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H-1B VISAS: DESIGNING A PROGRAM TO MEET 

THE NEEDS OF THE U.S. ECONOMY AND U.S. 

WORKERS 

HEARING 

BEFORE THE

SUBCOMMITTEE ON 

IMMIGRATION POLICY AND ENFORCEMENT 

OF THE

COMMITTEE ON THE JUDICIARY 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED TWELFTH CONGRESS 

FIRST SESSION 

MARCH 31, 2011 

Serial No. 112–23 

Printed for the use of the Committee on the Judiciary 

( 

Available via the World Wide Web: http://judiciary.house.gov 

(II) 

COMMITTEE ON THE JUDICIARY 

LAMAR SMITH, Texas, Chairman 

F. JAMES SENSENBRENNER, JR., 

Wisconsin 

HOWARD COBLE, North Carolina 

ELTON GALLEGLY, California 

BOB GOODLATTE, Virginia 

DANIEL E. LUNGREN, California 

STEVE CHABOT, Ohio 

DARRELL E. ISSA, California 

MIKE PENCE, Indiana 

J. RANDY FORBES, Virginia 

STEVE KING, Iowa 

TRENT FRANKS, Arizona 

LOUIE GOHMERT, Texas 

JIM JORDAN, Ohio 

TED POE, Texas 

JASON CHAFFETZ, Utah 

TOM REED, New York 

TIM GRIFFIN, Arkansas 

TOM MARINO, Pennsylvania 

TREY GOWDY, South Carolina 

DENNIS ROSS, Florida 

SANDY ADAMS, Florida 

BEN QUAYLE, Arizona 

JOHN CONYERS, JR., Michigan 

HOWARD L. BERMAN, California 

JERROLD NADLER, New York 

ROBERT C. ‘‘BOBBY’’ SCOTT, Virginia 

MELVIN L. WATT, North Carolina 

ZOE LOFGREN, California 

SHEILA JACKSON LEE, Texas 

MAXINE WATERS, California 

STEVE COHEN, Tennessee 

HENRY C. ‘‘HANK’’ JOHNSON, JR., 

Georgia 

PEDRO PIERLUISI, Puerto Rico 

MIKE QUIGLEY, Illinois 

JUDY CHU, California 

TED DEUTCH, Florida 

LINDA T. SA ́ NCHEZ, California 

DEBBIE WASSERMAN SCHULTZ, Florida 

SEAN MCLAUGHLIN, Majority Chief of Staff and General Counsel 

PERRY APELBAUM, Minority Staff Director and Chief Counsel 

SUBCOMMITTEE ON IMMIGRATION POLICY AND ENFORCEMENT

ELTON GALLEGLY, California, Chairman 

STEVE KING, Iowa, Vice-Chairman 

DANIEL E. LUNGREN, California 

LOUIE GOHMERT, Texas 

TED POE, Texas 

TREY GOWDY, South Carolina 

DENNIS ROSS, Florida 

ZOE LOFGREN, California 

SHEILA JACKSON LEE, Texas 

MAXINE WATERS, California 

PEDRO PIERLUISI, Puerto Rico 

GEORGE FISHMAN, Chief Counsel 

DAVID SHAHOULIAN, Minority Counsel 

(III) 

C O N T E N T S 

MARCH 31, 2011 

Page 

OPENING STATEMENTS 

The Honorable Elton Gallegly, a Representative in Congress from the State 

of California, and Chairman, Subcommittee on Immigration Policy and 

Enforcement .......................................................................................................... 1 

The Honorable Zoe Lofgren, a Representative in Congress from the State 

of California, and Ranking Member, Subcommittee on Immigration Policy 

and Enforcement .................................................................................................. 2 

The Honorable Lamar Smith, a Representative in Congress from the State 

of Texas, and Chairman, Committee on the Judiciary ..................................... 4 

The Honorable John Conyers, Jr., a Representative in Congress from the 

State of Michigan, and Ranking Member, Committee on the Judiciary ......... 5 

WITNESSES 

Donald Neufeld, Associate Director of Service Center Operations, U.S. Citizenship and Immigration Services 

Oral Testimony ..................................................................................................... 7 

Prepared Statement ............................................................................................. 9 

Bo Cooper, Partner, Berry, Appleman & Leiden, LLP 

Oral Testimony ..................................................................................................... 17 

Prepared Statement ............................................................................................. 19 

Ronil Hira, Ph.D., Associate Professor of Public Policy, Rochester Institute 

of Technology 

Oral Testimony ..................................................................................................... 26 

Prepared Statement ............................................................................................. 28 

Bruce A. Morrison, Chairman, Morrison Public Affairs Group 

Oral Testimony ..................................................................................................... 36 

Prepared Statement ............................................................................................. 38 

LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING 

Material submitted by the Honorable Zoe Lofgren, a Representative in Congress from the State of California, and Ranking Member, Subcommittee 

on Immigration Policy and Enforcement ........................................................... 47 

APPENDIX 

MATERIAL SUBMITTED FOR THE HEARING RECORD

Prepared Statement of the HR Policy Association ................................................ 75 

Prepared Statement of Andrew Sherrill, Director, Education, Workforce, and 

Income Security, the United States Government Accountability Office 

(GAO) .................................................................................................................... 81 

Letter from Ron Somers, President, U.S.-India Business Council ...................... 98 

Prepared Statement of Conservatives for Comprehensive Immigration Reform 

(CfCIR) .................................................................................................................. 100 

Letter from Lynn Shotwell, Executive Director, the American Council on 

International Personnel (ACIP) .......................................................................... 101 

Prepared Statement of Som Mittal, President, National Association of Software and Service Companies (NASSCOM) ........................................................ 103 

Page

IV 

Letter from Randel K. Johnson, Senior Vice President, Labor, Immigration 

and Employee Benefits, and Amy N. Nice, Executive Director, Immigration 

Policy, the Chamber of Commerce of the United States of America ............... 107 

Prepared Statement of the National Immigration Forum ................................... 110 

Prepared Statement of the Honorable Maxine Waters, a Representative in 

Congress from the State of California, and Member, Subcommittee on Immigration Policy and Enforcement ..................................................................... 112 

(1) 

H-1B VISAS: DESIGNING A PROGRAM TO 

MEET THE NEEDS OF THE U.S. ECONOMY 

AND U.S. WORKERS 

THURSDAY, MARCH 31, 2011 

HOUSE OF REPRESENTATIVES,

SUBCOMMITTEE ON IMMIGRATION

POLICY AND ENFORCEMENT, 

COMMITTEE ON THE JUDICIARY, 

Washington, DC. 

The Subcommittee met, pursuant to call, at 10:05 a.m., in room 

2141, Rayburn House Office Building, the Honorable Elton Gallegly 

(Chairman of the Subcommittee) presiding. 

Present: Representatives Gallegly, Smith, King, Lungren, 

Gohmert, Poe, Gowdy, Ross, Lofgren, Conyers, and Jackson Lee. 

Staff present: (Majority) George Fishman, Subcommittee Chief 

Counsel; Marian White, Clerk; and David Shahoulian, Minority 

Counsel. 

Mr. GALLEGLY. Good morning. 

The Subcommittee last held a hearing on the H-1B program almost exactly 5 years ago today. Much has changed since 2006. Demand for H-1B visas plummeted along with the great recession, especially in Silicon Valley and is only now slowly recovering. 

The number of H-1B workers approved for initial employment in 

the computer systems design industry fell by 46 percent from about 

44,000 fiscal year 2005 to 24,000 fiscal year 2009. 

On the other hand, the Bureau of Labor Statistics projects that 

some of the fastest growing occupations over the next decade will 

be computer and mathematic occupations with these jobs up 22 

percent overall. It is encouraging news that the median salary of 

H-1B workers approved for initial employment has increased by 

healthy amounts, going from $50,000 in 2005 to $59,000 in 2009 

and $60,000 for immigrants in computer-related occupations. 

Additionally, the number of visas issued to foreign students keep 

on growing, going from about 238,000 in 2005 to approximately 

331,000 in 2009. In fact, the single biggest selling point for H-1B 

visas is that they allow foreign students educated in the U.S. to 

work for American companies rather than our competitors. As 

Compete America argues, ‘‘in many critical disciplines, particularly 

in science, math, engineering and technology, 50 percent or more 

of the postgraduate degrees at U.S. universities are awarded to foreign nationals. The H-1B visas allow these graduates to apply their 

2 

knowledge toward the growth of new jobs and industries in the 

United States.’’ 

Yet we still hear the same disturbing stories we heard years ago 

about American computer scientists being unable to find work, especially when they hit 35 years of age. And we still hear the 

dispiriting stories of Americans being laid off and replaced by H-1B 

workers, sometimes even being forced to train their replacements 

if they want to receive severance packages. 

The debate persists over foreign companies being some of the biggest users of the H-1B program and utilizing a business model 

whereby they contract out their H-1B workers to their employers. 

GAO reports that a large number of H-1B complaints have been 

filed against such companies. 

The issue certainly reached a boiling point last year. Congress approved a special $2,000 H-1B visa fee for these companies. One 

of our witnesses today, Don Neufeld, Associate Director of Service 

Center Operations at U.S. Citizenship and Immigration Services, 

has waded into this controversy. He issued a memo determining 

that in many cases the business model is not an authorized use of 

the H-1B program. I am sure we will hear more from Mr. Neufeld 

as the hearing moves on. 

Finally, there is an ongoing matter of enforcement of the H-1B 

program. Because employers need to bring in H-1B workers onboard in the shortest possible time, the H-1B program’s mechanism 

for protecting American workers is not a pre-arrival review of the 

need for foreign workers and the unavailability of American candidates. Instead the employer had to file a ‘‘labor condition application,’’ making certain basic promises such as a promise to pay at 

least the prevailing wage. The Labor Department is entrusted with 

investigating complaints alleging noncompliance. The level of enforcement has always been problematic. The GAO has recommended that Congress grant the Department several additional 

enforcement tools. We should give careful consideration to these 

recommendations. 

All this being said, I look forward to today’s hearing and at this 

point I would move over to my good friend and the Ranking Member, Miss Lofgren. 

Ms. LOFGREN. Thank you, Mr. Chairman. 

In 2005 the National Academy of Sciences, the National Academy 

of Engineering and the Institute of Medicine published, at Congress’ request, a seminal and very sobering report on the state of 

our science and technology industries and our eroding economic 

leadership in these areas. The report, entitled, ‘‘Rising Above the 

Gathering Storm,’’ shows how the Nation’s economic strength and 

vitality are largely derived from the productivity of well trained 

people and the steady stream of scientific and technical innovations 

they produce. 

But after reviewing trends across the globe, the authors of the 

report were deeply concerned that due in part to restrictive immigration policies the scientific technological building blocks critical 

to our economic leadership are eroding at a time when many other 

nations are gathering strength. 

According to the report, and I quote, ‘‘Although many people assume the United States will always be a world leader in science 

3 

and technology, this may not continue to be the case in as much 

as great minds and ideas exist throughout the world. We fear the 

abruptness with which a lead in science and technology can be lost 

and the difficulty of recovering a lead once lost, if indeed it can be 

regained at all.’’ 

Fortunately, Congress passed the America Competes Act in 2007 

which we authorized again last year to address many of the educational and research challenges raised by the national academies. 

But, on our broken immigration system Congress has done nothing 

at all. 

Let me just share a few quick statistics. Immigrants in the 

United States were named as inventors or co-inventors in one-quarter of international patent applications filed from the United States 

in 2006. Of U.S. engineering and technology companies started between 1995 and 2005 more than one-quarter have at least one foreign-born founder. In my district, in Silicon Valley, over half of the 

new companies, the start-ups, were started by immigrants. Nationwide, immigrant-founded companies produced $52 billion in sales 

and employed 450,000 workers alone in 2005. 

