The Trump Administration has tried yet again to change the fine print around H-1B work visas, with the Department of Labor issuing a new rule on Tuesday that it said would “help protect the wages and job opportunities of American workers.”
The new requirement [PDF] takes a similar approach to a rule change introduced last year that was thrown out by the courts. It will increase the minimum wage level for foreign workers but this time proposes an increase that will come in over the next few years rather than an instant leap.
Despite having been repeatedly castigated by the courts for trying to jam through changes without considering the impact on the economy nor consulting with any of the many organizations that would be impacted by such changes, Labor Secretary Eugene Scalia stated in a press call that this latest version had been the "culmination of many hours of extensive research and thought."
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The new rules would “prevent potential abuses” of the visa system, the DoL claimed today. Following what it said was “an extensive review” of public comments received to its previous attempt, the Labor Department said it “has determined that the existing wage methodology undermines the wages and job opportunities of US workers, and that it is in tension with the governing statute.”
The current program, according to Scalia, was causing American workers to be “undercut by cheaper foreign labor.” He went on: “These changes help ensure that these important foreign worker programs function as Congress intended, while securing American workers’ opportunities for stable, good-paying jobs.”
Right idea, wrong approach
In truth, the work visa program does need reform and many companies have become adept at using it to bring in foreign workers at lower wages. Work visas are only supposed to be used if a company has a hard time finding a domestic worker with the same skills. While that is often true, it is not always the case.
However, the Trump Administration’s effort to reform the program have come across as punitive and xenophobic – fed by the president’s fierce anti-immigrant rhetoric – rather than good management. The fact that the US government has repeatedly pushed changes without even talking to businesses and, on occasion, without even allowing for public comment, has made industry highly skeptical of its claims.
The new proposed rule would “smooth the transition to the new wage levels” by increasing them over time. It will lift the entry-level salary tier from the current level of the 17th percentile to the 35th percentile, meaning foreign workers have to be paid at the same amount or better than 35 per cent of Americans in the same role.
Different jobs come with different wages levels but in each case they would be increased. Those jobs currently requiring wage levels at the 34th percentile would be increased to the 53rd; from the 50th to the 72nd; and the 67th to the 90th percentile.
In addition, US employers will be required to pay those with a visa the same amount as American workers with similar experience and qualifications. The DoL says it will decide what those wage levels are. Labor Secretary Scalia said the rule “reflects an even-handed approach to a complex problem, and we're proud to put in place this long overdue reform.”
We note that employers hiring foreigners on EB-2 or EB-3 visas must also "recruit US workers for the position using a prevailing wage issued by the Department. They must also attest that they will pay foreign workers the prevailing wage."
The wage rise will start in July 2021 with some companies given an additional year to adjust. For visa holders looking to become permanent resident workers – green card holders, basically – the rule will start in July 2024. ®