India-Based Infosys Plans to Hire Thousands of U.S. Workers for New U.S. Locations

Amid criticism of outsourcing firms, at least one large Indian outsourcing company is planning to hire 10,000 U.S. workers over the next two years. Infosys CEO Vishal Sikka announced the company will open four technology and innovation hubs in the U.S. “focusing on cutting-edge technology areas, including artificial intelligence, machine learning, user experience, emerging digital technologies, cloud, and big data.”

The first will be in Vice President Mike Pence’s home state of Indiana. The Indiana campus also will have a training facility and a “skilling and re-skilling” facility. Scheduled to open in August, the Indiana campus alone is expected to employ at least 2,000 U.S. workers by 2021. Indiana reportedly offered Infosys incentives that include $500,000 in training funds and $15,250 in conditional tax credits per job.

Sikka has stated that there is “a strong desire by [President Donald Trump] and [the] administration to hire more locally and make things locally, and that’s something we deeply support.” The restrictions on H-1B and L-1 visas, along with the strict scrutiny of outsourcing companies by the Trump Administration and Congress, are also factors.  On the other hand, the company also reportedly said that “more and more of the work that we do going forward . . . need[s] a great amount of presence locally.” Wages are increasing in India and it may be becoming more difficult to find Indian engineering graduates who can code software well enough to meet companies’ and clients’ needs. Automation and cloud computing also have led to a drop in outsourcing firms’ gross hiring numbers worldwide. The demand for H-1B visas from outsourcing companies, such as Infosys, decreased this year, but it also 37 percent lower than before the November presidential election. Market factors, as much if not more than the political environment and restrictions on H-1B and L-1 visas, may be the driving influence.

Infosys has not yet selected the locations of the three other promised hubs, but the company is looking for locations where there are economic incentives offered near their major clients and near universities. Infosys already has offices in Arkansas, Arizona, California, Connecticut, Georgia, Illinois, Massachusetts, Michigan, New Jersey, New York, Texas, and Washington, each with 100-200 employees. WIPRO and TATA also are moving toward more local hiring. The CEO of WIPRO told reporters, “In Q1, we expect to have more than 50 per cent of employees to be locals in our biggest market which is the United States.”

Supreme Court Allows Partial Effect to Trump Travel Ban, Will Review Case in October

It comes as no surprise that the U.S. Supreme Court will hear the travel ban case and will do so in early October. Meanwhile, the Court stayed lower court injunctions allowing President Donald Trump’s revised travel ban to go in effect, but only to the extent that it affects individuals with no bona fide connection to the United States. Those most affected will be tourists from the six banned countries and refugees fleeing hostile environments who have no ties to the U.S.

Individuals who have family ties to the U.S., jobs or job offers in the U.S., or who are attending school or have been accepted to school will not be subject to the ban. These individuals are being placed in a different category, not on account of their own merits, but as an indirect result of the Court’s efforts to protect the rights of the American citizens or entities to which they have ties.

This balancing of the equities may signal the Court is less focused on the Establishment Clause (“Muslim ban”) arguments, instead, focusing on the Executive’s interest in national security. The Court stated, “The interest in preserving national security is ‘an urgent objective of the highest order.’ . . .. To prevent the Government from pursuing that objective by enforcing [the provisions] against foreign nationals unconnected to the United States would appreciably injure its [the Government’s] interests, without alleviating obvious hardship to anyone else.”

The Court stated that a bona fide relationship cannot be established simply to avoid the strictures of the travel ban. It explained, “[A] nonprofit group devoted to immigration issues may not contact foreign nationals from the designated countries, add them to client lists, and then secure their entry by claiming injury from their exclusion.”

The Court’s opinion was a Per Curiam, not authored by any particular justice. However, Justice Clarence Thomas authored a concurring and dissenting opinion. He stated that he would lift the injunctions entirely, noting the potential complications of implementing procedures to determine bona fide connections. Justices Samuel Alito and Neil Gorsuch joined Justice Thomas in that opinion.

