‘Specialized’ Foreign Worker Makes Less Than Minimum Wage

‘Specialized’ Foreign Worker Makes Less Than Minimum Wage

Company uses L-1B visa, designed for execs and skilled employees, to skirt U.S. labor laws

by Brendan Kirby | Updated 24 Apr 2017 at 8:50 AM

A U.S. semiconductor manufacturer applied for an L-1B visa in December 2013 to bring in a foreign employee with “specialized knowledge” to work as a failure-analysis engineer in Oregon.

The L-1B visa is designed to allow companies to transfer workers from one company location to another across international borders. But the California Service Center of the U.S. Citizenship and Immigration Services denied the company’s application amid concerns about whether the employee actually possessed specialized knowledge and whether he would be working in a capacity that required such knowledge.

“While wage laws are not expressly restated in the Act, it is implied that authorized employment must comply with both the Act and the FLSA [Fair Labor Standards Act].”
The company — identified in documents only as “I-Corp.” — appealed to the Department of Homeland Security’s Administrative Appeals Office. That panel, in a decision handed down this month, declined even to address the issues flagged by the USCIS office because it found a more fundamental problem: The visa holder would not have made minimum wage.

The company’s visa petition stated that the employee would work in the U.S. for two years, earning a wage of 43,445 Malaysian ringgits per year. At the time, that equated to $13,467.95 in U.S. dollars, or $6.47 per hour. This is below the $7.25 federal minimum wage and even lower than the $8.95 minimum wage in the state of Oregon.

“While wage laws are not expressly restated in the Act, it is implied that authorized employment must comply with both the Act and the FLSA [Fair Labor Standards Act],” the decision states.

John Miano, a lawyer who co-wrote a book on abuses in the U.S. immigration systems, told LifeZette that American companies frequently try to skirt wage laws by exploiting the visa system.

L-1 Visas Increasingly Popular
Fiscal Year L-1 Visas
2012  62.4K
2013  66.7K
2014  71.5K
2015  78.5K
2016  79.3K
Source: U.S. Department of State

“The fact it was even appealed by the company shows they really try to do it,” he said.

Jessica Vaughan, a former State Department foreign service officer who now serves as director of policy studies at the Center for Immigration Studies, said the L-1 visa offers an alternative to the H-1B visa, which allows employers to sponsor temporary guest workers from foreign countries to work in technology jobs.

Like the H-1B, the L visa places few restrictions on employers.

“In fact, it is even less than the H-1B,” Vaughan said.

Unlike the H-1B visa, there is no annual cap on the number that can be awarded in any year. There are no income limitations; the biggest requirements are that the sponsored employee have “specialized knowledge” and have been on the company’s payroll in another country. The visa entitles the employee to work in the U.S. for up to five years.

As far back as 2003, a Government Accountability Office report warned that employers increasingly were turning to L-1 visas because they did not have an annual cap and were not subject to prevailing wage laws. According to the State Department, the number of L-1 visas awarded increased to 79,306 in fiscal year 2016, a 27 percent increase from fiscal year 2012.

Even though the L visa has no income requirements, the administrative appeal decision makes clear that other U.S. labor laws apply.

“It just shows you that not all of these visas are for the ‘best and brightest,’ as employers always like to say,” Vaughan said.

The USCIS put out a policy memorandum after the decision, making clear that it is binding on all USCIS employees. “USCIS personnel are directed to follow the reasoning in this decision in similar cases,” the memo states.

“It’s a little bit shocking that the government would have to spell that out,” Vaughan said.

Wouldn’t common sense hold that an employer cannot pay a worker less than minimum wage?

President signs ‘Hire American’ executive action to crack down on foreign-worker visa abuse
"When has common sense mattered?" quipped Hal Salzman, a professor of policy and planning at Rutgers University.

Salzman said he does not know how much scrutiny L-1B visa applications receive. He said he suspects a thorough investigation would turn up fake résumés and other fraudulent activity.

Vaughan agreed.

"I'm sure that wasn't the only one," she said. "Most of these cases are never investigated at all."


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