Due partly to immigration, our country, with just 5 percent of 

the world’s population, employs nearly one-third of the world’s scientific and engineering researchers, accounts for 40 percent of all 

R&D spending and publishes 35 percent of all science and engineering articles. This leadership in science and technology, according to the Academies, has translated into rising standards of living 

for all Americans, with technology improvements accounting for up 

to half of GDP growth and at least two-thirds of productivity 

growth since 1946. This is because, according to the Academies, 

while only 4 percent of the Nation’s workforce is composed of scientists and engineers, this group disproportionately creates jobs for 

the other 96 percent. 

Based on these statistics one would think we would be jumping 

all over ourselves to keep bright, innovative minds in the United 

States. But by failing to reform our employment-based immigration 

laws, which have not been substantially updated in more than 20 

years, we have been doing exactly the opposite. In 1977 only 25 

percent of masters and PhDs in science and engineering were foreign nationals. By 2006, the majority of U.S. graduate students in 

these fields were immigrants. In some fields, such as engineering 

and computer sciences, immigrants now comprise more than twothirds of all PhD graduates. But rather than keep the best and 

brightest of these U.S. trained graduates to innovate and create 

new jobs here at home, our laws force them to leave and compete 

against us from overseas. 

To remain the greatest source of innovation in the world, we 

need to educate more U.S. students in STEM fields, that is why I 

championed the American Competes Act. But we also must retain 

more of those who actually graduate from our universities, unquestionable the best in the world. Sending these graduates home is a 

reverse brain drain that threatens our competitive advantage in 

the global marketplace. Countries around the world are increasingly scrambling to lure these talents to their shores in the global 

race to create new and better technologies as well as the millions 

of jobs that come with them. 

4 

I am glad that we are having this hearing to discuss the H-1B 

program and how it can help us retain the talent this country 

needs to stay ahead. 

We will hear witnesses today discuss limitations inherent in the 

H-1B program as well as recent problems with the program’s administration that create roadblocks and uncertainty for employers 

and H-1B workers alike. And we will hear witnesses talk about a 

lack of safeguards that leaves the H-1B program subject to abuse 

and manipulation by bad apple employers. We need to address 

these issues so that the H-1B program better serves the employers 

that use it while better protecting U.S. and H-1B workers alike, 

and there are ways to achieve this. 

But I would be remiss if I did not say that the H-1B program 

is not the solution to America’s most pressing problems. We have 

years long backlogs right now that are preventing H-1B workers 

from getting the green cards that would actually allow them to lay 

down roots, start businesses and invest in America. Increasing 

H-1B numbers can’t fix this. Indeed, every day we learn of stellar 

scientists and engineers who pass up the H-1B visas and return 

home because of the uncertainty that H-1B status represents: 

Years in limbo, a limited ability to take promotions or other jobs, 

spouses unable to work, their destiny not their own. Meanwhile, 

Europe, Australia, Canada and even China and India are changing 

their laws and rolling out the welcome mats providing permanent 

visas and citizenship to STEM advanced degree holders. We must 

do the same or risk being left behind. 

And I yield back, Mr. Chairman. 

Mr. GALLEGLY. I thank the gentlelady. 

At this time I would recognize the Chairman of the full Committee, Mr. Smith. 

Mr. SMITH. Thank you, Mr. Chairman and let me comment on 

the audience today. It is nice to see so many people who are interested in this particular subject and the interest is well deserved. 

The H-1B visa program plays a vital role in our economy. It allows American employers to hire talented foreign students graduating from U.S. universities with degrees in science, technology, 

engineering and math fields. It gives these students a tryout period 

so that American employers can determine which are talented 

enough to deserve permanent residence. These foreign scholars are 

part of America’s present and future competitiveness. These students have the potential to come up with an invention that can 

save thousands of lives or jumpstart a whole new industry. They 

also have the ability to found a company that can provide jobs to 

tens of thousands of American workers. 

It appears that doctorates lead to much more invention than 

bachelors or masters degrees. Sixteen percent of those with doctorates were named as inventors on a patent application, while only 

2 percent of those were with bachelors degrees and 5 percent of 

those with masters degrees were so named. 

Not all H-1B visas go to workers in scientific fields. In 2009 only 

35 percent of all initial H-1B approvals went to workers in computer related fields. Foreign workers are receiving H-1B visas to 

work as fashion models, dancers, chefs, photographers and social 

workers. There is nothing wrong with those occupations but I am 

5 

not sure that foreign fashion models and pastry chefs are as crucial 

to our success in the global economy as are computer scientists. 

The 65,000 base annual quota of H-1B visas is going to come 

under more and more pressure as the economy improves. If Congress doesn’t act to increase the H-1B cap, then we may need to 

examine what sort of workers qualify for H-1B visas. Congress also 

will have to ensure that the L and B visa programs are not abused 

by employers seeking ways around the H-1B cap. 

No matter how generous our legal immigration system is, there 

will always be individuals who seek to game the process. The H-1B 

program has safeguards built into it to protect the interests of 

American workers. It is a subject of great dispute as to whether 

those safeguards are sufficient. The Government Accounting Office 

recently found that H-1B employers categorized over half of their 

H-1B workers as entry level, which is defined as quote, ‘‘performing 

routine tasks that required limited, if any exercise of any judgment,’’ end quote, and only 6 percent as fully competent. Are all 

these entry level workers really the best and the brightest? 

The dollar differences are not trivial. In New York City, the prevailing wage for a computer systems engineer in systems software 

is $68,000 for an entry level worker and are $120,000 for a fully 

competent worker. Are American workers losing out to entry level 

foreign workers? 

We also need to safeguard national security. The Government Accounting Office recently found that the U.S. Government approved 

thousands of H-1B visas to foreign nationals from 13 ‘‘countries of 

concern,’’ the names of the countries withheld for security reasons. 

I am also concerned about the legacy of fraud in the H-1B program. At a hearing over a decade ago we heard about petitioning 

companies that were nothing more than a post office box, an abandoned building or a fictitious address and a single telephone number. We heard about H-1B workers slated for employment as janitors or nurses aides or store clerks. 

Apparently, such fraud is not a thing of the past. Despite a $500 

anti-fraud fee that was instituted in 2004, 2008 Office of Fraud Detection and National Security issued an assessment that found outright fraud in at least 13 percent of randomly selected cases. Still, 

the H-1B program usually does operate to the benefit of America, 

American employers, especially high tech employers, and American 

workers. It is the job of Congress to ensure that it always does. 

Thank you, Mr. Chairman. Yield back. 

Mr. GALLEGLY. I thank the gentleman. 

At this time I recognize the Ranking Member of the full Committee, Mr. Conyers, for an opening statement. 

Mr. CONYERS. Thank you, Chairman Gallegly. 

Long ago when Zoe Lofgren was a commissioner in California, 

Morrison and I were working on the same problem. We were waiting for her to come along and give us the legislation that solved 

the problem then and solves it now. Create more green cards. And 

so here we are today with a lot of great witnesses trying to figure 

out how we do it. 

The second thing is to raise the compensation for the kind of engineers that we need. A computer analyst could make $70,000 inVerDate Aug 31 2005 16:42 May 18, 2011 Jkt 000000 PO 00000 Frm 00009 Fmt 6633 Sfmt 6601 H:\WORK\IMMIG\033111\65488.000 HJUD1 PsN: 65488
6 

stead of $50,000 and there would be a great movement toward that 

area. 

In addition, we need a—the concept of portability in terms of 

being able to carry these rights from one employer to the next. Now 

this is a vast secret never before revealed in a Judiciary Committee 

hearing, employees that have H-1B visas are at the mercy of their 

employers. This is shocking, I know, and may require another hearing in and of itself. They work frequently at lower pay, they can’t— 

there is no question they can’t change jobs or they will be sent 

back. 

Chairman Gallegly said that 50 percent of the engineers are foreign nationals that are graduating. We think it is even more than 

that. And so the most simplistic answer that we can arrive at is, 

fine Chairman Emeritus, just add more H-1B’s. That is all we need 

to do and you will be okay, right? Wrong. What we need are more 

green cards and the bill that Morrison and I got Lofgren prepared 

for was to do just that, staple a green card to a foreign national’s 

graduating certificate when he graduates from an engineering 

school. You would then relieve the problem of most of them ending 

up going back home to become our competitors when most of them 

didn’t want to go, really wanted to stay. 

So, I thank you for the hearing and I look forward to the witnesses’ comments. 

Mr. GALLEGLY. I thank the gentleman from Detroit. 

And with this we will move on with our witnesses. We have a 

very distinguished panel of witnesses today. Each of the witnesses’ 

written statements will be entered into the record in its entirety. 

I ask that the witness summarize his testimony in 5 minutes, if 

possible, or as close to it, to help stay within the time constraints 

that we have. We have provided lights down there and while I am 

not going to be real hard on it, I just ask your cooperation so we 

can get through this hearing and give everyone an opportunity to 

ask the questions that they would like to ask. 

Our witnesses are started by Mr. Donald Neufeld. Mr. Neufeld 

serves as associate director of Service Center Operations at the 

U.S. Citizenship and Immigration Services. He oversees all planning, management and execution of functions of Service Center Operations. He began his career with the Immigration and Naturalization Service in 1983 and joined the management team in 

1991. In this capacity Mr. Neufeld has held various management 

positions. 

Mr. Bo Cooper serves as partner in Berry Appleman & Leiden 

in Washington D.C. He provides strategic business immigration advice to companies, hospitals, research institutions, schools and universities. Mr. Cooper served as general counsel of the Immigration 

and Naturalization Service from 1999 until February, 2003 when 

he became responsible for the transition of Immigration Services to 

the Department of Homeland Security. Mr. Cooper earned JD at 

Tulane University Law School and holds a bachelor of arts from 

Tulane University. 

Dr. Ron Hira is associate professor of public policy at Rochester 

Institute of Technology where he specializes in policy issues on 

offshoring, high-skilled immigration, technological innovation and 

the American engineering workforce. Ron is also a research assoVerDate Aug 31 2005 16:42 May 18, 2011 Jkt 000000 PO 00000 Frm 00010 Fmt 6633 Sfmt 6601 H:\WORK\IMMIG\033111\65488.000 HJUD1 PsN: 65488
7 

ciate with the Economic Policy Institute. Dr. Hira holds a Ph.D. in 

public policy from George Mason University, an MS in electrical 

engineering from GMU and a BS in electrical engineering from the 

Carnegie Mellon University. 

And our fourth witness is Mr. Bruce Morrison. Well, I don’t know 

if I am promoting you or demoting you, you know. Bruce serves as 

chairman of the Morrison Public Affairs Group. He is a former 

Member of the House here and I had the honor of serving with him 

for several years, from 1983 to 1991. During this time he was a 

Member of the Judiciary Committee and served as Chairman of 

this Subcommittee. Additionally, he served, from 1992 to 1997, on 

the U.S. Commission on Immigration Reform. Mr. Morrison holds 

a bachelors degree in chemistry from MIT, a masters degree in organic chemistry from the University of Illinois and earned his JD 

from Yale Law School. 

Welcome to all of you. And we will start now with Mr. Donald 

Neufeld. 

Mr. Neufeld? 

TESTIMONY OF DONALD NEUFELD, ASSOCIATE DIRECTOR OF 

SERVICE CENTER OPERATIONS, U.S. CITIZENSHIP AND IMMIGRATION SERVICES 

Mr. NEUFELD. Chairman Gallegly, Ranking Member Lofgren and 

Chairman Smith and Ranking Member Conyers—is that better? 

