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The H-1B Visa Program
by Cyrus d. Mehta

  2. H-1Bs AT A GLANCE


1. What is the H-1B program? The H-1B program is a prompt, lawful way for U.S. companies to employ foreign-born professionals on a temporary basis. A U.S. employer using this program must guarantee that (1) the foreign-born professional will be paid at or above the rate paid for a similar position at the employer’s own offices or at those of their local competitors; (2) the foreign worker will not "adversely affect" the working conditions of his U.S. colleagues; (3) U.S. colleagues will be given notice of the foreign worker’s presence among them; and (4) there is no strike or lockout at the worksite.

The employer also must demonstrate that the position is one requiring a professional in a specialty occupation and that the intended employee has the required qualifications. The foreign employee must demonstrate that he or she possesses a baccalaureate degree or foreign equivalent. Progressively responsible work experience may substitute for any deficiency in education.

Usually, three years of work experience equates to one year of university education.

There is a detailed enforcement system in place to identify and punish those who do not comply with these requirements; the punishments include repaying salaries to the foreign workers if found that they have been underpaid, as well as debarment from immigration programs for a year.

2. Why is the H-1B program essential? U.S. employers who use the H-1B program to bring in temporary professionals seek particular sets of skills not currently found in sufficient quantity in this country. As the U.S. economy becomes increasingly global, H-1B professionals become even more essential to America’s continued economic growth. Importantly, if American companies are prevented from hiring essential people to fill critical positions, an increasing number of jobs dependent upon these slots also will go unfilled each year, resulting in American jobs being lost, and American projects losing out to competition from abroad.

3. Why is the cap a problem? Increased globalization and a booming economy have led to a steadily increased demand for H-1B professionals. Before 1990, there was no cap on the number of H-1B professionals allowed to enter the U.S. The 65,000 cap enacted by the Immigration Act of 1990 was set without any data about how many professionals were actually needed or what the economy might require in the future. The growth of jobs which require specialized expertise in new or innovative technologies has fueled the need for H-1B professionals, and the cap was reached for the first time in Fiscal Year (FY) 1997, even before the end of that fiscal year. Current projections strongly suggest that U.S. companies will have a steadily increasing need for H-1B professionals in coming years.

In FY 1998 the cap was reached on May 11, 1998, a full five months before the end of FY 1998.

On October 21, 1998, the American Competitiveness and Workforce Improvement Act of 1998 ("ACWIA") was enacted to increase the cap on H-1B visas from current 65,000 to 115,000 for the FY 1999; 115,000 in FY 2000; and 107,500 in FY 2001. The quota of 65,000 would return to 65,000 for FY 2002 and thereafter.

Despite the increased numbers, the cap was reached in April 1999, six months before the end of FY 1999 (September 30, 1999). In Fiscal Year 2000, the cap was reached in March 2000. The increase from 65,000 to 115,000 for FY 1999 was again not based on any data confirming the actual need of foreign professionals in a booming economy.

In October 2001, the American Competitiveness in the Twenty-first Century Act (2000) (AC21) increased the cap to 195,000 for the next three years, with the cap dropping to 65,000 in October 2003.

4. Why are H-1B professionals needed now? No employer would go through the extra burdens, costs and delays inherent in hiring a foreign professional worker unless they cannot find among American workers the skills they need. In many instances, U.S. workers simply are unavailable. The high-tech industry estimates that as many as 190,000 information technology jobs are currently unfilled. Companies have put into place significant education and training programs to develop needed skills in the American workforce. In fact, the information technology industry itself has spent cumulatively over $210 billion for training, and companies donate over $4 billion per year to U.S. schools at the K-12, college and university levels. However, these efforts simply are insufficient to fill in a timely manner the demand that exists in the current marketplace. There continues to be a need for H-1B temporary nonimmigrant professionals.

