Trump’s visa policy may harm Israeli hi-tech innovators

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April 26, 2017 01:53

Last Tuesday, Trump signed an executive order to evaluate the H-1B visa program, which enables skilled foreign workers with a “specialty occupation” to work temporarily in the United States.

Donald Trump

US President Donald Trump speaks to reporters aboard Air Force One. (photo credit:REUTERS)

As US President Donald Trump continues his campaign to tighten immigration policy, Israeli hi-tech innovators keen on relocating to Silicon Valley may see a sharp decline in employment opportunities.

Last Tuesday, Trump signed an executive order to evaluate the H-1B visa program, which enables skilled foreign workers with a “specialty occupation” to work temporarily in the United States.



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While changes to the H-1B visa alone will not necessarily threaten Israeli relocation options, experts agree that the president’s increasingly strict immigration agenda is cause for concern among budding entrepreneurs.

“There is going to be significantly increased uncertainty in the visa application process for Israelis,” Liam Schwartz, an Israel-based American corporate immigration lawyer at Liam Schwartz & Associates, told The Jerusalem Post on Sunday.


“For Israeli hi-tech, the number of work-visa options available for companies that want to relocate Israelis to Silicon Valley are extremely limited today and are going to get even more limited in the near future.”

Trump’s most recent announcement regarding the review of employment immigration laws largely focuses on the H-1B program, which grants 65,000 visas annually to specialized employees and another 20,000 to graduate student workers, through a lottery system.

Although the goals of the president’s review remain vague, one objective, according to Trump’s aides, would be to replace the lottery with a merit-based system that would restrict the visa allocation to skilled workers, a Reuters report said.

The decision to review H-1B comes less than a month after a Hawaiian federal judge blocked Trump’s revised travel ban, which would have restricted the entry of individuals from six Muslim countries into the US.

Today, some 60,000 Israelis, including spouses and children, live in Silicon Valley alone, according to Ogen Relocation, a company that helps Israeli hi-tech families transition to living in the US. Although some Israelis residing in the US do have H-1B visas, they often enter on a variety of other permits.

The H-1B, Schwartz explained, has largely become unavailable due to the global quota, with only one out of every three applicants even being accepted into the lottery.

“The H-1B has become such a political football, but that’s not from today. That’s from several years ago,” he said.

In Schwartz’s mind, two other visas – the L-1A and L-1B – remain among the few truly viable options for Israeli hi-tech companies seeking to transfer their employees to the US. The L-1 visas, he explained, have no annual quotas and can be assigned to company executives and managers (L-1A) or employees with specialized knowledge (L-1B), as long as the person has been working at the firm for at least 12 consecutive months.

“If you are a cyber company based in Tel Aviv and you want to send someone to your new San Francisco office, in order to set up a product or support apparatus in California, you’re probably going to go on L-1B,” Schwartz said.

At the moment, the L-1 remains a decent option for Israeli hi-tech entrepreneurs, but those depending on this visa may see its provisions becoming increasingly strict, Schwartz warned.

Although the provisions of L-1A and L-1B may become more and more restrictive, New York-based lawyer Kate Kalmykov likewise advocated the use of these visas among Israeli hi-tech companies looking to relocate employees to the US.

“We work with many Israelis who will start in Israel and be transferred here, and they can avail themselves of [a visa for a] multi-national manager or executive or someone with specialized knowledge,” said Kalmykov, who is an expert in business immigration and compliance for Greenberg Traurig LLP, which also has offices in Tel Aviv.

Another potential option for Israeli entrepreneurs is the E-1 treaty trader visa, which serves to promote international trade of products and technology, according to Schwartz. However, the company has to demonstrate that it is already doing substantial trade with US clients and that it is at least 50% Israeli-owned, which is often difficult to prove, he said. For example, Schwartz explained, an Israeli start-up might have a variety of venture capital investments from diverse origins or might be traded publicly on the NASDAQ Stock Market.

Kalmykov pointed out one other visa that could be specifically useful to Israelis who have an additional passport – the E-2 treaty trader visa – as Israel is not yet a party to this particular treaty.