Great. 

I’m Donald Neufeld, the associate director of the Service Center 

Operations Directorate of U.S. Citizenship and Immigration Services. I appreciate the opportunity to appear today to discuss the 

H-1B program and our efforts to combat fraud and misuse of this 

visa classification. 

USCIS is responsible for evaluating an alien’s qualifications for 

the H-1B classification and for adjudicating petitions for a change 

to H-1B status for aliens who are already in the United States. The 

majority of H-1B petitions are for specialty occupations which require both the alien and the position to meet specific criteria related to education and licensing. 

USCIS approval of an H-1B petition does not guarantee issuance 

of a visa or admission to the United States. For an alien seeking 

H-1B status outside the United States the Department of State will 

determine whether he or she is eligible for a visa. Finally, U.S. 

Customs and Border Protection is ultimately responsible for making admissibility determinations at a port of entry. 

In general, the number of aliens issued H-1B visas or otherwise 

accorded H-1B status may not exceed the statutory cap of 65,000 

per fiscal year. 

In administering the H-1B program USCIS is mindful of fraud 

concerns and has implemented a robust anti-fraud program. In 

May, 2004 USCIS created the Office of Fraud Detection and National Security, FDNS, as the organization responsible for fraud detection and prevention. In 2010 FDNS was elevated to a directorate 

raising the profile of this work within USCIS and increasing the 

integration of the FDNS mission into all facets of the agency’s 

work. 

8 

In February, 2005 FDNS developed and implemented what is 

now known as the Benefit Fraud and Compliance Assessment in an 

effort to quantify the nature and extent of fraud in selected benefits programs. USCIS conducted a study of the H-1B program involving a review of 246 randomly selected petitions filed between 

October 1st, 2005 and March 31st, 2006. After reviewing the findings of this report, USCIS issued guidance to adjudicators, in October, 2008 that provided them with fraud indicators, instructions on 

the issuance of requests for evidence and other notices and instructions on the referral of petitions to FDNS when further investigation is warranted. On January 8th, 2010 USCIS issued a memorandum to provide further clarification to adjudicators what constitutes a valid employer/employee relationship in the H-1B context. In March, 2010 USCIS headquarters personnel provided 

training to adjudicators on the updated guidance. 

This guidance and training provides USCIS officers with tools 

that help define and identify eligibility requirements and provides 

clear instructions on how to handle petitions when fraud is suspected. USCIS has also developed other tools for verification. In 

July, 2009 USCIS implemented an administrative site visit and 

verification program. Currently FDNS conducts unannounced postadjudication site visits to verify information contained in randomly 

selected H-1B visa petitions. In fiscal year 2010 USCIS conducted 

14,433 H-1B site inspections. 

USCIS continues to analyze results from these site inspections 

and to resolve those cases that have not been reaffirmed or revoked. 

Finally, this year USCIS provided adjudicators with a new tool 

for adjudicating H-1B and other employment-based petitions. The 

Validation Instrument for Business Enterprises, otherwise known 

as VIBE, uses commercially available data to validate basic information about companies, organizations petitioning to employ alien 

workers. USCIS adjudicators review all information received 

through VIBE, along with the evidence submitted by the petitioner 

in order to verify the petitioner’s qualifications. VIBE creates a 

standardized means of validating whether a petitioning company or 

organization is legitimate and financially viable. 

In conclusion, USCIS has taken a number of steps to guarantee 

the integrity of the H-1B program while ensuring U.S. employers 

have access to specialized, temporary workforce needed to compete 

in the global market. 

On behalf of USCIS Director Alejandro Mayorkas and all of our 

colleagues at USCIS, thank you for your continued support of the 

H-1B program and for giving us the tools to combat H-1B fraud. 

Mr. Chairman and Members of the Committee, thank you again 

for the opportunity to provide information on the status of our program and I looked forward to answering your questions. 

[The prepared statement of Mr. Neufeld follows:] 

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Mr. GALLEGLY. Thank you very much, Mr. Neufeld. 

Mr. COOPER? MR. Cooper, could you pull that in a little closer. 

I’m having a little harder time hearing Mr. Neufeld. Okay, that’s 

fine. Thank you. 

TESTIMONY OF BO COOPER, PARTNER, 

BERRY, APPLEMAN & LEIDEN, LLP 

Mr. COOPER. On? So sorry. 

Mr. Chairman, Ranking Member Lofgren, Ranking Member Conyers and distinguished Members of the Subcommittee, I am grateful to you for the opportunity to join you today. 

I think it is dead on for this debate over the role of high-skills 

immigration in our country’s economy to focus on jobs. Where Congress comes out on this issue will have a great deal to do with who 

we are as a country, in the decades to come, and with whether 

America will continue to lead the world in innovation and growth. 

This debate has been clouded over the last years by a fundamental misconception that the job supply in the U.S. is a zero sum 

game and that a job occupied by a foreign professional is a job lost 

to a U.S. worker. This is a misconception that has got to be shed. 

Our country has always operated on the principle that the more 

brain power we can attract from around the world, and the more 

creativity, invention and growth we can achieve here at home. Fortunately there appears to be a re-emerging consensus to stick to 

this principle. The comments that many of you made in your opening statements are in harmony with the comments of the President 

in his State of the Union address this year and comments from Majority Leader Cantor, just last week, noting the importance of attracting bright professionals into our economy and decrying an immigration policy that would lose them to foreign competitors. 

The H-1B is an indispensible part of the high-skilled immigration 

ecosystem. It is often the only way to get a highly skilled foreign 

professional on the job quickly when the economy needs them. It 

is often the only way to bring in person with pinpointed skills to 

provide a crucial temporary service. And it is overwhelmingly the 

only way to bring a bright foreign talent into a permanent role as 

a contributor to the U.S. economy. 

Our approach to the H-1B program should be governed fundamentally by the physician’s oath, ‘‘First, do no harm.’’ Those of 

us who practice immigration law see in our offices every day the 

power of the H-1B program to fuel the U.S. economy. Let me offer 

just one small example. Sonu Aggarwal is the CEO of Unify 

Square, a company in Redmond, Washington. He came here as a 

student at Dartmouth and MIT and entered the workforce with an 

H-1B. He’s the author of the original patent on enterprise—an author of the original patent on enterprise instant messaging technology, the seed of his current company. His product is used, for 

example, by healthcare providers to monitor patients’ conditions in 

real time through their cell phones. 

Now a U.S. citizen he runs a company with 34 employees around 

the world, 24 of which are in the United States. Of these 24, 22 

are U.S. workers. H-1B’s are used in obviously sparing numbers, 

when they are needed to fill an extremely hard to find skill set. 

They have got a monthly growth today of 10 percent per month. 

18 

One H-1B, 22 jobs for U.S. workers and counting, that is the main 

story of what the H-1B program does for the U.S. economy. 

H-1B employers also pour massive sums of money into programs 

to train U.S. workers and educate U.S. students and to fund their 

own enforcement. Since FY 2000 employers have paid to the Federal Government over $3 billion in training and scholarship fees 

and anti-fraud fees. That is 58,000 college scholarships for U.S. 

students, through the National Science Foundation, and training 

for over 10—for over 100,000 U.S. workers. 

The debate over the H-1B often focuses, as it ought to, on whether the program is simply a source of cheap labor to replace U.S. 

workers. And I think the starkest evidence against that is the pattern that Mr. Gallegly identified in his opening remarks. When the 

economy is strong demand is high, when the economy drops it 

plunges. If the H-1B were a source of cheap labor the exact opposite would happen. This is not a new point, but you can’t have an 

honest discussion about the H-1B program without keeping that 

point front and center. 

I certainly acknowledge that there is fraud and abuse within the 

H-1B program to some degree. I have spent many, many years in 

government, there is no such thing as a government benefits program that doesn’t have people coming to hoodwink it at times. Yet, 

responsible employers would welcome improved enforcement and 

rather than an extravagant rewrite of the program in ways that 

might harm the program’s ability to serve the U.S. economy and 

to create new U.S. jobs, the Government has already mapped out 

the key ways in which these abuses tend to take place. 

As was noted in the USCIS fraud report that Mr. Neufeld talked 

about, they have identified the key patterns of misuse. It is employers who bring an H-1B here and fail to pay the required wage; 

an employer who cheats the system by calculating the required 

wage in an inexpensive market and then employing the person in 

a more expensive market where the wage would be higher; or shell 

employers that don’t even exist. These are serious violations, but 

they are violations that can be enforced under today’s rules. And 

before Congress embarks on a major revision of the program’s contours that might have counterproductive effects on its job growth 

capabilities, it ought to use its oversight authority to examine 

whether the Government’s enforcement resources are being used to 

maximum effect. 

To conclude, it is clear that making the H-1B program the best 

it can be cannot, by itself, provide high-skilled immigration policy 

that will enable us to, in the President’s words, ‘‘out innovate the 

rest of the world,’’ employers of highly skilled professionals tend to 

want to bring, they typically want to bring their employees permanently into the U.S. economy. And observers across the board, I 

think, view that as a net positive for the United States and efforts 

to shorten that bridge or to eliminate it are critical parts of the reform puzzle. But, if we are to attract the bright minds from around 

the world that will help U.S. employers keep jobs in this country, 

grow more jobs for U.S. workers and remain the world’s innovation 

leaders, a robust and effective H-1 program is essential. 

Thanks very much. 

[The prepared statement of Mr. Cooper follows:] 

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Mr. GALLEGLY. Thank you, Mr. Cooper. 

Dr. Hira? 


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TESTIMONY OF RONIL HIRA, Ph.D., ASSOCIATE PROFESSOR OF 

PUBLIC POLICY, ROCHESTER INSTITUTE OF TECHNOLOGY 

Mr. HIRA. Mr. Chairman, I should have learned the lesson, right? 

[Laughter.] 

Thank you Chairman Gallegly, Ranking Member Lofgren, Chairman Smith and the Members of the Subcommittee for inviting me 

to testify here today. 

I have been studying the H-1B program and its effects on the 

American engineering labor force for more than a decade now, so 

this is a great opportunity for me. I have concluded in that study 

that the H-1B program as it is currently designed and administered does more harm than good and to meet the needs of both the 

U.S. economy and American workers, the title of this particular 

hearing, the H-1B program needs immediate and substantial overhaul. 

The goal of the program is to bring in foreign workers who complement the American workforce. Instead loopholes in the program 

have made it too easy to bring in cheaper foreign workers with ordinary skills who directly substitute for rather than complement 

American workers. So the program is clearly displacing American 

workers and denying opportunities to them. 

The program has serious design flaws and legislation is needed 

to fix them. Administrative changes alone or stepped up enforcement, while necessary, are simply not sufficient to correct the problems. 

First, the program allows employers to legally bring in foreign 

workers at below market wages. That is not a question of fraud, 

this is legal they are able to bring in workers at below market 

wages. How do we know this? There is lots of evidence, the most 

obvious one is that employers have said so. They told the GAO that 

they in fact bring in workers at below market wages. 

Second, the program—pardon me, second the program allows employers to bypass qualified American workers and to even outright 

replace American workers with H-1B’s. This is not a theoretical or 

hypothetical possibility, in fact there have been news reports about 

Americans training foreign replacements at companies like 

Wachovia, AC Nielsen and Pfizer. 

Third, because the employer holds the visa, an H-1B worker’s 

bargaining power is severely limited and they can easily be exploited by employers. 

