Human Capital

Immigration Uncertainty

Employers, especially in technology, are fearful of changes to the foreign worker visa program.
By: | April 7, 2017 • 5 min read

Uncertainty over President Trump’s travel ban and the potential for changes to the H-1B visa program have many companies contemplating the risks to foreign workers.

New proposals could call for some drastic changes to the visa program at a time when many technology companies say there’s already a talent shortage.

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At the same time, critics of the H-1B visa program, which is used for professionals in specialty fields, say some companies are playing the system to replace American workers with less costly foreign staff.

The debate is ongoing although it has heated up with the new administration’s pronouncements, leaving companies that rely on H-1B workers with both uncertainty and risk.

H-1Bs Essential to Secure Talent

Goldman Sachs estimates there are nearly one million H-1B visa holders working in the U.S., accounting for up to 13 percent of the country’s tech workforce. An H-1B visa is an employment-based, non-immigrant visa category for temporary workers.

Employers must apply to U.S. Citizenship and Immigration Services (USCIS) on the worker’s behalf. Most applicants are required to hold at least a bachelor’s degree or equivalent training and must be paid the prevailing wage for the role.

Employers pay filing fees of between $1,570 to  $2,320 per worker for three-year visas that can be extended for up to six years. Of the 85,000 H-1Bs offered annually by the USCIS, 20,000 are reserved for those with a master’s degree or higher.

William Stock, attorney, Klasko Immigration Law Partners

If the USCIS receives more than the number of petitions in the first five business days of the annual filing system, it awards visas on a random lottery system run by computer.

William Stock, an attorney with Klasko Immigration Law Partners in Philadelphia, and president of the American Immigration Lawyers Association, said companies have often used H-1Bs to fill roles in IT infrastructure and software development that they otherwise haven’t been able to fill.

According to Code.org, there are nearly a half-million open computing jobs, yet only 43,000 Americans graduate from college with computer science degrees annually. While many tech jobs can be outsourced overseas, Stock said there’s still a strong need for talent to be onsite in the United States.

Employers Anticipate Change

Companies of all sizes are evaluating the potential for changes in the system, said Matthew Dunn, partner with Kramer Levin Naftalis & Frankel law firm.

While there are some steps President Trump could take on his own, Dunn said, mass changes would likely need to be approved by Congress.

Sen. Chuck Grassley, R-Iowa, and Sen. Dick Durbin, D-Ill., recently announced plans to introduce a bill that would require all employers seeking H-1B visas to demonstrate “good faith efforts” to find American workers first.

It would also do away with a lottery system and require that employers prioritize the top foreign students who studied in the U.S.

Dunn said it could add pressure for companies since they are already challenged with obtaining the workers they need.

“Right now, there are 85,000 H-1B visas available each year and there are over 200,000 applicants so the chance of getting one is less than 50 percent,” said Dunn.

Other proposals would boost salary thresholds for workers and remove loopholes in the existing H-1B regulations that let some work for less money than U.S. counterparts.

While there is generally bipartisan support for a vetting process to ensure U.S. workers are not being replaced by cheap foreign labor, employers are still concerned that reforms could curtail their access to talent.

Dick Burke, CEO, Envoy

In the meantime, Stock said, these employers are seeking “as many H-1Bs as they can this season” before there are changes to the law, and they’re also ensuring their salaries are competitive.

Companies are also eyeing their vendor relationships to assess their dependence on foreign workers and how changes could impact their ability to deliver products or services.

Dick Burke, CEO at Envoy, a company that helps secure work authorizations across the globe, said many employers are seeking to move foreign workers to “higher ground” by securing more durable authorization.

Mexican and Canadian citizens can be moved to a NAFTA Professional (TN) work visa and others can use an L-1 work visa, a class designed to help multinationals move more people around. Burke said other companies are even trying to help employees obtain a green card as a legal permanent resident.

“They’re really trying to take advantage of the opportunities that the immigration process permits and we’re helping our [clients] do that,” said Burke.

Travel Ban “Unpredictable”

While employers anticipate changes in the H-1B program in the coming year, President Trump’s travel ban executive order has been a more pressing issue.

Dunn said it is difficult to contend with the new “unpredictability of rules that government may require them to follow.”

“It was just sprung on companies and business travel was certainly disrupted and then plans for future travel have been put on hold,” said Dunn.

It was just sprung on companies and business travel was certainly disrupted and then plans for future travel have been put on hold. — Matthew Dunn, partner, Kramer Levin Naftalis & Frankel

Companies have been communicating with their “employees of concern” about adjustments and status of the ban, he said. And while some of these companies have been holding town hall-type meetings to lend support to foreign national workers, others have been taking a “wait and see” approach.

Stock said the ban has led to a great deal of uncertainty in the business community as it was “unprecedented in scope” and not tethered to “any realistic risk/benefit analysis.”

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While employers remain at the mercy of federal regulations, Burke said, many are deciding to “become more vocal” with their representatives.

There’s not only concern about changes to immigration in the United States but about how foreign governments could respond with potential retaliation. The perception that the travel ban, now being fought in the courts, focuses on Muslims may cause retribution in the global economy, Burke said.

India is the biggest provider of H-1B workers, making up nearly 70 percent of the foreign workforce.

