Subcommittee Reproves Administration for Failure to Adopt Worker Protection Rules at H1B Hearing

(May 26, 2000) The House Immigration Subcommittee held a hearing on May 25 on the Clinton administration's failure to adopt the American worker protection regulations required under the 1998 H1B bill. Subcommittee Chairman Smith said that the delay is appalling and insulting to American workers.

The House Judiciary Committee's Immigration Subcommittee held an oversight hearing on the Clinton administration's nearly two year delay in adopting worker protection regulations, as required by the American Competitiveness and Workforce Improvement Act of 1998, which became law in late 1998.

The Congress raised the annual cap on H1B visas in October 1998 in response to requests from high tech companies that they could not find enough American programmers, engineers, and other highly skilled workers.

That bill also included language requiring employers of H1B workers to attest that they had not laid off American workers to hire H1B workers, and that they had made a good faith effort to hire American workers first. However, enforcement of these "attestation provisions" requires the promulgation of implementing regulations by the Department of Labor. These rules have not yet been adopted.

Subcommittee Chairman Lamar Smith (R-TX) presided and conducted most of the questioning of witnesses. The Ranking Democrat, Rep. Sheila Lee (D-TX), also examined witnesses. The two are also cosponsoring a new bill, HR 4227, that will temporarily remove the cap on H1B visas, and carry more provisions designed to protect American workers.

The subcommittee grilled two administration officials:

• John Fraser, Deputy Administrator, Wage and Hour Division, Employment Standards Administration, U.S. Department of Labor.
• John Spotila, Administrator, Office of Information Policy and Regulatory Affairs, U.S. Office of Management and Budget.

The Department of Labor is responsible for drafting the regulations, while OMB approves the draft regulations. The administration has been working on the regulations for eighteen months.

Rep. Smith stated that they should have been completed by now. Fraser and Spotila claimed that they were working on the matter, but would not say when the regulations would go into effect.

Fraser claimed that the DOL had received a lot of comments that required review. Rep. Smith added up the total pages, divided it by the number of days that the administration had already taken, and informed the witnesses that it came to only "two pages per day."

		Rep. Lamar Smith (R-TX)

Rep. Smith stated that "as we sit here today there are no safeguards in effect to prevent American employers from firing American workers and hiring from overseas. Nor are there any safeguards in effect requiring American employers to advertise for American workers before they hire from overseas. Is that correct?" Spotila agreed.

Rep. Smith continued: "These regulations, I believe, expire in October 2001. So, over half of the time that we expected the regulations to be in effect have now already expired, and even if they were implemented today, we would only have them in effect for a little over a year, if they are not extended." Spotila concurred.

"Is there any good explanation why we are increasing the number of H1B visas dramatically, but not protecting American workers at the same time?" asked Rep. Smith. Spotila said "we should be doing both."

Rep. Smith asked "When are you going to implement the final regulations?" The witnesses would not say. Rep. Smith repeatedly asked this question in many forms, but he never received any indication. The witnesses did say that the Department of Labor had completed their final draft four months ago, and it is now being reviewed by the OMB.

"After eighteen months you cannot even tell us when they are going to be approved?" asked Rep. Smith. Spotila answered: "I cannot tell you precisely when the review will be completed. I can assure you that people are working on it steadily."

"That doesn't do American workers any good," said Rep. Smith. "Why aren't you approving the regulations? What is the hold-up?" Spotila said it is "a complex process."

"Why don't you just decide, and approve the regulation?" said Rep. Smith. "The appearance is that as long as those regulations are not issued, that apparently it is not a priority to the administration to have these safeguards in effect to protect American workers. Otherwise, they would have issued them, or you would have approved them, some time ago. And, to come today and say you don't even have any idea when they might be approved is not only appalling to me, but I would think would be insulting to American workers who are relying upon the administration to see that they are implemented as quickly as possible."

"The signal that you have sent," said Rep. Smith, is "that you don't care." He demanded that the regulations be approved "in the next few days."

Rep. Sheila Lee expressed her "complete horror" with the delay.

The subcommittee also heard from a second panel of witnesses.

• John Templeton, Coalition for Fair Employment in Silicon Valley.
• Kevin Hinkston, Coalition for Fair Employment in Silicon Valley.
• Frank Brehm, Programmers Guild.

During this segment of the hearing the subcommittee examined four worker protection issues:

• replacement of American workers with H1B workers.
• age discrimination against American programmers.
• recruitment of minority high tech workers.
• "off-shoring".

Templeton and Hinkston both testified about the failure of high tech companies in Silicon Valley to recruit black and other minority American workers.

Templeton testified anecdotally about an employer who, when asked "Why aren't you recruiting from historically black colleges and universities and black professional organizations?", responded "H1Bs are easier -- I need a body count."

Frank Brehm testified about age discrimination, replacement of American workers with H1B workers, and "off shoring."

Brehm stated that the 1998 Act does not address "off shoring. He elaborated:

"When a corporation "offshores" workers, the firm brings on-site one or more H1B representatives from a foreign programming business, sometimes referred to as a "job shop." After the foreign programmer achieves competence, he or she begins to channel programming projects to his overseas co-workers at the parent firm. The U.S. corporation is then able to layoff what may be an entire department of American technical specialists."

The members of the subcommittee who participated in all or part of the hearing included Rep. Lamar Smith, Rep. Sheila Lee, Rep. John Conyers (D-MI), and Rep. Ed Pease (R-IN).