In a recent op-ed, I proposed reforming the H-1B program to require employers to prioritize the retention of their domestic workforce (i.e., American citizens and green card-holders). I argued that if employers are required to confirm that they will not displace American workers on an H-1B visa holder’s way in, that they should similarly be required to retain their similarly qualified American staff when workers are laid off.
Discussion of this proposal brought up a few good points that are worth amplifying here. First, at the end of the day, very few H-1B employers are required to confirm with the Department of Labor (“DOL”) that hiring H-1B workers will not displace U.S. workers. Most H-1B employers are required merely to attest as a part of their labor certification application that bringing on H-1B workers will not negatively impact the working conditions of their current employees. By most people’s standards, displacement is one of the worst ways foreign workers can impact their domestic counterparts. But even at the labor certification stage, this prohibition is implied at best.
Second, “H-1B dependent” employers – such as Meta, Facebook’s parent company – are required to jump through slightly higher hoops in order to petition for H-1B workers, but only in specific circumstances. Howard University Professor Ron Hira informed me that worker protections here are even weaker than I described because so many H-1B dependent employers are able to claim exemptions to these requirements.
An employer is considered “H-1B dependent” if a significant portion of its workforce are H-1B visa holders. Companies the size of Meta, or with at least 51 full-time employees, would be considered “H-1B dependent” if 15 percent of their workforce are H-1B visa holders. Companies with 26-50 full-time employees qualify if they employ 13 or more H-1B visa holders. Companies with 25 or fewer full-time employees need to only have eight H-1B workers to obtain this status. Generally, “H-1B dependent” employers must attest to DOL that they will not displace a U.S. worker within 90 days before or after petitioning for an H-1B employee.
The problem with this “hoop,” however, is that it contains such large loopholes that very few H-1B dependent employers actually have to “jump.” Federal requirements only compel employers to attest that they will not displace U.S. workers if they are paying the H-1B worker less than $60,000 per year or the worker has not earned a degree higher than a bachelor’s. As a result, many companies, including some leading Silicon Valley tech companies that have announced large layoffs this fall, are able to circumvent even these minimal protections. Data from the Department of Labor, which demonstrates that nearly 98.6% of the workers on certified labor condition applications (“LCA”) claimed an exemption from H-1B Dependent rules, paints a clear picture of how weak these protections are for most companies’ domestic workforce.
Even worse, because petitions for the October 1 start of the fiscal year can be made as early as 180 days in advance (i.e., in April), these protections are not even meaningful for most Americans working alongside this very small group where the rules do apply.
As I stated in my op-ed, DOL is right to raise an eyebrow at businesses that choose to import a significant portion of their workforce. There are significant financial incentives for employers to prefer H-1B workers over Americans. Lawmakers must empower DOL to act on that suspicion in more meaningful ways. They can start by actually requiring employers to confirm that their foreign hiring efforts will not result in displacement before they can receive LCA certification, closing loopholes that give nearly all employers an out from even that minimal requirement, and requiring employers to prioritize the retention of their domestic workforce when workers are laid off.