Attempting to avoid the original travel ban chaos, the Trump Administration had announced the ban would not go into effect for 72 hours after a stay of the injunction. Accordingly, it would seem that it will go into effect, to the extent allowed by the Court, on June 29th. Once in effect, it is possible that at least part of the ban that is being enforced will be moot by the time Supreme Court hears the case in October.

Jackson Lewis attorneys will continue to follow the issues around the travel ban. Extreme vetting is still the order of the day, but the Supreme Court’s latest action should not change things considerably for employers.

Trump’s Cuba Policy Reverses Course Set by Obama

Simpler and less expensive travel to Cuba by Americans is apparently short-lived, as more difficult and costly travel to the island nation appears forthcoming.

In a recent speech in Miami outlining his policies on Cuban travel and commercial ties with the island country, President Donald Trump said the U.S. is not severing ties with Cuba and the U.S. Embassy will remain open, but he hopes to force the Castro government to reform, especially as to human rights violations, by reverting to some of the policies that had been in effect for close to 50 years before the Obama détente moves.

What will change and what will not change?

  • Tourism to Cuba is technically banned, but, under the Obama Administration, the regulations were relaxed and individuals could plan their own “people to people” cultural tours. Now, Americans making educational or cultural trips will have to do so through a licensed tour company or apply for their own license from the Treasury Department. This is apt to be not only more costly, but more complicated.
  • Americans will be prohibited from transactions with companies controlled by the Cuban military, intelligence, or security services. Since those agencies run much of the tourist infrastructure, including hotels, tourists will find it hard to know where they can spend money.
  • The Department of State will issue a list of blacklisted companies (which could make things clearer) and the Department of Treasury will audit tours and finances more stringently.
  • There will be exceptions to the embargo for American companies (such as Starwood Hotels) already doing business with the Cuban government and for airports and seaports, meaning cruise ships and commercial air flights will not be affected directly (although the companies may curtail them as tourism may drop).
  • Other exceptions to the trade embargo are expected to remain in effect, including for medical supplies, telecommunications technology, and agricultural products.
  • The “wet foot, dry foot policy” ended by Obama will not be reinstated, i.e., Cuban refugees making it to the U.S. soil will be treated like any other refugees. They will be sent back or they will have to try to apply for asylum.

Trump stated he wants to force the Castro Administration to promote free and fair elections, release political prisoners, and allow Cuban workers to be paid directly. Those goals are seemingly shared by both the current and former administrations, but there are marked differences in how to accomplish them. Under the Obama Administration’s scaling back of restrictions, there was a surge in Cuban “capitalism.” More than 600,000 Americans visited Cuba last year and a Cuban entrepreneur class has been developing. Entrepreneurs have opened independent restaurants and have been selling their own “products,” such as tourist rooms and tours through Airbnb to cater to the revived American tourist industry.

The new rules will not go into effect immediately and it may take months before they become reality. The government has 90 days to start rewriting regulations.

USCIS May Request I-9

The USCIS is requesting some applicants for Adjustment of Status to submit copies of the I-9 Employment Eligibility Verification forms that they (and their employers) completed for current or former employment. These requests are coming as RFEs or from local USCIS field officers.

The stated purpose is to help determine benefit eligibility, particularly to determine whether any false claims to U.S. citizenship were made to obtain employment – a possible basis for inadmissibility. This focus on false claims to U.S. citizenship first appeared in the agency’s December 2016 update to its policy manual specifically identifying false claims on an I-9 Form as a possible basis for inadmissibility.

A finding that a foreign national has made a false claim of U.S. citizenship has very serious consequences. The individual can be permanently inadmissible and, although waivers are available for non-immigrant admissions, most foreign nationals will not be eligible for a waiver to obtain a Green Card.

Because there are strict limitations on the use of the I-9 and the severe consequences of a false claim finding, employers must be careful when providing copies of I-9s or information derived from the I-9, including requests from current or former employees. Consult with immigration counsel before providing any I-9 records.

