04:51 PM

H-1B Changes Would Exempt 20,000 Foreign Grads Of U.S. Schools

Congressional change means Ph.D.s and master's grads wouldn't count toward the 65,000 cap on H-1B visas, which critics say lets foreign workers undercut U.S. wages.

Companies that depend on foreign-born workers with advanced degrees from American universities will likely soon have something to be thankful for--Congress this week agreed to a provision that exempts those graduates from the annual H-1B visa cap.

The provision, which is expected to be approved by President Bush within the next two weeks, would exempt 20,000 foreign students with master's or Ph.D. degrees from the annual H-1B cap, says Jeff Lande, a senior VP for IT lobby group Information Technology Association of America, one of the most-outspoken advocates of raising the H-1B cap. "As the economy improves and U.S. companies ramp up, it's critical to ensure that they have access to talent with specialized knowledge and advanced degrees," Lande says.

The H-1B ceiling of 65,000 for the U.S. government's fiscal 2005 year was hit on Oct. 1, 2004--the first day of the fiscal year. Since then, the U.S. government hasn't granted any new H-1B visas. That means companies, particularly IT vendors and other high-tech companies, that depend on specialized talent--like U.S.-educated, foreign-born electrical engineers for the semiconductor industry-- would need to wait until next fiscal year to request visas for those individuals.

Opponents of the provision--such as the Programmer's Guild, a group representing IT workers--say too many of the existing 65,000 H-1Bs are going for work that doesn't require hard-to-find specializations and is merely a way to import cheap labor for which American workers are available.

More than half of the master's and Ph.D.s for math, science and engineering granted by U.S. universities are earned by foreign students, according to both ITAA and Compete America, a lobbying group linked to immigration issues that includes companies, universities, and research organizations.

Another provision passed by Congress would add requirements to the L-1 visa, a less-closely regulated visa that lets multinational companies bring employees here for short-term assignments. The L-1 has been criticized for allowing foreign IT firms to bring staff here and hire them out for short-term programming jobs. The provision, according to the office of sponsoring Sen. Saxby Chambliss, R-Ga., would require a "specialized knowledge employee" petitioning for an L-1 visa who will work off-site from the employer to be:

  • Controlled and supervised by the petitioning company
  • Provided in connection with an exchange of a product or service

It will also require the Department of Homeland Security to provide statistics about which L-1 workers are employed off-site.

Besides allowing additional H-1B visas to be issued to these advanced-degrees students, other provisions adopted by Congress this week include reinstating and increasing training funding for American workers. Under that provision, for each H-1B visa employee hired, employers must pay $1,500 toward retraining and education programs for American workers. Before a similar rule expired on Oct. 1, employers had been required to pay $1,000 per H-1B visa employee into education and retraining programs for U.S. workers.

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