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Failure to Communicate: How Labor Market Tests and Protections Are Out of Step With The United States Immigration System

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Executive Summary

The process of conducting labor market tests for temporary work visas or permanent residence via individual labor certification by the sponsoring employer is often convoluted, arbitrary, and outdated. It is not clear that the process actually protects job opportunities for American workers. Temporary guest worker programs require varying levels of labor market tests or attestations for different visas, but the compartmentalized nature of these certifications for different programs makes the process difficult and arduous to manage for employers and employees while also being vulnerable to abuse. Since the implementation of the labor certification program in 1965, many aspects of the labor certification requirements and labor market tests to hire a foreign worker to participate in the U.S. economy have remained the same. However, the nature of labor and employment itself, such as work culture, tenure, and corporate structure has undergone a tremendous amount of transformation. As such, the current iteration of the foreign labor certification program and its enforcement mechanisms must undergo changes to meet present-day labor trends while achieving the goal of protecting both foreign and American workers.

Currently, the United States has many categories of temporary work visas available to foreign workers. Among them, the H-1B, H-2A, H-2B, and J-1 visas are some of the most popular visa categories and are bringing the highest number of foreign employees to the United States each year. Each of these visa categories, with some exceptions, require employers to file a petition with U.S. Citizenship and Immigration Services on behalf of the nonimmigrant worker before the visa can be issued. However, not all temporary work visas trigger a labor certification process. A labor application is only necessary to bring temporary guest workers under the H-1B, H-2A, and H-2B categories and is managed by the Department of Labor. Individuals seeking these visas must undergo various labor market evaluations to ensure that employers are not displacing U.S. workers or adversely affecting wages by employing foreign workers.

The legislation of the early 1990s added the labor condition application (LCA) requirement along with annual caps to the H-1B category. The LCA is a streamlined and flexible version of the longer labor certification process used during the permanent immigration phase and is used by employers to hire temporary professional workers on an H-1B visa. The LCA is an “attestation” in that the employer is filing a statement of intent attesting to the truthfulness and accuracy of the statements without a formalized “test” to prove it. However, the LCA does not specify any action to be taken by the employer. Employers generally do not need to file a proof of recruitment or statement of wages paid with the attestation, but they must maintain documentation regarding wages and recruitment, which may be required by the Labor Department for audit or investigative purposes.

For the H-2A visa category, employers undergo a process closer to the permanent labor certification. The labor certification for the H-2A visa requires outlining the employment terms and conditions to the state workforce agency, a Department of Labor funded agency that deals with employment and labor issues in each state and serves the areas of planned employment. Employers must also conduct domestic recruitment to attempt to find U.S. workers before hiring foreign workers. The labor certification for H-2A workers protects employees by requiring employers to provide foreign workers with the Adverse Effect Wage Rate (AEWR), the federal or state minimum wage rate, or the prevailing hourly wage, whichever is the highest. The H-2A labor certification process also requires employers to do more for workers than the H-1B LCA in that employers must certify that they will guarantee guest workers employment for no less than three-fourths of the contract period, as well as housing, transportation, and workers compensation insurance.

The labor certification for H-2B visa program is a two-part process—registration and application—and has more regulations than the H-1B LCA filing. Employers must submit an H-2B registration 120 to 150 days before the date of when the workers are needed. The registration must also be approved before an employer can file for a labor certification application. In the certification application phase, an employer must submit a labor certification application to the Department of Labor Employment and Training Administration and a job order to the SWA for the area of intended employment to recruit for U.S. workers. The labor certification for H-2B workers protects employees by requiring employers to provide temporary workers with prevailing wage rate or the federal, state, or local minimum wage. H-2B employers must comply with the “three-fourths guarantee” and pay for the employees’ visa-related, lodging, and transportation expenses. In an event that the services of the employee are no longer required, the employer can only terminate the job offer with the approval of the certifying officer from the Labor Department and must provide the worker with transportation to the worker’s last place of residence or make an effort to transfer the employee to a comparable employment.

Employers are also required to undergo a labor certification process for permanent employment-based green cards for foreign workers. For employers who have previously hired foreign workers on an H-1B visa, this can sometimes mean a second labor market test for the same position. The certification authenticates that there were not enough qualified or willing U.S workers for the position at the prevailing wage and that hiring a foreign worker permanently will not affect wages and working conditions of other workers who are similarly employed. The employer must certify that the job opportunity has been and is open to any U.S. worker and is not available because a former employee is on a strike or lockout. In cases where the certifying officer from the Labor Department deems necessary, employers may be required to conduct supervised recruitment for pending and future applications.