Through this visa, individuals investing in American companies have the opportunity to temporarily reside in the US.

Australia, the United Kingdom and a number of other European countries are all party to the E-2 treaty.

“Many Israelis tend to have dual nationality,” Kalmykov said. “Some of them may be able to avail themselves of the E-2 treaty.”

As far as Trump’s decision last week to review the H-1B visa is concerned, Schwartz feels that this move is unlikely to significantly impact Israelis, both due to the limited availability of that visa and the unattractive conditions that the permit offers.

Stressing that the exact plans of the H-1B review remain unclear, Kalmykov said that the US government is likely aiming to root out fraud and abuse, as well as achieve a merit-based visa system.

At present, she explained, a H-1B visa applicant does not have to show that he or she is the best candidate for a given position. Rather, the applicant simply has to be qualified and have an employer willing to pay the prevailing wage for that position.

“One of the goals of the executive order is also to perhaps reexamine the prevailing wages and make sure that they really meet the market,” Kalmykov said.

“Ultimately, we may also see an increase in the prevailing wages,” she added. “That of course will be something for employers to examine – will they continue to sponsor foreign employees?” The H-1B visa is a “common go-to for companies recruiting new hires” in a variety of professions that require a bachelor’s degree, including many hi-tech industry positions, she explained. Kalmykov reiterated, however, that Israeli companies should be making use of alternative visas to bring their employees to the US.

Aya Levkovitz, CEO of Ogen Relocation, also encouraged the use of visas that are far less restrictive than H-1B. Yet she, too, voiced her concern that supervision over the L-1 visa in particular would become much stricter in the near future.

In response to the looming cloud of uncertainty over employment immigration, Levkovitz said she feels that big hi-tech firms could simply start seeking alternative options.

“These companies are trying to find other solutions, like having their centers not in the US, like in Canada, so it will be easier for them to relocate employees,” Levkovitz said. “It won’t happen in one day, but it’s starting to happen.”

Expressing confidence that Silicon Valley would remain strong regardless of Trump’s orders, Levkovitz said that the president might not even have sufficient power to cause significant damage to the companies there.

“If they feel it in their pockets, they will do something,” she added.

For Schwartz, the Trump administration’s attitude on employment immigration as a whole has become increasingly problematic, as transparency declines and uncertainty rises. It has become more and more difficult, he explained, to get the right person at the right time for a specific company into the US.

“Israelis are very big on timetables,” he said. “As an immigration lawyer, I’m finding it’s increasingly tougher to give intelligent timetables to my clients.”

While Trump’s second executive order on immigration was frozen on March 15 due to the Hawaiian federal judge’s decision, Schwartz pointed out that only two days later, Secretary of State Rex Tillerson sent a cable to consulates around the globe with instructions on how to implement the order.

The cable, which was originally revealed by Reuters, instructed diplomatic missions to toughen screening and vetting protocols for visa applications, in particular for “populations warranting increased scrutiny.”

“Tillerson’s cable has created a huge chilling effect on what the consulates do with L-1 applications, and all these applications,” Schwartz said. “As part of this increased vigilance, it means they will be sending more security checks about more people to Washington.”

In Schwartz’s opinion, Trump’s behavior is particularly paradoxical, as the man who bills himself as a successful businessman is essentially scaring off potential business opportunities for the US.

“I do think it’s counterproductive, if you want to attract direct foreign investments in the US and you want to attract foreign tech companies to increase training and employment,” Schwartz said.

While he said that he is not entirely pessimistic about the future of work opportunities for Israelis and other foreigners in the US, Schwartz stressed the importance of remaining aware of the potential ramifications of the administration’s actions.

“I’m concerned,” he said. “The process is still doable – that’s how I make my living. I don’t make added dollars by scaring people, but I’m definitely concerned by the trend toward increased scrutiny, toward increased security checks, toward greatly decreased transparency.”

“It’s becoming much more opaque,” Schwartz added.
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