What is the H-1B visa? Requirements, processes and FAQs

The H-1B visa allows U.S. employers to hire foreign professionals to work in the U.S. when qualified Americans cannot be found. Here are the requirements, processes and latest changes for this controversial nonimmigrant hiring practice.

What is the H-1B visa? Requirements, processes and FAQs

The H-1B visa program is controversial. Few people like it. Businesses say it’s too restrictive. Labor organizations complain that it displaces U.S. workers and lowers their wages. Some politicians use it to appeal to their base with scant ability to fix the process to the benefit of all.

The following overview of the H-1B visa is accurate as of the publication date. Beware that the rules and internal business processes of the H-1B visa are complex. Either could be changed by legislation, executive order, or internal process reviews. For the latest rules, consult the Department of Labor, U.S. Citizenship and Immigration Services, or a legal firm specializing in immigration.

What is the H-1B visa?

The H1-1B visa allows U.S. employers to hire foreign professionals to work in the U.S. when qualified Americans cannot be found. The H-1B visa holder can work only for the sponsoring employer or the visa will be revoked. It was created in 1990 when Congress expanded the 1965 Immigration and Nationality Act and is not a direct path to citizenship.

Although skeptics question the intent of the program, the Department of Labor website states: "The intent of the H-1B provisions is to help employers who cannot otherwise obtain needed business skills and abilities from the U.S. workforce by authorizing the temporary employment of qualified individuals who are not otherwise authorized to work in the United States."

What are the H-1B visa requirements?

To be eligible, professionals from other countries must work in a “speciality occupation” that

requires “theoretical and practical application” of a unique body of knowledge along with a bachelor’s degree or equivalent in the discipline. Information technology, engineering, medicine, math, law accounting and other difficult to master occupations are eligible for H-1B visas. Fashion models without a degree but of “distinguished merit and ability” may also work in the U.S. with an H-1B visa.

And no, despite the urban legend, Justin Bieber does not hold an H-1B visa. Instead, he is in the U.S. on an O-1 visa, sometimes known as a Celebrity Visa given to famous people.

Are there similar visas?

The H-1B1 visa and the E-3 visa allow individuals from Chile, Singapore, and Australia to work in the U.S. under essentially the same requirements as the H-1B visa. Each year, 1,400 workers from Chile and 5,400 workers from Singapore may obtain H-1B1 visas. The E-3 visa allows 10,500 Australians to work in the U.S.

How can dependents of H-1B visa holders enter the U.S.?

Spouses and children under 21 can get an H-4 visa to enter the U.S. with an H-1B visa holder. The H-4 visa holder can stay in the U.S. as long as the H-1B is in effect. An individual with an H-4 visa can attend school, get a driver’s license, and open a bank account. As of May 26, 2015, certain H-4 visa holders can become “lawful permanent residents” (LPR) and become eligible to work.

What is the process to get an H-1B visa?

To obtain an H-1B visa, an employer must complete the following steps:

  1. File a Labor Condition Application (Form 9035E/ 9035) with the Department of Labor. The employer demonstrates adherence to the H-1B, H-1B1 or E-3 program requirements. The employer must attest that qualified Americans are not available and that wages to be paid are at least equal to the prevailing wage and to wages paid to others in similar positions within the company.
  1. Following approval of the Labor Condition Report, the employer must file a Petition for a Nonimmigrant Worker (Form I-129) with the S. Citizenship and Immigration Services (USCIS). In addition to the actual form, the employer needs to submit supporting documentation and payment.
  1. After the Petition for a Nonimmigrant Worker is approved, the named worker can apply for the actual H-1B visa. The approved visa will allow the individual to enter the U.S. If the individual is already in the U.S, legally, the actual H-1B visa is required if the employee wants to leave and reenter the U.S.

How many H-1B visas are issued each year?

At present, the U.S. limits the H-1B visa program to 65,000 qualifying foreign workers. However, 20,000 additional individuals are eligible to work under the H-1B advanced degree exemption. These individuals must have a relevant graduate degree from a public or not-for-profit university located in the United States. The school must be properly accredited by a formally recognized accrediting organization such as the Accrediting Council for Independent Colleges and Schools or the Accrediting Council for Continuing Education and Training. For more information visit the U.S. Citizenship and Immigration Services (USCIS) website.

Additional visas are sometimes authorized under the H-1B program. Under the American Competitiveness in the Twenty-First Century Act of 2000, universities and research facilities are sometimes allowed to hire H-1B holders who are not counted in the limits above.

In addition, the USCIS states that individuals with H-1B visas working in the Commonwealth of the Northern Mariana Islands (CNMI) and Guam may not be counted in the H-1B cap. Since the rules can change frequently, consult the Department of Labor for the most recent updates.

How are H-1B holders taxed?

