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The H-1B Visa Blog by Siliato and Malyk

Is it Time for an End to the H-1B Protectionist Restrictions Applicable To TARP Recipients?

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With the advent of the new (FY 2011) H-1B filing season quickly approaching (April 1), it is not too early to begin considering an issue that was first thrust upon the H-1B program prior to the start of last year's filings - the Stimulus Bill signed into law last February 17 which made it more complicated for the big banks and insurance companies that received Troubled Asset Recovery Program ("TARP") funds to hire new foreign workers on H-1B visas.


Specifically, Section 1611(b) of the American Recovery and Reinvestment Act of 2009 provides that TARP recipients may not hire new H-1B workers unless such recipients comply with the requirements of that of an "H-1B dependent" employer, as defined by INA 212(n)(3). Consequently, following the passage of the Stimulus Bill, "H-1B dependent" was no longer a special status held only by companies that employ 15% or more of its workforce with H-1B visa holders.


What did this mean for TARP recipients?  They were required to actively recruit U.S. workers and were not permitted to file a Labor Condition Application ("LCA") for new employment unless they completed the required recruitment and made the attestations required of H-1B dependent employers. More specifically, TARP recipients were required to attest that (i) no similarly employed U.S. workers were displaced with H-1B hires within 90 days before or after applying for H-1B status or an extension of status; (ii) that the company engaged in a "good faith" effort to recruit U.S. workers for the position for which the company was seeking to employ the H-1B worker and (iii) that the company offered at least the "prevailing wage" during the recruitment process. Such attestations, of course, are subject to audit as the employer must offer the job to any U.S. worker who applies and is equally or better qualified than the H-1B worker. 


The question remains, for the upcoming FY 2011 H-1B filing season, whether the companies who received TARP funds, but have since repaid them to the government, are still restricted by the H-1B dependent rules? 


With unemployment at 10%, protectionist sentiment will likely continue to prevail.  Since the government (i.e. the taxpayer) extended significant bailouts to these institutions, a continuation of the restrictionist program would appear to support taxpayer interests.  Right?  Well, perhaps such thinking is more punitive than just. 


In the case of the H-1B dependent restrictions on TARP recipients, such a protectionist approach would appear to not serve the interests of U.S. employers who are looking to recover and remain competitive in the ever-expanding global marketplace. H-1B visa holders typically have specialty skills that are in short supply - by isolating them from the U.S. job market, these foreign-born individuals are left with no choice but to pursue other options abroad. Indeed, many of these individuals are educated in the United States at our finest institutions -- with a large number even benefitting from our public universities that are partially funded by taxpayers.  So whose interest are we really protecting by continuing these practices? 


Senator Chuck Schumer has called these hiring restrictions on H-1B workers "counterproductive" to New York's economy and has vowed to change them. Unfortunately, it appears that Congressional action is needed quickly in order to reverse or change these protectionist hiring policies of TARP recipients.


Then again, if the health of the institutions which have repaid TARP (e.g. Goldman Sachs, Bank of America, Citigroup, Wells Fargo) has rebounded enough to issue the Wall Street "fat cats" their annual bonuses, will negative sentiment prevail and punitive measures stay in place - with  the government cutting off a little more of its nose to save some face?


For additional information and frequent updates on a variety of employment-based immigration law issues, please click here to navigate to Meyner and Landis LLP's "Corporate Immigration Law News" Blog.


Post Authored By: Anthony F. Siliato, Esq. and Scott R. Malyk, Esq. of Meyner and Landis LLP

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Comments

  1. P Revere's Avatar
    In answer to your question "whose interest are we really protecting by continuing these practices?", the American IT worker. But then again, that's the last person you'd care about.
  2. Dennis's Avatar
    FIRST OFF GOVERNMENT SHOULD NOT BAILED OUT BANKS.IF THAT DID NOT HAPPEN. YOU WOULD NOT HAVE TO WORRY ABOUT BRINGING IN EMPLOYS FROM ANOTHER COUNTRY.PROBLEM SOLVED.BUT THEY DID DO A BAIL OUT SO YES AMERICAN WORKERS SHOULD BE HIRED FIRST.I'M SURE AMERICA HAS QUALIFIED WORKERS FOR THE AVAILABLE POSITIONS.
  3. Peter Parker's Avatar
    "...remain competitive in the ever-expanding global marketplace. "

    Has anyone ever explained what this gobledegook means?
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