“It is illegal now under that program [H-1B visa] to use it to replace American workers. Under that program, you have to prove not only that you’re not replacing Americans, but that you’ve tried to hire Americans. And if a company is caught abusing that process, they should never be allowed to use it again.”
–Sen. Marco Rubio, Republican debate on CNN, March 10, 2016
Readers asked us to fact-check the issue of H-1B visas that came up during the recent Republican debate. We’re not trying to kick a former candidate when he’s down (Rubio dropped out of the presidential race after a poor showing in the March 15 Florida primary), but he is still a sitting senator who was involved in crafting legislation to overhaul immigration laws.
This is a timely issue. Two former tech workers of Disney who were among 250 employees laid off and replaced by foreign workers are suing Disney. They allege Disney colluded with outsourcing companies to illegally bring in foreign workers to displace the two employees using H-1B visas.
The Senate also is considering legislation, sponsored by Sens. Charles E. Grassley (R-Iowa) and Richard J. Durbin (D-Ill.), to add measures to prevent displacement of American workers through the H-1B program. H-1B is a temporary work visa granted to high-skilled, non-immigrant workers. The company can later sponsor the worker for a green card.
Is it illegal to replace American workers using H-1B visas, and is there a recruitment requirement for employers?
The law and regulations over H-1B visas are complex. The bottom line is: Rubio’s characterization is not accurate. (His campaign did not respond when we asked them for clarification.)
Here’s the short answer: In general, it’s legal for employers to use the H-1B program to replace American workers, and there is no blanket requirement to recruit Americans first.
Employers trying to temporarily hire non-immigrant workers have to file a Labor Condition Application with the Department of Labor. In the application, the employers have to attest that they met or will meet several requirements (including wages and working conditions). These requirements are designed to protect U.S. workers.
There is a “no displacement” requirement and a recruiting requirement, as Rubio said. But these requirements apply to “H-1B dependent” employers that have a large number of H-1B workers (for example, a company of 51 or more full-time employees is considered H-1B-dependent if 15 percent or more of its workforce are H-1B workers). Employers that are not deemed H-1B-dependent are not subject to this requirement.
H-1B dependent companies are not allowed to lay off U.S. workers without a valid reason, then replace them with an H-1B worker to do essentially the same job with the same core responsibilities.
This requirement doesn’t apply if the foreign worker is paid at least $60,000 per year, or has a relevant master’s or higher degree. And most H-1B workers fit that bill, making it largely irrelevant.
The majority of H-1B workers are in computer-related occupations. The median salary H-1B recipients in fiscal 2014 was $75,000 and 55 percent of them had degrees higher than a bachelor’s. Nearly 72 percent of all workers who were granted continuing or initial employment with H-1B visas in fiscal 2014 were 25 to 34 years old.
The recruiting requirement also applies to H-1B-dependent employers, who have to take “good faith steps” to recruit U.S. workers (citizen or green-card holder) for any job that they wish to fill with H-1B workers, according to the Labor Department’s fact sheet.
Here’s an overarching caveat: Employers have to attest — not prove — that they met the displacement and recruitment requirements. The law only requires the labor secretary to review the application for “completeness and obvious inaccuracies,” rather than to make sure the employer actually met the requirements. Critics call this attestation process a loophole widely abused by dependent employers.
The law “is designed to make sure you can replace American at will, while making it look like you can’t,” said John Miano, an attorney for Washington Alliance of Technology Workers, whose practice focuses on U.S. job candidates and companies violating H-1B program rules.
It’s unclear exactly how many H-1B employers are deemed H-1B-dependent. Neither the Labor Department nor Citizenship and Immigration Services had a figure readily available. Several immigration and employment law experts said H-1B-dependent companies comprise a small percentage of all employers in the country — but comprise a large portion of all employers that hire H-1B workers. These generally are information technology services firms.
The additional requirements for H-1B-dependent employers were created to prevent abuse by those who use the program the most, but it is neither protecting American workers nor the H-1B workers, according to Ron Hira, an associate professor at Howard University and an expert on the H-1B program.
Previous attempts to test the law have shown that it is, indeed, legal to replace American workers, experts said. For example, in 2015, 10 senators requested the Department of Labor, Department of Justice and Department of Homeland Security to investigate the hiring of large number of H-1B workers to replace American workers by a California company. But the agencies declined or ended their investigation with no charges.
The Labor Department investigated HCL America, Inc., the contractor for Disney, and found that the company is H-1B-dependent, a department spokesperson said. They were found to have only hired H-1B- exempt workers, earning more than $60,000 a year or having a master’s degree. So the displacement and recruitment provisions do not apply to any of those workers, and no violations were found, the spokesperson said.
The Pinocchio Test
Rubio makes a blanket statement that makes it seem like a no-displacement and a recruiting requirement are the law and practice of the H-1B program. Technically, those requirements exist. But they only apply to companies that hire a large number of H-1B workers and are deemed “dependent” on the program. And even then, the companies can pay the workers more than $60,000 or hire people who have master’s or higher degrees to get around the requirements.
Rubio inaccurately portrays these requirements in law. As a former member of the Gang of Eight, Rubio really should know better than to make a sloppy statement like this. We bid him farewell from the presidential campaign with Three Pinocchios.
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