H-1B visa holders have to obtain an Individual Taxpayer Identification Number and pay U.S. taxes, Social Security, and Medicare. However, the rules can get very complicated depending on whether the H-1B visa holder is categorized as a resident alien or a non-resident alien. At a summary level, the IRS uses the “substantial presence test” to classify each H-1B holder. Substantial presence is a function of the number of days an individual has spent in the U.S. during the current tax year along with the prior three taxes years. Individuals who fall above the threshold are deemed resident aliens and are taxed on all income including non-U.S income. Individuals who fall below the threshold are considered non-resident aliens and are only taxed on U.S income. There are a large number of rules and exemptions. H-1B holders should consult a tax specialist.

What has happened recently with the H-1B visa?

In March 2017, the U.S. Citizenship and Immigration Services announced that premium processing for H-1B visas would be suspended for up to six months. As a result, petitioners would not be able to use Form I-129 for the H-1B visa. Petitions that were filed properly before April 3, 2017 would be honored. Those filed after April would not be processed and the premium processing fee would be refunded.

On June 26, USCIS resumed premium processing for “Conrad 30 waiver program” physicians. A month later, on July 24, USCIS announced that it would resume premium processing for institutions of higher learning, non-profits affiliated with institutions of higher learning, and government research organizations.

What H-1B changes are currently being proposed?

In April 2017, the Department of Labor (DoL) announced new initiatives to protect Americans from being displaced by H-1B visa holders. Specifically, the DoL will increase coordination with Homeland Security, the Department of Justice, and other government agencies to investigate possible discrimination. In addition, the DoL may update the Labor Condition Application to increase transparency. Finally, the U.S. Citizenship and Immigration Services established an email address for individuals to submit ideas for improvement or tips regarding potential violations.

In January 2017 California Representative Zoe Lofgren introduced the High-Skilled Integrity and Fairness Act of 2017. Among other things, this bill proposes to more than double the minimum salary at which H-1B visa holders are "exempt from nondisplacement and recruitment attestation requirements" to $130,000. In addition, the bill reserves 20 percent of H-1B visas for businesses with less than 51 full-time employees, including parent companies, subsidiary, or other affiliated entities. The bill has been referred to the Subcommittee on Immigration and Border Security for further study.

In January 2017 Congressman Darrell Issa (R-Calif.) supported by Congressman Scott Peters (D-Calif.) introduced H.R. 170, the Protect and Grow American Jobs Act. This bill would increase the attestation requirements of H-1B employees to $100,000. It too is awaiting action by the Subcommittee on Immigration and Border Security.

At this point, it is hard to know when or if Congress will act on any H-1B legislation.

Is the H-1B a way to become a permanent resident of the U.S.?

The holder of an H-1B visa can have “dual intent.” Although the H-1B is a non-immigrant visa, the holder can apply for a green card at the same time. Since the time required to obtain a green card has lengthened in recent years, the H-1B offers a way for individuals to work in the U.S. while seeking to become permanent residents.

How long is an H-1B visa valid?

An H-1B visa is initially issued for three years. However, the visa can be extended for an additional three years. When calculating the remaining time for an H-1B visa, the rules are complex. The time spent in another country whether for business or vacation is not included and can be “recaptured” extending visa expiration. If a visa holder, who is in the process of becoming a permanent resident, submits an I-140 immigrant petition before the beginning of their sixth year of holding an H-1B visa, the holder can renew their H-1B visa one year at a time until a decision has been reached on their application for permanent residence.

Since the H-1B visa is for nonimmigrants, at the end of the maximum period for the visa, a foreign worker must either leave the U.S. or obtain a different visa. Failure to leave results in loss of legal status and can lead to deportation.

On November 18, 2016, DHS granted a 60-day grace period to H-1B visa holders who have been working and suddenly find themselves unemployed. Prior to this official grace period, individuals whose employment ended, were required to leave the U.S. immediately.

Can an employer cancel an H-1B visa?

The U.S. Citizenship and Immigration Services can revoke an H-1B visa. While it is not common, it does happen if the sponsoring employer is going out of business or cancels their original request. After the H-1B visa has been granted, employers can terminate employees but must comply with the terms of any employment agreement and follow federal, state, and local employment law.

Why is the H-1B visa controversial?

The H-1B visa continues to be dogged by controversies. The most common complaints include:

  • S. workers are being replaced by lower-paid H-1B workers.
  • Each year, outsourcing firms get most of the H-1B visas.
  • Companies headquartered outside the U.S are getting more H-1B visas than U.S. firms.
  • Few small firms are able to get H-1B visas.
  • Some H-1B employees are treated unfairly.
  • Some H-1B visa holders lack advertised credentials and associated skills.
  • Some entrepreneurs who started companies while in college may not be allowed to remain in the U.S.

For more on these controversies, see “H-1B A Good System Gone Bad.”

What is President Trump doing about the H-1B visa?

At various times, President Trump has talked about the foreign workers taking American jobs. On April 18, 2017 he signed "Presidential Executive Order on Buy American and Hire American" directing federal agencies to give preference to American products and American workers. All agency heads were directed to create a process to monitor their agency’s compliance within 150 days of the order’s issuance. In addition, the Secretary of Commerce and U.S. Trade Representative were directed to assess the impact on all U.S. free trade agreements.

For more analysis, see “FAQ: The real impact of Trump’s H-1B executive order.”

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