IT companies jittery over Donald Trump's plan to suspend H-1B visa

The Donald Trump Administration is considering a proposal to suspend several employment-based immigration visas, including the H-1B visa, according to a report in The Wall Street Journal on Thursday. 

Though details of the proposed suspension are vague so far, the report says that the suspension “could extend into the government’s new fiscal year, beginning October 1, when many new visas are typically issued”.

It further says that the US could bar new H-1B visa holders outside the country from coming to work until the suspension is lifted, though visa holders already in the country are unlikely to be affected. The Indian information technology industry, which has long been a beneficiary of the H-1B visa regime, is likely to be directly impacted if such a suspension is announced for a longer term. However, experts suggest that getting legal sanction for such a proposal will not be easy. They also point out that this is expected rhetoric in an election year — the presidential election is scheduled for November. 

Poorvi Chothani, managing partner of LawQuest, an immigration firm headquartered in Mumbai, said rumours of H-1B visa restrictions had been doing the rounds for the past few days but the details remained scanty. The impact of a temporary ban on new H-1B or L-1 visas will depend on its nature and duration. 

“I doubt very much that a sweeping restriction on non-immigrant work visa categories could be implemented (without a change to the laws) and/or go unchallenged in a court of law,” said Chothani. She pointed to the approximately 85,000 new H-1B petitions that had been filed or would be filed before June 30, 2020 for FY 2021, for which the US government has already collected millions of dollars in fees. Many of these petitions are under process.  

“A ban on the H-1B programme would surely trigger litigation against the government and I personally don’t think the government will be able to adequately defend its  position in view of the reduction in unemployment,” said Chothani.  

L-1 visas are issued for intra-company transfers. For instance, if an Infosys executive moves from India to the company’s office in the US, it will be on an L-1 visa. But if the same executive is going to the US to work at a client site, then he or she will be issued an H-1B visa. 

The National Association of Software and Services Companies (Nasscom) said workers on non-immigrant visas such as L-1 and H-1B were helping run critical US infrastructure, building products for health care and hospitals, among others, and playing a key role to develop treatments for Covid-19. 

“Given this, we seek exemption for technology workers, as essential workers, from any restrictions that may be imposed in a second White House Proclamation. The priorities established by DHS’s CISA (Cybersecurity and Infrastructure Security Agency) that designates key categories of ICT workers as essential service, should help define the types of essential workers,” Nasscom said in a statement.

It added that the demand for hi-tech workers continued to be high, even during the Covid-19 pandemic. “I think it is just a consideration which will be difficult to implement. During the global financial crisis in 2008, similar attempts were made to put restrictions on H-1B visa holders. However, it came back within one year. So, any such proposal is unlikely to be followed up with legal sanction,” said Supaul Chanda, vice president at Experis of Manpower Group.

It is not just Indian IT firms that depend on the H-1B visa but also technology giants like Google, Microsoft, Facebook and others. US-based Manpower Group, along with Swiss firm Adecco and Dutch firm Randstad, are among the large subcontractors that supply critical human resources to the global IT industry by availing themselves of H-1B visas.

According to The Wall Street Journal report, “Lawmakers and businesses - including tech companies and seasonal employers - along with colleges and universities, are calling on the administration to abandon the plan and have been circulating details of the proposals online.”

Chothani said a temporary suspension will have a low impact on large firms but a larger impact on small ones. "Individuals who are stuck because of a suspension on visa issuance would suffer the most.  Many of them were in India at the time of the lockdown because they were here for personal trips or to get new H-1B visas stamps. They may not be able to return to the US until the restrictions are lifted," she said.