5. The solution – Eliminate the cap. The H-1B cap of 65,000, and now 195,000, was chosen arbitrarily, without regard to actual usage or need. Basic economics tells us that market forces will keep the number of needed H-1B workers at a level consistent with U.S. hiring needs. Statistics since 1990 indicate that without a cap, numbers will not increase dramatically but will continue a pattern of modest, steady growth. Keeping safeguards in place for wages and working conditions, with proper enforcement, will ensure that H-1B workers will help generate more, rather than fewer, jobs for Americans.


1. What are H-1Bs?

  • Temporary – H-1Bs are temporary foreign professionals hired by a U.S. company or academic institution.
  • Highly skilled – H-1Bs can be hired only for "specialty occupations," those jobs requiring a professional who have the equivalent of at least a bachelor’s degree.
  • Professionals – H-1Bs must be professionals such as doctors, engineers, professors, accountants, lawyers, physical therapists, and computer professionals.

2. How many Enter and Where do They Come From?

  • Under current law, no more than 195,000 H-1B visas can be issued in the next three fiscal years, with the cap dropping to 65,000 in October 2003. Even with these numbers, H-1B temporary professionals comprise less than one-tenth of one percent of the U.S. workforce of more than 127 million people.
  • The top 5 – The top 5 source countries for H-1B professionals are currently India, the United Kingdom, Japan, Philippines and Germany.

3. Why Do Employers Hire H-1Bs?

  • Needed skills in short supply – Employers hire H-1B professionals to obtain essential technical skills or knowledge that is relatively unique and not readily found in the U.S.
  • Global market expertise – Employers often need H-1B professionals to bring special expertise in overseas needs, markets, trends or distribution that enables U.S. businesses to compete in global markets.

    4. What Must Employers Do?

    • Protect wages – Employers must pay a wage to every H-1B worker that is at least as much as what is typically paid in the region for that type of work ("prevailing wage"), or what the employer pays existing employees with similar experience and duties.
    • Protect working conditions – Employers cannot use H-1B professionals to break a strike, and must notify their U.S. workforce when they hire an H-1B professional. Employers cannot make the H-1B nonimmigrants work under conditions different from their U.S. counterparts, including hours, shifts and benefits.
    • Recruit in the U.S. and Not Displace U.S. workers – Employers who use a lot of H-1Bs must first try to find U.S. workers before they can hire an H-1B. They also must attest that they are not hiring the H-1B if they have laid off or displaced a similarly situated U.S. worker. Employers must attest to the above protection by affirmatively filing with the Department of Labor (DOL) and by maintaining a file available for public access.
    • Be subject to penalties – Failure to comply with DOL regulations can result in an investigation, civil and administrative penalties, payment of back wages, and even debarment from participating in key immigration programs.


    An employer who temporarily needs the services of a foreign professional must demonstrate that both the job requirements and the foreigner’s credentials or experience are "professional." The employer must also meet DOL requirements (noted below) and petition the Immigration and Naturalization Service (INS) for permission to employ a foreign national. If the employee is out of the country, he or she must also apply for the visa at a U.S. consulate abroad.

    1. "Labor Condition Application" Process – Department of Labor (DOL)

    1. Employer must certify to the Department of Labor:
      • It is paying the higher of what it pays its own similar workers or what similar workers in the area are paid (whichever is higher);
      • The working conditions of its U.S. workers are not adversely affected;
      • There is no strike/lockout at the worksite nor in the occupation for which a foreign professional is sought;
      • It has given notice to current employees that it is seeking to hire an H-1B professional.
    2. DOL certifies receipt and acceptance of the attestation in order to create a public record.
    3. Employer must post the labor condition application for 10 days and maintain a wage file that is open to the public.
    4. ACWIA created a new category of employers known as "dependent" H-1B employers. U.S. employers of 51 or more whose workforce comprises 15% or more H-1B workers are considered dependent employers. Smaller employers are allowed a slightly higher ratio of H-1Bs to their total workforce. These employers must additionally attest that they will not displace a U.S. worker 90 days before and after filing the visa petition for a foreign worker. Further, they must attest that they have taken good-faith steps to recruit in the U.S. using industry-wide standards and that they have offered the position to any U.S. worker who applies and is equally or better qualified than the H-1B worker. Dependent employers who pay H-1B workers a salary of $60,000 or who employ a person with a master’s degree are exempt from these additional attestations.
    5. Violations of the attestations
      • Employers must follow through on attestations or they are in violation of law and could be required to pay wages, incur civil penalties and be debarred from the program;
      • DOL will begin an investigation of employer practices with formal complaint and investigation mechanisms.