Adjusting status from H-1B temporary visa to permanent residency demonstrates low levels of integration between the temporary and permanent employment sponsorship processes. The H-1B to permanent residency channel triggers two independent labor evaluations, a labor condition application in the temporary phase and then a labor certification in the permanent phase, with no integration between the two. America’s temporary to permanent employment-based immigration system does not have a direct pathway between the two streams of immigration. The labor certification process is also designed to facilitate parallel channels of temporary and permanent labor certifications that are not streamlined to assist with a foreign worker’s transition from temporary to permanent immigration, even when that is the intention of both the employer and the worker.

Guest worker visas in the H-2A and H-2B categories are not dual intent and therefore do not have provisions under which workers normally can adjust status to a green card. Unlike the skilled worker attestation program, H-2A and H-2B visa categories require employers to undergo a stringent labor certification process to demonstrate that they were not able to find any U.S. worker for the job, among other requirements. Even when labor market tests establish there is a shortage of U.S. workers for agricultural or non-agricultural employment, a lack of dual intent means employers cannot sponsor foreign workers on H-2A and H-2B visas for a green card without risking the workers’ nonimmigrant status.

The labor certification process in its current form tends to be controversial and yield arguments from experts that the system is either too rigid or not rigid enough. Critics of the current certification process often claim that the labor certification process for both high-skilled and other workers in its current form may not be adequate to protect U.S. workers and will require reforms. However, many businesses argue that the current process is overly rigorous and cumbersome yet ensures that only those foreign workers who are the best qualified are allowed to work in the United States. For example, critics of the current labor certification system also propose eliminating the legal provisions that exempt employers who hire H-1B workers with a master’s degree or those who are paid $60,000 or more from the prevailing wage rule, which they claim employers use to hire foreign workers for a lesser rate than employees already in the United States.

Employers and businesses that rely on foreign talent, however, claim that additional bureaucratic and rigorous rules would restrict employers from filling labor shortages in a timely manner, which they argue would stifle United States economic productivity and innovation. Employers state that an arduous and lengthy labor certification program to hire temporary workers may limit companies’ ability to attract global talent and could drive workers to migrate to other competing economies such as Canada and Australia.

The labor certification process, albeit with minor adjustments under the Immigration Act of 1990, has remained relatively the same since 1965. However, employment practices and the nature of work have drastically changed since the early 1990s when major immigration reform was last legislated. The evolution of shorter job tenure makes the employer to employee one-to-one tethering of H-1Band other temporary visa holders antiquated as it restricts vertical and lateral growth that foreign employees may seek in the workplace or while changing jobs. Furthermore, the process of transitioning from H-1B to green card in the employment-based stream can tie a worker to a specific employer and job for more than a decade, a situation that is increasingly rare in the open labor market and can dissuade a foreign worker, whose status is tied to that employer, from exercising workplace rights.

Further, while our labor certifications are intended to regulate employment with a single employer at a designated location, the rise of technology and automation are upending the traditional 9-to-5 permanent employment structure. More informal or “gig” employment arrangements would largely preclude sponsoring foreign workers to fill workforce needs since the labor certification requirements indicate that foreign workers are only allowed to perform specific tasks outlined in the certification application at a designated location. Labor certification laws for nonimmigrant employees may bind them to a particular and obsolete working situation.

Conclusion

America’s labor certification program has not undergone a major reform since the early 1990s. However, the country’s labor practices have undergone a significant shift in work style, corporate structure, remote work, employment tenure, and gig economy, making the U.S. visa and certification program increasingly antiquated. The varying levels of labor market tests and labor certification programs for different temporary guest worker programs make the bureaucratic system convoluted and hard to navigate for employers and foreign workers. The different and compartmentalized labor market evaluations for various visas such as H-1B, H-2A, H-2B, and permanent employment make the U.S. labor market test vulnerable to abuse, and subordinates’ foreign workers to their employers in the process, making them more exploitable. Our different visa programs require different degrees of labor market tests and the system is not designed to facilitate smooth movement of people from temporary to permanent visas, especially for those who want to contribute to our labor markets when it has been previously established that there is an existing labor shortage. A system that is streamlined may better reflect the current nature of work and the labor force as well as protecting foreign and native workers which is the ultimate intention of our labor certification program.

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