One of the consequences of the loopholes has been that in fact 

what the Government is doing with this policy is giving a competitive advantage to certain kinds of businesses, certain types of business models, and that is offshore, outsourcing firms. So in fact 

what the Government is doing with this—with the current policy 

is subsidizing the offshoring of American jobs. 

For the past 5 years the top H-1B employers—most of the top 

H-1B employers are using the program to offshore tens of thousands of high wage, high-skilled American jobs. Using the H-1B to 

offshore is so common that in fact the former commerce minister 

of India dubbed the H-1B program the outsourcing visa. 

Even more disturbing though than all of this, is the fact that the 

H-1B program has lost legitimacy amongst the American high tech 

workforce. And those are critical workers, not only because, as you 

27 

have all pointed out, science and technology and engineering is 

critical to not only the tech sector and national security but economic growth in general, but these are the incumbent workers who 

are the ambassadors for their profession. And what they are telling 

students is to shy away from these careers because they feel like 

the, you know, the cards are stacked against them. 

In conclusion, let me say that I believe that the United States 

benefits enormously from high-skilled, permanent immigration. We 

can, and should encourage the best and brightest to come to the 

United States and settle here permanently, but the H-1B program 

is failing on both accounts. First it is clear that many H-1B workers are not the best and brightest. Instead, they possess ordinary 

skills and are filling jobs that could and should be filled by American workers. 

And just to give you some examples, you mentioned earlier that 

the GAO found that 54 percent of H-1B applications were at the 

lowest wage level, that is the 17th percentile. So they aren’t bringing in the best and brightest through this. And to give you another 

example, Infosys had a labor certification application for an—for 

100 computer programmers, to bring in 100 H-1B computer programmers at $12.25 an hour. That is hardly the best and the 

brightest. 

Another big misconception is, and this has been pointed out also 

today already, is that the H-1B is often equated with permanent 

residents. One of my recent studies found that in fact many of the 

largest H-1B employers sponsor very few of their H-1B’s for permanent residents. And let me give you one example of this. Between 

2007 and 2009 Accenture hired nearly 1,400 H-1B’s, that is how 

may petitions they actually received. Yet during that same timeframe, during that same 3 years, they only sponsored 28 H-1B’s for 

permanent residence. That is a 2-percent yield. I don’t think anybody would argue that 2 percent is a very good success rate. 

Our future will be enhanced by high-skill immigration, but its 

foundation critically depends on our homegrown talent. And I look 

forward to your questions during the discussion. 

[The prepared statement of Mr. Hira follows:] 

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Mr. GALLEGLY. Thank you very much, Dr. Hira. 

Bruce, welcome back to this chamber, I am sure you are familiar 

with it. And we welcome your testimony. 


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TESTIMONY OF BRUCE A. MORRISON, CHAIRMAN, 

MORRISON PUBLIC AFFAIRS GROUP 

Mr. MORRISON. Thank you, Mr. Chairman and Ranking Member 

Lofgren, Ranking Full Committee Member Conyers and other 

Members of the Committee. It is a pleasure to be here and thank 

you for having me. I am appearing today on behalf of IEEE-USA 

which is an organization of over 210,000 engineers and technical— 

technically trained people who work in the computer industry and 

students who are training to fill those jobs in the future. And their 

role is critical in the future of out country. 

I think that the one point of consensus that there ought to be on 

both sides of the aisle, and I think that there is at this table, is 

that the future of American jobs and American prosperity is what 

we should be focused on. And I would hope that the product of this 

hearing is to look at that question. 

And I would say that the future to American jobs is to retain, 

in this country, those graduates who are foreign-born and in our 

universities who have these critical science and technology skills 

that our country needs in order to grow in the future. Doing that 

successfully will make a huge difference for American workers already here and Americans in the future. If we fail to do that we 

will pay the price in important ways and we should avoid that. 

Now I think that the focus to do that needs to be on fixing the 

green card program. And why do I say that? I know a little bit of 

the history. The H-1B program was created in 1990, it is a successor to an earlier program, the H-1 program. And the changes 

that this Committee and the Congress made at that time really 

echoes a lot of the debate that is going on right now, trying to target the program better, narrow it, raise the skill levels that are required and encourage the use of green cards instead to bring highly 

skilled workers here on a permanent basis. 

Well, 20 years have gone by, we really haven’t quite got the job 

done, the debates are the same. We need to redouble our efforts. 

We need to focus our attention on these STEM students that we 

currently have and make sure that we compete them but that we 

compete for them in a way that does not disadvantage American 

workers and that we compete for them in a way that is effective 

in beating out our competitors in who we keep. And that is where 

green cards provide such an advantage. 

The discussion about what to do in the regulatory realm to try 

to level the playing field for H-1 workers ought to teach everybody 

about the limits of regulation. I would think there ought to be a 

consensus on both sides of the aisle that the market is a better way 

to preserve good terms and conditions than endless regulations and 

the attempts to have Government enforce them. We are not enforcing the H-1B regulations now as a country, we never really have 

and despite the best efforts of USCIS and the Department of Labor, 

I doubt that we ever will. Yet, green card workers don’t need all 

those protections because they have the power of the marketplace 

and employers don’t have any special advantage over green card 

workers because they are just like American citizens, they can pick 

up and leave any time they want. And the way you keep them, as 

an employer, is not by coercion, but by good terms and conditions 

of employment. That is the way our labor market works. It is not 

37 

perfect but it sure is better than a regulatory regime. H-1B is a 

surrender to regulation when the market will solve the problem. 

Green cards can be abused also. Green cards can be given to 

workers who don’t need to be here, but let’s focus on the people we 

know we want to keep, people who are getting advanced degrees 

today in STEM fields from American universities. They clearly are 

a valuable resource and they will go somewhere else if we don’t 

keep them. Let’s focus on them. Let’s make sure that they are selected in a quality fashion and that when they are added to our 

workforce we will all be benefited because there will be greater productivity and greater jobs. 

Green card workers can start their own businesses, H-1B workers can’t. Green card workers are on a path to become American 

citizens, H-1B workers are not. Our competitors use guest worker 

permits to recruit against us. We have always done better because 

we ask people to become Americans, we don’t ask them if we could 

please borrow their labor for a while and then we will see. That 

is a much more powerful recruiting tool, it has always worked for 

this country, it is why we are the great immigration country of the 

world. And for this critical competition, for the job creation we need 

today, with 9 percent unemployment, let’s focus immediately not on 

what could divide people and the controversies over H-1B but what 

could unite us all. Let’s get these new graduates who are going to 

be coming out on a green card path to become Americans and create American jobs. 

[The prepared statement of Mr. Morrison follows:] 

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Mr. GALLEGLY. Okay. Thank you. Appreciate your testimony. 

At this time we will begin with questions and the Ranking Member, Ms. Lofgren will begin. 

Ms. LOFGREN. Well thank you very much, Mr. Chairman and 

thanks to all of the witnesses. The testimony is excellent and I 

think having a hearing of this nature is very important because 


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what I am hearing from the policy witnesses is that there is value 

in retaining top talent, but the H-1B program needs work, to understate it. 

You know, I come from Silicon Valley and I hear sometimes from 

my constituents concern about some of the H-1B visa holders. And 

I asked the Department of Labor to run prevailing wage numbers 

for various occupational classifications in Silicon Valley and one of 

the things that shocked me actually was when they came back with 

the average wage for a computer systems analyst in my district. 

They said—well, it didn’t surprise me it was $92,000 except that 

the level one for H-1B was $52,000. I mean that is $40,000 less 

than what people are paid. So small wonder that there is a problem 

here. That needs to be fixed if we are going to keep this program. 

We can’t have people coming in and undercutting the American 

educated workforce, that is just a problem. 

And I don’t blame really even, you know, I’ve got a number of 

wonderful companies in my district that do excellent work, but I 

mean this is the system they are in as well, and then you have got 

H-1B visa holders who get frozen in place because they can’t move 

really because they have got a petitioner, if you have got a legit 

employer. And as time goes on their skill set—I mean inevitably 

they are going to do more sophisticated work just as their coworkers are doing, but they are still frozen at the wage. 

And so this creates problems and I think it is something that we 

need to fix and that we can fix. But the real issue, as has been discussed, is how can we capture with permanent visas, the individuals who we want to keep to create companies, to do start-ups, to 

create jobs for American workers. 

And I am interested, Mr. Morrison, you are here representing the 

IEEE but traditionally IEEE, which I think is the largest organization of computer scientists in the world, and the Semiconductor Industry Association didn’t always see eye to eye on immigration 

issues, and yet they came together on a proposal for immigration 

reform—can you explain how that happened and what the bottom 

line recommendation is? 

Mr. MORRISON. Yes. First of all, I think that Congresswoman 

Lofgren, you and the Chairman and others have received a letter 

today from those two organizations and I would hope that it would 

be made part of the record of this hearing. These organizations 

don’t agree about everything, but they have a focus on the highskilled, technical workforce that they represent in two ways. IEEE 

as the representative of workers and students in that area and the 

SIA as representing companies who employ those people. And both 

of them together agree that the priority is to keep these skills here 

in the United States to build employment and production and research and development here in the United States. I think that is 

shared. 

And they have decided to put aside differences and focus on what 

they have in common, which we hope this Subcommittee might do 

as well. And that to do that they see the long-term benefits of permanent residence as key to getting rid of the contention that exists, 

the potential exploitation, the unfair competition that goes on using 

H-1B. 

Ms. LOFGREN. Well—— 

44 

Mr. MORRISON. So that is why they came together, because they 

will both prosper if they keep this talent here. 

Ms. LOFGREN. I appreciate that. And hopefully we in the Congress can use SIA and IEEE as a role model for our own behavior 

of doing what is right for the economy of our country instead of 

fighting over, which we often do unfortunately. I think we can gain 

consensus. 

You know, I have a question, if I could, for Mr. Cooper. You 

talked about when the H-1B program works, and it does. I mean 

I have met some fabulous, I mean talented people. The fact that 

there are abuses sometimes doesn’t mean that there aren’t also 

successes. But, if we had a choice to make enough green cards 

available to keep our best or brightest or to increase the H-1B program, if you had to choose between those two, which would you 

choose? 

Mr. COOPER. They are obviously both very important. You know, 

as I mentioned before, the H often is—you know, there is such a 

thing as important temporary use and you have got to have a way 

to get people in for that. You have also got to have a way to get 

people on the job quickly, which the green card system, at least 

today, is not set up to do. 

Ms. LOFGREN. Right. 

Mr. COOPER. So they are both critical. Between the two, if I had 

to pick one, you know, frankly I think green cards are the ultimate 

goal in the end because employers typically wish to bring their 

H-1B’s—I think it is fair to say that employers typically wish to 

bring their H-1B’s permanently into the U.S. workforce. Again, I 

think that is something that all of us agree is a good thing for the 

U.S. economy. 

You know, what often happens, a very common pattern is that 

an H-1B employer will hire a professional worker in the H-1B process, start the green card process right off the bat and concurrently 

be trying to push through the green card process at the same time 

the person goes for their H-1B status. And often when the 6 years 

of H-1B status is over they are still not all the way through the 

green card process. 

Ms. LOFGREN. I understand. Yes. I’ve met many people in that— 

I would ask unanimous consent for an additional minute—— 

Mr. GALLEGLY. Without objection. 

Ms. LOFGREN [continuing]. So I can ask one question from our 

Government witness. 

I have some frustration that I will disclose, that we have consensus that a need for green cards for highly talented graduates 

with Ph.D.’s from American universities, and yet from ’92 to 2007 

we failed to issue the 140,000 employment based green cards, 9 out 

of 16 years. Can you explain why we are not actually utilizing the 

visas that we have provided for in the law? 

