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NAM, US Chamber Sue to Stop H-1B Visa Changes

Oct. 22, 2020
The new rules were rushed through inappropriately and would be onerous to employers, according to the plaintiffs.

The pushback on the Trump Administration’s revision to H-1B Visa rules has solidified into a lawsuit. The National Association of Manufacturers and 12 other parties have filed suit to stop the Department of Labor and the Department of Homeland Security from enacting newly restrictive rules designed to cut down on the amount of H-1B skilled worker visas issued each year.

The rules, announced earlier this month, made visas more difficult to qualify for and more expensive for employers by requiring more specific credentials from visa applicants and raising the wage floor companies would be required to pay them.

NAM, alongside the U.S. Chamber of Commerce and 10 other plaintiffs, filed the lawsuit in the Northern District of California for an injunction against the rules changes. The suit alleges that the two rules—one issued by each of the defendant Departments—were imposed not to protect American workers but to wreck the H-1B program itself by making it too onerous for employers to use.

The lawsuit also notes that similar efforts to reduce immigration on work visass have failed recently: The introduction of the lawsuit notes that President Trump’s Proclamation 10052, which banned the entry of H-1B, H-2B, L-1, and J-1 visa-holders to the United States was enjoined by the Northern District.

Five days after the presidential order was blocked, the Department of Labor and the Department of Homeland Security each announced their new rules. Those rules, the suit alleges, “would sever the employment relationship of hundreds of thousands of existing employees in the United States” and “virtually foreclose the hiring of new individuals via the H-1B program” if left unchecked.

One argument posed by the lawsuit is that the rules were passed abnormally and inappropriately quickly: both rules were published in the Federal Register October 8 without going through the ordinary “notice-and-comment” period typical for such actions, during which the rules are subject to public comment followed by a round of revisions. The atypical timeline, the plaintiffs argue, bypasses a key protection without a good reason.

“We need high-skilled innovators now more than ever, and the administration’s attempt to rush these rules forward without properly considering their impact on thousands of people … could have devastating consequences at a critical moment in our history,” said Linda Kelly, Senior VP and General Counsel of NAM.

“Rewriting laws through a dark-of-night-style rulemaking leads to dangerous policy outcomes,” she said.

Tom Donohue, CEO of the U.S. Chamber of Commerce, said in a statement that the rules “undermine high-skilled immigration in the U.S. and a company’s ability to retain and recruit the very best talent.”

The Department of Labor rule, which was implemented immediately for all new visa applications, raised the prevailing wage for H-1B employees substantially. An analysis by law firm Constangy, Brooks, Smith & Prophete estimated that an entry-level software developer in the Boston area that would have been paid about $76,523 would, after the rule change, need to be paid $112,757. Secretary Eugene Scalia said the wage increases would “ensure American workers are not undercut by cheaper foreign labor.”

The rule changed by the Department of Homeland Security, meanwhile, aims to make credentials required for visas stricter. Under the change, employers must demonstrate that their applicants hold specific qualifications for the job of at least a bachelor’s degree or equivalent. That might be used to limit, for example, hiring someone with a generalized engineering degree for a job that requires a software engineering degree.

In addition, H-1B holders who work for a contractor that sends them to work at third-party sites will have their visas eligibility reduced to one year. That setup is common for tech support companies who contract out IT specialists.

According to the Department of Homeland Security, the new rules would likely cut the amount of new visas issued by at least a third. 

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