“There’s big concern for companies with global operations. There’s a fear that if you’re not going to let our people come in, we’re going to make it very difficult for you to transact business in our country,” said Burke. &

Craig Guillot is a writer and photographer, based in New Orleans. He can be reached at [email protected]

More from Risk & Insurance

More from Risk & Insurance

Robotics Risk

Rise of the Cobots

Collaborative robots, known as cobots, are rapidly expanding in the workforce due to their versatility. But they bring with them liability concerns.
By: | May 2, 2017 • 5 min read

When the Stanford Shopping Center in Palo Alto hired mobile collaborative robots to bolster security patrols, the goal was to improve costs and safety.

Once the autonomous robotic guards took up their beats — bedecked with alarms, motion sensors, live video streaming and forensics capabilities — no one imagined what would happen next.

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For some reason,  a cobots’ sensors didn’t pick up the movement of a toddler on the sidewalk who was trying to play with the 5-foot-tall, egg-shaped figure.

The 300-pound robot was programmed to stop for shoppers, but it knocked down the child and then ran over his feet while his parents helplessly watched.

Engaged to help, this cobot instead did harm, yet the use of cobots is growing rapidly.

Cobots are the fastest growing segment of the robotics industry, which is projected to hit $135.4 billion in 2019, according to tech research firm IDC.

“Robots are embedding themselves more and more into our lives every day,” said Morgan Kyte, a senior vice president at Marsh.

“Collaborative robots have taken the robotics industry by storm over the past several years,” said Bob Doyle, director of communications at the Robotic Industries Association (RIA).

When traditional robots joined the U.S. workforce in the 1960s, they were often assigned one specific task and put to work safely away from humans in a fenced area.

Today, they are rapidly being deployed in the automotive, plastics, electronics assembly, machine tooling and health care industries due to their ability to function in tandem with human co-workers.

More than 24,000 robots valued at $1.3 billion were ordered from North American companies last year, according to the RIA.

Cobots Rapidly Gain Popularity

Cobots are cheaper, more versatile and lighter, and often have a faster return on investment compared to traditional robots. Some cobots even employ artificial intelligence (AI) so they can adapt to their environment, learn new tasks and improve on their skills.

Bob Doyle, director of communications, Robotic Industry Association

Their software is simple to program, so companies don’t need a computer programmer, called a robotic integrator, to come on site to tweak duties. Most employees can learn how to program them.

While the introduction of cobots into the workplace can bring great productivity gains, it also introduces risk mitigation challenges.

“Where does the problem lie when accidents happen and which insurance covers it?” asked attorney Garry Mathiason, co-chair of the robotics, AI and automation industry group at the law firm Littler Mendelson PC in San Francisco.

“Cobots are still machines and things can go awry in many ways,” Marsh’s Kyte said.

“The robot can fail. A subcomponent can fail. It can draw the wrong conclusions.”

If something goes amiss, exposure may fall to many different parties:  the manufacturer of the cobot, the software developer and/or the purchaser of the cobot, to name a few.

Is it a product defect? Was it an issue in the base code or in the design? Was something done in the cobot’s training? Was it user error?

“Cobots are still machines and things can go awry in many ways.” — Morgan Kyte, senior vice president, Marsh

Is it a workers’ compensation case or a liability issue?

“If you get injured in the workplace, there’s no debate as to liability,” Mathiason said.

But if the employee attributes the injury to a poorly designed or programmed machine and sues the manufacturer of the equipment, that’s not limited by workers’ comp, he added.

Garry Mathiason, co-chair, robotics, AI and automation industry group, Littler Mendelson PC

In the case of a worker killed by a cobot in Grand Rapids, Mich., in 2015, the worker’s spouse filed suit against five of the companies responsible for manufacturing the machine.

“It’s going to be unique each time,” Kyte said.

“The issue that keeps me awake at night is that people are so impressed with what a cobot can do, and so they ask it to do a task that it wasn’t meant to perform,” Mathiason said.

Privacy is another consideration.

If the cobot records what is happening around it, takes pictures of its environment and the people in it, an employee or customer might claim a privacy violation.

A public sign disclosing the cobot’s ability to record video or take pictures may be a simple solution. And yet, it is often overlooked, Mathiason said.

Growing Pains in the Industry

There are going to be growing pains as the industry blossoms in advance of any legal and regulatory systems, Mathiason said.

He suggests companies take several mitigation steps before introducing cobots to the workplace.

First, conduct a safety audit that specifically covers robotics. Make sure to properly investigate the use of the technology and consider all options. Run a pilot program to test it out.

Most importantly, he said, assign someone in the organization to get up to speed on the technology and then continuously follow it for updates and new uses.

The Robotics Industry Association has been working with the government to set up safety standards. One employee can join a cobot member association to receive the latest information on regulations.

“I think there’s a lot of confusion about this technology and people see so many things that could go wrong,” Mathiason said.

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“But if you handle it properly with the safety audit, the robotics audit, and pay attention to what the standards are, it’s going to be the opposite; there will be fewer problems.

“And you might even see in your experience rating that you are going to [get] a better price to the policy,” he added.

Without forethought, coverage may slip through the cracks. General liability, E&O, business interruption, personal injury, cyber and privacy claims can all be involved.

AIG’s Lexington Insurance introduced an insurance product in 2015 to address the gray areas cobots and robots create. The coverage brings together general and products liability, robotics errors and omissions, and risk management services, all three of which are tailored for the robotics industry. Minimum premium is $25,000.

Insurers are using lessons learned from the creation of cyber liability policies and are applying it to robotics coverage, Kyte said.

“The robotics industry has been very safe for the last 30 years,” RIA’s Doyle said. “It really does have a good track record and we want that to continue.” &

Juliann Walsh is a staff writer at Risk & Insurance. She can be reached at [email protected]