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U.S. District Court for Northern California Overrules New Restrictions on H-1B Visas

U.S. District Court for Northern California Overrules New Restrictions on H-1B Visas

  • The rules would have toughened H-1B eligibility and imposed new obligations on the companies trying to bring in foreign workers.

In what is being seen as a significant victory over the Trump administration, the U.S. District Court for Northern California has ruled against new restrictions on H-1B visas imposed by the President. The lawsuit was filed last month by the Bay Area Council, Stanford University and other business and educational groups. In the lawsuit, they challenged the new restrictions arguing that they are not only illegal, also rushed.

The lawsuit challenged rules issued by the Departments of Labor and Homeland Security in October, imposing a one-year limit on the placement of H-1B workers at third-party firms, and increased minimum pay for foreign workers on the H-1B. According to the Department of Labor, “the lowest possible wage that a company can pay an H-1B worker will rise from the 17th percentile of a profession’s income distribution to the 45th percentile, while the uppermost tier “will increase approximately from the 67th percentile to the 95th percentile.” 

The agencies cited unemployment from the coronavirus pandemic as reason to invoke the rules without the standard public notice and comment periods. The DOL rule took effect on October 8, and the DHS rule would have been effective Dec. 7. Judge U.S. District Judge Jeffrey S. White’s ruling overrules both regulations. 

“Defendants failed to show there was good cause to dispense with the rational and thoughtful discourse that is provided by the APA’s [Administrative Procedure Act] notice and comment requirements,” White wrote in the Dec. 1 order. “Accordingly, the court concludes that plaintiffs are entitled to judgment in their favor on their first two claims for relief, and the court sets aside the rules on the basis that they were promulgated in violation of [the law].”

“The June suspension did not affect the foreign workers already in the United States on H-1B visas,” the New York Times reported then. “But it upended the lives of those who were outside the country when the president issued his suspension.”

According to Stuart Anderson, executive director of the National Foundation for American Policy, this decision has far-reaching consequences, the most important of which may be its impact on future administrations. “Analysts note the Trump administration has been hostile toward high-skilled immigration for the past four years,” wrote in Forbes. “The failure to make these H-1B regulations permanent means it will be much easier for future administrations to adopt more neutral or even welcoming policies toward high-skilled foreign nationals, including international students.”

In June, temporarily suspended new work visas barred hundreds of thousands of foreigners from seeking employment in the U.S., as part of a broad effort to limit the entry of immigrants into the country. “The June suspension did not affect the foreign workers already in the United States on H-1B visas,” the New York Times reported then. “But it upended the lives of those who were outside the country when the president issued his suspension.”

The Mercury News reported that “the H-1B program has become a flashpoint in America’s immigration debate.” Foreign workers are employed by major firms in the Bay Area like Facebook, Google, Apple and Tesla, which are part of the Bay Area Council and engage workers with specialized skills. “The tech industry has pushed to expand the annual 85,000 cap on new visas, while critics have pointed to reported abuses and argue that the H-1B is used to supplant U.S. workers, drive down wages and facilitate outsourcing,” the Mercury News report said.

See Also

According to a Bay Area Council press release, 40-45 percent of technology companies in the Bay Area have been founded by immigrant entrepreneurs. “Of 91 unicorns (billion dollar plus companies) that were recently surveyed nationally, more than half had at least one immigrant founder and 75 had at least one immigrant in key roles such as CEO, CTO of chief product officer,” the council said.

“This is a major win for our economy and for our ability to recover from the worst downturn in generations,” said Jim Wunderman, President and CEO of the Bay Area Council. “H-1B workers fill an important need in our economy and provide immense benefits not only to the companies they work for but the communities where they live.”

U.S. Citizenship and Immigration Services (USCIS) data shows that 278,491 H-1B visa recipients were from India in FY 2019, accounting for 71.7 percent of the total number issued.China had the second highest share of visas issued to skilled foreign workers with 13 percent while Canada had the third-highest share at 1.2 percent.

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