Thursday, the House Judiciary Committee Subcommittee on Immigration, Border Security, and Claims held an oversight hearing entitled "Is the Labor Department Doing Enough to Protect U.S. Workers?".
http://www.judiciary.house.gov/...
Pro and con testimony is represented at the above link. Full hearing transcript is not yet available. This will be a two-part series.
I will summarize the testimony and supporting documents of the main witness, Sigurd L. Nilsen, Ph.D., Director for Education, Workforce, and Income Security Issues, United States Government Accountability Office (GAO).
H-1B VISA PROGRAM
More Oversight by Labor
Can Improve Compliance
with Program Requirements
Statement of Sigurd R. Nilsen, Director
Education, Workforce, and Income Security
For Release on Delivery
Expected at 2:00 p.m. EDT
Thursday, June 22, 2006
What GAO Found
While Labor's H-1B authority is limited in scope, it does not use its full
authority to oversee employers' compliance with program requirements.
Labor's review of employers' applications to hire H-1B workers is timely, but
lacks quality assurance controls and may overlook some inaccuracies. From
January 2002 through September 2005, Labor electronically reviewed more
than 960,000 applications and certified almost all of them. Labor's review of
the applications is limited by law to checking for missing information or
obvious inaccuracies and does this through automated data checks.
However, in our analysis of Labor's data, we found more than 3,000
applications that were certified even though the wage rate on the application
was lower than the prevailing wage for that occupation. We also found
approximately 1,000 certified applications that contained erroneous
employer identification numbers, which raises questions about the validity
of the applications. In its enforcement efforts, Labor's Wage and Hour
Division (WHD) investigates complaints made against H-1B employers. From
fiscal year 2000 through fiscal year 2005, Labor reported an increase in the
number of H-1B complaints and violations, and a corresponding increase in
the number of employer penalties. In fiscal year 2000, Labor required
employers to pay back wages totaling $1.2 million to 226 H-1B workers; by
fiscal year 2005, back wage penalties had increased to $5.2 million for
604 workers. Program changes, such as a higher visa cap in some years,
could have been a contributing factor. In April 2006, WHD began randomly
investigating willful violators of the program's requirements. Labor uses
education as its primary method of promoting compliance with the H-1B
program by conducting compliance assistance programs and posting
guidance on its web site.
Labor, Homeland Security, and Justice all have responsibilities under the
H-1B program, but Labor and Homeland Security face challenges sharing
information. After Labor certifies an application, USCIS reviews it but
cannot easily verify whether employers submitted petitions for more
workers than originally requested on the application because USCIS's
database cannot match each petition to Labor's application case number.
Also, during the process of reviewing petitions, staff may find evidence that
employers are not meeting their H-1B obligations. For example, Homeland
Security may find that a worker's income on the W-2 is less than the wage
quoted on the original application. USCIS may deny the petition if an
employer is unable to explain the discrepancy, but it does not have a formal
process for reporting the discrepancy to Labor. Moreover, current law
precludes WHD from using this information to initiate an investigation of the
employer. Labor also shares enforcement responsibilities with Justice,
which pursues charges filed by U.S. workers who allege they were displaced
by an H-1B worker. From 2000 through 2005, Justice found discriminatory
conduct in 6 out of the 97 investigations closed, and assessed a total of
$7,200 in penalties.
Certain employers are required to make three additional attestations on
their application. These additional attestations apply to H-1B employers
who: (1) are H-1B dependent, that is, generally those whose workforce is
comprised of 15 percent or more H-1B nonimmigrant employees; or (2) are
found by Labor to have committed either a willful failure to meet H-1B
program requirements or misrepresented a material fact in an application
during the previous 5 years. These employers are required to additionally
attest that: (1) they did not displace a U.S. worker within the period of
90 days before and 90 days after filing a petition for an H-1B worker;
(2) they took good faith steps prior to filing the H-1B application to recruit
U.S. workers and that they offered the job to a U.S. applicant who was
equally or better qualified than an H-1B worker; and (3) prior to placing
the H-1B worker with another employer, they inquired and have no
knowledge as to that employer's action or intent to displace a U.S. worker
within the 90 days before and 90 days after the placement of the H-1B
worker with that employer.6
6 These additional requirements first applied from January 19, 2001--September 30, 2003. However, the provision requiring these attestations sunsetted, or expired, and was not reinstituted until March 8, 2005. Consequently, from October 1, 2003, to March 7, 2005, H-1B dependent employers and willful violator employers were not required to make the additional attestations, and, in effect, were able to hire H-1B workers even if they displaced U.S. workers and did not make efforts to recruit U.S. workers.
