The bill to remove per country quota HR1044 has already passed in the house. The senate version, S386 has 35 cosponsors in the senate.
Even though Senator Paul Rand has raised an objection to passing the bill unanimously, the bill will eventually pass before the end of the year due to the sheer number of Senators and House members supporting it.
An individual including a H-1B employee can contribute $5,600 per senator for primary and general count elections and senators to be sympathetic to the per country quota issue.
DOL has silently increased the wages on July 1st, 2019 again. The wages for a Software Developer Level 2 has increased to $82,000 in a small tier 2 city like Brandon in Florida.
DOL has put a proposal to double the ACWIA fees soon. ACWIA fee is currently $750 each for petitions filed by an employers with 25 or less full-time employees, and $1,500 for employers with 26 or more. So many employers would be paying $3,000 instead of $1,500 in ACWIA fees.
For employers with more than 50 employees it costs $10,000 approximately in government fees plus attorney fees to sponsor or file for an extension for a H-1B employee. Health Insurance and other benefits cost another $7000 to $8000 per employee. This roughly translates to $65 per hour in salary per employee just to maintain the payroll and benefits.
Any H-1B employee earning less than $85 per hour in billing from an end client and working for a big 5 consulting firm or an implementation partner is at the risk of layoff.
It has become a common practice for vendors to collect H-1B copies and other immigration related documents. USCIS and ICE are issuing blanket subpoenas (I-138) to vendors for all immigration documents collected by them. If any consultancy owner has knowingly or unknowingly sent a false H-1B copy to the vendor there are at grave risk of arrest and/ or denaturalization due to visa fraud.
The inverted yield curve which is the best recession indicator has been inverted for more than a quarter. Prices of homes have doubled. Cost of food has increased due to increasing cost of food items and door delivery services like Uber Eats.
US has not seen a recession or correction in the last 12 years. Global economy including Europe's economy has slowed down considerably. There is a very high chance of recession in 2020 due to these factors. With Level 2 wages employers cannot afford even 3 months of bench pay as that will completely drain the company resources.
With Level 2 wages, 80/20 percentage sharing, 6.5% Social security, 1.45% Medicare, 1% state unemployment insurance, 1% business liability insurance 0.25% payroll processing charges, 0.75% line of credit interest, office rent, HR manager salary, overseas marketing team costs, high chances of recession in 2020, it is no longer lucrative to run an IT consulting company with less than 35 employees.
Most business lines of credit and business credit card are secured by the consultancy owners personal guarantee and the owners are liable to pay with their personal funds or personal properties in the event of bankruptcy or default on business line of credit or business credit card.
Many owners have business of credit lines guaranteed by SBA. If you default on a SBA loan, you will be forced to do an offer in compromise (40-50%) of the total loan amount plus outstanding interest or file Chapter 11 Bankruptcy.
Once you file Chapter 11 Bankruptcy, company bank statements can be verified by creditors and questions can be asked in a 341 creditors meeting to determine fraudulent conveyance or fraudulent transfers to wives, relatives, friends up to 6 years prior to filing of Bankruptcy depending on the state.
If you decide not to go with either of these options the SBA loan will referred to Department of Treasury. Department will automatically slap an additional penalty of 28%. The department of treasury has unlimited time and reach to garnish your wages from a full time job, levy your bank accounts, 401k , IRA and social security payments.
If you are an IT consultancy owner and would like to exit the business or seek a working / managing partner or an investor, please send an email to info@consultancyforsale.com.
Press release by: Indian Clicks, LLC