H1B Layoffs and COVID-19

H1B layoffs can take place quite easily, depending on the circumstances surrounding the layoff. This means that the financial plans of a certain visa holder working in the U.S. are being disrupted, causing uncertainties that might be worrisome – particularly when you are working in an alien country.

With the outbreak of the COVID-19 pandemic, more and more visa holders are finding themselves without work – putting their visa status and everything else at risk. How H1B visa holders are affected and how they can approach this matter, one may find out by reading this article.

COVID-19 and Layoffs

After the COVID-19 pandemic began to affect a bigger and bigger part of the United States, President Donald Trump declared a state of National Emergency starting with March 13, 2020. Over the next 30 days, several rules would be put in order to help prevent the spread of the novel coronavirus.

Only two days after the state of national emergency was declared, the CDC advised that gatherings with more than 50 people should be avoided – and that was only the start. The problem seemed to be under control – but when it comes to disease, one cannot really predict anything. Over the next few weeks, the number of infections soared along with the death toll – and as if that wasn’t bad enough, about 15 million people in the United States lost their job.

Up until recently – February, to be more precise – the United States was at a point of historic prosperity. The unemployment rate was only about 3.5%, and it did not seem like people would have any issues coming up with a source of income. That being said, with the hit of COVID-19 lockdowns, the unemployment rate may go as high as 16% – which is higher than the worst points of the Great Depression.

How Layoffs Are Affecting H1B Visa Holders

Every person living in the United States is affected by these layoffs – but the people that are most likely to suffer are the ones in the United States on an H1B visa. Since these people need to be under employment to keep their visas, the fact that they were suddenly left jobless makes things rather complicated.

The only way to resolve this issue is by finding another job so that you can show you are deserving of being there on a visa – but the problem is that in this scenario, no one is hiring. If so many layoffs are occurring, there is a very low chance that anyone will be doing any hiring – and there’s only so much the COVID-19 stimulus checks can do for you after some time.

This leaves visa holders in a state of uncertainty in a foreign country, as they do not have proof of the main thing that should keep them there. With sources saying that more than 90,000 H1B visa holders can be forced back into their own country, things aren’t looking so bright.

Aside from endangering their visa status, these layoffs are also hurting their health insurance. Since they are no longer under employment, these people don’t have any health coverage – and in the event of a medical emergency, they will have to pay for everything themselves. This can be slightly difficult to do when you do not have a job in the first place.

Indian H1B Holders at Particular Risk

With the economic fallout following the COVID-19 pandemic, more and more companies have begun to downsize to stay alive. As a result, more and more people are being laid off – with the most predisposed ones being Indians on an H1B visa.

In some cases, companies have already made it clear that the H1B visa holders will be the first ones to go. That being said, it also depends on the origins of the visa holder. For example, a worker from Canada will be more likely to remain safe in comparison to a worker from Canada – all because their proximity makes them a smaller risk. It doesn’t matter if they’ve been living in the U.S. for more than a decade and they are close to becoming citizens – their status still makes them a risk.

Steps of H1B Layoff Overview

If a resident on a visa in the U.S. gets laid off, there are some steps that they might have to follow. Some may be skipped, others may be mandatory – but it all depends on each person’s circumstances. Here is what they will have to do if they get laid off due to COVID-19 – as well as what tends to happen, given the situation.

• If their H1B visa is valid when their contract is terminated, the holder will stay 60 days in order to find a new job. However, considering the recession and the restrictions, this is quite difficult to do.
• Every visa close to expiration has to be renewed. That is also quite difficult to do, considering that the embassies and USCIS offices are closed.
• When facing rejections, they will have to switch to a B2 visa – also known as the visitor visa. This will force them back into their home country, where they will have to find a new employer to sponsor their visa.
• Most of the people that have already applied for a passport are currently stuck and cannot do anything to change or extend their current status.
• In the event that the visa holder does succeed in finding a new job, their employer will have to submit a form updating USCIS on that matter. That cannot easily be done with USCIS offices being closed.
• Under normal circumstances, companies would be able to file for “expedited processing,” which will allow them to finish the entire process in the next two works. However, since the state of national emergency discontinued this service “until further notice,” it is once more very difficult to do.

Therefore, most of the steps following the layoff are made even more difficult following the restrictions of the pandemic situation.

Demand for an Increased H1B Grace Period

In the fear of massive layoffs caused by the degrading economy, people on an H1B visa are now demanding that the Trump administration extends their permission to remain in the US. The old permission allowed them to remain 60 days at most before losing their job – but given the circumstances at hand, they are requesting that the extension is changed to 180 days instead.

For this reason, H1B visa holders have started a campaign where they are signing petitions on that matter. They need at least 100,000 signatures to get an answer from the White House – and so far, they gathered around 20,000.

Health Insurance During an H1B Layoff

With the layoff causing more and more people to remain without H1B health insurance, many of them are worrying that they won’t be able to receive medical assistance in an emergency. That being said, H1B visa holders still have health insurance options if they are being laid off.

These people might go for short-term health insurance, where they may get coverage for 30 to 180 days. A slightly more affordable option is travel medical insurance, where you can receive coverage from 5 to 364 days, depending on the plan that you choose.

Final Thoughts

The COVID-19 crisis has caused quite a few delays and disturbances for a variety of people – visa holders in particular. This is why everyone needs to keep a clear head and act upon what they can do until the situation settles.

Frank Gogol

I’m a firm believer that information is the key to financial freedom. On the Stilt Blog, I write about the complex topics — like finance, immigration, and technology — to help immigrants make the most of their lives in the U.S. Our content and brand have been featured in Forbes, TechCrunch, VentureBeat, and more.

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