Industries: International Business
Services: International Business, Tax
By: Jennifer Dowdy
Companies planning to hire foreign individuals to work in the U.S. may have their efforts stalled by President Trump's executive order suspending the grant of temporary employment visas.
President Trump issued the proclamation on June 22, 2020, and it immediately suspended the issuance of H-1B and H-2B, J and L temporary visas until December 31, 2020. H-1B visas are used by employers to bring highly skilled or specialized workers into the U.S., while H-2B and L visas are issued for seasonal workers and to temporarily transfer executive or management employees to the U.S. The order is set to expire December 31, 2020, however, a clause in the ruling states that the order is subject to review every 60 days and may be continued as necessary into 2021.
The order came about as a result of the high unemployment rate caused by COVID-19. The White House does not want U.S. laborers to compete with foreign citizens for a limited supply of jobs. Since the U.S. and the rest of the world are still dealing with the immediate threat of COVID-19, it's possible that the suspension could last into 2021.
Foreign companies planning a direct investment in the U.S. now or in early 2021 may want to take particular note of this order since it will limit the ability to send foreign executives and management to the U.S. for a period of time to start up U.S. operations. Additionally, companies looking to hire highly specialized professional workers for a particular project or business expansion efforts may have to wait or hire U.S. workers instead.
It's important to note that this order does not apply to foreign nationals who were already in the U.S. currently working under a valid temporary visa as of the effective date of the order, and it does not preclude those individuals from applying for visa extensions. It also does not apply to individuals seeking to enter the U.S. for temporary jobs that are essential to the U.S. food supply chain, or to B-1 visas, which are issued to business visitors from countries not included in the Visa Waiver Program entering the U.S. to meet with colleagues or clients or to attend conferences.
The Department of Homeland Security also recently issued a proposed rulemaking on October 28, 2020 that would affect the prioritization of H-1B visa selection once the suspension is lifted. There is a cap on the number of H-1B visas that can be issued each year, and under the agency's proposal, priority in the visa selection process would be given to H-1B visas that would employ higher wage workers as opposed to the current random selection process that is now in place. The intent is to better protect lower wage U.S. workers from competing for jobs with foreign individuals. The proposal is currently open to public comment.
Companies will need to wait and see if President-elect Biden and his administration will overturn the executive order once he takes office.