 

Trump Administration Rescinds DAPA Program

DHS Secretary Kelly has rescinded DAPA (Deferred Action for Parents of Americans and Lawful Permanents).  DAPA was meant to 1) provide undocumented parents of U.S. citizens or Green Card holders with a way to remain in the U.S. with work authorization and 2) expand DACA (Deferred Action for Childhood Arrivals) by encompassing a wider range of ages and arrival dates and lengthening the duration of deferred action and work authorization per application from two to three years.  Created by President Obama by an executive order, DAPA was quickly enjoined by the courts as an unacceptable expansion of executive power.  The Obama administration appealed to the Supreme Court, and just one year ago, the lower court ruling was affirmed by default as a result of the Supreme Court deadlocking at 4 to 4. The case has since been stalled.

Secretary Kelly made it clear that his memorandum does not affect DACA’s original terms. DACA recipients will continue to be eligible for two-year extensions.  “DACA recipients who were issued three-year extensions before the district court’s injunction will not be affected, and will be eligible to seek a two-year extension upon their expiration.  No [DACA] work permits will be terminated prior to their current expiration dates.”

This action is consistent with President Trump’s campaign promise to deport people who are in the country illegally. The Secretary noted that the order was rescinded because there “wasn’t a credible path forward” in terms of litigation.  How Justice Gorsuch rules on President’s Trump’s revised travel ban executive order may provide some insight into how the Supreme Court might have ruled on DAPA had the Court had its full complement of justices to consider that executive action.

Supreme Court: Gender-Based Distinctions in Immigration Law Violate Equal Protection

A federal citizenship statute setting different residency requirements for U.S. citizen fathers and mothers seeking to transmit birthright citizenship to their non-marital children born outside the U.S. violates the Equal Protection Clause of the Constitution, the U.S. Supreme Court has ruled. Sessions v. Morales-Santana, No. 15-1191 (June 12, 2017).

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Travel Ban Case on Fast Track at Supreme Court

Expectations are that the U.S. Supreme Court may decide soon whether to stay the injunctions blocking President Donald Trump’s travel ban. Meanwhile, the President has issued a Memorandum meant to amend and clarify the revised travel ban executive order.

The President declared that the 90-day travel ban and the 120-day ban on refugee admissions would not kick in until the injunctions were lifted. This is meant to ensure the bans remain “active” and to parry any legal argument before the Supreme Court that the case is moot (or soon will be moot) because the bans, which were meant to go in effect on March 16th, have already expired.

The White House also stated that when and if the injunctions are lifted or stayed, there would be a three-day (72 hour) grace period before the relevant provisions would go into effect. This is to “ensure an orderly and proper implementation of those provisions.”

Individuals from the six countries (Iran, Libya, Somalia, Sudan, Syria, and Yemen) who could be affected and plan to travel soon should take particular note of the possibility of the three-day warning.

Jackson Lewis attorneys will continue to provide updates.

 

DOL, USCIS Continue Focus on H-1B Visa Abuse

With his “Buy American, Hire American” Executive Order, President Donald Trump officially announced his intention to reform the H-1B visa program and the DOL and the USCIS are taking steps accordingly.

In April, the DOL announced it would be investigating violations of the H-1B visa program, “cautioning employers who petition for H-1B visas not to discriminate against U.S. workers . . . .”  While this typically means undercutting U.S. wages by hiring foreign workers at lower pay rates for the same work, details from Secretary of Labor Alexander Acosta on the DOL side of H-1Bs show that, beyond vigorous enforcement of laws related to the program, employers can expect:

  • More criminal referrals for fraud (e.g., petitioning for the individual to work in one job, then employing the person in a different role);
  • More civil investigations by Wage and Hour (e.g., regarding alleged wage disparity between U.S. workers and foreign workers);
  • Changes to LCA forms to create more transparency;
  • More coordination of enforcement among agencies to effectuate criminal referrals to the Office of the Inspector General and to avoid duplication of efforts;
  • More collaboration with DOJ and DHS to detect visa fraud; and
  • Publication of investigations and prosecutions to shame and promote compliance.

Penalties for violations of H-1B LCA regulations include civil monetary fines (up to $51,000 for willful violations), restricting access to additional H-1B workers and debarment, ordering payment of back wages, and federal criminal penalties (including imprisonment for interfering with an investigation).

