Firebell in the Night

Date: Sunday, March 30, 2003 12:08 PM

H-1B and JOB DESTRUCTION NEWSLETTER

www.ZaZona.com

Immigration lawyers regard American workers as "the enemy." They are
very paranoid that these workers may begin to demand that something
will be done to limit their cash cow program, the L-1 visa.

New L-1s soared by 50% between 1998 and 2002; the first 5 months of
fiscal 2003 saw an additional 10% rise in L usage according to State
Department data. Over this same period, by contrast, H-1B visas fell by
27% through 2002 and another 17% thus far in FY 2003. There were
384,000 H-1B temporary workers in 2001 while 329,000, nearly as many,
were working here as L-1 intracompany transfers.

http://www.visalaw.com/03mar2/16mar203.html

Guest Article - Firebell in the Night: The Coming L-1 Crisis and What
We Can Do About It, by Gary Endelman

DISCLAIMER:Gary Endelman practices immigration law at BP Amoco
Corporation. The opinions expressed in this column are purely personal
and do not represent the views or beliefs of BP Amoco Corporation in
any way. This article is copyrighted by ILW.COM and is reprinted with
permission. You can read other articles by Mr. Endelman and subscribe
to future articles at www.ilw.com.

One of the little-noticed side effects of the Special Registration
controversy is that those who know most about immigration find it
difficult to think about anything else. It does not trivialize the pain
and anxiety that Special Registration is causing to suggest that
pro-immigration advocates must think about other things and have other
priorities. The most obvious candidate for our consideration is the H1B
quota that, absent action by Congress, will plunge to 65,000 on October
1, 2003 from the current 195,000 level. There is another brewing crisis
that has yet to emerge fully but, when it does, may prove even more
dangerous to American employers: the L-1 intracompany transferee visa
is under attack. Created by Congress in 1970 to allow US employers to
rotate expatriate employees into and out of the United States, the L-1
has long been a stable and quietly accepted visa not troubled by the
constant controversy that has plagued its more high profile H-1B
cousin.

As the H-1B has become more radioactive, interested employers have
increasingly turned to the L-1 as a less onerous alternative unburdened
by labor union attack and DOL oversight. New L-1s soared by 50% between
1998 and 2002; the first 5 months of fiscal 2003 saw an additional 10%
rise in L usage according to State Department data. Over this same
period, by contrast, H-1B visas fell by 27% through 2002 and another
17% thus far in FY 2003. There were 384,000 H-1B temporary workers in
2001 while 329,000, nearly as many, were working here as L-1
intracompany transfers. The continuing debate over H-1Bs has so sucked
all the oxygen out of employment based immigration that, below the
radar, few have noticed that the L-1 has begun to replace it as the
work visa of choice. Critical articles on the L1 are not new. What is
different is that such negative treatment is no longer confined to the
nativist fringe but has crossed over into the mainstream press. That is
why the Business Week story on major US companies outsourcing their IT
functions, laying off Americans and replacing them with L-1
international workers supplied by Tata Consulting, India's largest
technology consulting firm, should be, to quote Thomas Jefferson's
reaction to the Missouri Compromise, a "firebell in the night" to the
immigration bar and its business clients. Sound like an overwrought
exaggeration? Listen to the Business Week report and think again:

With the travails of the high-tech industry, and the jump in IT
unemployment, fewer U.S. companies can tap the H-1B program these days
by saying qualified Americans aren't available. At the same time,
employers looking to slash costs have discovered that they can use
firms that hire L-1s to dump high-paid Americans in favor of cheaper
workers from abroad. As a result, many companies are subcontracting
thousands of jobs to outsourcing companies such as Tata, Infosys
Technologies and Wipro Technologies, the three largest Indian software
servicing companies, which are all using more L-1s..."Is it OK to use
L-1s for outsourcing to other firms? The answer is no" says State
Department spokesman Stuart Patt. Legal or not, the growing use of L-1s
has sparked a backlash...the Immigration and Naturalization Service is
reviewing the L-1 visa program to "assess whether companies are using
the L-1 to circumvent the H-1B program," says an INS official.

Representative John L. Mica (R-FL) vows to amend the L-1 law if the
Justice Department does not prosecute Siemens Corporation for allegedly
replacing US workers with cheaper L-1 Indian nationals at its Lake
Mary, Florida office. Congressman Mica now condemns the L-1 as a
"backdoor to cheap labor" while a sympathetic Business Week notes with
obvious disapproval that "Companies like Tata have grabbed a US market
share in IT consulting in part by exploiting the L-1s loophole." This
comes at a time when America is poised to embark upon war with Iraq,
the economy shows no signs of revival and the anti-immigration faction
with the Republican Party seems to have gained the upper hand on
Capitol Hill. The most recent issue of Immigration & Business News
Comment lays out the legislative landscape for the 108th Congress as it
begins work:

The Republicans have apparently chosen Rep. John Hostettler (R-IN) who
has been tapped by the House Leadership to chair the immigration
subcommittee...Rep. Hostettler gets an A- rating from NumbersUSA an
advocacy group calling for significant restrictions on new
immigration...Other immigration restrictionists on the immigration
subcommittee include Rep. Lamar Smith (R-TX) and Rep. Elton Galleghy
(R-CA). With former Majority Leader DIck Armey retired and gone from
the House leadership, there are no overtly pro-immigration Republicans
left at the top of the party in the House. In the Senate...the latest
Washington rumors are that newly-elected Sen.Saxby Chambliss (R-GA)
will head the Senate immigration subcommittee. Sen. Chambliss also gets
a high rating from NumbersUSA...none of the traditional friends of
immigration in the Republican Party, are being mentioned for the
subcommittee.

Faced with such reports, the friends of the L-1 visa need not panic but
must plan for the future. A rationale for keeping, even expanding, this
visa must be fashioned while there is still time. A variety of possible
solutions readily come to mind. Some may want to set a hard annual
limit on L1 admissions. Others may favor a flexible cap that allows for
any ceiling to be exceeded if clear national benefit can be
demonstrated, perhaps as judged by a points system that places high
emphasis upon cutting-edge skills in industries that are most actively
in need of more workers. Skeptics may prefer to link the L-1 to rates
of occupational unemployment when regional and local variations are
factored in. If this happens, however, the price for such a check on L1
admissions should be that no subsequent test of the relevant job market
need be repeated as a condition precedent for attaining green card
status.

Precisely because the enemy has yet to strike, if we marshall our
defenses now, all may not be lost. If we retreat into the false
security of an illusory denial, and pretend that the future will always
resemble the present, then the L-1 could be diffcult to save. To do
nothing, to deny that the L is in danger, guarantees that, if a serious
backlash against the L does come, it will be deeper and more painful
that any of us either wants or expects. Our present immigration
priorities must be reversed. It should be harder to come to America,
but easier to stay. We need the L-1 and now is the time to tell the
nation all the reasons why. Act now friends of the L, while there is
still time.

About The Author: Gary Endelman practices immigration law at BP America
Inc. The opinions expressed in this column are purely personal and do
not represent the views or beliefs of BP America Inc. in any way.

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