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Explained: What are H-1B visas and what are the new wage-based rules?

The new wage-based work visa regime will now give priority in selection of visas to applications of those employers where the “proffered wage equals or exceeds” the prevailing level in that area of employment.

Written by Aashish Aryan | New Delhi |
Updated: January 19, 2021 10:58:14 am
The Trump administration has announced stricter rules for the H-1B visa programme, which U.S. companies have long valued. (The New York Times: Doug Mills, File)

The US administration has once again amended the H-1B visa norms by changing the rules to give priority to higher wages and skills for selection of deserving candidates. The old lottery system of work visa selection will not be followed now.

What are H-1B wok visas?

In 1952, after the US started expanding its presence in the science, technology, engineering and mathematics disciplines, it felt the need to hire quality workers who could help the country achieve innovation in these areas at reasonable costs. This need to hire workers paved way for the introduction of the H-1 work visa system.

This work visa system was further subdivided into H-1B, H-2B, L1, O1, and E1 visas, depending on the qualification required and the area for which workers were sought. Of these, the H-1B visa remains the most popular due to the relatively better wage chance it offers.

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The arrival of internet and low-cost computers in homes and universities of developing nations such as India, China, and Pakistan saw a large number of students graduating in disciplines related to computer science, technology, engineering and mathematics (STEM). Lack of jobs in their home countries, on the other hand, meant that the STEM graduates were willing to work in the US at relatively low costs, which proved to be a win-win situation for both the employer and the employee, thereby making the H-1B work visas the most popular.

The H-1B work visa system has since undergone many changes and revisions to allow or disallow certain categories of skilled workers in the US, depending on the economic situation of the country. Of late, however, it has also been often been criticised for sending low-cost workers to the US at the expense of domestic workers.

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What was the lottery system for selection of H-1B and other work visas?

Currently, every year the US administration issues 85,000 H-1B work permits. Of these, 65,000 are for people with specialty occupations, while the rest are reserved for foreign workers who have earned a Master’s or a higher university degree in the US.

Each employer who seeks to employ a worker on H-1B visa must fill out a registration form on behalf of the employee who they wish to employ. The form contains all the details of the employee, such as the nature of work they will undertake in the US, the wage being offered to them, the level of education of these workers and so on.

Since the number of applications for H-1B visas filed each year exceeded the 65,000 cap in the specialty occupations and 20,000 for the higher education category, the US Citizenship and Immigration Services then employed a random lottery selection of the eligible applicants to fill the 65,000 vacancies, and then moved on the fill the next 20,000. This lottery system was completely randomised and did not take into account any requirements such as wages, skills or needs of the employer.

What is the new wage-based H-1B work visa regime?

The new wage-based work visa regime will now give priority in selection of visas to applications of those employers where the “proffered wage equals or exceeds” the prevailing level in that area of employment. The proffered wage is the the wage that the employer intends to pay the beneficiary. This will be done for both the 65,000 regular visas and the 20,000 advanced degree exemption visas. This regime will also take into account the skill set that the respective worker brings to the country and cross check it whether such skill set is available at the same cost among the US workers.

According to the USCIS, since it is not possible to individually judge the skill set of all the applicants to the H-1B work visa regime, salaries are the best indicators of the same as employers would pay high wages only to the most deserving candidates. This, the USCIS said, would also not undercut the jobs that could be done by US workers who would otherwise be unemployed.

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