And I have a second question on enforcement. You know, the 

USCIS as well as the GAO analysis of the H-1B program identified 

the same problem, which is that the abuses of the H-1B program 

tend to be localized in a particular kind of firm, staffing companies, 

small companies, smaller firms, firms with income less than $10 

million a year. And yet, the enforcement has been random. And I 

even hear—I mean whether or not the petition is valid, you know, 

45 

I don’t think anybody should ask to a see a floor plan of Cisco to 

see if the company exists, I mean that is absurd, and yet that has 

happened. So I am just not understanding what the enforcement 

strategy here is when we know the targeted problem and yet the 

enforcement seems to be scattered. 

Mr. NEUFELD. Can you hear me? 

Ms. LOFGREN. Yes. 

Mr. NEUFELD. I will take your first question first. I can’t really 

speak to why in years past visa numbers were not all utilized in 

the employment-based categories. I can say that for the last few 

years we have been using up all of the visa numbers in the categories. And as you know, the unused visa numbers in the employment-based roll over to the family-based and the family-based visa 

numbers that are unused roll over to the employment-based. 

Ms. LOFGREN. And sometimes neither one gets used because they 

are rolling back and forth and then they are lost. 

Mr. NEUFELD. That is correct. We currently have about a 145,000 

pending employment-based adjustment of status applications for 

which there are not visa numbers available and so those applications for adjustment of status are just held in abeyance. The fact 

that they are held in abeyance and that they have been pre-adjudicated actually enables us, working with the Department of State, 

to better manage the use of all visa numbers, because now they 

are—as we do as much in the way of adjudication as we can without actually putting on an approval stamp and issuing the green 

card, we go—when we determine that one of these cases is approvable, but for a visa number, we request the visa number of the Department of State and in their IVAM system then they have visibility into the number of pending requests. And so that actually 

helps them in establishing the priority dates in the visa bulletin, 

they can see, with priority data a certain amount what the demand 

will be. 

And so we have been quite successful in that regard, in terms of 

using up the visa numbers with the Department of State’s help in 

managing the visa bulletin. 

The other question was with respect to enforcement. And I want 

to be clear, even though I am not responsible for the Fraud Detection and National Security Directorate, but I an speak to the fact 

that our enforcement efforts are not solely focused on random site 

visits. We also have provided to our adjudicators the information 

that resulted from that benefit fraud assessment in terms of fraud 

indicators and adjudicators can refer cases to the FDNS because of 

those fraud indicators or because of information that is contained 

in a specific filing and then the Office of FDNS can determine 

whether to pursue that, perhaps do an inspection, you know, a targeted inspection of that employment location or to even refer the 

matter to—— 

Ms. LOFGREN. Well, I know—I don’t want to abuse the Chairman’s time, but I—you should and the Department should make a 

decision on a case-by-case basis. I am not suggesting just because 

a company is big that, you know, a petition should be approved. 

But, it is absurd to ask a company that is publicly traded and has, 

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ployer in a county, whether they exist or not. I mean that is a 

waste of time. 

Mr. NEUFELD. No. And I agree with you entirely. And the implementation of the—of VIBE is one of the efforts that we have undertaken to provide adjudicators with information that they can rely 

on in—so that they are not solely—— 

Ms. LOFGREN. Well, but maybe—— 

Mr. NEUFELD [continuing]. Basing their decisions on what the 

file—— 

Ms. LOFGREN.—I should get with you afterwards because this is 

not—it is not working the way you are describing and it is a waste 

of resources when there is an enforcement issue that really needs 

to be done. 

Mr. Chairman, I would like to ask unanimous consent to enter 

into the record statements that were prepared for today’s hearing 

from our colleague Congresswoman Judy Chu on the Committee, 

from the Institute of Electrical and Electronic Engineers, the IEEE, 

and from the Semiconductor Industry Association; the Partnership 

for a New American Economy; the Asian American Center for Advancing Justice; and the American Jewish Committee. 

Mr. GALLEGLY. Without objection. 

Ms. LOFGREN. Thank you. I yield back. 

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Mr. GALLEGLY. Seeing that my time is expired. [Laughter.] 

We do have a very good bipartisan relationship on this Committee and I respect the gentlelady’s right to be wrong periodically. 

So—— [Laughter.] 

Ms. LOFGREN. And you also. 

Mr. GALLEGLY. Mr. Neufeld, what happens when the Office of 

Fraud Detection and National Security discovers fraud or technical 

violations in a petition? Are such cases denied or revoked by ISCIS 

or are such cases referred to USCIS or ICE for further investigation? 

Mr. NEUFELD. I was checking to make sure my mic was still on. 

Yes, they—actually the Office of Fraud Detection and National Security can do either, which ever makes sense on that particular 

case. If—they can either refer it to an adjudicator with their findings and then the adjudicator can institute—issue a notice of intent 

to revoke. It gives the petitioner a chance to respond to the information that we have. But then if there is in fact fraud, then the 

adjudicator can revoke the previously approved petition. 

Also, the Fraud Detection National Security officers can refer the 

matter to ICE for either further investigation or for prosecution. 

Mr. GALLEGLY. Are you satisfied that the system is working? 

Mr. NEUFELD. Yes. 

Mr. GALLEGLY. Dr. Hira, in your testimony could you explain 

what you mean when you say that some companies use their 

H-1B’s to engage in knowledge transfer? 

Mr. NEUFELD. Let me turn my microphone on. 

Sure. Knowledge transfer is a term of art, it the site actually a 

euphemism for forcing American workers to train their foreign replacement. Basically with they are doing is transferring their 

knowledge and capabilities to either an H-1B worker or in many 

cases an L-1 intercompany transfer worker and that worker may 

stay, that guest worker may stay right there on site and/or may 

take that knowledge and take it back to their home country and 

offshore the work and do it from offshore. And this is—it is common enough to have its own term. Right, knowledge transfer. 

Mr. GALLEGLY. Mr. Morrison, you were recently quoted as stated 

that, if I knew in 1990 what I know today about the use of H-1B 

visas for outsourcing, I would not have drafted it so that staffing 

companies of that sort could have used it. You want to elaborate 

a little bit on that? 

Mr. MORRISON. Sure. And let me say that in another life I represent a staffing company in the healthcare field. So I don’t think 

staffing as a way of participating in providing goods and services 

in the American market is a bad thing. The bad thing is when 

there is a model that does not participate in the American workforce, by hiring Americans and sometimes foreign-born, just like 

American employers do, and providing services in a staffing model 

as opposed to in a direct employment model. Those are choices that 

employers can legitimately make and there are reasons to use both. 

But, the model that seems to have developed is a model of companies that exclusively use H-1B visas and sometimes L-1’s, and I 

don’t know how they do that legally, and bring a particular nationality to the United States and provide services and then often 

transfer those workers back with the knowledge that Dr. Hira was 

60 

just describing, going back and becoming intellectual property for 

somebody else. That kind of activity I think is very troubling. It is 

not really legitimate staffing in the U.S. labor market, it is something else. And I think the H-1B program shouldn’t countenance 

that kind of structure. 

Mr. GALLEGLY. I think—Mr. Cooper, can you expand a little bit 

on your point that many employers of H-1B workers pay more than 

the prevailing wage? 

Mr. COOPER. Yes, Mr. Chairman. The way that the—— 

Mr. GALLEGLY. Hit the button. 

Mr. COOPER. The ways that the rules work is that it is not actually the prevailing wage that is required of an employer, it is either 

the prevailing wage which is sent by the Department of Labor or 

what that employer actually pays to workers doing the same job in 

the same place, which ever is the higher those two. And what actually happens in the marketplace, especially when the economy is 

strong, is you know, we have got to remember that what is—with 

this group of people that typically are the subject of H-1B’s there 

is a massive competition for them between employers in the U.S. 

and employers in competitor countries and among employers in the 

United States. And so you know, that competition can heat up and 

often the actual wage is much higher than the prevailing wages. 

The prevailing wage is reflected in these LCA’s that are filed 

with the Department of labor and that is unfortunately, you know, 

the—what gets reflected in a lot of the statistical debate But, in the 

marketplace it is actually the—a much higher wage that is being 

paid to H-1B workers. 

Mr. GALLEGLY. Thank you, Mr. Cooper. 

Mr. Conyers? 

Mr. CONYERS. I yield to Jackson Lee. 

Mr. GALLEGLY. Ms. Lee. 

Ms. JACKSON LEE. I thank the Ranking Member of the full Committee for his courtesies. I thank the Chairman of this Committee 

and the Ranking Member for an astute assessment of a very important issue. 

I have had the privilege of serving on the Imigration Subcommittee, I believe for almost a decade, serving as a Ranking 

Member and remember discussing this issue of H-1B visas, Mr. 

Hira, particularly on the question of where are the talented Americans who could do the same jobs. In one instance we were carefully 

looking at the question of African-American engineers who had 

raised a concern about their ability to be employed. 

At the same time I have to be a practical legislator and realize 

that there were periods in our history, which were not 50 years ago 

but recent, when our friends in Silicon Valley and elsewhere made 

some eloquent arguments in the earlier stages of their development. I am very glad to report, however, that every youngster coming out of college is either a venture capitalist and they want to 

be involved in IT. We have the talent. It doesn’t mean that H-1B 

visas cannot find a place but I join with the Ranking Member on 

raising the question about the validity and the better structure of 

green cards. 

And as I do that, I think it is important—I would be remiss if 

I did not put on the record, and I know my—the collegiality of the 

61 

Chairman and the Ranking Member leads me to be inspired that 

we will have an opportunity to look at comprehensive immigration 

reform and really fix this system that doesn’t suggest amnesty and 

it doesn’t violate the virtues of my friends on the other side of the 

aisles, but it will keep youngsters who are here, called Dream Kids, 

able to become citizens and to contribute well to the United States. 

I hope the Administration will be actively engaged in this, Mr. 

Neufeld. 

So let me try to pinpoint one of the angst that I think can be 

fixed immediately. Our lawyers tell us, and those of us who are 

lawyers know not to lawyer our cases here, that the statute that 

deals with wages for these workers is very broad. The one about 

prevailing wages and I think Mr. Cooper acknowledges the highest 

rate is kind of confusing. The Government has all kinds of authority, we are already sort of baffled why we are not fulfilling our obligation on the 140,000 that my colleague asked about, we are confused about that. But I would like to know really the details of 

these low wages. 

I appreciate, Mr. Cooper, but I believe you are on the hot seat 

because we are in—able to do a lot of things by making or raising 

questions and I want to know whether you have reached out to Department of Labor to use the power you already have to really not 

have a nebulous prevailing wage but to actually have a requirement of what it is that has to be paid if we are using these visas, 

in order for us to be competitive and not to harm American workers. 

My second question is the idea of having this 90 day period when 

an American worker is retained, Mr. Neufeld, and we hear the 

rumor that they are training the H-1B visa person who then boots 

out the well trained American worker. The low wage, the multiple 

use of H-1B visas for talents that are already here. That may not 

be your jurisdiction, but certainly it is your jurisdiction to make 

sure that we are not dumbing down the wages of Americans and 

really unfairly treating these individuals, because I am going to get 

to my next question quickly. 

But let me just get that as quickly as you can, please. I want you 

to go to the Department of Labor and work this out. I want to have 

a wage that we can all understand. 

