, Occupation, Economic Sector and Locations
• H1B Visa 2011 Cap Count Tracking with FY2010 Comparison
• How to Apply for H1B Visa Petition for 2011 Quota? Step by Step Process.

Abuse of the H-1B program

• Pittsburgh law firm's immigration video sparks an Internet firestorm, Pittsburgh Post-Gazette, June 22, 2007
• "Lawmakers Request Investigation Into YouTube Video" Sen. Chuck Grassley and Rep. Lamar Smith ask the Labor Department to look into a video they say documents H-1B abuse by companies. Information Week, June 21, 2007
• Oct. 2007 study by Georgetown University – The study raises questions about the use of test scores by visa-worker-seeking technology companies to claim that American citizens are not qualified.
• "America's New Immigrant Entrepreneurs" – A Duke University Study
• Communication Workers of America Communication Workers of America Union
• Compete America An H-1B coalition.
• Numbers USA Numbers USA – organization about protecting USA citizens jobs
• Programmer's Guild A professional society
• Technical Workers United Technical Workers Uniting for information on their jobs
• Bright Future Jobs Shedding light on H-1B visa abuse.

Bridge to Immigration or Cheap Temporary Labor? The H-1B & L-1 Visa Programs Are a Source of Both

• Articles with multiple maintenance issues from November 2009
• Misplaced Pages neutral point of view disputes from November 2009
• United States visas by type
• Employment of foreign-born