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The Impact of the Stimulus Package on Immigration Law H-1B restrictions for TARP recipients

A new provision in Congress’ recently passed stimulus package, called the Employ American Workers Act (EAWA), will prohibit financial institutions that receive certain federal funds from hiring foreign workers under the H-1B program for two years. 

Specifically, the EAWA places new restrictions on H-1B petitions filed by any company that receives funding under the Troubled Asset Relief Program (TARP).  For two years, employers that receive TARP funds or certain other federal loans will be restricted from hiring new H-1B workers, or extending the status of their existing H-1B workers, unless they can show they have actively recruited U.S. workers (that is, U.S. citizens or permanent residents) and were unsuccessful in these attempts.  Additionally, these employers must show that they are not using H-1B workers to replace laid-off U.S. workers or otherwise displace American workers.

E-Verify dropped from the stimulus bill

House and Senate conference negotiators dropped all E-Verify related provisions in the final version of the stimulus bill.  Previously, the House had included in its stimulus bill a stipulation that all contracts paid for with stimulus funding must use the E-Verify system.  The Senate version, however, contained no E-Verify language.

The proposed E-Verify provisions would have forced the E-Verify program on more employers by requiring any federal contractor hired under the authority of the stimulus bill to verify the employment eligibility of workers through E-Verify. 

E-Verify is an internet-based program promoted by the Bush administration to allow employers to submit Social Security numbers for new hires and existing employees.  If there is a match, the employee is eligible to work.  If there is not a match, there are procedures for further assessments of the potential employee’s status. 

Currently, about 100,000 employers voluntarily use E-Verify.  Under an executive order issued by President George W. Bush, federal contractors are supposed to start using E-Verify in May, though business groups are challenging the order in court.

Unemployment benefits for non-citizens or permanent residents

Under the stimulus package, workers receiving unemployment benefits who are not U.S. citizens or permanent residents will be required to have their immigration status re-verified if the initial documentation that they provided expires at any time while they are receiving unemployment benefits.  The purpose of this requirement is to ensure that unemployment benefits will go only to those people who are eligible to work legally in the U.S.

Other limitations on stimulus loan recipients

The stimulus package also prohibits the issuance of a stimulus loan to any company that has been determined by the Secretary of Homeland Security or the U.S. Attorney General to have engaged in a pattern or practice of hiring, recruiting or referring for a fee, an alien for employment in the United States knowing the person is unauthorized to work.

Even though the content of the above Greenebaum Doll & McDonald e-bulletin is primarily informative, state and federal law obligates us to inform you that this is an advertisement. You have received this advisory because you are a client or friend of the firm.

About Greenebaum Doll & McDonald PLLC
Greenebaum Doll & McDonald PLLC is a widely-respected business law firm with approximately 200 legal professionals in six offices, serving local, national and international clients in virtually every industry. A forward-thinking business law firm, Greenebaum is committed to the practice of Breakthrough Law®.

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