Executive Council Statement | Immigration

Reform The H-1B and L-1 Guest Worker Visa Programs

Chicago, Ill.

In the current recession—unlike previous economic downturns—a growing number of well-educated and highly skilled U.S. professional and technical workers have found themselves in the long lines of the unemployed. They and their families have not only been battered by the economic trauma of being out of work, but increasingly they are finding themselves victimized by dysfunctional U.S. guest worker policies. For many—particularly workers in high tech—these policies have made a bad situation much worse.

Under current law, employers, especially in high tech, are abusing temporary visa programs to allow hundreds of thousands of guest workers with no rights and no job security to take job opportunities in the United States, when workers in this country are unemployed and even being laid off. There are now more than a million of these workers in the United States under the two largest guest worker programs, H-1B and L-1. Yet neither of these programs connects in any way to the realities of the U.S. labor market and our rising unemployment rate.

Worse, both programs are rife with fraud and abuse and are being used by unscrupulous corporations to displace America’s workers and exploit guest workers. Under these programs, guest workers must depend on their employers not only for a job, but also for their legal status.  Employers also have the power to renew guest worker visas at their pleasure. This creates an unequal relationship inherently subject to abuse, in which employers have the upper hand to intimidate guest workers who seek better wages and working conditions, seek to join a union or complain of discrimination. Employers can retaliate by threatening to end these guest workers’ employment and thus their visas, or by threatening to deny the renewal of visas in the future. 

This year, Congress must take action to clean up the problems that plague these programs by implementing urgently needed reforms.

The H-1B Temporary Guest Worker Program

In effect since 1990, the H-1B program originally was designed to permit a modest number of professional and technical guest workers into the United States each year to alleviate spot shortages in our labor market. However, in 1998 and again in 2000—despite AFL-CIO opposition—Congress drastically expanded the program, even as widespread reports of exploitation and abuse of U.S. and H-1B guest workers were surfacing. Later this year, the previous legislation will sunset and thereby reduce the number of visas to the original yearly limit of 65,000 that was in effect prior to 1998.  The AFL-CIO supports this reduction, but other reforms are also needed:

  • To make the program truly “temporary,” H-1B visas should be limited to one non-renewable three-year term.
  • The program must include explicit prohibitions against replacement of U.S. workers and must strictly tie the entry of any and all H-1Bs to U.S. labor market conditions to minimize the impact on all professional workers.
  • The existing “attestation” system—a sort of honor code whereby employers assert they have searched for qualified U.S. workers and are paying H-1B workers prevailing wages and benefits—should be replaced with real safeguards that protect both domestic and foreign guest workers.
  • The number of guest workers per company must be limited.  Only the primary employer—with a specific, full-time job opening—should be eligible to make application for an H-1B visa. In higher education, the primary employer may make application for job openings consistent with the unique employment terms and conditions in that industry.
  • H-1B workers must have an independently verified college degree equivalent to a U.S. degree, demonstrated experience in the field for which they are being hired and must have achieved licensure in the occupations that require it.
  • With the exception of employment in higher education, H-1B workers who are laid off for legitimate reasons must return to their home country within 90 days. Misuse of the "portability" of H-1B visas that allows foreign guest workers to compete against unemployed U.S. professionals who also are looking for work should be prohibited. Employers should not be permitted to lay off or otherwise terminate workers on H-1B visa for asserting their rights under federal and state laws, including their right to union representation. In higher education, workers on H-1B visa who do not work during one semester of 120 days, whichever is longer, shall not be considered on “layoff.”
  • The coverage and protections of all applicable federal and state labor laws should be made available to H-1B workers, including the right to forum unions.
  • U.S.-trained foreign graduate students seeking to adjust their status should be given preferential rights for obtaining H-1B employment visas. 
  • The provision must be retained in current law that exempts the H-1B workers at U.S. colleges and universities from being counted under the H-1B caps but there must be assurances that all other current or future requirements, such as protections of the H-1B employees’ labor rights and domestic workers’ non-displacement rights, apply.

Regarding agency oversight, the Department of Labor and successor agency for the Immigration and Naturalization Service—the Bureau of Citizenship and Immigration Services—need to ramp up enforcement. However, since this program directly affects the U.S. labor market as well as workers, primary oversight responsibilities should reside with the Labor Department. That agency must be given adequate oversight and enforcement authority, as well as sufficient resources to end program abuses, enforce the law and protect the interests of U.S. and guest workers alike. If necessary, additional funds should be allocated by statute from the $1,000 H-1B visa fee to enhance these enforcement functions.