Mr. NEUFELD. Fortunately or unfortunately we—I can only enforce the statute and the regulations as they are written. And that 

doesn’t provide USCIS with the authority to look any further than 

the labor condition application that was filed with the Department 

of Labor and to make sure that they—that employers are in fact 

paying either the prevailing wage or the—— 

Ms. JACKSON LEE. I think you can make an inquiry. That is not 

an unacceptable act. I can call the Department of Labor. You are 

not prohibited from calling the Department of Labor. If you are intimidated, use your leg. affairs and have leg. affairs from each department just try to get a sense of you moving forward on this 

issue. 

Go ahead, you can finish your answer. 

Mr. NEUFELD. Oh, I can—I am happy to engage our office of legislative affairs to work with theirs in that vein. 

Ms. JACKSON LEE. Mr. Chairman, I ask for additional 1 minute. 

62 

Mr. GALLEGLY. Without objection, 1 minute. 

Ms. JACKSON LEE. I thank you very much. 

Let me also ask a question about the idea of do you have anything that you hold as a standard of American workers being replaced or do you do that only—you think that is only a Labor Department issue? 

Mr. NEUFELD. Well, it is mostly a Labor Department issue but 

we do—there are requirements that change depending on what percentage of the workforce of a particular employer is made up of 

H-1B employees. And for those employers who exceed, I believe it 

is 15 percent of their workforce or comprised of H-1B employees, 

then the labor condition application that is filed with the Department of Labor contains some additional attestations that are required in terms of the—not bringing folks in to replace current 

workers and I also believe that it is—— 

Ms. JACKSON LEE. All right. 

Mr. NEUFELD [continuing]. Not a requirement only—— 

Ms. JACKSON LEE. I just want to get quickly to Mr. Morrison. 

Mr. Morrison, give me again your most forceful argument for the 

value of green cards in the spirit of we must create more jobs, we 

must be able to respect the American worker and we also understand we need a fair immigration policy. 

Mr. MORRISON. I don’t promise it will be the most forceful, I will 

try my best. I think that permanent residence is our competitive 

advantage, number one, as a country. And putting people on the 

road to becoming Americans is a key part of having this work well 

for the whole country. When people have permanent residence they 

are free to move around the workforce and they have market power 

to enforce terms and conditions of employment, which H-1B workers don’t really have and you have to have a complicated regulatory 

scheme to get at it. 

In addition to that, those people who are here permanently can 

start their own businesses and create additional jobs that way. And 

there have been many who have done that when they finally got 

green cards. But by holding this process back for years at a time, 

by a combination of lack of visa numbers, bureaucratic delays and 

the attractiveness of the H-1B status to employers we miss out on 

those benefits and we lose many of the talent. But—— 

Ms. JACKSON LEE. Well, I thank the Chairman. I want to be able 

to protect American workers and balance this whole idea of immigration reform and generate jobs so that American workers stand 

equal to anyone who seeks to come to this country and gain great 

opportunity, which is the American way. 

I yield back. Thank you. 

Mr. GALLEGLY. Time of the gentlelady has expired. 

Mr. Gohmert? 

Mr. GOHMERT. Thank you, Chairman and appreciate each of the 

witnesses being here today. 

Mr. Neufeld, the Government Accountability Office raised concerns over large numbers of H-1B aliens being nationals of countries of concern who may be gaining unauthorized access to duel 

use technology with military applications. How does USCIS coordinate with the Commerce Department to ensure H-1B employers obtain deemed export licenses before employing such aliens? 

63 

Mr. NEUFELD. Thank you. We recently—USCIS recently revised 

the I-129 Petition which is the form that employers use to bring 

in nonimmigrant employees to include an attestation section, that 

is part six, that—so that it requires employers to both acknowledge 

and attest that they have read and become familiar with the export 

control requirements and to indicate whether the employee will 

have access to controlled technologies and if so, to attest that they 

will obtain the appropriate licenses from either Department of 

State or Department of Commerce before allowing them access. 

Mr. GOHMERT. There is any follow up or checking on that or is 

it just a statement required? 

Mr. NEUFELD. For our adjudication it is just—we do require the 

attestation. If that section is left blank then we will request it be 

completed. And if they refuse then we would deny the petition. 

Other than that, it—the legacy systems that we have right now 

don’t allow us to capture that, the responses electronically and then 

share that with the Department of Commerce. We are working 

with them to make the best use of our systems that we can. And 

in response to requests from them, we can identify all of the filings 

by a particular employer that may be of interest to them and then 

allow them access to the physical files to review the answers to 

those questions. 

Mr. GOHMERT. Is that always done? 

Mr. NEUFELD. Well, this is new. This—— 

Mr. GOHMERT. Okay. 

Mr. NEUFELD [continuing]. Question was just recently added and 

became effective in February. 

Mr. GOHMERT. All right. Okay. Just recently, huh? Well and 

sometimes it takes Government a while to—in fact many years. 

People can be encouraged with the Government taking over 

healthcare, if you have got a problem many years later we will be 

able to get around to it. 

But with regard to healthcare, obviously that is a hot issue here on the Hill. This country is projected to spent $3.75 billion and we 

are only bringing in 2.1 billion this year. We can’t afford to keep 

bringing in people and paying for their healthcare. I was curious, 

on the H-1B petition, is there any requirement for a statement as 

to whether or not any hospitalization or medical care is anticipated 

by the petitioner coming in? 

Mr. NEUFELD. I have to say that I don’t know the answer to that 

question, but I would be happy to look into it and—— 

Mr. GOHMERT. Okay. Could you provide us a written answer to 

that question as to whether—and not just H-1B, on any petition or 

application for visa, is there a requirement that the applicant or 

petitioner state whether or not any type of medical or hospitalization care is anticipated. 

Mr. NEUFELD. I will certainly do that. 

Mr. GOHMERT. All right, thank you. 

Mr. Morrison, you had stated in your testimony that we should 

create an unlimited green card category for advanced degree STEM 

graduates from quality American universities. And of course it may 

be an interesting question how we determine which ones are quality. But when Australia tried something similar they found what 

happened was that the quote, the reformers did not anticipate the 

64 

alacrity with which Australia’s universities would set up courses 

designed to attract international students looking for the cheapest 

and easiest ways to obtain qualifications and occupations that 

could lead to permanent residence. 

We know in Texas, for example, Texas Tech is—I would consider 

a quality school, yet we just had one of their persons here on a visa 

arrested for plots to kill people and destroy things. I am curious, 

how could we prevent an outcome where universities maybe are 

quality, maybe they are not quality, rushing to provide courses that 

people could come in and take so we end up taking people that 

probably we shouldn’t. 

Mr. MORRISON. Well, obviously any provision needs to be tailored 

carefully. But, the National Science Foundation does identify programs in the country in a tiered system as to the level of quality 

based on the kinds of grants that they are able to achieve. So the 

government already makes judgments about levels of quality of our 

universities, especially in this area of science and technology which 

is what we are talking about. So I would suggest we use that expertise which is—already exists in the Government in judgments 

about where the quality programs are. 

And those quality programs depend on competitive grant programs from the NSI and the NIH and others in order to survive. 

They can’t just add people to their programs and be successful. 

They have to have high quality students to do that work and high 

quality professors. So while, you know, if we are talking about—— 

Mr. GOHMERT. Of course you understand that is not what Australia said their experience was. 

Mr. MORRISON. Well, I am not an expert Australia. Australia relied a lot on points and other things that weren’t nearly as tailored 

as the U.S. system is. So I would say you—this Subcommittee could 

write a rule, based on what we already know about where the quality is, that could avoid the abuse and still take advantage of that 

talent. And I think that is, you know, that is the job that I would 

hope that you would—— 

Mr. GOHMERT. And you are willing to put your entire credibility 

on the line by swearing here that somebody in Government has expertise? [Laughter.] 

Mr. GALLEGLY. The time of the gentleman is expired. 

Mr. MORRISON. Thank you, Mr. Chairman. 

Mr. GALLEGLY. Mr. Conyers? 

Mr. CONYERS. Thank you very much, Mr. Chairman. 

Morrison, you were a workers guy, now you are a free market 

type talking guy. What happened to you—— [Laughter.] 

Mr. CONYERS. Since you—is there any reasonable explanation for 

your change of philosophy? 

Mr. MORRISON. Oh, I am not sure I made a change of philosophy, 

but I wanted to say is this, if we want to protect workers we need 

to give them choices. And what green cards do is give them choices. 

Sometimes Government can do things, but Government’s ability to 

do things is limited. 

You are all familiar with the reports that show the Department 

of Labor doesn’t really even enforce our wages and hours laws right 

now. I mean we have a whole lot of laws on the books that don’t 

get enforced. So, if that is the case let’s at least use the power of 

65 

the market when it helps to create a level playing field. And I 

think compared to the H-1B, the green card playing field is a lot 

more level. 

Mr. CONYERS. Well, that is a reasonable explanation. [Laughter.] 

But, I remember when you used to think the free market wasn’t 

very free. 

Mr. MORRISON. It is quite expensive actually, but well, maybe I 

am guilty maybe I am not. I—either I have learned something or 

there was a misunderstanding. 

Mr. CONYERS. Mr. Hira, I want to compliment you for bringing 

up a subject that is important to almost everybody with an industrial sector in their state. When you start—would you explain a little more about the Government subsidizing offshore American jobs 

through immigration policy? 

Mr. HIRA. Sure. If you just look at the top employers, the top ten 

for exactly, employers, recipients of H-1B’s, it is essentially a who’s 

who of the major offshore outsourcing firms. The—they are mostly 

based in India but many of them are even based here in the U.S. 

They are the major beneficiaries. And what—so what we are doing 

with this H-1B program, because there are so many loopholes is we 

are actually giving advantages to those particular firms. 

And let me give you examples of two firms that are competing 

directly with these offshore outsourcing firms, trying to hire Americans. One is a company that has a facility in Ann Arbor, Michigan 

called Systems in Motion and in fact they are trying to hire Americans. And they are a very interesting company because the CEO 

and some of the executives are actually veterans of the offshore 

outsourcing industry, so they know the exploitation of the H-1B’s 

and the program. And what they are finding is that they are put 

at a competitive disadvantage because the firms that are exploiting 

the loopholes can bring in workers at lower wages, train them and 

ship them overseas. 

I think that if we close these loopholes, that we would create 

and/or retain tens of thousands of jobs and that this would not cost 

anything and would not have a major impact on the budget. And 

you could just look at it in terms of the numbers of visas that these 

firms are getting. And it is pretty clear they are not bringing them 

for permanent residence. 

I have done some analysis of that. You know, Tata Consultancy 

brought in 2,400 workers on H-1B’s, they applied for exactly zero 

green cards for their H-1B workers. What are they using those 

H-1B workers for? To do offshoring. They are the largest Indian IT 

offshore outsourcing firm. 

So I think these loopholes could be closed. And I don’t see that 

at least the folks that Mr. Cooper represents would object to those 

kinds of closing the loopholes, if they really want to bring in the 

best and brightest and keep them here permanently. 

Mr. CONYERS. Well, Chairman Gallegly, I think this is probably 

within our jurisdiction too. This is something that I think we can 

examine within the Judiciary Committee. 

Mr. GALLEGLY. Your point is well taken. 

Mr. HIRA. Could I also just—could I just add? 

Mr. GALLEGLY. Sure. 

66 

Mr. HIRA. And the companies themselves have said that this is 

part of what they do in their business model. So executives from 

Wipro, for example, have been quoted in Business Week saying 

they bring in workers for the express purpose of knowledge transfer and to take that knowledge and capability offshore. 

Mr. CONYERS. Well that—makes it kind of convenient for us to 

take care of the business here. 

Mr. Cooper, I appreciated you beginning our discussion that this 

isn’t immigrants versus—we are not taking jobs from Americans 

when we move folks with this kind of skill into citizenship. I think 

that was a very important comment. 

