At first glance, the practice of employing foreign nationals at your company appears quite arduous and possibly controversial. Nevertheless, many companies nationwide have concluded that seeking such workers is a reasonable business decision, given the significant shortage of skilled IT workers available domestically.
The U.S. government has determined that the shortage of technology workers could be a drag on the economy—which is becoming increasingly driven by technology—and sees opportunity to alleviate the problem through international workers. In 1990, Congress imposed a 65,000 annual limit on H-1B visas. That number was first reached in 1997, but a year later the cap was hit in May, due to increased competition for international workers. Although the number of H-1B visas was nearly doubled to 115,000 each of the past two years, the limit was again reached in June 1999 and March 2000. Congress recently passed a bill expected to be approved by President Clinton, that raises the visa limit to 195,000 through 2003.
Raising the H-1B cap has not totally avoided controversy. Labor organizations continue to oppose such legislation, claiming H-1B visas take high-paying jobs from Americans (USA Today, Friday, May 12, 2000).
However, based on data from a study conducted by the Information Technology Association of America (ITAA), even increasing the cap for H-1B visas will not fill the void. The study, published in April 2000, estimated that approximately half of the 1.6 million IT positions created in 2000 would go unfilled, leaving a staggering supply deficit of 843,328 for the year.
Accordingly, if you are considering the pursuit of international workers to fill jobs in your organization, it is important to proceed efficiently and with due speed in order to be competitive. Although this white paper does not seek to convince you that hiring foreign nationals will resolve your technical staffing problems, it intends to provide you with step-by-step guidelines that will help make this process manageable if you do decide to pursue this course of action.
H-1B Defined
The primary non-immigrant visa used by companies to hire foreign nationals is the H-1B. This visa category covers individuals in specialty occupations defined as “an occupation that requires (a) theoretical and practical application of a body of highly specialized knowledge, and (b) attainment of a bachelor’s or higher degree in this specific specialty (or its equivalent) as a minimum for entry into the occupation in the United States.”
There are two essential requirements for a successful H-1B filing. First, the job itself must be professional, requiring at least a bachelor’s degree in a particular field(s). If a company requires that all of its employees have college degrees, but does not particularize those degrees in relation to the subject position, that is not sufficient for specialty occupation eligibility. The second requirement is that the individual candidate must have a bachelor’s degree, foreign degree equivalent, or the equivalent based on experience.
For example, technician positions do not qualify for H-1 eligibility, since they do not require a bachelor in engineering or engineering technology. A higher level position, such as engineer, does require an appropriate professional degree. Similar cases exist for mechanics vs. mechanical or automotive engineers, draftsmen vs. architects and bookkeepers vs. accountants. As the economy develops new professions, including formerly non-professional positions, e.g. graphic designers, you will need to look to the industry and your company to determine if the position qualifies as “professional.” Particularly in the area of information technology, this determination is critical, as is the evidence provided to convince INS that the position is indeed professional.
Evaluating Credentials
In most cases, the candidate will have a bachelor’s degree from a U.S. college or university. However, when they present a degree from outside the United States, the degree should be evaluated by a professional credentials expert to provide the U.S. equivalent. Situations exist where a degree from another country indicates a bachelor’s degree on its face, when in fact it is only equivalent to three years of U.S. university study. Some of the bachelor’s degree programs in India require four years of study while others only require three. This caused a recent investigation at the Texas Service Center with regard to H-1s for certain Indian nationals.
INS regulations also permit the substitution of real world experience for university credits. The formula utilized is three years of work experience for one year of academics. In these instances, the experience is to be progressive and the objective is to establish that, through industry experience, the individual has gathered the knowledge/information basis and theoretical understanding equivalent to that gained in a university setting. In the example above, the Indian possessing a bachelor’s degree based on a three-year program would have to establish at least three years of experience in the industry for a bachelor’s degree equivalence. There are instances where a candidate will have no university or college credits, but can establish the equivalence of a bachelor’s degree through a minimum of 12 years of progressive work experience. There are professional evaluators, many of which are college professors, who will review the academic and/or experiential background of the candidate and provide an analysis.
For positions requiring licensure, the H-1B beneficiary must possess a license or, at least, an interim permit. Depending on the context, a license may or may not be required for that profession. For example, a law firm may have the need for an expert legal specialist on international tax law to serve as a consultant/researcher, but not to be engaged in the actual practice of law. A pharmacist working in a pharmacy or hospital will require a license, but if the pharmacist is working in a research laboratory, a license is not likely required.
The other major consideration for an H-1B is the need for the salary to satisfy the prevailing wage in that market. Historically, labor unions have battled against the granting of
H-1B visas on the grounds that employers would pay lower wages to foreign nationals and, consequently, bring down the wage scale for similarly situated American workers. In order to avoid such a result, the employer must pay at least 95% of the prevailing wage to the H-1B beneficiary.
