New Rules Raise Barriers to Employers’ Ability to Hire Global Talent

The Departments of Labor and  of Homeland Security, in an unusual move, issued two interim final rules on October 8, 2020 raising new barriers to employers who seek to gain H-1B visas for specialty occupation temporary professional workers, or who are petitioning for permanent residency for their foreign employees.  The administration estimates that the new H-1B rules will cost employers $4.3 billion over a decade, and result in at least a third fewer approvals annually of H-1B visa petitions.

The Department of Labor (DOL) rule, effective on October 8, 2020 and applicable to applications already filed and pending with the Office of Foreign Labor Certification’s National Prevailing Wage Center (NPWC) as well as to petitions filed on or after that date, substantially increases the amount that employers must pay the employees for whom they seek H-1B visas or permanent residency.   The Department of Homeland Security (DHS) rule, effective on December 7, 2020,  changes decades-long definitions of key terms applied in the H-1B visa context such as “specialty occupation”, “employer-employee relationship” and “worksite”,  to make fewer positions eligible for H-1B visas.  It also shortens the duration of  H-1B visas from 3 years to one year in some cases, and provides for increased worksite inspections of employers of H-1B visa holders.

This Forbes article provides a detailed analysis of the substantial changes made by these interim final rules.

Ordinarily, new rules are issued as proposals and do not take effect until the public has had the opportunity to comment on them, and the administration has been able to consider and sometimes make changes based on the comments.   It is striking that the administration chose to issue these changes as interim final rules, a mechanism to be used only in exceptional cases where urgency is required, a circumstance that doesn’t apply here, given that these changes have been in the works since at least 2017.  Should the November 2020 presidential election result in a new administration, it could simply jettison a proposed rule and never finalize it.   An interim final rule must go through a review process and will take much longer for a new administration to revoke.

The U.S. competes worldwide for the best and the brightest who contribute to innovation and a vibrant U.S. economy.   In Maine, hundreds of H-1B visa holders work in hospitals from York to Aroostook county, providing critically needed healthcare.  They also are employed in Maine’s universities and colleges, in our biotech and medical research facilities, in high tech and many other sectors.  In the past three years, over 100 Maine businesses have benefited from access to the global talent that the H-1B and permanent residency processes provide, benefiting Maine’s communities and economy as a whole.  

The new regulations are likely to result in many businesses nationwide choosing to offshore their employees or to locate offices in other countries such as Canada, doing more harm to the U.S. economy than good as the U.S. tries to emerge from the pandemic.

Public comments opposing the new rules will be due on November  9th (DOL rule) and December 7th (DHS rule).  MeBIC will be opposing both rules.