And finally, I think that you, Mr. Neufeld, can’t we do something 

about this prevailing wage business without—don’t you have it 

within your power, your department’s power to do something about 

this? 

Mr. NEUFELD. What USCIS does is—— 

Mr. CONYERS. Make it permanent? Well, you will have to get together with our good friend the Secretary of Labor and can’t something be done here? 

Mr. NEUFELD. Again, what we can do is make sure that it is addressed in the filing of the petition, that they have the labor condition application from the Department of Labor that says that they 

will be paying the prevailing wage or the higher—the actual wage, 

whichever is higher. And that is our role to make sure that that 

attestation has—is in there. Beyond that it is up to the Department of Labor to determine what the prevailing wage is and what 

is the higher—— 

Mr. CONYERS. Well, the four tier system ensures that you will always hire somebody at the cheapest wage you can. I mean that is 

not hard to figure out. 

Mr. COOPER. May I address that point briefly? One thing that I 

think it is important to keep focused on is what can we do with 

today’s rules to make the program better and are we losing any opportunities to do so today. And you know, on this point of enforcement, there is a great deal of money that is put into the Government treasury for this particular purpose. With respect to prevailing wages, there are a lot of tools out there and it is important 

for us not to gain a misconception, I think an overall misconception 

of the program is one that is—that endorses underpayment. 

The Department of Labor has very specific authority to go in and 

investigate and address whether an employer has actually slotted 

an employee into too low a slot on this prevailing wage scale. No 

matter how you calibrate the wages there is always the ability to 

go find cheaper—— 

Mr. CONYERS. Yeah, but they don’t do it. 

Could I get 1 minute more, Chairman Gallegly? 

Mr. GALLEGLY. Without objection. 

Mr. CONYERS. Look, we got a recitation of what we can do and 

how we review and how we oversight. An H-1B that gets a job, the 

first time he squawks, that is the end of it, he is shipped back, you 

never have a chance to investigate anything and they know it. So, 

let’s get some reality here going about how—we have got a lot of 

rules, but they don’t mean anything if you can’t change jobs and 

if you can’t lodge a legitimate grievance. 

67 

Mr. COOPER. Yes, I think that is a very good point. But one thing 

for us also to keep in mind about that is that—is that it is possible 

for—you know, there are ways for an H-1B worker to squawk if 

they are getting cheated and for the Department of Labor to respond. And, it is possible actually—— 

Mr. CONYERS. What ways? 

Mr. COOPER. You can file a complaint with the Department of 

Labor and they have got the authority to do investigations and—— 

Mr. CONYERS. Please, Cooper, give me a break. [Laughter.] 

I mean the—as soon as that paper hits the employers desk or 

goes to Labor that guy is on a boat back to wherever he came from. 

Mr. COOPER. Well, there actually are rules that permit pretty 

freely that employee to go—there is a market, they can go work for 

an employer very readily. You can change jobs—— 

Mr. CONYERS. H-1B you can’t change jobs. 

Mr. COOPER. There’s—Congress wrote special rules that permit 

an H-1B to go work for a new H-1B employer—— 

Mr. CONYERS. Oh, come on. 

Mr. COOPER [continuing]. Called portability. 

Mr. CONYERS. And I gave you so much credit when we started 

out this morning with the hearing. I mean look, you—a person here 

on a H-1B better keep his trap shut, work under whatever conditions that are given and better not be thinking about going to get 

another job, citing section something 1(b) with a paragraph, et 

cetera. That won’t get it in—out of the market today. 

Ms. LOFGREN. Would the gentleman yield? 

Mr. CONYERS. Sure. 

Ms. LOFGREN. As you were talking it occurred to me that one of 

the pieces of information that I have never seen—we did write in 

a portability provision and the reason why was to prevent kind of 

this freezing, but I don’t know if it has been used, you must have 

statistics that would tell us how often, if at all. 

Mr. CONYERS. It has never been used. 

Ms. LOFGREN. And I would like—I am wondering if—if you have 

it now, tell us. If you don’t, could you tell us later how often, if at 

all, the portability provision has been used. 

Mr. NEUFELD. I certainly don’t—— 

Ms. LOFGREN. I thank the gentleman for yielding. 

Mr. NEUFELD. I certainly don’t have statistics here with me. I am 

not sure that we—those statistics exist. If they do, of course we will 

be happy to share them. I—— 

Mr. GALLEGLY. Mr. Neufeld, in the interest of time, we have had 

eleven minutes on this one inquiry, so perhaps you could get the 

information to Mr. Conyers and also Miss Lofgren and to the Committee as a whole, to the best of your ability? And then if that is 

not satisfactory there will be opportunity for follow up. 

The gentleman from Texas. Well, I am sorry, the gentleman from 

Iowa, the vice-chair of the Committee, Mr. King. 

Mr. KING. Thank you, Mr. Chairman. Recognized for eleven minutes I presume. [Laughter.] 

I will not do that to you, it makes your job too difficult. But I 

appreciate the witnesses testimony. And I would like to add, if we 

could, bring a certain perspective to this discussion that I don’t 

know that has been examined. 

68 

And let me start with this. Is it a safe presumption that each of 

the witnesses at the table were supportive of the Bush/McCain/ 

Kennedy immigration reform proposal around 2006? And I guess I 

will start on the end then with Mr. Neufeld and go down the line, 

a yes or a no will be helpful, please. 

Mr. NEUFELD. Well, as a government employee I don’t think it 

is appropriate for me to comment on that. 

Mr. KING. I expected that. [Laughter.] 

Mr. Cooper? 

Mr. COOPER. With respect to the high-skilled issues that we are 

addressing today? 

Mr. KING. With respect to the full proposal. 

Mr. COOPER. I think it had—I think it was very sound in a lot 

of ways and it had some problems. 

Mr. KING. You generally supported it or generally opposed it? 

Mr. COOPER. I would say I generally supported it. 

Mr. KING. Thank you. 

Mr. Hira? 

Mr. HIRA. My expertise is on the high-skill side and on that and 

I would oppose it. I thought it was very bad. 

Mr. KING. Thank you. 

And Mr. Morrison? 

Mr. MORRISON. Yeah. Mr. King I am here on behalf of IEEE and 

they don’t have a position on that specific matter so I don’t think 

it is appropriate for me to say anything on this record. If you would 

like to query me on a personal level at another time I would be 

happy to answer that. 

Mr. KING. And they did not have a position in 2006, would that 

be also your testimony? 

Mr. MORRISON. They didn’t have a position on the overall comprehensive reform bill. That is right. 

Mr. KING. Okay. Thank you. And that is also an appropriate answer, I want to acknowledge. 

And so now I want to start back down through this list and pose 

a couple of other questions that we have got a little bit of a parameter to work off of. You know, first I will just make this statement 

and I will offer it to anybody to seek to rebut it. But I pose this 

question as more than rhetorical, but where there are two different 

categories of illegal—of immigration we need to deal with before we 

can get to H-1B, and that is legal and illegal. And I want to make 

the statement that—and I would ask this question, how many 

illegals are too many and I am going to say the universal answer 

needs to be one. And so if anyone would care to rebut that statement I would offer the floor to you, or if we can accept that as a 

foundation to carry on the discussion, I will let the record show 

that no one sought to rebut that statement. 

So, let’s go on to the next one then. Is there such a thing as too 

much legal immigration? And as a Government official I will exempt the gentleman, but Mr. Cooper, I would start with that. Is 

there such a thing as too many—of legal immigration, whatever the 

category? 

Mr. COOPER. I think that with respect to the categories we are 

dealing with today there is not enough legal immigration. 

Mr. KING. And Mr. Hira? 

69 

Mr. HIRA. I think that there can be too much and I think there 

needs to be controls, in terms of numbers and the impacts, for example, on jobs and wages can really be significant. 

Mr. KING. Thank you. 

And Mr. Morrison? 

Mr. MORRISON. Immigration should be driven by the American 

national interest and the Congress should determine what that interest is and set numbers that reflect that interest. I agree with 

Mr. Cooper that in this area of high-skilled, advanced degree, 

STEM graduates that we have been talking about, we need more 

numbers. And more importantly than numbers, we need people to 

be able to quickly—— 

Mr. KING. Okay. That would be your—— 

Mr. Morrison:—gain that status. 

Mr. KING. Thank you. That would be your editorialization on 

this. But I think I misheard Mr. Cooper, I thought he said in this 

era. You mean in this area, not in this era? 

Mr. COOPER. In this area. 

Mr. KING. Okay, thank you. Because it is a big difference in the 

area and that is this, I will just take my position here and that is 

that there is such a thing as too much legal immigration. Too much 

legal immigration also drives down wages and over supplies in the 

workforce. And we are in a precarious position here in this country. 

And I would agree with Mr. Morrison to this extent, I believe an 

immigration policy should be designed to enhance the economic, 

the social and the cultural well being of the United States of America or which ever nation is drafting its policy, selfish interest if you 

will. And developing our economy with that as an important component of it, I look at this and I think H-1B’s as a separate category have significant merit, but written into the broader picture 

of this when we don’t take into account the growing numbers of 

legal immigrants that are taking up the growth in jobs, even when 

our economy was healthy we were bringing in between 1 and 11⁄2

million legal immigrants a year which occupied the growth in new 

jobs completely over at least a period of a decade. 

So I think we should look at this thing more broadly than we do, 

not within the narrow H-1B bounds, but within the broader scope 

of what is a whole policy here instead of a part of a policy. I know 

I can go over here and justify about every appropriations that will 

come up on the floor of the House and if I vote for every one we 

will bust the budget. Well, we have a budget here of population too 

and skills and today we have a welfare state that has been created 

over the last—well, it hasn’t taken a full century, we know that 

have had witnesses before this Committee that testified that there 

are 71, at least 71 means tested welfare programs and we have a 

subsidy of low wages in other categories of immigration that are accommodated because of the means tested welfare that we built. So 

that does tend to subsidize the employers. 

I believe we need a stronger, tighter labor market and labor is 

a commodity like any other commodity that you need. And it sets 

its value by supply and demand in the marketplace. So I get uneasy when I hear the former Chairman Conyers talk about prevailing wage. I don’t think we should support any kind of preVerDate Aug 31 2005 16:42 May 18, 2011 Jkt 000000 PO 00000 Frm 00073 Fmt 6633 Sfmt 6601 H:\WORK\IMMIG\033111\65488.000 HJUD1 PsN: 65488
70 

vailing wage. I don’t think Government can set the wage, I think 

the economy sets the wage. 

And I think that if we have got some 15 million unemployed in 

the country and when you add that to the broader perspective of 

that there are another 6 or 8 million that are underemployed or 

have dropped out of the workforce and you look at the Division of 

Labor or the Department Labor statistics that show that there are 

80 million Americans of working age that are not working, we are 

in a condition here where we have a lot of people that are riding 

and not enough that are rowing. 

And so I think we need to look at H-1B’s within the broader perspective of what would be the good overall policy for the United 

States of America. And I think we should look at some of these 

countries that have a point system where they score all of their immigrants according to their—the legal immigrants according to 

their ability to assimilate and the skill level they have, the talent 

that they have. Those things are—run very high on my scale. 

So I just want to tell you, philosophically, I agree with upgrading 

America, but I think we should do it on a broader scale. 

Thank you. And I yield back. 

Mr. GALLEGLY. Gentleman from Florida, Mr. Gowdy? I’m sorry. 

Mr. Ross? 

Mr. ROSS. Thank you. You just—— 

Mr. GALLEGLY. Gowdy is from South Carolina. 

