Foreign nationals arriving on F-1 visas are getting tax-free jobs in the U.S.
HR 3564, the Fairness for High-Skilled Americans Act, sponsored by Rep. Paul Gosar (R-AZ-4th Dist.), seeks to end the F-1 OPT (Optional Practical Training) program.
Recent publicity on OPT has served to inform the public and Congress about how this program is hurting American grads. Major media outlets, including Tucker Carlson and NBC News have both covered the harm in OPT.
David North at the Center for Immigration Studies (CIS) has also been investigating and reporting on F-1 OPT for years. And technologist-turned-lawyer John Miano, has been leading the fight in court to end OPT for over eleven years.
But most American college kids and their families are unaware of this program and how it affects every student’s chance of landing a job during college or in the years following graduation. Mainstream media stories on OPT rarely mention the substantial tax breaks and how they hurt American citizens.
Colleges, businesses and the F-1s exploiting the program know full well how the OPT program benefits them. Neither the employer, nor the F-1, pays payroll taxes (Medicare, Social Security or unemployment taxes), which means each pocket half of the 16.5 percent savings. It also short changes Medicare, Social Security and unemployment funds. Updated numbers from CIS show the shortfall is now closer to $3 billion per year.
Why are OPT jobs tax free? Because the F-1 visas that foreign nationals use to enter the country are designated as “nonimmigrant” visas. The U.S. government established F-1 visas with the expectation that students would return home upon completion of their American education.
Foreign nationals on F-1 visas are eligible for tax-free jobs as follows:
- Curricular Practical Training (CPT) working 20 hours per week while maintaining student status
- Optional Practical Training (OPT) working at any job they choose full-time for 12 months after graduating
- OPT STEM extension for an additional 24 months for STEM program enrollees, so long as the job fits in to one of the categories on the widely inclusive nine-page list (including Urban Forestry, Livestock Management, HVAC Technician and Welding Technician)
- Another 24-month STEM extension if the F-1 visa holder earns “a second qualifying degree at a higher education level” and is “participating in an initial period of OPT at the time they apply to USCIS for their second STEM OPT extension.”
Because OPT recipients and their employers are excused from paying payroll taxes, employers have a financial incentive to discriminate against U.S. citizens when hiring. The F-1s get the much-coveted job experience, while American citizens and legal permanent residents can’t get a foothold in the workplace, especially in STEM fields.
Created under the George W. Bush administration, expanded during the Obama administration and continuing to grow under the Trump administration, F-1 OPT was designed —without Congressional approval — as an end-run around H-1B limits when the Department of Justice promulgated regulations, without any public notice or comment period. OPT is not legal.
No analogy captures the full scope of the damage the F-1 work programs are doing to America.
These insidious programs – combined with Business Roundtable and Chamber of Commerce messaging — are hurting American grads and America’s chance for future success.
Because American grads aren’t getting the 300,000 jobs going to F-1 OPTs, the attrition rates for Americans in STEM will continue to rise. Absent Congressional action to end OPT, the industry-generated mantra of “we can’t find American STEM workers” will become a self-fulfilling prophecy.
Kids of all backgrounds are getting the message: “You’re not smart enough, especially in the STEM fields,” and “foreign kids are smarter.” The reality, however, is that our government is giving F-1 visa holders a leg up … a foot in the door … a head start. Why? Corporations that want cheaper labor are lying to Congress — and worse, to the American people – saying they can’t find qualified American workers, all while American workers are being laid off and required to train their foreign replacements on work visas.
And the hurt goes on…
Since the F-1s get the desired on-the-job training, their employers are likely to offer them permanent full-time jobs (by applying for their H-1B visas), once again leaving Americans out of the training-to-jobs loop, when only half of U.S. STEM grads are landing jobs in STEM.
Scholars and experts contend that businesses use OPT for the cheap labor, just as they use the better-known H-1B visa. Companies groom low-wage F-1 OPTs, then turn around and say they need foreign workers because Americans don’t have the skills they need – when those companies are responsible for excluding Americans from the training and the jobs.
Because of the significant tax incentive to hire foreign workers, it’s no wonder that OPT has increased by 400 percent and has actually surpassed the number of H-1B visas issued yearly for the last several years. According to the PEW Research Center, for the period 2004 to 2016, there were a total of 1,474,000 approvals of OPT compared with 1,473,000 initial H-1B visa approvals for the same period.
No Merit, No Limit, No Restrictions: No Good
Because there is no limit to the number of OPT work permits that can be issued, OPT has become more of a threat than H-1B. OPT does not limit F-1s to any specific position, is not merit based, and has little to no oversight, as the only evaluations come from the F-1 OPT and the employer, both self-interested parties.
Both the OPT and H-1B programs are used to block qualified Americans and hire only foreign applicants. But OPT’s attractiveness as a work-around to H-1B limits has caused a surge of “visa mills,” or substandard and often unaccredited institutions that issue high numbers of OPT work permits, according to a report by the CIS. One visa mill, Stratford University in Virginia, issued more OPT STEM extensions than all Ivy League schools combined over the same period.
Some colleges have even altered schedules so that alien students can stay in status while going to class only once every four weeks or so. Swamy has continued working on F-1 OPT extensions full time for five years.
F-1 OPT attracts those “more interested in working in the U.S. than receiving the education.”That became national news when ICE conducted a sting at the fake University of Farmington, nabbing F-1s who didn’t really want the education part of the deal, just the jobs.
But there are many more scams providing OPT. The University of Cumberlands, in Kentucky, offers F-1 programs that allow F-1 students to take classes anywhere in the U.S. and come to the campus just one weekend per semester, all while working in the U.S. from the first day of the program.
OPT is extracting a huge toll from America, quite apart from the tax breaks they and their employers are given. OPT has proven to be a national security threat, as this foreign student stole a Duke University Professor’s intellectual property that our U.S. military had invested millions in and became a billionaire because of it. And this F-1 OPT teacher was charged with molesting a 13-year-old school boy.
There is no reason for America to allow tax-free training of foreign students who take American jobs. If a foreign student graduating from an American college is truly talented, an “O” or “H1B” visa should be the route to legal U.S. employment.
America welcomes students from all over the world, however, giving non-citizens tax-free jobs – especially at a time when Americans are being displaced in record numbers by foreign workers, and American student debt is at an all-time high – is unbelievably bad policy.
Join us in educating Congress on the facts, so we can end OPT and put American graduates first.
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