The current system encourages H-1B workers to keep quiet or look for another job rather than file complaints about exploitation. The Labor Department should be given the authority to begin affirmative enforcement through random and “profiled” audits as well as through response to complaints. In addition, the Labor Department must be given the authority to initiate investigations of suspected misconduct without having to wait for a complaint to be filed. H-1B employees should be given “whistle blower protections” when they file non-frivolous complaints with the Labor Department. W-2 forms for H-1B workers should be reviewed to ensure that employers are paying the required wage and have not cut workers’ hours illegally. More punitive sanctions, including debarment from the program, must be authorized for any employer or visa petitioner who violates statutory mandates.

The L-1 “Intra-Company” Transfer Visa

Under L-1, multinational corporations are authorized to bring into the United States employees from their overseas subsidiaries on an “intra-company transfer” basis. The only requirements are that these guest workers must have worked for the company for one year out of the past three prior to the transfer and that the individual’s prior education, training and employment must qualify the guest worker to perform the intended services in the United States.

Several recent media reports indicate that the program is being badly abused:

  • L-1s are being used to replace U.S. workers, who are often forced to train their L-1 replacements before they themselves are laid off; nothing in current law prevents this displacement.
  • Foreign-owned outplacement firms—also known as “body shops”—are bringing in thousands of foreign L-1 visa workers and then contracting them out to other employers, contrary to congressional intent. 
  • While the L-1 visa is supposed to be reserved for executives, managers and workers with “specialized knowledge,” the so-called body shops are importing run-of-the-mill tech workers and other low-level workers for U.S. firms.
  • Many L-1 workers lack the requisite credentials to do the high-level work envisioned under this visa program.
  • L-1 brokers are filing open-ended, blanket petitions that allow mass importation of these foreign workers instead of an individualized application process.

Other serious problems also exist. Unlike H-1B, there is no limit on the total number of foreign workers that can be brought into the United States annually under the L-1 program. The duration of the visa—up to five years—exceeds a reasonable definition of a temporary program. There is no requirement that L-1 foreign guest workers be paid prevailing wages and benefits for the duration of their employment.  Unlike H-1B, there is no visa fee to defray the cost of processing and agency enforcement, oversight and data collection, as well as to fund training for U.S. workers. Government agencies responsible for administration of the program freely admit there is little or no oversight or enforcement, a situation made worse because there are no effective sanctions that deter abuse of this visa program.

Each and every one of these abuses must be ended, and that is the intent of legislation introduced by Rep. Rosa De Lauro (D-Conn.) and Rep. Christopher Shays (R-Conn.). We urge Republican and Democratic members of the House to co-sponsor and support the De Lauro initiative and encourage the Judiciary Committees of the House and Senate to begin hearings soon and report out reform legislation this year.

Professional Visas in Trade Agreements

The United States Trade Representative (USTR) embedded entire new categories of guest worker visas within new trade agreements with Singapore and Chile. This extraordinary revision of U.S. immigration law unilaterally undertaken by an executive branch agency occurred without either a grant of explicit authority from, or adequate prior consultation with, Congress. When this action came to light during negotiations on the agreements last fall, Republican and Democratic leaders on the House and Senate Judiciary Committees—at the instigation of the AFL-CIO—raised objections with the USTR.  As a result, a bipartisan backlash led by House Judiciary Committee Chairman James Sensenbrenner and ranking Democrat John Conyers forced the USTR to agree to language that subjects the guest worker programs to many of the statutory requirements of the existing H-1B program. Notwithstanding these improvements, other key H-1B labor market provisions will not apply to these new visas, potentially opening up another avenue for abuse and exploitation of guest worker programs.

Congress had the opportunity to send a message to the USTR by rejecting these agreements because they usurp the legislative authority of Congress regarding the nation’s immigration law and they lack effective and adequate labor and environmental standards. Despite the opposition of the AFL-CIO, many affiliated unions and environmental and other organizations, the trade agreements were approved. Now the Judiciary Committees of the House and Senate must exercise constant oversight to prevent the USTR from unilaterally negotiating temporary entry provisions in future trade agreements. Otherwise the visa limits set by Congress for foreign guest workers under H-1B and L-1, along with whatever other reforms are implemented for these programs, will be irrelevant.


With domestic unemployment at its highest level in nearly a decade and with tens of thousands of jobless tech workers, engineers and other professionals looking for work, abuses inherent in the H-1B and L-1 visas are intolerable. Employer abuse of the system—whether through displacement and unfair treatment of domestic workers, intimidation of guest workers or artificial depression of their wages and working conditions below the standards of the domestic labor market—is unacceptable. Congress created these programs; now it must reform them so America’s workers are not disadvantaged and foreign workers are protected from exploitation.