American businesses just received another blow from the Trump administration in the form of a proposal to dramatically restructure the filing procedures for H-1Bs, the temporary work visa category for foreign professionals. The timing of this proposal couldn’t be worse. Published on the eve of the FY 2020 “H-1B cap season,” the time period when U.S. businesses begin preparing to compete for the limited number of new H-1Bs available each fiscal year, employers are now in a state of limbo: Will the new process articulated in the notice of proposed rulemaking (NPRM) take effect this spring? Or will the current process remain in place? Either way, the unveiling of this NPRM brings another layer of uncertainty to H-1B adjudications, uncertainty which has multiplied exponentially during the first two years of the Trump administration.
Here’s what you need to know:
New H-1Bs are limited in number each year to 65,000 plus an additional 20,000 for individuals with U.S. graduate degrees. To allocate the precious few visas that are available each year, U.S. Citizenship and Immigration Services (USCIS) conducts a random selection process to identify the lucky 85,000 professionals whose petitions will be reviewed. When the economy is thriving, as it is now, demand for these visas far outweighs the supply: last year, nearly 200,000 H-1B petitions were submitted within the first week of April when the filing window opened (and quickly closed). To be considered in the lottery, current procedures require employers to prepare a full petition, including supporting documentation and details of the job offer, and to show that they have taken required steps to protect the wages and working conditions of their American workforce. Although this process is imperfect, it has been in place for many years, and employers understand the rules and requirements.
Under the proposed new system, U.S. employers will be required to electronically register each potential H-1B employee by providing USCIS with basic information about the person and the position. The lottery is run from the electronic registrations and only those who are selected will be eligible to file a full petition and receive an adjudication.
While the proposed registration system might solve some of the logistical issues USCIS has long-struggled with, it is not without its flaws. For example, because of the relative ease with which an employer can register a potential H-1B worker, employers will be incentivized to register many positions that might not ultimately qualify for an H-1B, or that might be abandoned. This will create uncertainty for employers whose registrations are not initially selected, making it difficult for these employers to effectively plan to fill their workforce needs. In addition, it is unclear how the registration system might affect small employers who need only one or two H-1Bs. Will a higher proportion of H-1Bs be allocated to industries that can apply economies of scale to H-1B strategy? Or will the registration system encourage more small employers to seek H-1Bs, knowing that they won’t have to expend the time, money, and resources preparing and filing an H-1B petition unless their registration is selected? Though it remains to be seen, it would be tragic if a lower number of H-1Bs were allocated to smaller employers who simply need that one mega-talented teacher from Peru, ground-breaking graphic designer from China, or innovative electronics engineer from India.
Along with the registration process, the Trump administration also indicated its intent to change the order in which the lottery is conducted in order to give priority to individuals with graduate degrees from U.S. institutions of higher education. While prioritizing advanced degree professionals is not an inherently bad idea, this too could have unintended consequences – penalizing U.S. businesses who employ professionals in fields where a master’s degree is not typically required, such as public education, accounting, and architecture. The healthcare sector, which relies heavily on foreign physicians to supplement a shortage of U.S. doctors, will also be disadvantaged, as many such physicians complete their medical education overseas before seeking employment in the United States.
On top of all of this uncertainty lies the fundamental question as to whether USCIS even has the authority under the Immigration and Nationality Act to make these changes. USCIS implicitly acknowledges this in the NPRM by including a severability provision that would allow implementation of one portion of the rule, if the other portion is “enjoined or invalidated by a court of competent jurisdiction.” USCIS also admits that implementation of the registration system could be delayed beyond the upcoming “H-1B cap season” if additional beta testing and vetting is required. Given all of this uncertainty, instead of keeping employers in the dark as to which process will be used in April, and instead of skimping on process and rushing this NPRM over the finish line, USCIS should immediately announce that the current process will remain in place for the coming year. This will give the agency the essential time and resources to implement a registration system that is fully-tested and that works.
In the meantime, Congress and the Trump administration should reach out to American business leaders to identify opportunities to make thoughtful changes to the employment-based immigration system. Instead of creating ad hoc solutions to isolated areas, our elected leaders should consider creative methods by which we could develop a more flexible, responsive visa program for professionals that addresses America’s economic needs as they change through the years, rather than relying on visa levels and systems created in a completely different economic and technological era. In the absence of this type of collaborative, introspective policymaking, we risk dismantling a system that plays a critical role in building a strong American economy. And if that happens, we all lose.