Changes in H1B visas to affect Indian IT firms

Washington: The proposed changes in the issuing of H-1B visas, the highly sought after US work permits, will badly affect the Indian IT firms which depend heavily on these work visas.

The changes under the Comprehensive Immigration Reform (CIR) put a curb on use of H-1B visa for those companies which have a higher ratio of work force under this category.

Most of the Indian companies will fall under this classification.

The companies will also have to shell out more fee to get a H-1B visa, if the draft legislation is cleared by the Congress and is signed into law by the US President.

The US, according to the 17-page outline of the 'Border Security, Economic Opportunity and Immigration Modernisation Act of 2013', will crack down on abusers of the H-1B system by requiring the dependent employers to pay significantly higher wages and fees than normal users of the programme.

If the employer has 50 or more employees, and more than 30 per cent but less than 50 per cent are H-1B or L-1 employees (who do not have a green card petition pending), the employer will need to pay a USD 5,000 fee per additional worker in either of these two statuses, the outline of the bill said.

In case the employer has 50 or more employees and more than 50 per cent of these workers are H-1B or L-1 employees who do not have a green card petition pending, then the companies will have to pay a USD 10,000 fee per additional worker in either of these two statuses.

As such, large Indian IT companies like TCS, Wipro and Infosys will have to pay USD 10,000 for each additional H-1B employee they would be hiring.

Such a thing will not be for companies like IBM, Intel or Microsoft who are based in the US and majority of their employee are American nationals.

In case of companies like TCS, Wipro and Infosys, which are headquartered in India having large off-site offices back home and depend on a small strength in the US, will be affected by such a provision.

The bill proposes that in the fiscal year 2014, companies will be banned from bringing in any additional workers if more than 75 per cent of their workers are H-1B or L-1 employees.

This provision is in accordance with the US plan to crack down on use of H-1B and L visas to outsource American jobs by prohibiting companies, whose US workforce largely consists of foreign guest workers, from obtaining additional H-1B and L visas.

Under the bill, the Secretary of Labour must establish a searchable website for posting H1B positions. The site must be operational and online within 90 days of the passage of the new law.

It requires employers to post a detailed job opening on the Department of Labour's website for at least 30 calendar days before hiring an H1B applicant to fill that position.

The bill also restrains employers from recruiting or giving preference to H-1B or OPT workers over American workers.

It also proposes to establish significant new authorities and penalties to prevent, detect, and deter fraud and abuse of the H-1B and L-1 visa systems by fraudulent employers.