Senate Bill Calls for Market-Based H-1B Cap

By Roy Maurer Feb 7, 2013

Propelled by the political momentum for national comprehensive immigration reform, a bipartisan group of U.S. senators introduced a bill that would expand the number of skilled foreign workers that American companies can hire, as well as a host of other provisions related to these workers.

Sen. Orrin Hatch, R-Utah, introduced the Immigration Innovation Act of 2013 on Jan. 29, 2013. It calls for raising the current cap on H-1B visas for high-skilled foreign workers and making the cap adjustable based on market demand.

The bill focuses solely on high-skilled immigration—one of the least controversial aspects of immigration reform. Strongly endorsed by the business and tech communities, the bill proposes to reform both the temporary and permanent high-skilled immigration system by tackling four areas: H-1B visas, student visas, green cards, and funding for science, technology, engineering and mathematics (STEM) education and training.

“This legislation would transform the high-skilled immigration system in our country,” said R. Bruce Josten, executive vice president for government affairs at the U.S. Chamber of Commerce, in a statement of support for the bill. “Significantly, this legislation would also ensure that individuals earning master’s or doctorate degrees in the natural sciences and engineering from U.S. universities have access to permanent resident status, as long as those individuals have a job offer and their U.S. employer is unable to find qualified and available Americans,” he said.

While there have been many high-skilled immigration bills in both the House and Senate, none have gained traction,” said Peter F. Asaad, managing partner of Immigration Solutions Group, a Washington D.C.-based law firm.

What makes this bill special is that it focuses on expanding the number of green cards to meet economic demand, Asaad told SHRM Online.

“Currently, the number of green cards available each year to highly skilled immigrants through employment-based immigration is such a small fraction of the total number that it is detrimental to the U.S. economy,” he said.

There is much to like about the bill, said Andrew Wilson, a partner with Serotte Reich Wilson LLP, based in Buffalo, N.Y., and a Society for Human Resource Management Global Special Expertise Panel member. “The H-1B cap was hit after two months last year, and many believe it will be hit even sooner this year. An increase in H-1B cap numbers will be a welcome sight to many U.S. employers, particularly those in high-tech out in Silicon Valley,” he told SHRM Online.

H-1B Visa Reform

Each April, employers race to submit applications for the limited number of H-1B visas available to private employers. Depending on the year, these visas can run out in a matter of days, weeks or months. The Immigration Innovation Act would amend the Immigration and Nationality Act to raise the H-1B visa cap from the current 65,000 per year to 115,000 per year. It also would create an H-1B market-based escalator cap that automatically adjusts the number of available visas depending on demand, with a requirement that the cap never exceed a 300,000 visa ceiling in a given year.

For example, as written in the bill, if the cap is reached within the first 45 days of the current fiscal year, an additional 20,000 visas will be made available on day 46 of the fiscal year and at minimum the cap would be set at 135,000 visas the following fiscal year. Conversely, if the cap is not reached by the end of the fiscal year, the following year’s cap would be reduced by the number of visas left unused the previous year.

“Employers need predictability in the H-1B system to plan for their workforce needs,” said Rebecca K. Peters, legislative director for the American Council on International Personnel.

“The escalator cap is a good solution in that it provides for much more predictability than does the current arbitrary H-1B cap, where lotteries often make it difficult for employers to access talent, especially when the cap is used before the end of the fiscal year,” she told SHRM Online.

The bill also seeks to reduce obstacles to H-1B extensions and job changes by making it harder for U.S. Citizenship and Immigration Services to deny the extension of previously approved petitions and giving terminated H-1B workers a 60-day transition period to find new employment.

Additionally, spouses of H-1B visa recipients would be authorized to work in the United States, the 20,000 H-1B cap exemption would be lifted for those who earn U.S. advanced degrees, and the 6,800 H-1B1 visas set aside annually for Chile and Singapore would no longer count toward the H-1B base cap.

