Proposed Changes to H-1B Program Encourage Fraud, Undermine American Workers

FAIR Take | November 2023

On October 20, the Department of Homeland Security announced an expansive regulation to change the H-1B visa program. The proposed regulation not only hurts American workers but it undermines the integrity of the program and will encourage more fraud.

In theory, the H-1B program is considered a “skilled” guest worker program because it requires foreign workers to meet certain educational criteria to participate.  Each year, the government makes 85,000 H-1B visas available to individuals holding a bachelor’s degree or a master’s degree. This numerical cap, set in statute, does not include the thousands of H-1B workers who are exempt from the cap (such as those who work for nonprofit entities or universities). These visas are valid for three years, but can be extended for up to six years. In addition, unlike other most other guest worker programs, H-1B visa holders can also apply for permanent residency (i.e. a green card), essentially creating a permanent guest worker program.

FAIR has highlighted the abuses of the program, specifically the displacement of American workers. The visa program was intended to complement the U.S. workforce – not replace it. Nevertheless, the H-1B visa lobby, primarily tech giants and outsourcing firms, frequently claim that a sustained influx of foreign guest workers is necessitated by labor shortages and that America’s economic growth would suffer without foreign “top talent” that the program supposedly brings into the country. In fact, the program does not supplement the U.S. workforce. Rather, it supplants able-bodied Americans with foreign workers who are beholden to their employers by virtue of their presence in the U.S. depending upon employer sponsorship.

The Trump Administration attempted to reform the program by transitioning away from a deeply flawed system that currently allocates H-1B visas to employers via a lottery. In its place, the Trump Administration proposed awarding visas to prospective H-1B guestworkers based on salary, rather than randomly. DHS, at that time, reasoned that prioritizing wage levels in the registration selection process “incentivizes employers to offer higher wages, or to petition for positions requiring higher skills and higher-skilled aliens that are commensurate with higher wage levels, to increase the likelihood of selection for an eventual petition. Similarly, it disincentivizes abuse of the H–1B program to fill lower-paid, lower-skilled positions, which is a significant problem under the present selection system.”

The Biden Administration, however, refused to implement the changes envisioned by the Trump Administration and withdrew the final rule in December 2021 after it was vacated by the U.S. District Court for the Northern District of California. Now, the Biden Administration is proposing its own changes, claiming that its new proposed rule would “modernize” the H-1B program.

The Biden Administration’s proposed rule barely gets to the heart of the H-1B visa fraud and abuse schemes that undermine the intent of the program. Study after study has highlighted fraud and abuse, and has shown that visa holders are not actually the best and brightest from around the world. In fact, they are coming into the United States to replace Americans (and sometimes be trained by Americans in the process).

While the administration claims the new rule will “modernize” the long-plagued H-1B visa program, instead it undermines American workers.  It relaxes requirements on aliens working in the U.S. and the employers who hire them. It is an attempt to cut corners under the guise of efficiency, capitulating to big business and ignoring American workers at home who must compete for high skilled job opportunities.

FAIR has published an in-depth policy paper on the proposed rule that can be viewed here. To view the entire rule or to provide comment, visit the Federal Register.