    2. Immigration Petition – U.S. Immigration and Naturalization Service (INS)

    1. Employer must submit a request to INS, proving that it has completed the Labor Condition Application process and demonstrating that both the employer and the foreign professional qualify for the visa category. The employer must submit a fee of $110 plus a $1000 fee to fund scholarship and training programs, and to fund Department of Labor administration and enforcement activities under the H-1B program. Employers cannot recoup the $1000 fee from the H-1B nonimmigrant or they are subject to fines per violation. Certain employers such as institutions of high education, research organizations affiliated to universities, nonprofit or government research organizations, primary/secondary education institution or nonprofit entities engaged in "established curriculum-related clinical training of students" and certain non-profit organizations are exempt from the $1,000 fee.
    2. Employer must demonstrate:
      • The need for someone who is a professional (job requires a worker with at least a bachelor’s degree);
      • That the candidate it seeks to hire has the required degree (including an equivalency of a foreign degree) and any other qualifications required.
    3. INS has the final say on the professional and the position.

    3. Visa Application – Department of State (DOS)

    1. If the professional is outside the U.S., he or she must apply to a U.S. consulate for an H-1B visa. If already in the U.S. in another status, the professional can petition the INS for a change of status to H-1B. The $1000 fee is waived for any employer who is filing for a second extension of stay for an H-1B nonimmigrant.
    2. U.S. consulate officer adjudicates the application to determine the alien’s admissibility.

    4. Portability

    Under § 105 of the AC21, a nonimmigrant who was previously issued an H-1B visa or provided H-1B visa status is authorized to accept new employment upon the filing of a petition by the prospective employer. Prior to the enactment of this provision, an H-1B worker switching from one employer to another would have to wait for several weeks for the H-1B visa petition to get approved before joining the new employer.

    In order to be eligible under § 105, the nonimmigrant should have been lawfully admitted into the United States and the petition must have been filed "before the date of expiration of the period of stay authorized by the Attorney General." Furthermore, this nonimmigrant subsequent to such lawful admission has not been employed without authorization in the U.S. before the filing of the petition.

    5. Extension Of H-1B Status Beyond Six Years

    AC21 provides for extensions of H-1B status beyond six years in two situations. The first situation occurs when the H-1B worker is a beneficiary of an employment-based immigrant petition and is subject to per-country limitations. In this event, the alien is eligible to obtain a one-time extension of nonimmigrant status valid until his or her application for adjustment of status has been decided.

    The second provision allows for extensions of H-1B status in one-year increments beyond the six-year limitation in the case of nonimmigrants who had previously been issued an H-1B visas or had H-1B status if 365 days have elapsed since the filing of either a labor certification application or an employment-based immigrant petition on the his or her behalf. This provision, however, does not take effect unless the immigrant petition has been filed, and, hence, fails to provide relief to people with long-pending and still-pending labor certification applications. The extensions provided under this provision continue until the final decision is made on the alien’s permanent residence application.

    About The Author

    Cyrus D. Mehta, a graduate of Cambridge University and Columbia Law School, practices immigration law in New York City. He is Vice Chair of the American Immigration Lawyers Association's National Labor Department Liaison Committee, trustee of the American Immigration Law Foundation and recipient of the 1997 Joseph Minsky Young Lawyers Award. He is also Chair of the Immigration and Nationality Law Committee of the Association of the City Bar of New York. He frequently lectures on various immigration subjects at legal seminars, workshops and universities and may be contacted at 212-686-1581 or

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