How the Grassley-Durbin Bill Allocates the 65,000 H-1B Visas

By David North on November 24, 2015

One of the most interesting elements of S. 2266, the bill proposed by Senators Chuck Grassley (R-Iowa) and Dick Durbin (D-Ill.) regarding the H-1B and L-1 nonimmigrant worker programs, is the proposed distribution of H-1B petitions should there be, as there has been recently, more petitions than the 65,000 slots permitted.

The current practice, resulting from an administrative decision made by the Department of Homeland Security, is that a lottery is conducted on a random basis; this system, which has nothing to do with the levels of wages or skills, rewards employers who have filed the most applications, and punishes those who have filed the least.

Section 104 of the Grassley-Durbin bill lays out a ladder of allocations probably assuring those employers filing a single application in one of the top eight categories of an approval, while grouping the remaining, low-priority visas in a ninth category, in which there might well be a need for a smaller-scale lottery.

The motivation for the proposed distribution scheme is to encourage the payment of higher rather than lower wages, and the hiring of graduates of U.S. institutions, rather than foreign ones. It gives a priority to workers with degrees in Science, Technology, Engineering and Math (STEM), which reflects what the market wants anyway. It also sorts out physical therapists and nurses for special favorable treatment (this a small subset of H-1Bs currently).

Left in the bottom category would be low-paid foreign workers generally and graduates of overseas universities. This describes a large class of workers currently hired through the H-1B process. Other provisions in the S. 2266 would eliminate these visas for companies who have more than 50 percent of their work force with H-1B or L-1 visas. This would have a negative impact on the Indian outsourcing companies who currently use the largest single fraction of the visas.

There are, potentially, other ways to distribute visas in the case of an over-subscription.

One could simply run one of two auction programs. In one type, favoring the more skilled of the alien workers, would simply award the visas to the top 65,000 salaries offered. Another one would be an auction based on the size of the fee paid to the government by the prospective employer. This system would benefit the taxpayers.

Either of these proposed systems would be easier to administer than that proposed in the pending legislation, which seeks to meet several other goals, other than those of the highest salaries or the highest fees.

A CIS condensation of the Grassley-Durbin ladder, or allocation scheme, follows:

The potential sizes of the various sub-categories are the author's estimates, and are not based on any congressional language.

The third and final posting in this series will deal with the proposed changes in the L-1 program.

Read Part 1

Read Part 3