The Department of Labor and its local agent can determine the prevailing wage, or the employer may use an independent wage survey or other published source. It is critical to classify, properly, the position, based upon the duties and not the title, in order to insure an accurate prevailing wage analysis.
H-1B Process, Step by Step
Step One: Obtaining the prevailing wage
These wages are now available on computer for each state and metropolitan statistical area (MSA) for the subject position. Previously, the Department of Labor used a system that included many more job titles and, therefore, you may find that your particular position does not have its own prevailing wage. Instead, you will have to look to a more generalized position most closely related to the position in question to identify the prevailing wage. There are two categories of prevailing wages. The first is for entry-level positions requiring little or no experience and generally requiring a great deal of supervision. The second category is for all other positions.
You can see that this “lumping together” means that a relatively junior level lawyer, for example, will be treated the same as the most senior level lawyer, often creating a significant gap between the offered wage and the required prevailing wage. When such a gap exists, it is recommended that an independent wage survey or other published source be utilized, which provides a more realistic figure. Resources for wage surveys are numerous. A visit to your local library or an Internet search will get you heading in the right direction.
Step Two: The Labor Condition Application
Next, the employer must file a Labor Condition Application (LCA) with the U.S. Department of Labor. The LCA (ETA 9035) must be certified by the DOL before the H-1B petition may be filed with the INS. The DOL reviews the application for completeness and accuracy. Certifications are currently done through an electronic system and commonly will be adjudicated within a matter of hours. The system does have its glitches and you periodically may experience a two-to three-week turnaround.
A single LCA may be filed for multiple positions. For a position that requires work at various locations, one LCA must be filed for each location. The LCA requires the employer to attest that it is offering the H-1B worker the higher of (a) the actual wage the employer pays to other individuals similarly employed and with similar backgrounds, or (b) the prevailing wage in the geographical area of employment.
The employer must also confirm that the working conditions for the H-1B worker will not affect, adversely, other similarly employed workers and that there is no strike, lockout, or work stoppage. Moreover, the employer must give notice to its employees of the filing of the LCA through a posting or notice to a bargaining representative, i.e. a labor union.
The notice, which must be posted for 10 continuous business days, should contain the wage offered, the prevailing wage, and the source of that wage. Postings must be placed in two conspicuous locations at each place of employment where the individual will be employed. The notice must also include information where complaints can be filed with the Wage & Hour Division of the U.S. Department of Labor. The employer must also provide a copy of the certified LCA to the H-1B nonimmigrant.
Step Three: Prepare the I-129H petition for the INS
This petition is to be filed in duplicate and must include the following:
A) Certified LCA.
B) Written job offer letter or employment contract.
C) Detailed job description, including academic and experiential requirements.
D) Beneficiary’s resume.
E) Academic documentation (plus credentials evaluation, if necessary).
F) Industry-relevant employment reference letters.
G) Materials that describe the petitioning entity (business, organization, etc.).
H) Beneficiary’s complete passport.
I) I-94 entry document (and I-20 and the employment authorization document, if applicable).
Filing Instructions
The I-129 petition is filed generally with a $610 filing fee, of which $500 is a training fee paid by the employer. If any immediate family members are to be included, then an
I-539 application is filed for H-4 status with a filing fee of $120. For derivative applicants, file a copy of their complete passports and I-94 entry documents and proof of the familial relationship, e.g. marriage certificate/birth certificate.
The petitions are filed with the applicable INS Service Center based on geographic jurisdiction. There are four centers (see Quick Guide below for details): Eastern Service Center in Vermont, Southern Service Center in Texas, Northern Service Center in Nebraska and Western Service Center in California.
The time in which INS adjudicates these petitions varies by regional service center and by the supply and demand for H-1B visas. Since there is an annual cap (115,000 in Fiscal 2000 and 195,000 in Fiscal 2001), and because during the last four fiscal years the cap has been reached earlier and earlier, it is advisable that H-1B petitions be filed as soon as possible. The fiscal year begins October 1 and an application may be filed up to six months before the requested start date.
H-1B in Action
The beneficiary does not need to leave the United States in order to commence H-1B employment. The only exception is where the individual is out of status and therefore must proceed abroad to a U.S. Consulate to obtain an H-1B visa. Also, if the individual must travel abroad for personal or business reasons, they must have an H-1B visa in order to re-enter the country, unless the trip is to Canada or Mexico for less than 30 days.
Visa processing at a U.S. Consulate requires advance planning, in some instances requiring up to two weeks of the individual’s presence in the country where the U.S. Consulate is located. However, in most instances, the H-1B visa can be issued the same day or within 24 hours. The individual must present the original H-1B approval, their passport, a completed and executed OF-156 nonimmigrant visa application form, a photograph, and a visa fee of at least $45.
Initially, H-1B approvals may be issued for a period of up to three years. Although there are some exceptions, generally, an individual may hold H-1B status for up to a maximum period of six years. H-1B employees also have an opportunity to recapture unused time, e.g. time spent on business trips outside the United States taken at the request of the employer.