Mr. ROSS.—That’s okay, you just complimented him. 

Mr. GALLEGLY. Greenville, Spartanburg. That’s right. I didn’t 

mean to slander you. [Laughter.] 

Mr. GOWDY. You did. You did. 

Mr. ROSS. Thank you, Mr. Chairman. 

One of the issues I want to go back to is the intellectual property 

protections, because I think it is rather disconcerting, especially in 

my district where I have a telecommunications company that is 

using H-1B visas. And then once they have expired then they are 

not only moving the employees back but they are moving the whole 

operation back. And I know that good employers will have confidentiality agreements to protect patents and proprietary inventions and things of that nature, but Mr. Neufeld, shouldn’t there 

be something that protects that our economy, that protects the jobs 

here in this country from this transfer of knowledge and transfer 

of jobs going overseas? 

It seems to me that some of these companies are using, as part 

of their business plan, this particular tactic where they will have 

them over here for 3 years or 6 years and then move the entire operation overseas. 

Mr. NEUFELD. That may well be, but in my position in—as head 

of the operations component within USCIS, you know, my job is to 

make sure that, you know, the adjudicators have the tools and the 

knowledge to enforce the laws and the regulations as they are written—— 

Mr. ROSS. I understand. 

Mr. NEUFELD [continuing]. And we can’t go beyond that. 

Mr. ROSS. Mr. Hira, you mentioned about it. You mentioned that 

we need to close loopholes. Any suggestions as to how we ought to 

close the loopholes there? 

71 

Mr. HIRA. Specifically to this issue or—— 

Mr. ROSS. Yes, sir, specifically to that issue. 

Mr. HIRA. I think this is something where the private companies 

have to protect their intellectual property. I think it is pretty difficult or I can’t—right now I can’t imagine a way, a good way for 

Government to sort of control that. 

Mr. ROSS. But I mean even to the extent where companies themselves are actually probably looking at the bottom line and seeing 

that they can do it better with their labor costs now overseas, even 

though they have trained them over here. It is essentially H-1B onthe-job training—— 

Mr. HIRA. Yeah, and I—— 

Mr. ROSS [continuing]. It is going to be equitable. 

Mr. HIRA.—I think one of the areas that hasn’t been looked at 

is how offshoring is getting into Government contracting. So to 

what extent are U.S. government contracts being offshored. Nobody 

has really looked into that carefully or how H-1B’s are performing, 

how many of them are performing, how they are performing on 

these types of government contracts. 

Mr. ROSS. Mr. Cooper, you spoke about the prevailing wage and 

you indicated there are some—in most instances that the prevailing wage is here, the market wage is up here. Are there any 

instances where the prevailing wage is the higher wage? 

Mr. COOPER. Not that I am aware of, but you couldn’t pay lower 

than the prevailing wage. That sets the rock bottom minimum that 

an employer must pay. 

Mr. ROSS. Right. But I am saying, if we—but in your example 

you said that just about everything is paid above the prevailing 

wage. So I guess what I am saying is what good is the prevailing 

wage then if the market wage is being paid? 

Mr. COOPER. The rules are either pay prevailing or what you actually pay to similar workers in similar jobs, whichever is the higher. You cannot go below the prevailing wage, but you can go above, 

if that is what it takes to get the worker that you need. And that 

commonly happens either when you are trying to recruit somebody 

from overseas or when you are trying to recruit somebody for another worker. And on this portability issue, I mean I can tell you 

that we file portability or change of employer petitions for an H-1B 

moving from one employer to another all the time. It is appropriate—— 

Mr. ROSS. I appreciate that and I was just going to get back to 

my question. 

Mr. COOPER. Sorry. 

Mr. ROSS. That is okay. 

Mr. Hira, you’ve mentioned about prevailing wages, though. And 

you think that there are some problems with it. And could you expound on that? 

Mr. HIRA. Sure. It is really well known in the IT sector especially 

that the H-1B workers are cheaper. Not in all cases, there are some 

very highly skilled workers, but there is a competitive advantage 

to bringing in H-1B workers. And I am actually just trying to find 

the quote, but you know, there is, you know, industry experts as 

well as CEOs of—or executives of some of these firms who have acVerDate Aug 31 2005 16:42 May 18, 2011 Jkt 000000 PO 00000 Frm 00075 Fmt 6633 Sfmt 6601 H:\WORK\IMMIG\033111\65488.000 HJUD1 PsN: 65488
72 

tually admitted this, as much, that their wages are below market 

and that is what gives them the competitive advantage. 

In my study of the offshore outsourcing industry, just looking at 

finances, where they have developed their competitive advantage, 

it is clear that they get a wage advantage, not only of doing the 

work offshore, but their on site labor is much cheaper. 

Mr. ROSS. Do you think that this H-1B program has facilitated 

age discrimination? 

Mr. HIRA. I think there is no doubt that there is age biases within the technology sector. And if you look at the age profile of H-1B 

workers they tend to be much younger than the typical worker in 

those particular sectors in the U.S. So it certainly enables it. 

Whether it definitively actually is causing that, I don’t—I can’t say 

for sure. 

Mr. ROSS. Thank you. Mr. Morrison, real quick question. I note 

that according to the statistics we have been given the quotas for 

these visas have been taken up really very quickly, in some instances the first quarter of the year, one actually—the proceeding—last quarter of the first year and as late as the second 

quarter of the year where these visas have been given. And it 

seems to me that the demand is constantly increasing each year to 

increase the cap on the H-1B visas. 

What bothers me, as a layperson and looking at this rather simply, we have got 9 percent unemployment and yet we increase the 

number of petitions, we reach our cap earlier and earlier. Is that 

indicative of a lax of educational and vocational training standards 

in this country? 

Mr. MORRISON. Well first, the demand for H-1B’s is somewhat 

lower right now than it was a few years ago. But the perspective 

of IEEE and my perspective, my testimony, is the solution is not 

to expand the H-1B program, the solution is to use the green card 

program, to expand that where—in a targeted way, for STEM 

workers so that we bring people permanently and we bring the 

right people and we give them a chance to be permanent Americans and make that kind of contribution and compete effectively 

with other countries that would like to have those skills. So that 

I think is a better answer than raising the H-1B cap. 

Mr. ROSS. Thank you. I see my time is up and I yield back. 

Mr. GALLEGLY. I thank the gentleman from Florida, Mr. Ross. 

And at this point I yield to the gentleman from South Carolina, 

Mr. Gowdy. 

Mr. GOWDY. Thank you, Mr. Chairman. I know reinforcement is 

coming up I may well find myself in Florida. I hope not, because 

I love South Carolina. [Laughter.] 

Mr. Hira, I want to ask you about perhaps a little smaller niche 

which would be areas fraught with fraud or abuse within the H-1B 

process. Give me your top three areas that are ripe or potentially 

rife with abuse. 

Mr. HIRA. Well, in terms of the loopholes themselves there is no 

what we would call labor market test. So companies can go out and 

bypass Americans altogether and in fact can replace Americans 

with H-1B workers. And this is contrary there’s—to sort of conventional wisdom or popular belief. They can actually replace American workers. They can legally, right now, pay below market wages 

73 

and it is pretty clear that they have built business models around 

this. And there is a variety of different business models. Some are 

domestic where they are small job shops, but some are very large 

like these offshore outsourcing firms which are publicly traded and 

so on. 

The other area where I think there needs to be a lot more scrutiny where there hasn’t been is that’s H-1B dependent companies. 

These are companies that have more than 15 percent of their employees in the U.S. on H-1B’s. So if you think about that, some of 

these companies have 60, 70 percent of their worker force in the 

U.S. as guest workers, maybe even more than that, 80 percent. 

And we are not talking about a couple hundred, we are talking 

about 10,000 workers here as guest workers. They hire almost no 

Americans. They somehow are able to meet the extra criteria that 

they have go through to bypass Americans, but they are able to do 

that. 

And let me just give you a sense of the figures. Infosys, for example, over a 3-year period got almost 10,000 H-1B workers. You 

know how many Americans did they hire? Probably a couple hundred. 

Mr. GOWDY. With respect to violations, intended or not of either 

the letter or spirit of the process, are there effective investigative 

tools to determine whether or not the letter or spirit is being violated? 

Mr. HIRA. Well I think Mr. Conyers pointed out an important 

problem with the Administration and that is that it is almost entirely dependent on a whistleblower. That H-1B worker, their legal 

status in the U.S. depends on their employment and their H-1B 

visa. So it is very unlikely that they are going to come out and blow 

the whistle. There have been a small number of cases but there is 

very little bit—little evidence that there is lots of these H-1B workers who are blowing the whistle, even though they are being adversely affected. 

Mr. GOWDY. Are there sufficient investigative tools once the 

whistle has been blown? For instance, subpoena power? 

Mr. HIRA. I don’t know enough about that. So—— 

Mr. GOWDY. Mr. Cooper, do you know whether or not the Department of Labor has subpoena power with respect to employers? 

Mr. COOPER. There is no specific subpoena power in the statute 

but they can and they do very often go out and do wage and hour 

investigations, make sure that people are being paid the wage they 

are supposed to. And they have got significant enforcement authority. For instance—— 

Mr. GOWDY. When you say significant, I am a prosecutor so jail 

is significant to me. 

Mr. COOPER. Well—— 

Mr. GOWDY. What are the potential consequences for an investigation that doesn’t turn out well for the employer? 

Mr. COOPER. Well, here is one that would frighten an employer, 

short of jail. If an employer is found to have willfully underpaid an 

H-1B and if that takes place in the context of a displacement of a 

U.S. worker, they can be fined in the tens of thousands of dollars, 

but more important, they can be kicked out of the system, no one 

H-1B’s for 3 years. 

74 

Mr. GOWDY. Is there subpoena power to investigative claims such 

as that? 

Mr. COOPER. There is investigative but not subpoena power, if I 

am not mistaken. 

Mr. GOWDY. But what power would you say is tantamount to 

subpoena power? 

Mr. COOPER. Oh, I am sorry, wage and hour investigators can 

and they do go into employer’s workplaces and they can—you 

know—— 

Mr. GOWDY. They can—— 

Mr. COOPER [continuing]. There they can see records and so 

forth. 

Mr. GOWDY. So they have full access to all the records, even absent administrative or legal subpoena power? 

Mr. COOPER. That is my understanding. I mean I can tell you our 

firm does—you know, they do these wage and hour investigations 

of employers of the H-1B program. 

Mr. GOWDY. Your firm does? 

Mr. COOPER. Our firm has represented employers who have been 

the subject of these. 

Mr. GOWDY. Does the investigative agency have the full panaplea 

of investigative tools that the bureau or other Federal agencies 

would have? 

Mr. COOPER. I don’t know about the comparison but they can certainly see the things that would help them—would—that they need 

to know to make that evaluation. They can see payroll records, 

they can see what—they can find out what the employer is actually 

doing, they can access that against what the required wage level 

should be and so forth. 

Mr. GOWDY. What is the definition of willful? You said a willful 

violation. 

Mr. COOPER. It is basically on purpose, knowing, you know, 

knowing that you should have done otherwise. 

Mr. GOWDY. The fact that you did it last week and are doing it 

again this week, would that be tantamount to willful? 

Mr. COOPER. I think that would help indicate. 

Mr. GOWDY. All right. Thanks. 

Mr. GALLEGLY. I thank the gentleman from South Carolina. 

I thank all of our witnesses this morning. Welcome back Bruce, 

you are always welcome. And with that the Subcommittee stands 

adjourned. 

[Whereupon, at 11:52 a.m., the Subcommittee was adjourned.] 

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