Why Are Employers Of H and L Professional Workers Paying A $600 Million Tab For Border Security And Now For 9/11 First Responders?
Since August 13, 2010, pursuant to Public Law 111-230 (“P.L. 111-230” or “the Bill”), some H-1B and L-  employers have been required to pay additional immigration fees of $2,000 and $2,250, respectively, when filing immigration petitions on behalf of temporary, foreign workers. When first enacted, the additional fees mandated by the Bill were scheduled to sunset on September 30, 2014. During the final days of the 111th Congress, Greenberg Traurig (GT) closely followed the debate surrounding the James Zadroga 9/11 Health and Compensation Act of 2010 (“9/11 First Responder’s Bill”) due to the inclusion of a provision calling for an extension of these fees to 2021 as a means to fund the 9/11 First Responder’s Bill. On December 22, 2010, when Congress passed the 9/11 First Responder’s Bill, they also extended the sunset date of these fees to September 30, 2015. This added only one year, instead of the proposed seven years, for companies subject to the additional fees.
Putting aside the purpose of the 9/11 First Responder’s Bill1, it appears that Congress is becoming increasingly open to tapping business visa programs as a source of funding various programs outside of immigration. This should be worrisome for a Nation that prides itself on its diversity and which thrives on innovations and creativity stemming not just from those born in the United States, but also abroad. Many weighing in on the debate suggested more thought and analysis should be given to the prudence in using visa programs utilized by the business sector as an untapped funding resource. In the instant case, the additional fees apply to companies employing 50 or more individuals in the United States, with more than 50 percent of its employees in the United States in H-1B or L-1 status. The fees apply when a company submits an initial petition on behalf of a foreign worker.
At first glance, it seems that the intent of this bill was not to dissuade U.S. employers from using business visa programs; but rather a means to fund projects and programs designed to enhance U.S.- Mexico border security. As outlined in the Bill, the fees are expected to generate $600 million in support of an overall border enhancement package. The funds will assist with plans to deploy more unmanned drones; construct forward operating bases for the border patrol closer to the border; hire 1,000 new Border Patrol agents, 500 new Customs and Border Protection agents, along with more agents for a number of agencies including Immigration and Customs Enforcement, Federal Bureau of Investigation, Alcohol, Tobacco and Firearms, and Drug Enforcement Agency.
Taking a closer look at the history behind the Bill, it appears that while the primary goal was to secure funding and votes, the practical implications are much more extensive. Initially, there was heated debate in Congress as to whether the funding for the new border enhancement package should be diverted from other programs such as the Recovery Act - the stimulus bill. But this was quickly quelled in favor of increasing fees for certain H-1B and L-1 petitions. One wonders why it was more palatable to vote in favor of visa fee increases. Some believe the rational was that Congress shouldn’t take away from a “fireman in Buffalo to hire more agents in El Paso.” But as Congressman Jerry Lewis (CA) argued, this provision is also “[p]enalizing businesses with increased fees”  which may also be considered as “de facto tax increases.”
Could it be that Congress was able to justify the additional fees for companies that some have deemed to be taking advantage of the business visa programs? The argument in favor of placing the burden on companies using such visas includes the assumption that these companies “exploit an unintended loophole in the H-1B visa program.”  The discussions and debate centered around a belief that companies fitting the criteria were no longer utilizing the visa programs to employ foreign workers whose talents will benefit the U.S. through innovation, creation and advancement of new technologies. Instead these companies are now deemed to be “multinational temp agencies” that were never contemplated when the visa programs were established. In light of the debate behind passage of the Bill, there is an implication that all companies with 50 or more employees and whose workforce consists of 50 percent or more H-1B or L-1 workers are de facto violating the spirit of the visa programs and driving down wages for U.S. workers, in particular those in the technology sector. Given this history, it could be argued that such companies are effectively being penalized through a back door via substantial fee increases.
