The Donald Trump administration has come out with new measures to increase scrutiny of H-1B visa holders working for companies in the US, while bringing in new restrictions for fresh applications for the visa programme designed to attract highly skilled foreign workers.
The move is likely to hit Indian IT firms such as Tata Consultancy Services, Infosys and Wipro and American firms such as IBM, Google and Facebook, who depend on H-1B visas to send engineers from India to work on projects in the US. The US opened the window to invite applications for 80,000 H-1B visas it plans to issue in 2018.
"The H-1B visa programme should help US companies recruit highly-skilled foreign nationals when there is a shortage of qualified workers in the country. Yet, too many American workers who are as qualified, willing, and deserving to work in these fields have been ignored or unfairly disadvantaged. Protecting American workers by combating fraud in our employment-based immigration programs is a priority for USCIS (US Citizenship and Immigration Services Agency)," said the USCIS in a statement.
This fresh crackdown may force Indian IT services companies, which receives nearly one-third of the H-1B visas issued to India, and their counterparts in the Silicon Valley to be selective on H-1B applications this year.
USCIS will scrutinise petitions on three parameters: validation of employer's basic business information, higher H-1B employee ratio and employers petitioning for H-1B workers who work offsite at another company or organisation's location. There will be more scrutiny on fresh engineers who apply for the coveted visas.
It means that the US government will seek more information for computer engineers going there to work on projects on H-1B visas and they will have to prove that their jobs require highly-skilled workers.
Pareekh Jain of HfS Research India says this is a change in the evaluation and execution process, but the policy remains same. "This will primarily result in selective approach by Indian IT firms in H-1B visa petitions."
While the Indian IT services industry is already struggling to maintain growth momentum in traditional services business, companies may have to factor in a higher cost for sending engineers on projects in the US anticipating a wage hike for H-1B visa holders. Many Indian firms have already announced hiring more local workers in anticipation of the visa restriction regime.
Infosys declined to comment on this development.
"The H-1B visa system exists specifically because of the persistent shortage of highly-skilled domestic IT talent in the US, and NASSCOM member companies have and will continue to provide skilled talent and solutions to fill that gap and keep US companies competitive globally," said industry body Nasscom in a statement.
During his election campaign, US President Trump had called for tougher immigration laws for technology companies and had threatened to impose taxes on companies that moved work offshore. In his first State of the Union address to a joint session of the US Congress last month, he also proposed having a merit-based immigration system like Canada, Australia and other nations.
Poorvi Chothani of LawQuest, a global immigration and employment law firm, believes a few Indian IT services firms may reduce the number of petitions this year thereby bringing down the total number of petitions slightly. "The number of H-1B petitions for Indian nationals may be less. But overall, we expect there will still be more applications than the overall cap of 85,000 applications leading to a lottery for this year too," said Chothani.
Last year, USCIS received more than 236,000 petitions within the first five days. This number led to a lottery for H-1B issuance as the regular cap remained 65,000, along with the additionally 20,000 visas for the US master's degree holders.