How Trump Executive Order “Buy American, Hire American” May Impact H-1B Visas
On April 18, 2017, President Donald Trump signed an Executive
Order titled, “Buy American, Hire
American.”1
Enhanced Scrutiny of H-1B Program
In the “Hire American” portion of the order, Trump
announced he was directing DOL, DOJ, DHS, and DOS to review the
current laws governing the H-1B program and suggest changes to
prioritize the most skilled and highest paid positions. The
President also indicated he was directing federal agencies to
review all visa programs and take prompt action to crack down on
fraud and abuse in order to protect U.S. workers. This follows the
notices found in memoranda from DOL, DOJ, and DHS where the various
agencies announced that they would impose greater scrutiny on the
H-1B program.
No Immediate Impact on H-1B Visas
The Executive Order will have no immediate impact on H-1Bs. The
Order does not pronounce any concrete changes, but rather simply
articulates a desire to create higher wages and economic rates for
U.S. workers, and to do so the executive branch will rigorously
enforce immigration laws governing entry to the U.S. Again, rather
than listing specific changes, the order states that the Secretary
of State, Attorney General, Secretary of Labor, and Secretary of
Homeland Security should propose new rules and guidance to protect
the interests of U.S. workers including preventing fraud or abuse.
This is consistent with the three memoranda and announcements which
were issued by the Department of Justice2, Department of
Labor3, and Department of Homeland Security4
early April announcing that the government agencies would be taking
a targeted approach to prevent fraud with the H-1B program.
Following the Executive Order, we anticipate additional updates
from these agencies in the near future.
Potential Merit Based System Forthcoming
Some Bills in Congress have discussed the possibility of a
merit-based system for allocating H-1B visas rather than the
current lottery. The Executive Order follows this concept. The
order states, “In order to promote the proper functioning of
the H-1B visa program, the Secretary of State, the Attorney
General, the Secretary of Labor, and the Secretary of Homeland
Security shall, as soon as practicable, suggest reforms to help
ensure that H-1B visas are awarded to the most-skilled or
highest-paid petition beneficiaries.” These types of changes
to the H-1B program contemplated by the Administration would
require legislative action or rulemaking and would take time to go
through the necessary processes.
Potential Impact on Outsourcing Companies
The potential outcomes of the order could hurt outsourcing
companies, most of which are from India. These companies file the
most visa applications.5 If the H-1B process moves away
from a lottery-based system to a process where visas are awarded
based on who pays the highest salary or based on the background of
the foreign national, it is possible that fewer visas would be
accepted from the outsourcing firms and distributed more to other
companies.
Footnotes
3 https://www.dol.gov/newsroom/releases/eta/eta20170404-0
5 https://www.nytimes.com/2017/04/18/us/politics/executive-order-hire-buy-american-h1b-visa-trump.html
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