S. 2928: H-1B and L-1 Visa Reform Act of 2025

H-1B and L-1 Visa Reform Act of 2025

Title I: H-1B Visa Fraud and Abuse Protections

Subtitle A: H-1B Employer Application Requirements

• Sec. 101 - Modification of Application Requirements:

  • Wages: Requires employers to pay H-1B workers wages that are the highest of: the local prevailing wage, the median wage for the occupation in the area, or the median wage for a "skill level 2" worker in the same occupation.

  • Transparency: Mandates that employers post detailed job descriptions on a public Department of Labor (DOL) website for at least 30 calendar days before hiring an H-1B worker.

  • Non-Displacement: Applies rules preventing the displacement of U.S. workers to all H-1B employers, not just those who are "H-1B dependent."

  • Third-Party Placement: Forbids employers from placing H-1B workers with another company unless they receive a specific waiver demonstrating no U.S. workers will be harmed.

• Sec. 102 - New Application Requirements:

  • Hiring Practices: Prohibits employers from advertising positions as exclusively for H-1B workers or giving them preference in hiring.

  • 50% Cap: For companies with 50 or more employees, this provision caps the total number of H-1B and L-1 employees at 50% of their total workforce.

  • Documentation: Requires employers to submit previous W-2 tax forms for their H-1B employees to the government.

• Sec. 103 & 107 - Application Review and Fees:

  • Enhanced Scrutiny: Requires the DOL to review H-1B applications for "indicators of fraud or misrepresentation," not just for completeness. The review period is extended from 7 to 14 days.

  • Application Fee: Establishes a new processing fee for H-1B applications to fund the administration, oversight, and enforcement of the program.

• Sec. 104 - H-1B Visa Allocation:

  • Prioritization: Creates a tiered system to replace the H-1B lottery when demand exceeds the annual cap. Priority is given to:

    1. Foreign nationals with advanced STEM degrees from a U.S. university.

    2. Petitions for jobs offering the highest wages.

    3. Foreign nationals with other advanced degrees from U.S. universities.

    4. Employers demonstrating good corporate citizenship (e.g., using E-Verify, high petition approval rates).

    5. All other petitions.

• Sec. 105 - H-1B Workers at Universities: Clarifies that to be exempt from the annual H-1B cap, a worker must be "employed by" an institution of higher education, not just stationed at one. This targets abuse by third-party contracting firms.

• Sec. 106 - Definition of "Specialty Occupation": Narrows the definition to require a bachelor's degree or higher in a field specifically and directly related to the job, aiming to eliminate the use of unrelated degrees or broad work experience to qualify.

• Sec. 108 - H-1B Subpoena Authority: Grants the Secretary of Labor subpoena authority to compel testimony and document production to ensure employer compliance during investigations.

• Sec. 109 - Limitation on H-1B Extension: Limits the total H-1B admission period to a maximum of six years (an initial three-year period plus one three-year extension), which is only available if the beneficiary has an approved employment-based immigrant petition.

• Sec. 110 - Elimination of B-1 Visas in Lieu of H-1B: Prohibits the use of the B-1 temporary business visitor visa for individuals coming to the U.S. to perform skilled labor that would typically require an H-1B visa.

Subtitle B & C: Investigations, Penalties, and Other Protections

• Sec. 111-115 - Enhanced Enforcement:

  • Audits: Requires the DOL to conduct annual compliance audits on at least 1% of H-1B employers, with mandatory audits for large employers who rely heavily on H-1B workers (more than 15% of their workforce).

  • Increased Penalties: Substantially raises fines for violations. For example, the penalty for displacing a U.S. worker increases from a maximum of $35,000 to $150,000.

  • Whistleblower Protections: Creates protections for employees who report H-1B program fraud and abuse.

  • Information Sharing: Requires U.S. Citizenship and Immigration Services (USCIS) to share information with the DOL to aid in investigations.

• Sec. 121-124 - Transparency and Resources:

  • Public Job Bank: Directs the DOL to create a public, searchable website where all H-1B job openings must be posted.

  • Employee Rights: Requires employers to provide H-1B and L-1 workers with copies of all immigration paperwork filed on their behalf and a brochure outlining their rights under U.S. law.

  • DOL Staffing: Authorizes the hiring of 200 additional DOL employees to oversee and enforce the H-1B program, paid for by the new application fees.

• Sec. 116, 125, 126 - Technical and Application Provisions: Includes conforming amendments to remove obsolete language, technical corrections to other parts of the Immigration and Nationality Act, and specifies that the new rules apply to petitions filed after the date of enactment.

Title II: L-1 Visa Fraud and Abuse Protections

• Sec. 201 - Prohibiting Displacement and Outsourcing:

  • Third-Party Placement: Prohibits L-1 workers from being stationed primarily at a third-party worksite. A waiver is possible only if the employer can prove no U.S. workers at the third-party site will be displaced.

  • Displacement: Explicitly prohibits L-1 employers from displacing U.S. workers within the 180-day period before or after placing an L-1 worker.

• Sec. 202 - Requirements for "New Offices": Imposes stricter standards for petitions to send an L-1 worker to open or be employed in a "new office" in the U.S. The employer must prove it has a sufficient business plan, physical premises, and the financial ability to operate. Initial approval is limited to one year.

• Sec. 203 - Cooperation with Secretary of State: Mandates that DHS and the State Department work together to verify the existence and operations of a company's U.S. and foreign offices.

• Sec. 204-207 - Investigations, Wages, and Penalties:

  • Enforcement: Grants the Department of Homeland Security (DHS) new authority to investigate, audit, and penalize L-1 employers for program violations.

  • Wages: Requires employers to pay prevailing wages to L-1 workers who are in the U.S. for more than one year.

  • Penalties: Establishes civil penalties for violations, including fines up to $25,000 per willful violation and debarment from the program.

  • Retaliation Protections: Provides whistleblower protections for L-1 workers who report fraud or abuse.

• Sec. 208 - Adjudication of Blanket Petitions: Shifts the final adjudication of individual visa applications under an L-1 "blanket petition" from consular officers abroad to DHS, centralizing the decision-making process.

• Sec. 209 - Reporting: Expands annual reporting requirements to Congress to include detailed data on L-1 visa usage, including employers, occupations, wages, and countries of origin.

• Sec. 210 - Definition of "Specialized Knowledge": Significantly narrows the definition for the L-1B category. "Specialized knowledge" is defined as an "advanced level of expertise" and "proprietary knowledge" that is not readily available in the U.S. labor market, making it harder for personnel with only general skills to qualify.

• Sec. 211 & 212 - Technical and Application Provisions: Makes technical amendments to update agency names (e.g., changing "Attorney General" to "Secretary of Homeland Security") and clarifies that the title applies to petitions filed after the date of enactment.