United States: Immigration Laws Stifle US Business

US immigration laws have not been created with the growing global economy's need for foreign talent in mind, and should be reformed to promote hiring the best minds for the US economy. With globalization of the modern economy, US companies have an increasing need to hire foreign labor with unique skills and specialized knowledge. These business needs are frequently challenged by restrictive immigration laws and policies – hiring even the brightest scientists, engineers or executives from other countries has become more frustrating in recent years. An immigration reform bill has been in the works for quite some time now. Two years ago, the Obama Administration presented a proposal to streamline business immigration. The proposal suggested creating a "startup" visa for entrepreneurs, expanding opportunities for investor visas, creating a new visa category for employees of national security science and technology laboratories, and cutting red tape for employers. To date, however, no significant substantive changes have been implemented in this regard. These and many other business immigration issues have remained untouched during the Congressional gridlock. Now with the refugee crisis at the center of the immigration debate, and the Presidential election commanding center stage, business immigration reform will likely be postponed for even longer.

In order to fully appreciate what needs to be fixed in the US immigration system, it is helpful to understand how the current immigration system actually works. Immigration status in the US can be divided into three separate categories: 1) Nonimmigrants - those holding temporary US visas; 2) Immigrants – "green card" holders or permanent resident aliens; and 3) Naturalized US citizens – those who were approved for US citizenship after application and government review, and who hold almost all of the same rights as US born citizens, including voting in the federal elections. This article will address some of the hotly debated business immigration issues related to the most commonly issued nonimmigrant visas, and the impact of visa backlogs for immigrant visas.

Immigration law has distinguished between immigrants and nonimmigrants since 1819. US law permits nonimmigrant visitors to stay in the US for a temporary period of time, and presumes that they are leaving at the end of their authorized stay. It is important to understand the distinction between a visa and a nonimmigrant status in the US.  A visa is a passport stamp issued by the Department of State's US embassies and consular posts abroad, which permits a request at the border for admission to the US as a nonimmigrant. Visa issuance does not guarantee entry to the US. The US Customs and Border Protection ("CBP") determines whether to admit a visa holder at the border and for how long – this dictates nonimmigrant status. CBP might admit one applicant as a visitor for a full six months, and another as a visitor for just two weeks. Someone else might be denied entry, even if they hold a ten year visitor visa issued by a US Embassy. The CBP's determination on admission depends on the visa category, the purpose of the visit, previous issues on entry, and other general concerns.  Once admitted, nonimmigrant status can be changed or extended by US Citizenship and Immigration Services ("USCIS"), a branch of the US Department of Homeland Security. The US Department of State, US Department of Homeland Security, and Customs and Border Protection are three separate US government agencies, and their decision-making is not always consistent. 

The Limits of Temporary Work Visas

The US immigration system includes a "visa alphabet soup"– a wide range of non-immigrant visa categories that are issued for various temporary purposes. The H-1B visa is the most common visa category used by US companies to hire highly skilled professionals in specialty occupations - computer specialists, engineers, scientists, and other occupations requiring Bachelor's level degrees or the equivalent based on experience. The current number of H-1B visas is capped at 65,000 per fiscal year, with an additional 20,000 visas allocated to graduates from US universities with Master's degrees and higher. This cap is so low that it has been exhausted on the first day of filing in the past few years, and clearly does not reflect modern business reality. In response, USCIS instituted a computer generated random lottery of all petitions received the first week. This random lottery gives an advantage to large technology companies over small and medium sized companies that do not have the resources to file for multiple professionals, and does not come close to satisfying the needs of US businesses willing to pay prevailing wage for highly qualified professionals. The chances of being selected in the H-1B lottery are getting much lower every year, and the very fact that our government hosts a lottery for highly educated professionals is questionable.

As with the H-1B visa cap, companies seeking to employ less skilled workers also face cap issues under the H-2B temporary nonagricultural worker program. The H-2B visa is a category used to employ workers for seasonal or short-term positions in construction, landscaping, hospitality, or other similar businesses. The current H-2B quota does not satisfy business demand for essential staff positions, and leaves companies in need of these workers without an alternative.  In addition, this category requires a burdensome application process, which includes a temporary labor certification filing with the Department of Labor ("DOL") certifying the wage and non-availability of US workers prior to filing a petition with USCIS.

