Senate Passes Comprehensive Immigration Reform

On June 27, 2013, the Border Security, Economic Opportunity, and Immigration Modernization Act of 2013 (S. 744) passed the Senate by a vote of 68 to 32. The bill, which was introduced in the Senate on April 17, 2013 by the Senate “Gang of Eight,” would allow a path to citizenship for the estimated 11 million undocumented immigrants in the United States and proposes significant changes to employment-based immigration laws. Below is a brief summary of the bill’s key provisions.

H-1B High-Skilled Visas

The H-1B Cap: The bill calls for increasing the annual numerical quota (“cap”) on H-1B skilled workers from the current cap of 65,000 to one that will fluctuate within a range of between 115,000 and 180,000 based on several factors, including the unemployment rate and labor demand. Further, an additional 5,000 H-1B visas are added to the current 20,000 advanced degree exemption, but this exemption is now limited to graduates in science, technology, engineering, and mathematics (STEM) from U.S. schools.

H-4 Employment Authorization for Dependents: The bill grants employment authorization to dependents of H-1B visa holders. The U.S. Department of Homeland Security (DHS) has the authority to suspend this work authorization for H-4 nonimmigrants who are nationals of countries that do not provide reciprocal benefits to dependents of U.S. citizens abroad.

Wages: By moving from a four-tiered to a three-tiered wage system, the bill effectively increases the prevailing wages for all H-1B workers. In addition, H-1B dependent employers are required to pay Level 2 (or higher) wages to all H-1B employees.

Increased Filing Fees: The bill creates an additional H-1B filing fee of $2,500 for most employers. Further, additional fees and restrictions are imposed on employers with a high volume of H-1B workers.

Outplacement Restrictions: The bill requires qualifying H-1B employers to pay a $500 fee for each outsourced H-1B worker. H-1B dependent employers are, however, categorically prohibited from outsourcing H-1B employees.

Recruitment: All H-1B employers are required to post H-1B jobs on the U.S. Department of Labor (DOL) website for 30 days before filing the H-1B petition and to engage in good faith recruitment using industry-wide standards.

Expanded DOL Authority: The bill gives the DOL expanded authority to review Labor Condition Applications (LCAs) and audit H-1B employers. The LCA certification process is extended from seven days to 14 days. Further, most fines for LCA violations are doubled.

L-1 Intracompany Transferee Visas

L-1 Outplacement Restrictions: The bill places special requirements on the third-party placement of L-1 Intracompany Transferees, including:

• the worker must be controlled and supervised by the petitioning employer;
• the placement cannot be an arrangement to provide labor for hire; and
• the employer must pay an additional $500 fee.

Further, the bill completely prohibits the third-party placement of L-1 visa holders if 15 percent or more of the employer’s workforce consists of L-1 workers.

Increased Filing Fees: The bill creates an additional L-1 filing fee of $2,500 for most employers. Further, additional fees and restrictions are imposed on employers with a high volume of L-1B Specialized Knowledge workers.

Expanded DHS Authority: The bill grants DHS expanded investigative powers in relation to L-1 employers and the authority to impose penalties for violators.

Green Cards

The bill retains the immigrant visa quota of 140,000, but includes provisions to relieve the backlog in the employment-based green card preference categories. The bill creates mechanisms to recapture up to 200,000 green card numbers that were unused from 1992 to 2013, and provides for numerous exemptions to the quota. Specifically, the bill exempts the following individuals from the annual numerical limitations: employment-based derivate beneficiaries; aliens of extraordinary ability; outstanding professors/researchers; multinational executives/managers; Ph.D. degree holders; and some physicians. Additionally, the bill creates a new merit-based point system, allocating additional visas based on factors including skills, employment history, and education.

Employment Verification

The bill requires all employers to enroll in the federal E-Verify employment verification system. State and local employment verification would be invalidated. U.S. companies must implement the enhanced E-Verify employment verification system over a five-year phase-in period. Employers with more than 5,000 employees will be required to enroll in E-Verify within two years, employers with more than 500 employees within three years, and all other employers within four years. Furthermore, civil and criminal liability for non-compliance is substantially increased.

Other Provisions

Visa Revalidation: S. 744 allows certain E, H, L, O, and P nonimmigrants to revalidate expiring visas from inside the United States. This means that applicants eligible for interview waivers will be able to renew visas without international travel.

F-1 Students and “Dual Intent”: The bill recognizes dual intent for F-1 students and allows employers to sponsor F-1 students for green cards.

New “W Visa” for Lower-Skilled Workers: The bill creates a new “W visa” category, a nonimmigrant classification for foreign workers in low-skilled jobs. Beginning in 2015, the annual cap for W visas is 20,000 for the first year and increases to 75,000 by the fourth year. For each year after the fourth, the annual cap will be calculated according to a statistical formula taking into account various factors.

Border Security: The bill allocates increased resources to secure U.S. borders, amounting to a total of $46.3 billion. Provisions include doubling the number of border patrol agents, enhancing border surveillance, and extending fencing along the U.S. southern border.

Additional Information

Although many believe that the current efforts at immigration reform have a greater chance at success than any past initiatives, the bill must overcome several legislative obstacles before it can become law, including gaining approval from the Republican-controlled U.S. House of Representatives. While several stand-alone bills have been introduced in the House, a bipartisan group from the House is considering its own comprehensive immigration reform legislation and has reached an “agreement in principle” on such legislation. However, the extent to which the House bill will resemble the Senate approach is, as yet, unclear.

Ogletree Deakins is continuing to monitor the progression of the bill through Congress, and we will provide updates on comprehensive immigration reform as more information becomes available.