Employers' Requests Is
Fast but May Overlook
Some Inaccuracies
Labor reviews applications electronically8 by subjecting them to data checks, and its web site informs employers that it will certify or deny applications within minutes based on the information entered. We found that of the 960,563 applications that Labor electronically reviewed from January 2002 through September 2005, it certified 99.5 percent.
Labor's review of the application is limited by law to identifying omissions
or obvious inaccuracies. Labor defines an obvious inaccuracy as when an
employer:
* files an application after being debarred, or disqualified, from
participating in the H-1B program;
* submits an application more than 6 months before the beginning
date of the period of employment;
* identifies multiple occupations on a single application;
* states a wage rate that is below the Fair Labor Standards Act
minimum wage;
* identifies a wage rate that is below the prevailing wage on the
application; and
* identifies a wage range where the bottom of the range is lower than
the prevailing wage on the application.
Despite these checks, Labor's system does not consistently identify all
obvious inaccuracies. For example, although the overall percentage was
small, we found 3,229 applications that were certified even though the
wage rate on the application was lower than the prevailing wage for that
occupation in the specific location.
Additionally, Labor does not identify other errors that may be obvious.
Specifically, Labor told us its system reviews an application's employer
identification number10 to ensure it has the correct number of digits and
that the number does not appear on the list of employers who are
ineligible to participate in the H-1B program. However, we found 993
certified applications with invalid employer identification number
prefixes. Officials told us that in other programs, such as the permanent
employment program, Labor matches the application's employer
identification number to a database with valid employer identification
numbers. However, they do not formally do this match with H-1B
applications because it is an attestation process, not a verification process.
[Honor system.]
Justice Handles U.S.
Worker Cases
Justice pursues charges filed by U.S. workers who allege that an H-1B
worker was hired in their place. Such charges may be resolved before an
administrative law judge, through an out-of-court settlement, or by
dismissal for lack of reasonable cause to believe that a violation occurred.
From 2000 through 2005, no cases were heard by an administrative law
judge. Most of the 101 investigations started by Justice from 2000 through
2005 were found to be incomplete, withdrawn, untimely, dismissed, or
investigated without finding reasonable cause for a violation. Of the
97 investigations closed, Justice found discriminatory conduct in 6 cases,
and assessed $7,200 in penalties in 3 of the 6 cases, all in 2003.11
11 In the three cases where penalties were assessed, employers advertised for only H-1B workers for various information technology positions. Upon receiving notice of the
charges, the employers immediately agreed not to post discriminatory advertising in the
future and to take steps to recruit U.S. workers (as well as permanent and temporary
residents, refugees, and asylees). In these cases, minimum penalties were imposed because
there were no identifiable victims and, by statute, penalties are capped at $2,200 per
violation or individual. In the three cases where penalties were not assessed,
discrimination against U.S. workers appeared to be inadvertent, not intentional.
Conclusion and
Recommendations
We believe that Labor is at risk of certifying H-1B applications that contain
more errors than were found in the scope of our review. For example, we
checked only for employer identification numbers with invalid prefix
codes, and did not look for other combinations of invalid numbers or data.
Therefore, we do not know the true magnitude of the error rate in the
certification process. We continue to believe there are cost-effective
methods that Labor could use to check the applications more stringently
that would enhance the integrity of the H-1B process.
www.gao.gov/cgi-bin/getrpt?GAO-06-901T.
To view the full product, including the scope
and methodology, click on the link above.
For more information, contact Sigurd Nilsen at
(202) 512-7215 or nilsens@gao.gov.
More excitement tomorrow in PART 2.