H-1B approvals may be issued for part-time positions and an individual may hold multiple H-1B approvals, simultaneously, enabling them to work for more than one employer. The H-1B approval is employer specific, geographically specific, and job specific. If a material change occurs in any of those areas, a new or amended petition must be filed. There is some latitude for individuals to begin work for company A, and then move to company B based upon a new H-1B approval, and then return to company A without the need for a new H-1B filing.
In the event that the H-1B individual is dismissed before the end of their authorized stay, the employer is liable for reasonable costs related to return transportation of the beneficiary to their last place of foreign residence. This includes dismissals for cause. However, if the beneficiary voluntarily terminates employment the employer is excused from this requirement.
Alternatives to H-1B
For Canadian and Mexican citizens, the Treaty National (TN), provided under NAFTA, serves as an alternative to H-1B. The NAFTA agreement covers many of the same categories as an H-1B, and actually adds several categories that would not qualify as H-1B professionals. TNs are issued in one-year increments and for Canadians can be issued on the spot at the Port of Entry. TNs can be a very useful alternative, particularly where time is of the essence and if the H-1B cap has been reached for that fiscal year.
Supplementing Your Workforce
Skilled international workers can be viable additions to your IT staff, well worth the extra effort and paperwork involved in sourcing and bringing them into the country. It’s a process, not a mystery. However, just as with American workers, there is tremendous competition for H1-B visas. Should you choose to go this route, the key to being competitive is to move quickly, since there is no guarantee that the number of visas will outlast the demand.
Quick Guide
Step 1: Determine the prevailing wage.
- Sources -
- - Bureau of Labor Statistics web site: www.bls.gov
- - Web search for independent wage survey
Step 2: File the Labor Condition Application (LCA)
- Requirements -
A) Verifies that employer is offering highest of a) actual wage paid to similarly employed, with similar backgrounds or b) prevailing wage.
B) Confirms that working conditions for H-1B worker will not affect, adversely, other similarly employed workers and that there is no strike, lockout, or work stoppage.
C) Notify employees of LCA filing through postings (for 10 continuous business days) in two conspicuous locations.
D) Also, employer must provide notice of LCA filing to employees by posting or notice to bargaining representative, such as a labor union.
E) Provide copy of certified LCA to the H-1B nonimmigrant.
Step 3: Prepare I-129H Petition
- Requirements -
A) Certified LCA.
B) Written job offer letter or employment contract.
C) Detailed job description, including academic and experiential requirements.
D) Beneficiary’s resume.
E) Academic documentation (plus credentials evaluation, if necessary).
F) Industry-relevant employment reference letters.
G) Materials that describe the petitioning entity (business, organization, etc.).
H) Beneficiary’s complete passport.
I) I-94 entry document (and I-20 and the employment authorization document, if applicable).
Filing Locations
Eastern Service Center – Vermont
Service area includes CT, DE, ME, MD, MA, NH, NJ, NY, PA, RI, VT, VA, WV, Washington D.C., Puerto Rico, and Virgin Islands.
U.S. Department of Justice
Immigration and Naturalization Service
Vermont Service Center
75 Lower Welden Street
Saint Albans, VT 05479
802-527-4913
Southern Service Center – Texas
Service Area includes AL, AR, FL, GA, KY, LA, MS, NM, NC, SC, OK, TN, TX.
USINS TSC
P.O. Box 852211
Mesquite, TX 75185-2211
214-381-1423
Northern Service Center – Nebraska
Service area includes AK, CO, ID, IL, IN, IA, KS, MI, MN, MO, MT, NE, ND, OH, OR, SD, UT, WA, WI, WY
U.S. Department of Justice
Immigration and Naturalization Service
Nebraska Service Center
P.O. Box 87129
Lincoln, NE 68501-7129
402-323-7830
Western Service Center - California
Service area includes CA, NV, AZ, HI, Guam
U.S. Department of Justice
Immigration and Naturalization Service
California Service Center
P.O. Box 10129
Laguna Niguel, CA 92607-0129
949-831-8427
About the Author
Mark Newman is the immigration law partner at Troutman Sanders LLP. Prior to joining the firm in 1989, Mark practiced immigration and international law in Florida for 10 years. He served as lead counsel in the federal class action proceedings to acquire lawful permanent residence for more than 100,000 Cubans. Mark is a member of the Atlanta Bar Association and the American Immigration Lawyers Association where he served as Chairman of the Atlanta District Director’s Liaison Committee. He co-chaired the 1999 Georgia Bar’s ICLE Business and Litigation Immigration Seminars and the ABA/Prentice Hall Seminar on the 1990 Immigration Act and co-authored Immigration Law and Practice in Florida. He has spoken to audiences abroad about U.S. immigration and is a frequent speaker on immigration issues throughout North America. Mark received his undergraduate degree in 1976 from Princeton University and his law degree in 1979 from the University of Miami School of Law. Mark Newman can be reached by calling 404-885-3194. Or e-mail him at mark.newman@troutmansanders.com. |