Another visa classification in need of revision is the L-1 visa, which was created by Congress in 1970, based on the conclusion that immigration laws at the time unduly restricted the transfer of foreign personnel. This category permits multinational companies to transfer employees from their foreign operations to the US. Employees with "specialized knowledge" can qualify for L-1B status, and those with executive or supervisory positions can qualify for L-1A status. The US petitioning company must share a qualifying legal relationship with the foreign company, such as parent/subsidiary, affiliate, or branch office, and the employee must have worked on a full time basis for the foreign entity for at least one year prior to the transfer to the US. While this visa has no numerical limitation, only a limited number of companies can qualify, and in practice, the government has been requiring a much higher standard than the regulations specify. In 2014, the L-1B denial rate reached an all-time high of 35%, compared to 2006, when the denial rate for L-1B petitions was only 6%.  Such a drastic increase of L-1B denials is especially disconcerting because the regulations governing L-1B adjudication have not changed. This burdensome and overly restrictive interpretation of the regulations defies the purpose of the L visa creation, and needs to be modified.

Employment Based Immigrant Visa Backlogs

Permanent residency ("green card") employment quotas are equally out of touch with today's business reality and modern economic changes. Immigrant admissions have been numerically limited since 1924. Citizens of all countries are treated equally – with a small caveat that no nationality can use more than 7% of all the green cards issued per year.  When more people than the allotted per country quota apply for permanent residency, they are placed on a waiting list, which can be very lengthy. For example, as of January 2016, the waiting list for Indian nationals with an approved immigrant visa petition under the employment based Third Preference category goes back to July 2005. This means that in January 2016, the government just began processing immigrant visas for beneficiaries of employment based filings initiated by employers in July 2005.

Here is a simplified overview of a typical process to permanently hire a professional employee under the commonly used employment based Second and Third Preference categories. Before filing a permanent visa petition, the employer is required to conduct an extensive and costly recruitment campaign to prove that no minimally qualified US workers are available and interested in the position offered, and that the salary offered meets the wage requirements offered to other US workers in similar positions. If no minimally qualified applicants are located in the recruitment campaign, the employer files an application for alien labor certification with the DOL.  Government processing of this application can take from one to two years, which calls into serious question whether the recruitment campaign and prevailing wage determination have any validity or purpose. And just because the DOL certifies the application does not mean that an employee gets the green card right away. Instead, the employer then moves on to the next step, filing an employment based immigrant visa petition with USCIS, which can take another two weeks to approximately six months for processing. Following the approval of an immigrant visa petition, some beneficiaries are placed on a long waiting list until a visa number becomes available. This can take years in some cases due to the permanent visa number backlog, which depends on the beneficiary's country of birth, degree and experience required. Finally, if an employee is fortunate enough to still have the job offer after the visa number becomes available, the final step in the green card process, an application for adjustment of status to permanent residency is filed. This can hardly be called an efficient system. 

Overhaul of the employment based immigrant visa admission numbers has been the subject of multiple reform proposals – everything from issuing unrestricted employment authorization following approved visa petitions to stapling green cards to graduates with STEM (Science, Technology, Engineering and Math) degrees from US universities, but nothing has changed at all. The cumbersome employer recruitment campaigns and the process for moving qualified long term employees into permanent status are in need of serious revision to meet the modern needs of our economy.

There are many concerns with the current US immigration system – refugees, unauthorized employment, social costs, fraud, children brought to the US without authorization, and of course, the very real threat of terrorism. For the past few years, there has been an ongoing debate regarding "comprehensive" vs. "incremental" approaches to immigration reform. Many have weighed in with solutions for these immigration problems, and much has been covered by the press. But what has been lost in the process, particularly overwhelmed by the sound bytes of an election year, is the clear fact that the US business immigration policy desperately needs reform.  Ideally, a solution that includes all components of the immigration equation is required – a means to deal with unauthorized immigrants and border protection, promotion of family unity, as well as an efficient and real world approach to permit regulated business immigration. 

If you have any business immigration related questions, please contact immigration attorney Natalia Gove at Lowndes, Drosdick, Doster, Kantor & Reed, P.A. 

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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