US lawmakers introduce bill to tighten H-1B, L-1 visa rules: Why hiring may get tougher

Days after President Donald Trump moved to impose a sweeping $100,000 fee on new H-1B visa petitions, a bipartisan group of US senators has reintroduced legislation to further restrict access to the H-1B and L-1 visa programs used heavily by technology companies and outsourcing firms.

Senate Judiciary Committee Chairman Chuck Grassley, a Republican, and Ranking Member Dick Durbin, a Democrat, said the bill seeks to “reform and close loopholes” in the visa programs, which they argue have been exploited by employers to replace American workers with cheaper foreign labour.

“Major companies are laying off thousands of American workers while filing thousands of visa petitions for foreign workers at depressed wages and poor working conditions,” Durbin said. “Congress must step in to protect American workers and fix our broken immigration system.”

Grassley added that while the programs were created to help businesses bring in top talent when it could not be found at home, “many employers have used them to cut out American workers in favour of cheap foreign labour.”

What the H-1B and L-1 Visa Reform Act proposes

The legislation, known as the H-1B and L-1 Visa Reform Act, is cosponsored by Senators Tommy Tuberville, Richard Blumenthal, and Bernie Sanders.

The measure would implement new wage and recruitment requirements, require employers to post H-1B job openings on a Department of Labour website, give the agency expanded enforcement powers, and raise penalties for wage violations.

It also proposes changes to the L-1 visa program, including stricter time limits and verification requirements for petitions from foreign affiliates.

Nicole Gunara, an immigration attorney with Manifest Law, said the proposals would “increase compliance requirements and likely make H-1B hiring more expensive, particularly for companies that have relied on lower wage levels or contract-based staffing,” reported Hindustan Times.

She added that reforms to the L-1 program would make it harder for multinationals to transfer workers, forcing many to shift toward direct US employment instead.

Impact on Indian IT firms and foreign workers

The bill comes as Trump’s $100,000 visa petition fee proposal has already rattled the US tech industry, which heavily relies on foreign talent.

More than 700,000 H-1B visa holders currently work in the US, most of them in computer-related jobs, according to the Pew Research Center. Nearly three-quarters of approvals in 2023 went to Indian professionals, who would be disproportionately affected by the new rules and higher costs.

TCS under scrutiny

Indian IT companies such as Tata Consultancy Services and Infosys are among the largest users of the H-1B and L-1 programs.

Durbin and Grassley last week wrote to several large corporations, including TCS, questioning why they continued to file thousands of visa petitions while conducting mass layoffs of US employees.

The layoffs, primarily targeting mid- and senior-level employees, come even as the company added 5,000 new hires in the April–June quarter, bringing its total headcount to 613,069 as of June 30.

In a letter to TCS CEO and Managing Director K Krithivasan, the Senators said the IT major has been laying off American employees, while also filing H-1B visa petitions for thousands of foreign workers.

"In fiscal year 2025, TCS received approval to hire 5,505 H-1B employees, making TCS the second-largest employer of newly approved H-1B beneficiaries in the nation. With all of the homegrown American talent relegated to the sidelines, we find it hard to believe that TCS cannot find qualified American tech workers to fill these positions," they wrote.

TCS is already under investigation by the Equal Employment Opportunity Commission for allegedly firing older American workers in favour of newly hired South-Asian H-1B employees.

"We would like to give you an opportunity to explain yourself," they said, posing nine questions on TCS's hiring and layoff practices.