A variety of factors from increased government crackdown on businesses employing illegal immigrants to a gap between the skills American companies require and the skills American workers can provide. Businesses all over the country are spending ever greater attention on immigration law matters as they make up their workforce gaps. Unfortunately, companies are continually confronted with the same set of problems as they try to navigate the nuances involved in immigration law matters.
Furthermore, immigrants are graduating from U.S. universities in record rates. These students cannot remain in the U.S. unless they find an employer to hire and sponsor them into the H1-B or some other similar employment visa program.
Immigration in a Downturn
Generally, during an economic downturn, corporations look to decrease their costs and weather the recession. Companies do this in two ways: (1) cutting wasteful spending and (2) downsizing their employee rosters. When corporations are dealing with American employees, the ability to lay off a worker is limited only by their contract and a few federal laws prohibiting discrimination. However, dismissing an employee on a visa is more complicated.
Most corporations acquire immigrant talent through the H1-B visa program. This program allows businesses to hire a certain number of immigrant employees to perform services as a professional in a specialty occupation.
The limitation imposed on companies is that they are prevented from just dismissing their H1-B employees. The employer must notify the Department of Labor, the U.S. Citizenship, and Immigration Services, and offer the affected employees funds sufficient to cover the cost of transportation to their home country. Employers that terminate H1-B employees without following the above steps are still required to pay their employees salary.
For years employers have verified immigration status through the I-9 Form. Moreover, enforcement was always based on the civil penalties. However, ever since the Bush Administration and continuing under the Obama Administration, Immigration Customs Enforcement (“ICE”) has begun to rely more and more on the criminal aspects of immigration law. ICE agents conduct “raids” on businesses with greater frequency.
To address these concerns, companies are taking a more aggressive stance on immigration status. However, many businesses that enhance their investigation into these matters run the risk of violating Civil Rights protections against discrimination based on ethnicity and national origin.
Employers are advised to publish a standard policy for the entire company. All employees are expected to stick to that policy. The ultimate purpose is to create a corporate culture that readily complies with immigration requirements.
E-Verify is a voluntary system which allows employers to obtain electronic verification from the government as to a worker’s status. So far, only Federal contractors are bound by the E-Verify system but, many companies are exploring the possibility of joining the program.
However, if an employer agrees to join the program, it must affirmatively consent to ICE inspections of its business records without notice. For many businesses, they cannot stomach this exposure because the E-verify system only covers new employees, it cannot be used to confirm existing workers.
Companies are hamstrung by Quotas
Each country is granted a quota of H1-B applications that their citizens may receive. During normal hiring times, companies have about one day to file every request for the people it needs to hire. Moreover, even if companies get their applications in on the first day, they are often subjected to a lottery system.
Corporations are prevented from hiring the people they need, and when they do get the applications in, they are unable to know if their people were selected in the lottery definitively. It is an inefficient way to run hiring practices.
Furthermore, even companies that rely on the H2-B system for semi-skilled workers find no reprieve. These companies are subjected to the same quotas and lotteries as H1-B professional workers.
EB-5 Regional Center Program
The final category utilized by corporations is the EB-5 visa. EB-5 granted resident status to foreign investors who invested at least $1M (or $500,000 in rural or high unemployment areas) and through that investment created employment for at least ten workers. For years this category was underutilized because it was narrowly interpreted by the USCIS.
However, the government recently began opening EB-5 Regional Centers. These Regional Centers are government-approved projects, typically construction, that the USCIS has certified would provide substantial U.S. employment.
The EB-5 program is a classic win-win for all parties involved. Developers gain access to a new pool of investment funds that they can obtain at below market rates. Foreign investors are willing to give below market rates because they receive the valuable benefit of a green card. Furthermore, American workers are employed, and valuable infrastructure is created. The EB-5 program is so popular that in the past few years, the regional centers have tripled in number.