Companies unfazed by hike in H-1B visa fee

Venkatesh Ganesh Mumbai | Updated on August 02, 2020 Published on August 02, 2020

Filing fees for H-1B high-skill visas will increase 21 per cent to $555, while that for L1 visas will go up by 75 per cent to $850

With WFH being the new normal, firms push for hiring locally, use remote tech

The fee hike for H-1B and L1 visa applications will have little effect, as companies have worked out alternative options to counter this move.

The US Department of Homeland Security announced in a notification that costs for one of the most sought-after visa categories were hiked by 21 per cent and 75 per cent, respectively. Cost for an H1-B visa will go up from $460 to $555 and L1 from $460 to $855. Also, conditions such as companies with more than 50 non-American employees (who hold H1-Bs) may have to shell out an additional $4,000 for every visa, according to immigration officials.

This development comes on the back of US President Donald Trump issuing a proclamation which restricts skilled workers to work in the US till December 31 this year. The hikes are with effect from October.

Hire local

While the IT industry did not offer to comment immediately on the impact of this, and while some believe that it is not that significant, others opine that the hike is an indirect way to force hiring of locals.

“This will not have much of an impact as companies are looking at hiring locally,” said Ashank Desai, co-founder of Mastek. Every year, 85,000 visas (which include renewals) are up for grabs. “They are trying to push local hiring even though they don’t have the requisite manpower. We are a year before the US elections and half expected this rhetoric,” said a senior VP from a top-5 IT outsourcing company.

Headwinds in IT

The $191-billion Indian IT industry has been facing many headwinds in the last four years with regard to obtaining these visas. Visa applicants have seen a rise in the number of cases that fall under the Request for Evidence (RFE) by the US authorities. RFE is a notice sent out by USCIS to the applicant, requesting for missing initial/additional evidence. Once the applicant submits the evidence, a decision is taken on whether to approve or deny the visa. “The scrutiny has gone up several notches and any discrepancy found results in getting the visa approval very cumbersome and time consuming,” said Rohit Turkhud, Partner, Fakhoury Global Immigration.

In the first half of fiscal 2020, almost half the visa petitions came under the RFE. Around 41.7 per cent of total H-1B visa petitions were processed after ordering an RFE; of these, 67.8 per cent were granted an H-1B visa. As an example, random compliance has gone up significantly.

Companies, on their part, have begun to hire locally and use remote technologies to counter all this. “With work from home the new normal, more work is expected to be done remotely,” said Raja Lahiri, Partner, Grant Thornton India.

Indian companies, which consume a sizable chunk of H1-B visas, have given their local hiring a big push. TCS, Infosys, HCL Tech and Wipro, have on an average, 50-65 per cent of their international workforce as locals.

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Published on August 02, 2020
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