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October 2014, Volume 21, Number 4

Labor, H-1B

The unemployment rate fell to 5.9 percent in September 2014, the lowest rate since summer 2008. However, the labor force participation rate dropped below 63 percent, the lowest rate in 40 years.

Some 27 million US workers are employed part time, including 7.5 million who would like full-time work. Part-time workers generally work less than 30 hours a week, and many do not receive advance notice of exactly when they will work. The Fair Workweek Initiative aims to require employers to give part-time workers more notice of exactly when they are scheduled to work.

The most common labor-market policy proposal is to raise the federal minimum wage from $7.25 to $10.10 an hour. President Obama issued an executive order requiring federal contractors to pay at least $10.10 an hour in 2015. In Los Angeles, where the minimum wage is now $9 an hour, the mayor has proposed raising the minimum wage to $13.25 an hour by 2017. If implemented, about 35 percent of Los Angeles workers, some 570,000, would likely get wage increases.

In September 2013, DOL announced that the two million home health care workers would have to be paid at least the federal minimum wage of $7.25 and overtime after 40 hours a week beginning January 1, 2015. In October 2014, DOL said that it would delay minimum wage and overtime for home health care workers until at least July 1, 2015, citing concerns of states who share the cost of paying these workers.

The 10.6 million workers employed in US restaurants earn a median wage of $10 an hour including tips, according to a study by the Employment Policy Institute (EPI) ( The federal minimum wage for workers who receive tips has been $2.13 an hour for decades, and EPI wants to raise this minimum wage to 70 percent of the federal minimum wage, now $7.25 an hour. The National Restaurant Association, in opposition, counters that restaurants "train America's workforce and provide a pathway towards upward mobility and success for millions of people."

On September 4, 2014, workers in fast-food restaurants and their allies demonstrated in 150 cities around the US for a $15-an-hour minimum wage, the seventh in a wave of walkouts aimed at raising wages. For the first time, some demonstrators sat in front of restaurants to shut them down; over 400 were arrested. McDonald's said that all of its 14,000 US restaurants remained open and that fewer than 10 McDonald's employees participated in the protests.

President Obama expressed support for the "national movement going on of fast food workers organizing to lift wages so they can provide for their families with pride and dignity." The National Labor Relations Board general counsel in July 2014 authorized a complaint naming McDonald's USA as a joint employer with franchisees for labor relations purposes, so that McDonald's share responsibilities with its franchisees for labor law violations. The Service Employees International Union is supporting the fast-food workers, and SEIU-represented home health-care aides joined the fast-food protesters in five cities.

An average of 2.8 million workers are employed by temp or staffing agencies, and 12 million individuals work for temp firms at some time during a typical year. Most temp workers are supervised by the client at the worksite but are paid by the temp firm that is considered their employer. Workers employed by temp firms earn about 20 percent less than all private sector workers, a median $12.40 in 2013 versus $15.85 an hour.

The American Mobility Act (HR 4033) would allow DOL to provide grants of up to $10,000 in relocation assistance to workers who were jobless at least 26 consecutive weeks if they move to an area where the worker has a job offer or where the unemployment rate is at least two percentage points lower than the area where the worker currently lives. A third of the 9.4 million jobless US workers in June 2014 were unemployed 27 weeks or more.

Education is the best single predictor of earnings. When the educational attainment of US workers is displayed graphically, the data form a diamond shape. The bulge in the middle reflects the fact that over half of adults have a high-school diploma, but not a college degree. Technology is changing the nature of US jobs, creating more jobs that require a college degree or that can be filled by workers without high-school diplomas, often immigrants. The question is what will happen to high-school graduates whose jobs are eliminated, as, for example, bank tellers are replaced by ATMs, and travel agents by the internet?

Analysts say that the hardest tasks to automate are those that require common sense and judgment, as with medical support jobs and construction crafts. It is often easier to see how technology displaces workers rather than how technology creates new jobs. Optimists believe there will be sufficient new jobs created to absorb mid-skill workers who lose jobs to computers.

Nonetheless, many of the occupations adding jobs fastest are low-paying. The US is expected to have 161 million jobs in 2022, including 1.8 million personal care and 1.3 million home health-care jobs. Both had average annual earnings of about $20,000 in 2012. Turnover is high, topping 50 percent a year. Home-care employment agencies such as ResCare say they cannot raise current $10 an hour wages because Medicaid and Medicare, which pay three-fourths of the bill for in-home care, limit reimbursements. States determine reimbursements rates for in-home care, setting them per visit or by the hour, but must operate within federal guidelines.

