Trump Administration Announces Significant Overhaul of H-1B Program

FAIR Take | October 2020

On October 6, the Department of Homeland Security (DHS) and the Department of Labor (DOL) unveiled two new interim final rules targeting the H-1B guestworker program. FAIR has long called for a complete overhaul of this deeply flawed program, and just this week, suggested these changes, and more, in the “Immigration Reform Blueprint for the American Worker.”

The purpose of the DHS rule is to close a number of well-known loopholes in the H-1B program. It establishes with greater clarity the definition of a “specialty worker” in the context of H-1B hiring. These new rules ensure that only those essential to the U.S. economy will be able to come to the US under the program. The new DHS rule will affect about one-third of all H-1B petitions, according to senior department officials. In 2019, the DOL certified over 650,000 new or returning H-1B workers in FY 2019. The rule also addresses offsite employers, commonly referred to as body shops or shadow employers, who use the H-1B program to staff third-party worksites. Finally, the rule also makes it easier for DHS to conduct greater worksite enforcement and removes authorization from employers unwilling to cooperate with investigators.

The DOL rule specifically targets the prevailing wage levels, which they agency uses when certifying applications. It is ultimately determines what H-1B workers are paid. In the past, the prevailing wage levels were far too low, meaning that employers could hire H-1B workers instead of Americans and save significant amounts of money. The DOL rule will raise the cost of hiring an H-1B worker, significantly reducing the incentive to use the program as a replacement for Americans.

These rules from DHS and DOL are incredibly important and reinforce President Trump’s pledge to protect American workers during these trying times. Although the economy continues to recover, the Bureau of Labor Statistics (BLS) reported that September’s unemployment rate was 7.9 percent, more than double the pre-COVID level of 3.5. These new rules will make it easier for American workers to find meaningful employment without unfair competition from foreign guestworkers.

The day of the announcement, FAIR president Dan Stein said that the rule changes have been long overdue and are critical to the welfare of American worker amidst the current economic crisis.

“The changes that go into effect immediately will ensure that U.S. companies will use H-1B workers to augment our domestic labor force, not replace it, as had been the case for far too long,” Stein said. “FAIR, and millions of American workers who are in crisis due to the COVID-19 pandemic, applaud the changes being implemented by Labor Secretary Eugene Scalia and Acting Homeland Security Secretary Chad Wolf,” he added.

FAIR will continue monitoring this and other developments within the federal rulemaking process.