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Thursday, 05 November 2020 20:35

Latest H-1B rule changes will make it expensive to hire such workers: claim Featured

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Latest H-1B rule changes will make it expensive to hire such workers: claim Pixabay

Recent changes to the condition for issuing H-1B visas, which many companies, predominantly those in the technology sector, use to bring in skilled workers from abroad, have made them much less attractive to use.

The October changes prescribed a minimum salary level, which the National Foundation for American Policy, a non-profit dedicated to public policy research on trade, immigration, and other issues of national importance, estimated would be US$208,000 (A$289,888).

Any existing H-1B visa will be renewed only on the new terms, and a worker's visa will be cancelled if the conditions are not met.

The NFAP analysis said that to meet this level of pay, an electrical engineer at the highest grade in San Jose, California, would have to be paid about US$85,000 more or a rise of 53% on than the market rate. An entry-grade engineer would have to be paid 54% more or US$41,838.

Indians form the largest percentage of H-1B workers in the tech industry and thus it is not surprising that 46 technology firms have challenged the new rules in court.

Big outfits like Microsoft, Google, Facebook and Amazon have filed briefs supporting the action. These companies benefit greatly from hiring staff on H-1B visas as they are generally paid much lower wages.

According to the NFAP analysis, "for all occupations and geographic locations, the new minimum salary that employers are required to pay when compared with the system in place prior to the new Department of Labour wage rule is, on average, 39% higher for Level 1 positions, 41% higher for Level 2, 43% higher for Level 3 and 45% higher for Level 4."

While its analysis found that a petroleum engineer would have to be paid 99.5% more than the prevailing wage at Level 1, computer research scientists, depending on their level, would need to be paid from 42% to 49%, an increase in the required annual salary of US$36,000 to $55,000.

When the Department of Homeland Security announced this new rule, it said: "The H-1B program was intended to allow employers to fill gaps in their workforce and remain competitive in the global economy. However it has now expanded far beyond that, often to the detriment of US workers.

"Data shows that the more than half a million H-1B non-immigrants in the US have been used to displace US workers. This has led to reduced wages in a number of industries in the US labour market and the stagnation of wages in certain occupations. These latest efforts on H-1B visas are part of a larger Trump Administration goal to protect American workers."

The acting secretary of the department, Chad Wolf, said: “We have entered an era in which economic security is an integral part of homeland security. Put simply, economic security is homeland security.

"In response, we must do everything we can within the bounds of the law to make sure the American worker is put first.

“The Department of Homeland Security is honoured to take this important step toward putting Americans first and to continue to implement President Trump’s agenda to keep our economy secure.”

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Sam Varghese

Sam Varghese has been writing for iTWire since 2006, a year after the site came into existence. For nearly a decade thereafter, he wrote mostly about free and open source software, based on his own use of this genre of software. Since May 2016, he has been writing across many areas of technology. He has been a journalist for nearly 40 years in India (Indian Express and Deccan Herald), the UAE (Khaleej Times) and Australia (Daily Commercial News (now defunct) and The Age). His personal blog is titled Irregular Expression.

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