Hot News on Compromise Bill Affecting H1B Cap
Posted Oct 12, 1998

On Friday, July 24, 1998, the House Immigration Subcommittee's Congressman Lamar Smith's office announced an agreement pertaining to H1Bs in a compromise bill. Several other Republicans have joined the bandwagon in ensuring that they receive credit for the compromise Bill. There is a good chance that Congress would vote on the compromise legislation before adjourning for their August recess and President Clinton could sign it as early as sometime in August 1998.

As the name suggests, the House-Senate bill has been approved by both the House of Representatives and the U.S. Senate. One of the highlights of the Bill for high tech companies and foreign national employees is the increase of the H1B cap as follows:

From 65,000 to 85,000 in fiscal year (FY) 1998, then to 95,000 in FY1999, to 105,000 in FY 2000, and finally to 115,000 in fiscal years 2001 and 2002.

In other words, if this Bill is passed into law by August 1998, it will benefit those who have been waiting for an increase in the H1B cap and those who have not yet withdrawn their H1B Petitions and those who have not requested a start date of October 1, 1998. Such H1B Petitions have a chance of obtaining the H1B approval before October 1, 1998. However, it probably will not be much before September 1998 at this stage and except for those falling out of status within the month of September 1998, the increase in the H1B cap for this fiscal year may not be as helpful as it would have been if the Bill had been passed in May/June 1998.

According to some of the press releases, the Bill when signed into law will require companies who are persistent and heavy users of foreign temporary workers to attest that they have recruited American workers and that they have not laid off an American worker to hire a foreign worker. These H1B dependent companies also will have to attest that they do not provide temporary workers to other companies who use foreign workers to replace laid off workers. Those who do could be fined and face debarment from using the H1B program for a specified time frame. In the most recent list provided by the Immigration and Naturalization Service (INS) to Congress, of the top 25 users of H1B program, at least six have been identified with at least 15 percent of their employees being temporary foreign workers. Presumably, these companies are being targeted by the Bill.

For those of you who recollect, approximately 2 years ago, similar provisions pertaining to H1B dependent employers were to be passed but those Bills never passed because of strong opposition from U.S. business. The Law Office of Sheela Murthy had summarized those provisions approximately 2 years ago in the Immigration Bulletin. Even though many may not be too happy with this Bill, U.S. businesses may swallow it because of the increase in the H1B quota.

Although the White House has not confirmed if this Bill will meet with President Clinton's approval, according to many estimates it is likely to be signed by President Clinton since it has safeguards for U.S. workers while it will also will help American businesses who are encountering acute worker shortages in the high tech field. The Law Office of Sheela Murthy will provide any significant updates either as a News Flash or as an Update on this proposed H1B law at our website at www.murthy.com.