Proposed Durbin-Grassley Bill Would Revamp H1B & L-1 Visa Programs – July 7, 2009

Senator Dick Durbin (D-IL) and Senator Chuck Grassley (R-IA) introduced the H1B and L1 Visa Reform Act on April 23, 2009.

The bill is currently in the initial stages of the legislative process. It is being reviewed by the Senate Judiciary Committee.

Here are some of the key points of the proposed bill:

For Employers Hiring H1B employees:

Employers must pay the highest median average wage for all workers in a given occupational classification at a given skill level, with wages determined by the latest occupational employment statistics survey.

Employers must post a detailed job opening on the Department of Labor’s website for at least 30 calendar days before hiring an H1B applicant to fill that position.

Employers should not have displaced and will not displace a US worker within the period beginning 180 days before and 180 days after the date of filing of any visa petition. This lengthens the current displacement clause which currently is 90 days before and after. Unlike the current displacement clause, the new displacement clause will apply to ALL employers and not just H1B-dependent employers.

Companies of greater than 50 employees will be forbidden to have H1B and L1 employees exceeding 50 % of the firm’s total employees.

Employers must submit W2 Tax statement for each H1B applicant.

The Secretary of Labor must establish a searchable website for posting H1B positions. The site must be operational and online within 90 days of the passage of the new law.

H1B Employees working as consultants at Client offices:

By striking clause (ii) of sub-paragraph (E) of the section 212(n)(1), and then adding the new clauses under (F), the bill Prohibits placement of H1B employees on another employer’s site.

H1B employees cannot be placed at a client site unless a waiver is obtained, which will mean every consulting services company will need to obtain a waiver in order to do business.

Allowable waiver conditions include: 

(I) the employer with whom the H1B non-immigrant would be placed has not displaced, and does not intend to displace, a United States worker employed by the employer within the period beginning 180 days before and ending 180 days after the date of the placement of the non-immigrant with the employer;

(II) the H1B non-immigrant will not be controlled and supervised principally by the employer with whom the H1B non-immigrant would be placed; and

(III) the placement of the H1B non-immigrant is not essentially an arrangement to provide labor for hire for the employer with whom the H1B non-immigrant will be placed.

In order to take advantage of the waivers, consulting companies have to insure the client did not displace US workers before and after 180 days from the start of every new assignment.

Investigation of Fraud:

Discriminatory advertisements, such as “Position specified is available only to H1B candidates” or “H1B’s will receive priority”, will be explicitly prohibited.

If the secretary’s review of an application identifies clear indicators of fraud or misrepresentation or when a complaint is filed against the employer for failing to meet any of the conditions, then an investigation will be conducted.

Annual audits will be conducted of not less than 1 percent of employers of H1Bs . Additional compliance audits will be conducted of each employer with more than 100 employees who work in the US, if more than 15 percent of such employees are H1B non-immigrants.

If any violations are found then Secretary of Homeland Security will be notified. A penalty of $2000 per violation (increased from $1000) may be imposed.

Employers requiring H1B non-immigrant pay a penalty for ceasing employment prior to a date agreed or employers failing offer benefits to H1B workers such as health, life, disability and other insurance plans in accordance to the same criteria as offered to US workers will be considered to have broken the law and will be fined.

No notice of an investigation will be provided to H1B employers if the Secretary of Labor determines that giving employer a chance to respond to the allegations would interfere with an investigation. The Secretary is not subject to judicial review under this clause.

USCIS shall provide the Secretary of Labor with any information contained in the application as part of the adjudication process that indicates violation of the H1B visa program.

Stricter Required Wages with Minimum Level 2 Wages in Most Cases

The wage requirements would be modified to prohibit paying less than the skill level two wages based on the Occupational Employment Statistics (OES) survey in most cases. 

Miscellaneous Provisions:

Employer must provide employees any paperwork (original or certified copy of the original) exchanged with Federal agencies no later than 21 business days after receiving a written request from current or former employee.

L1 Changes:

L-1 Outsourcing Prohibitions

If this proposed bill is passed into law, companies would be prohibited from employing specialized knowledge L-1 beneficiaries for more than one year if they are primarily stationed at a worksite other than the petitioning employer’s location. This requirement could be waived, under waiver provisions that mirror the waiver provisions for outsourced H1B employees, explained above.

L-1 Wage Provisions

The bill would add prevailing wage requirements to the L-1 petition. 

Enforcement Provisions for L-1 Employers

The bill would require the DHS Inspector General to submit a report to Congress within six months of the passage of the bill on the use of L-1 blanket petitions to determine whether the current review process provides adequate safeguards against fraud and abuse.

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