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Chavez & Valko, LLP
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H-1B and L-1 Visa Reform Act

On January 20, 2017, Senators Chuck Grassley (R-IA) and Richard Durbin (D-IL) reintroduced their H-1B and L-1 Visa Reform Act. Currently, the Trump administration is circulating a draft executive order targeting employment-based immigration. As the draft order mostly contains vague directions regarding numerous visa programs, the proposed bill serves as an indicator of where the H-1B and L-1 visa programs could potentially be headed under the current administration.

It is important to note that this bill has not been passed and that the situation may change at any time. We will be certain to provide updates, clarification, and guidance as this matter develops.

Proposed changes to the H-1B program include the following:

Prohibits outsourcing of H-1B employees unless a waiver is granted by the DOL:

•  Waivers require the employer certify the following:

•  Not replacing a U.S. worker;

•  Has not and will not displace a U.S. worker;

•  Employee will be controlled by the petitioning employer; and

•  Not essentially an arrangement to provide labor for hire.

•  Prohibits displacement of U.S. workers 180 days before or after the placement of an H-1B employee;

•  Requires employers to post all H-1B jobs on a website to be created and run by the DOL for 30 at least days,;

•  Limits H-1B workers to no more than 50%of an employer's workforce, employers cannot restructure to evade this limitation;

•  Sets minimum prevailing wage at a level 2 wage;

•  Replaces the current H-1B lottery with a preference system as follows:

•  Applicants with a U.S. advanced degree in STEM;

•  Applicants who will earn a level 4 wage;

•  Applicants with a U.S. advanced degree;

•  Applicants who will earn a level 3 wage;

•  Applicants with a U.S. bachelor's degree in STEM;

•  Applicants with a U.S. bachelor's degree;

•  Applicants working in needed occupations as determined by the DOL ;

•  Petitions filed by employers using E-verify;

•  All remaining applicants;

•  Limits applicants to those with actual degrees, eliminates experience equivalents;

•  Limits H-1B status to three years unless an I-140 is approved, can then extend H-1B status for another three years (max of six years and AC21 still apply);

•  Adds an additional processing fee to be paid by the applicant;

•  Eliminates the B-1 in lieu of H-1B; and

•  Gives DOL strong and active enforcement authority as well as dramatically increases penalties.

Proposed Changes to the L-1 program include the following:

•  Limits outsourcing of L-1Bs to one year unless a waiver is granted;

•  Waivers require the employer certify the following:

•  Not replacing a U.S. worker;

•  Has not and will not displace a U.S. worker;

•  Employee will be controlled by the petitioning employer; and

•  Not essentially an arrangement to provide labor for hire.

•  Prohibits displacement of U.S. workers 180 days before or after the placement of an H-1B employee;

•  Places strict requirements on extending a new office L-1s including:

•  Employer must demonstrate full compliance with business plan;

•  Evidence that the employer was doing business for the full year;

•  Evidence of wages paid and financial status;

•  Sets minimum prevailing wage for L-1s employed over one year at a level 2 wage;

•  Requires employers to must offer the same benefits to L-1 workers as they offer to U.S. workers;

•  Expedites visa applications under blanket L-1s;

•  Narrows the definition of specialized knowledge;

•  Gives DHS strong and active enforcement authority as well as dramatically increases penalties.

Congressman Darrell Issa (R-Ca) has introduced a competing bill that would set the minimum prevailing wage for H-1B dependent employers at $100,000

For further details on this proposed bill, or on any other immigration matters, please contact a member of our employment-based immigration team.

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