To accept this argument would mean that we are accepting the assumption that all U.S. employers who utilize this business model, such as IT staffing companies, are bad apples. While limited abuse of visa programs may exist-there are employers that use all types of vehicles to game the system in a number of areas outside of immigration. While the stories of these few egregious employers make for large fines and great headlines, all companies should not be prematurely judged. The current H-1B regulations protect U.S. workers first and foremost. The current regulatory scheme has adequate checks built-in for protections against potential fraud. For example, existing regulations require certification from the Department of Labor (“DOL”) for all H-1B filings and ensuring that all sponsored H-1B workers are paid wages that are the higher of either the prevailing wage as determined by the DOL or the actual wage paid by the employer to all other individuals with similar experience and qualifications. Furthermore, L-1 standards are very strict as they relate to the placement of L-1 workers at third party worksites.
More importantly, even if there are some companies exploiting loopholes in the existing H-1B or L-1 regulations, that is not sufficient justification to punish all companies legitimately using the visa programs and contributing to improving the U.S. economy. Many of these exact companies are producing cutting edge technologies, providing vital services, while indirectly creating additional jobs for U.S. workers, as well as more demand for U.S. services and products. Congress commended the practices of some of the better known companies - Microsoft, IBM, Apple, Cisco, and Oracle as companies that are using the H-1B or L-1 programs as they were intended. However, it is important to note that the list is much larger than these household names; there are numerous other U.S. companies whose success depends on the talent and the availability of these H-1B and L workers.
The business world today works on collaboration not only internally but externally, pooling expertise from consultants and niche companies to encourage investment, innovation and to spur competitive growth in the U.S. These companies, with workforces high in foreign workers, should also be recognized for keeping the remaining percentage of jobs, regardless of whether it is 10% or 50%, here in the U.S. instead of sending the work abroad. Keep in mind these foreign H and L workers generally pay full U.S. income tax and also pay into the Social Security system.
The heavy financial burden placed on the private sector, particularly small business, should be given careful consideration and the long term impact of these "pay-for" measures should not be discounted. Companies facing increasing filing fees along with increased government investigations, will limit use of the visa programs and seriously consider off-shoring as an alternative to ensure they remain competitive. If they cannot employ the best, the brightest and the most appropriate individual for the job in the U.S., their only recourse may be to start searching for and employing them abroad. While the primary goal of these bills is laudable, an unintentional, or perhaps intentional, chilling side effect on our already fragile economy may be a rapid decline on the legitimate and sensible use of the H-1B and L visa programs.
1 The 9/11 First Responder’s Bill provides, among other things: (1) medical monitoring and treatment benefits to eligible emergency responders and recovery and cleanup workers (including those who are federal employees) who responded to the September 11, 2001, terrorist attacks; and (2) initial health evaluation, monitoring, and treatment benefits to residents and other building occupants and area workers in New York City who were directly impacted and adversely affected by such attacks. It also (1) make individuals eligible for compensation under the September 11 Victim Compensation Fund of 2001 for harm as a result of debris removal; (2) extend the deadline for making a claim for compensation for physical harm not discovered before the deadline; (3) cap liability for claims related to debris removal based on the level of insurance available; (4) limit the total payment for compensation for claims filed on or after the regulations are updated pursuant to this Act; and (5) cap the amount that an individual may charge in connection with a claim under such Act, with exceptions.
2 156 Cong. Rec. S6996-01, S6997 (Aug 12, 2010).
3 156 Cong. Rec. H6584-02, H6586 (Aug 10, 2010).
5 156 Cong. Rec. S6996-01, S6998 (Aug 12, 2010).
6 8 CFR 214(h)(1)(ii)(B)(1).
7 USCIS Memorandum, Donald Neufeld, Associate Director (Jan 08, 2010). available at http://www.uscis.gov/USCIS/Laws/Memoranda/2010/H1B%20Employer-Employee%20Memo010810.pdf.
8 156 Cong. Rec. S6996-01, S6998 (Aug 12, 2010).
Mahsa Aliaskari leads the Los Angeles immigration group of GreenbergTraurig. She provides guidance to domestic and foreign employers regarding U.S. immigration laws, regulations and employment compliance matters. Providing practical and innovative strategies and immigration practices that work for companies, since 1998 she has assisted various companies, professionals and skilled workers in obtaining immigrant and nonimmigrant visas. Mahsa focuses her practice on business professionals across a number of industries, including health care, financial, trade, retail and entertainment. She also assists companies with completing due diligence, as well as conducting I-9 and H-1B audits.
Steve Kim is a Law Clerk at Greenberg Traurig.
The opinions expressed in this article do not necessarily reflect the opinion of ILW.COM.