H-1B. Employers filed petitions on behalf of 124,000 foreigners for whom they sought H-1B visas in FY13, and filed 172,500 petitions for FY14's 85,000 H-1B visas. USCIS uses a lottery to determine which foreigners receive H-1B visas, and does not allow employers to rank the foreigners for whom they are seeking H-1B visas.

Employers complain that there are too few H-1B visas, and attorneys for employers complain that USCIS is questioning whether the job that the employer wants to fill with a foreigner is a "specialty occupation," that is, the occupation requires a BA or more and specialized knowledge. Attorneys say that USCIS often questions two types of employer requests for H-1B visas: (1) when the owner of a US corporation petitions for an H-1B visa for himself and; (2) when "body brokers" who bring H-1B workers into the US and send them from one US firm to another to work request visas.

Most RN nursing jobs do not qualify for the H-1B program because RNs are generally not required to have a bachelor's degree or more. In July 2014, USCIS said that some specialty nursing jobs may qualify for H-1B visas because of the "advanced level of education and training required for certification." No US state requires nurses to obtain bachelor's degrees in order to obtain nursing licenses. USCIS says that if states were to require bachelor's degrees for nursing licenses, the nursing jobs in that state would be considered H-1B specialty occupations.

Some 22 percent of working-age adults speak a language other than English at home, and 19.2 million or 9.3 percent of the 206 million working-age adults were Limited English Proficient in 2012. Most LEP adults speak Spanish, 40 percent have not finished high school, and a third are unauthorized. LEP adults with jobs are concentrated in six industries, led by building and grounds cleaning and maintenance in cities such as New York and Los Angeles.

Unauthorized. The Tennessee Court of Appeals in August 2014 ruled that unauthorized workers may sue their employers for firing them in retaliation for pursuing a workers' compensation claim. The Court held that Ricardo Torres had standing to bring a retaliatory discharge claim against Precision Industries because he was asserting the right to file a workers' compensation claim, not asserting a right to work.

Torres injured his back at work and, after hiring an attorney to obtain workers compensation benefits, was not rehired for "lack of work." Torres sued, and Precision countered that Torres was unauthorized and thus ineligible to be rehired. The trial court was of the opinion that Precision knew Torres was unauthorized when it first hired him, but agreed that, since Torres was unauthorized, he was not entitled to reinstatement. However, the Court of Appeals said that Torres was entitled to sue, but might not be entitled to full benefits if a lower court finds he should have been rehired.

The Nebraska Supreme Court in 2013 ruled that an unauthorized worker is entitled to permanent total disability benefits under the state's workers' compensation law (Moyera v. Quality Pork International) and that an unauthorized worker is entitled to permanent total disability benefits even after returning to his native Mexico (Visoso v. Cargill Meat Solutions). The California Supreme Court in 2014 allowed an unauthorized worker to bring a disability discrimination claim under California's Fair Employment and Housing Act for an employer's failure to accommodate a back injury and eventually discharging him in retaliation for filing a workers' compensation claim (Salas v. Sierra Chemical Company).

The Idaho Supreme Court avoided the question of whether unauthorized workers are entitled to extended workers' compensation benefits in August 2014 by holding that Francisco Serrano failed to prove that his continuing back pain was due to work accidents in 2004 and 2008. In an earlier case related to a construction worker, the Idaho Industrial Commission held that an unauthorized worker was not entitled to permanent disability benefits because he was not a lawful US worker. However, the dissenters in that case argued that, since "a real and significant labor market exists for undocumented workers in this state," unauthorized status should not automatically preclude unauthorized workers from receiving benefits.

Most employers and their insurance companies pay for medical care and treatment for injured workers regardless of legal status. Disputes arise when recovered unauthorized workers cannot return to their old jobs because of their injury or they seek compensation because they can no longer work at all.

President Obama in August 2014 signed an Executive Order requiring contractors seeking to do business worth more than $500,000 to report to government agencies any labor-law violations over the preceding three years. DOL estimates that 24,000 businesses employing 28 million workers will be affected by the Executive Order.