What Is The H-1B Visa Cap?

Over the past several weeks, you may have noticed news reports about the government reaching the H-1B cap within the first week that temporary employment visas became available.

These reports leave several questions unanswered such as what is an H-1B visa?  What is the cap? Why is this issue important for immigration policy and for the U.S. economy as a whole?  

H-1B Visas

An H-1B visa is a non-immigrant visa for “specialty workers” and, oddly, fashion models. It gets its name from its location in the Immigration and Nationality Act.  8 U.S.C. § 1101(a)(15)(H)(i)(B).

To qualify for an H-1B visa, an employer must file a non-immigrant visa petition for an employee, or file a blanket petition for a group of employees. The employee must hold a bachelor’s degree or its equivalent in a “specialty occupation.” The job must commonly require a bachelor’s degree or must be so complex that it can only be performed by an employee with a specific degree. The employer must normally require a degree for this position. Finally, the nature of the specific duties is so specialized and complex that the knowledge required to perform the duties is usually associated with a bachelor’s degree or higher in the field.  

H-1Bs visas are frequently used for engineers, accountants and computer scientists. Often an immigrant will come to the United States to attend school, and then get a job where his or her employer will file an H-1B visa petition on his or her behalf. Then a few years later the employer will file an immigrant visa petition. An H-1B is initially valid for three years, and then may be renewed for another three years. If the employee has an immigrant visa pending, s/he can stay in H-1B status until the immigrant visa becomes available.

What the Employer Must Do

There is naturally a concern that H-1B visa holders will depress the salaries of U.S. workers and will depress the economy in general. Congress has addressed this concern by providing that the employer must pay the higher of the prevailing wage in the industry (what other local employers are paying for a similar position) based on the job title and the location of the employment or the same as the employer pays other employees in the same or similar position and locale.

The employer must file a Labor Condition Application (LCA) with the Department of Labor showing that the employer is paying the higher of the prevailing wage in the industry or at the place of employment for the position and the LCA must be approved by the Department of Labor. The employer must post the job opening and salary at the work-site and must provide a copy of the job opening with any union at the company. Only after the Department of Labor approves the LCA, may the employer then file for the non-immigrant visa. 

The Cap

Congress has provided that 65,000 H-1B visas will be available each fiscal year with an additional 20,000 H-1B visas for immigrants with advanced degrees who are exempt from the 65,000 cap. In other words, there are 65,000 H-1B visas for immigrants with a bachelor’s degree or its equivalent and an additional 20,000 H-1B visas that are only open to immigrants with a master’s or doctoral degree, for a total of 85,000 visas for mainly high tech workers. 

On April 1, 2013, employers were able to file H-1B visas for fiscal 2014, which will start in October 2013. There are stories of truckloads of visa petitions leaving lawyers’ offices and arriving at U.S. Citizenship and Immigration Services on April 1. In the first week of April, the government received 124,000 H-1B visa petitions and met the cap the first week the visa was opened for the first time since 2008.

USCIS announced that on April 7, 2013, it would select the 20,000 advanced degree visas via a computer-generated lottery. Those petitions for employees with advanced degrees who were not chosen in the first lottery were then put in the pool with the visa petitions for employees without an advanced degree. Of the second pool, the government selected 65,000 visa petitions of the remaining 104,000 petitions by computer-generated lottery. In other words, for fiscal 2014, the chances of getting an H-1B visa petition approved under the 65,000 cap are 62.5 percent. 

The Fall-Out

Large corporations and small entrepreneurial companies are having a difficult time hiring the necessary workers. Several large corporations including Microsoft, Intel, Facebook, Hewlett-Packard, and Texas Instruments, are not happy with the H-1B process and have been lobbying Congress either to increase or to eliminate the cap entirely. 

One company called Blueseed.com plans to park a cruise ship 12 nautical miles off the coast of Northern California in international waters. Foreign-born workers and entrepreneurs would live and work on the ship. The employees would not need to get work visas, and could avoid the H-1B lottery, and would instead just need a business tourism visa so they could ferry back and forth to Silicon Valley. It is an innovative solution, but it may not be the best way to run an economy.

Criticisms of the H-1B Program

According to a report by National Public Radio, the largest employers of foreign tech workers are not Microsoft, Google, or Facebook. Instead, the largest employers are consulting companies. 

Ron Hira, a professor of public policy at the Rochester Institute of Technology, states "[t]he top 10 recipients in [the] last fiscal year were all offshore-outsourcers.  And they got 40,000 of the 85,000 visas … .”  Dr. Hira continues, "[w]hat these firms have done is exploit the loopholes in the H-1B program to bring in on-site workers to learn the jobs [of] the Americans to then ship it back offshore," he says.  "And also to bring in on-site workers who are cheaper on the H-1B and undercut American workers right here." 

According to a 2011 report by the Government Accountability Office, worker protections for H-1B employees are weak and government oversight of the program is cursory. 

While the United States should be hiring the best and the brightest workers, the country also needs to protect its labor force to ensure that no one is exploited and that all are being paid a fair wage. The question is, whether the current H-1B program is the best way to meet these goals.