What’s the Problem with Optional Practical Training (OPT)?

Optional practical training (OPT) is in the news again. OPT is a temporary employment authorization program that allows F-1 student visa holders in the United States to work in a job directly related to their major field of study. While the program was created in the 1960s to allow for limited “practical training” in the United States, it has evolved into one of the country’s largest (and uncapped) guestworker programs.

The program can be used either while an F-1 visa holder is a student (“pre-completion OPT”) or after graduation (“post-completion OPT”). F-1 visa holders in non-STEM (science, technology, engineering, and mathematics) fields typically obtain work authorization under this program for 12 months. Those working in STEM fields, however, may apply for a 24-month extension, allowing them to work in the United States up to 36 months after graduation.

The Trump administration signaled that it will be amending the regulations governing the program. While we don’t know what exactly will be in the new rule, here are a few of CIS’s most pressing concerns about the program.

The OPT Program Has Never Been Authorized by Congress. OPT has never been authorized by any statute. It was created by the legacy Immigration and Naturalization Service (INS) and, later, continued and expanded by the Department of Homeland Security through regulation under the agencies’ general authority to regulate the F-1 nonimmigration visa program.

Once an F-1 Visa Holder Graduates, They Are Not Maintaining Their Immigration Status and Should Not Be Granted Work Authorization. OPT, itself, is not an immigration status and does not confer any other sort of legal status. Participants are considered to be remaining in their F-1 student status while participating in the program.

Once an F-1 visa holder graduates, however, they are no longer maintaining their immigration status because their F-1 classification authorizes them to remain in the United States solely for the purpose of pursuing “a full course of study” at an eligible academic institution. Under INA § 101(a)(15)(F), that status is contingent on being a bona fide student actively enrolled in an educational program. When the individual completes or ceases full-time study, the condition that justifies their stay ends, and so does their lawful F-1 status.

DHS regulations allow F-1 visa holders to remain and work in the United States under this classification if they participate in post-completion OPT. However, this scheme conflicts directly with the INA and has never otherwise been authorized by statute.

The Program Puts Recent U.S. Graduates at a Disadvantage. OPT can disadvantage recent U.S. graduates by creating an uneven labor market in which foreign students can be hired more cheaply than their American graduate peers. Because F-1 visa holders on OPT are classified by the IRS as “students” (even after graduation), their employers are exempt from paying federal payroll taxes for Social Security and Medicare — saving roughly 7.65 percent in labor costs per worker — while American graduates generate these costs for employers. This tax subsidy makes OPT workers financially more attractive to companies, especially for entry-level positions in competitive industries.

Moreover, the temporary and easily renewable nature of OPT allows employers to avoid the long-term commitments and wage standards required for regular employees or even H-1B visa holders. As a result, American graduates can face greater difficulty finding jobs that match their skills or pay fairly, particularly in STEM and professional fields where OPT participation is concentrated.

OPT, as Currently Designed, Allows Employers to Get Around the H-1B Cap and Other Protections for U.S. and Foreign Workers. OPT allows employers to get around the H-1B visa cap by providing a way to hire foreign workers for years without going through the statutory limits, lottery system, and labor protections that apply to H-1B visas. Employers can thus fill full-time professional roles with foreign graduates immediately after school without filing an H-1B petition, paying the associated fees, or meeting the wage attestation and labor condition application requirements that are intended to protect U.S. workers. Many employers use this as a bridge to continue employing foreign workers year after year by cycling through multiple OPT participants or by repeatedly extending employment under the STEM extension, effectively circumventing the statutory limits Congress imposed on temporary high-skilled workers.