Green Card Recapture

The bill sets its sights on reforming the employment-based immigrant visa quota system by allowing for the recapture and rollover of unused immigrant visas (green cards) from prior years. Though no new immigrant visa numbers would be created, the bill would create quota exemptions for dependents of employment-based immigrants, holders of U.S. STEM advanced degrees, individuals of extraordinary ability, and outstanding professors and researchers.

In some situations, depending on the individual’s nationality, the green card process can take 40-plus years, Wilson said. For many others, it can be an 8- to 10-year process. “Companies are very frustrated with trying to keep key workers here in the U.S.,” Wilson said. “These are real companies with legitimate needs, and our current priority-date green card system is not meeting those needs.”

Some have suggested that the proposed legislation does not likely provide enough green cards to clear the existing green card backlogs or to avoid deficits given the future demand created under the bill.

“While the bill does a good job of providing employers access to students and H-1B professionals, it must simultaneously provide enough green cards to eliminate the existing green card backlogs and meet future employment-based green card needs,” Peters said. “Without enough green cards, we could be re-creating the backlogs of the past decade all over again, instead of working toward a more efficient system that allows employers to both access and retain the top talent they need to grow our economy.”

The legislation would also eliminate annual per-country quotas on employment-based immigrant visas, resulting in a first come, first served employment-based green card system. The result of this change would mean that most EB-2 and EB-3 green cards would go to the most backlogged country—India—in 2014, which would likely cause delays for other countries.

“Lifting the visa quota based on per-country limits specifically for employment-based visa petitions may be the biggest change,” said Ann Cun, an immigration attorney and counsel for LawLogix Group, a provider of electronic Form I-9 compliance and immigration case management software. This means that U.S. employers may sponsor permanent workers without the worry of per-country limits that have traditionally clogged the immigration system, she told SHRM Online. “Our practitioners by now should be in full alarm mode as this section of the bill has the potential to uniformly affect both family and business immigration practices by significantly increasing caseloads,” she said.

Student Visas

To stem the “brain drain” from the United States, the bill proposes allowing students who are immigrants a means to pursue permanent residence in the U.S. Under the bill, all F-1 students would have the ability to immigrate if they are qualified to do so. The bill would apply to a broad scope of students, including those in high school, language school and flight school as well as community colleges and universities, Peters explained.

“I think many people are starting to accept the premise that any immigration system that discourages the best and brightest from STEM fields to remain in the U.S. is counterproductive and does nothing to protect U.S. workers,” Wilson said. “In fact, the counterargument could be made that forcing innovative STEM graduates to take their skills to other countries and compete with U.S. companies would hurt U.S. workers,” he said.

Funding for STEM Education and Training

The bill also sets up future funding, said Cun, referring to the provision that H-1B visa and green card fees would be used to fund workforce and STEM education training.

The proposed legislation would charge employers a new $1,000 H-1B visa fee on top of existing fees for employers with more than 25 full-time employees; a new $500 H-1B visa fee on top of existing fees for employers with 25 or less full-time employees; and an additional $1,000 fee for green card applicants.

The billions of dollars generated over the next decade would be invested in a new fund that the Department of Education would distribute to state governments based on competitive grant applications. To obtain these funds, states would need to outline how they would improve STEM education to meet employer needs.

“This is one part of the bill I don’t like,” Wilson said. “There is already a $750 or $1,500 training fee for most employers, and there are questions as to how efficiently that money is being used to train U.S. workers. I don’t know why the government is mandating another financial burden for U.S. employers to make sure U.S. students are trained in high-tech and growth fields,” he said.

The timing of this bill is perfect, Asaad commented. “No doubt it was put on the table to communicate ideas and to build consensus around them so that it can be considered for incorporation in the larger comprehensive immigration reform bill. It would not be surprising if some, if not all, the ideas in this bill are not incorporated into the larger bill,” he said.

Cun agreed, saying there’s no doubt that whether or not this bill survives congressional review, “it will certainly leave its mark on what will soon be a comprehensive immigration reform package.”

Roy Maurer is an online editor/manager for SHRM.

Follow him at @SHRMRoy

Related Article:

Higher Visa Fees, Penalties Foreseen with Immigration Reform, SHRM Online Legal Issues, January 2013

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