Meanwhile, in response to a letter from Senator Charles Grassley, the DHS has stated that it is planning to issue new H-1B regulations and release updated guidance for the agency’s policy manual consistent with the President’s executive order, including suggesting reforms to “protect the interests of U.S. workers” and “improve the H-1B visa program.” The DHS already announced it would be conducting more targeted investigations in response to some highly publicized lay-offs of U.S. workers.  Lee Francis Cissna, Trump’s nominee for Director of the USCIS, already has a penchant for H-1B reform. He helped write the H-1B and L-1 Visa Reform Act sponsored by Senators Grassley and Dick Durbin. That bill focuses on enforcement and protecting U.S. workers by cracking down on alleged abuses by outsourcing firms, as well as giving priority to H-1B petitions offering higher wages, or to aliens with higher qualifications. It is important for employers to note that, during his confirmation hearing, Cissna stated that the “penalties are probably too low” for H-1B visa violations.

Jackson Lewis attorneys will continue to provide updates on changes in H-1B policies, regulations, and penalties as they become available.

Ninth Circuit Blocks Travel Ban

Joining the Fourth Circuit Court of Appeals and using President Donald Trump’s tweets to support its decision, the Ninth Circuit Court of Appeals in Hawaii v. Trump has continued to block the revised travel ban.

Unlike the Fourth Circuit, the Ninth Circuit did not rule on constitutional grounds. The unanimous three-judge panel ruled on statutory grounds and held that the government did not show sufficient justification to suspend the entry of more than 180 million people on the basis of nationality.”

The Court opined that there was no showing that allowing the entry of individuals from the six banned countries and allowing the entry of refugees would be detrimental.

The Ninth Circuit, however, narrowed the scope of the Hawaii District Court’s injunction to allow the government to continue with its review of the vetting procedures in foreign countries – something that the Trump Administration had claimed was equally deleterious. The lifting of this part of the injunction could lead to more stringent vetting of visa applicants. The government has asked the Supreme Court to stay both the Fourth Circuit’s and the Ninth Circuit’s injunctions. We await the Supreme Court’s first word on these cases.

President’s Budget Proposes New DOL Filing Fees for Employers

Suspecting that employers seeking to hire foreign workers are not acting in the best interests of American workers, President Trump has requested the authority to establish fees for the adjudication of labor certifications and prevailing wage requests. These fees would be retained by the DOL.  By doing this, the Office of Foreign Labor Certification (OFLC), which handles PERM labor certification, LCAs for H-1B and H-1B1 and E-3 applications, H-2A and H-2B labor certifications and prevailing wage determinations, would eventually become self-funded (like USCIS). The President’s budget proposal states that such fees would “ensure that employers proposing to bring in immigrant workers have checked to ensure that American workers cannot meet their needs and that immigrant workers are being compensated appropriately and not disadvantaging American workers.”  The underlying assumption is that adding fees will protect American workers from displacement by foreign labor.

It is interesting to note that 37,000 fewer Cap H-1B cases were filed this year – down to 199,000 from 236,000 last year. In fact, this is the first time in the past five years that the number of applications has decreased.  Also this year, the filing fee for H-1B petitions was increased by $135 from $325 to $460, and beginning last year H-1B dependent employers (among whom are some of the largest IT consulting firms) were obliged to pay an additional $4,000 fee.  It has been reported that the decrease in Cap cases this year may be due to a reduction in cases filed by the large IT consulting/outsourcing firms. It is possible that the fee increases have been a factor and, if so, additional DOL use fees may be part of the Trump administration’s general plan to attempt to reduce abuse in the H-1B and green card process by cracking down on large IT consulting/outsourcing firms.  Adding DOL fees may achieve this goal, but consulting firms may simply adapt their business models and move more jobs off-shore.

The proposed fee amounts are not yet known. The expectation is that they would be set by regulation.  On the plus side for employers, expedited processing fees might become available.

Jackson Lewis attorneys will follow the budget negotiations and provide updates.

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