Bipartisan Legislation Introduced to Protect American Jobs

FAIR Take | April 2023

Before adjourning for recess, Sen. Chuck Grassley (R-Iowa) and Senate Majority Whip Dick Durbin (D-Ill.) introduced the H-1B and L-1 Visa Reform Act, a bill designed to reform the employment-based visa programs to reflect Congress’ original intent in protecting American workers when foreign workers are recruited and hired.

The H-1B visa program is designed to allow American companies to bring in foreign workers in specialty occupations, while the L-1 visa allows for intra-company transfers into the United States.  Though the programs were intended to fill a company’s legitimate employment needs, both have instead been widely exploited to displace American workers, leading to depressed wages and adverse working conditions.

Even with the U.S. economy facing difficulties and thousands of layoffs hitting the H-1B reliant tech industry, outsourcing firms continue to overlook Americans and recruit foreign labor. So far this year, layoffs have increased 396% when compared to last year, for a total of 270,416 jobs cut. The tech industry, however, faces the worst of it, already losing 102,391 jobs this year. That represents an increase of 38,487% more tech jobs lost than in the same period last year. The tech sector is, in fact, on track to exceed the single-year record for the number of jobs lost set for that industry back in 2001, following the collapse of the dot-com bubble.

The H-1B and L-1 Visa Reform Act has several provisions aimed at protecting American workers and increasing transparency.  For example, the bill would require employers to post H-1B positions on a public website.  It would improve wage requirements and establish higher penalties for violators.  It would require all employers to first recruit Americans and attest that they have not displaced a U.S. worker upon hiring a foreign worker.  The bill would also put in place a rule to prevent companies that employ more than 50 people from having more than 50% of their total workforce as H-1B or L-1 employees. It would ensure too that L-1 visa applicants seeking to open a new U.S. office for a foreign company do so, making L-1 visas for such applicants valid only for 12 months and allowing just two visa extensions for employees of bona fide new offices.

Perhaps most significantly, it would restructure the H-1B visa program into one that rewards those who have advanced degrees and have studied in the United States.  This new approach is a marked improvement over the current random lottery and would favor the best and brightest for H-1B visas, providing nonimmigrants who received bachelor’s and advanced degrees while physically present in the United States, particularly in STEM fields, more opportunities to be selected.  This would help ensure that highly intelligent foreign students coming to the United States to be educated at some of the world’s leading universities use their newly acquired skills to benefit American companies and the American economy.

According to Sen. Grassley, “The H-1B and L-1 visa programs were established to fill in gaps in America’s high-skilled workforce, not supplant it.  Unfortunately, some companies have exploited these programs to replace American workers with cheaper labor, which ultimately harms American workers and foreign labor alike.  Our bill puts American workers first and ensures that the programs promote fairness for all workers.”

Sen. Durbin specifically noted the effect of these practices, saying, “[f]or years, outsourcing companies have used legal loopholes to displace qualified American workers and replace them with foreign workers who are paid subpar wages and put in exploitative working conditions.”

The legislation is a longstanding priority for both Senators, who first introduced legislation to reform the programs in 2007.