Trump Suspends H-1B, Other Visas Till Year-end as Covid-19 Shrinks Jobs, Setback for Indian Professionals

In a major setback for Indian professionals, US President Donald Trump has instructed his administration to "reform" the H-1B visa system and shift towards a merit-based immigration, White House officials said.

"Moving to a merit-based immigration system," the White House said in a statement after Trump announced the temporary suspension of H1-B and other visas till the end of 2020. The statement went on to say that the Trump administration would reform the system to prioritise skilled workers and protect American jobs.

In the said reforms, the H-1B programme will give priority to workers who are being given the highest wage, making certain that only skilled applicants are admitted, the White House statement said.

The Trump administration is also seeking to address certain gaps that permitted employers in the US to replace American workers, the statement added.

The White House statement said that these changes would help protect the salaries of American workers and ensure that foreign labour coming into the US is high skilled and does not undercut the United States labour market.

"The more permanent actions that he is directing us to take include reforming the H-1B system to move in the direction of a more merit-based system. You hear the president talk all the time about getting the best and the brightest, and you also hear him talking about protecting American jobs. So, these reforms will do both," a senior administration official told reporters during a conference call, according to news agency PTI.

Under the said reforms, the H-1B programme is going to prioritise those workers who are offered the highest wages as the best proxy for what they bring to the table to add to the American economy, the official was quoted as saying.

Taking cognisance of the fact that there is a limit on H-1B visas of 85,000 every year, the official said that last year, 2,25,000 applications were received for those visas.

"Up until this year, those visas have been distributed through random lottery... The president has instructed us to get rid of the lottery and replace it with ranking the salaries -- so the top 85,000 salary offers among the 225,000 or so applicants will get visas," the official said.

This will drive both the wage-level and the skill-level of the H-1B applicants up. It will eliminate competition with Americans, it will reduce American competition in these industries at the entry-level, and will do more to get the best and the brightest, the official further said.

As per the official, Trump has also directed them to put to an end the gaps that have permitted employers, to essentially, domestically outsource their labour by swapping American workers with low-cost foreign labour.

"The way this loophole worked was the analysis of whether an incoming immigrant worker would displace an American worker was done at the company hiring the immigrant," the official said.

"If the company hires a bunch of immigrants and then subcontracts them out to another company -- say, Disney or AT&T, to just pick two historical examples -- then they end up displacing American workers at Disney and AT&T, both of which infamously had their American citizen employees training their H-1B replacements as their last act," the official was quoted as saying.

The official added that the president had asked them to put an end to this practice and they would do so as soon as possible.

Responding to the development, Google CEO Sundar Pichai said that he was disappointed by the proclamation and added that Google would continue to stand with the immigrants.

"Immigration has contributed immensely to America’s economic success, making it a global leader in tech, and also Google the company it is today. Disappointed by today’s proclamation - we’ll continue to stand with immigrants and work to expand opportunity for all," Pichai wrote on Twitter.

The official added that Trump has asked a change in the present wage calculation and clean it up, with respect to H-1B wages.

"It is an old, crazy system from the Clinton era, with four tiers, and the prevailing wage calculation is done in a variety of bases."

"The Department of Labor is going to fix all that, with the idea of setting the prevailing wage floor at the 50th percentile so these people will be in the upper end of earnings, so we're getting the best and the brightest, we're adding the most value to the economy, and we're maximizing the opportunity for Americans to get jobs," the official said.

The Secretary of Labor is going to commence using his statutory authority to investigate abuses in the H1B states, the official added.

"While this statutory authority has existed, I do not believe that any Secretary of Labor, prior to Secretary Scalia, has ever sought to use it. The President has directed him to do that. He's enthusiastic to commence that," the official said.

(With inputs from PTI)