H-1B Visa Overhaul Spurs New Corporate Compliance Tactics

A historic shakeup in the process to seek and retain highly skilled foreign workers is motivating US companies to be creative in both compliance and steering clear of regulators.

Beefing up international operations and heightening in-house counsel oversight of immigration are a couple strategies companies are mulling after the Trump administration a week ago released plans to impose a $100,000 fee on H-1B visas and reconfigure its lottery selection.

Sectors like technology rely heavily on this kind of visa to fill specialized roles as the US struggles to bulk up its pipeline of STEM workers. Under the newly proposed system, jobs with higher wages would receive more lottery entries—a win for large companies and a bad omen for smaller ones.

Companies were already dealing with a rapidly changing compliance landscape since President Donald Trump’s second term began. But uncertainty around immigration policy is especially rattling given the Justice Department’s directive to pursue immigration-related cases, said Chris Thomas, a partner at Holland & Hart LLP’s immigration practice.

Add that to the Department of Labor’s new plans to investigate employers for H-1B visa fraud, and you’ve got a high-stakes environment with “existential” risks, Thomas said.

Companies trying to avoid criminal investigations and boost their chances in the H-1B lottery aren’t expected to change anything major overnight, especially as litigation remains a possibility. But if Trump’s policy proposals advance, employers could raise wages, closely watch employees’ travel, or look at other visa programs for hiring.

Here are three other strategies available to companies:

Get Out of Dodge

Companies are increasingly considering moving more of their operations outside the US to ease immigration compliance burdens, Thomas said.

“The general reaction is turning more toward, ‘OK, maybe it’s time to outsource more of this to India,’ ” he said. “Leading compliance counsel and others are saying, ‘You know what? This is all just becoming too messy.’ ”

Kate Kalmykov, co-chair of Greenberg Traurig LLP’s immigration and compliance practice, says she’s hearing the same from her clients as they weigh the potential costs of new policies.

“We’re in an enforcement-heavy environment,” she said. “We may see more hiring overseas, and that’s the reality of it, unfortunately.”

It’s not just large companies. Brian Sathianathan, who co-founded startup Iterate.ai, says he’s considering bulking up his company’s Toronto team.Bringing people up to speed in Canada—which has easy access to the US and similar time zones—would be faster than trying to hire more personnel overseas, he said.

Companies should consider, however, that investing in more workers outside the US isn’t an easily reversible decision, Kalmykov said.

Restructure Immigration Operations

Immigration oversight has traditionally been a human resources process. But the stakes are high enough now that companies should consider letting legal departments handle it, Thomas said.

If a company is found guilty of visa fraud, the entity itself—not just the responsible employee or department—can face prosecution, he said.

Moving immigration processes to an entirely different department may not even be necessary.

It’s already fairly common for HR’s immigration operations to have a “dotted line to the legal department,” said Grace Shie, who leads Mayer Brown’s global mobility and migration practice. With the current legal landscape, that line might become solid, she said.

“In-house counsel has to play, and will play, a larger role in the administration and governance of a company’s or business’ immigration” operations, she added.

Maintain Documents

Companies all too often aren’t aware of their requirements to maintain H-1B public access records—in general, documents that must be available for inspection, Thomas said.

“This is a soft spot, he said. “So many companies don’t understand this.”

These records must include information about how companies determine what to pay H-1B employees, as well as a document attesting the employer will follow wage standards when hiring foreign workers, and other filings.

It’s not that requirements for maintaining public access files have changed—it’s just more important to be in compliance, Shie said.

Companies should make sure their employment documentation has been reviewed, compiled, and made ready in case of an immigration audit, Kalmykov said. Employers should also ensure that employees are classified correctly in accordance with labor laws, she said.

Now is the time for companies to prepare for more federal oversight, Shie said. “Evaluate the current state and close any gaps that simply might exist.”