When California banking regulators closed Silicon Valley Bank (SVB) Financial Group on March 10, it marked the largest bank failure since the Great Recession. This particular bank failure disproportionately affects immigrants and immigrant business owners because SVB not only employed so many foreign born workers but also served so many from the immigrant entrepreneur community.
What do the SVB layoffs mean for its foreign-born employees?
The Silicon Valley Bank collapse has caused job loss and risk of deportation for a significant number of people. Silicon Valley Bank had over 4,000 employees, many of whom were immigrants and in the U.S. on an H-1B visa, which allows highly skilled, specialized workers with bachelor’s degrees (or equivalent) from other countries to obtain visas in the U.S. For H-1B visa holders, immigration status is tied to employment and its accompanying sponsorship. Foreign-born employees on work visas are considered “out of status” in the U.S. if they are unemployed – even if they lose their jobs due to layoffs or hiring freezes. To maintain lawful status, these workers have a 60-day grace period to find a new job or else return to their home country.
Unfortunately, the SVB collapse has sent ripples throughout the overall job market, particularly in the venture capital sector. Due to fears of further financial turmoil, companies may hold off on hiring or initiate layoffs to reduce budgets, as Meta just did for the second time in four months.
What are the options for people who have lost their H-1B jobs?
If finding a new job within the allotted 60 days is not possible, there may be other options to consider. However, since each case is unique, it’s wise to connect with an attorney well-versed in H-1B immigration issues to explore ways to maintain lawful status. In some cases, laid off H-1B visa holders may be able to explore changing their visa type to:
- O-1 visa (“extraordinary workers”)
- E-1 visa or E-2 visa, available to citizens of certain treaty countries
- F-1 visa for students
- TN Visas, which may apply to Canadian or Mexican professionals
- B-2 Visitor visa (non-work status)
Currently, President Biden is considering a recommendation to extend the H-1B grace period for laid off visa holders from 60 to 180 days.
SVB’s effects on foreign-born entrepreneurs
In addition to layoffs and deportation risk, the SVB collapse also means the loss of a financial institution that was known for being supportive to foreign-born entrepreneurs. Immigrant founders often have a harder time raising capital, but SVB supported immigrant entrepreneurship and took chances on founders. For example, the bank accepted customers without Social Security numbers, helped early-stage founders get business credit cards that weren’t tied to their personal credit, and gave many immigrant business owners their first business credit card or mortgage even though those borrowers might not meet a larger bank’s traditional criteria.
In the wake of SVB’s collapse, immigrant-led startups that can’t partner with a new bank quickly may struggle to provide proper financial support to their employees and deliver on promises to their customers. In addition, potential founders who are younger or who have historically had less access to capital—such as Black entrepreneurs—are also likely to be affected.
Next Steps: Help For Work Visa Holders
If you have experienced an H-1B layoff, we recommend consulting with an immigration lawyer who specializes in H-1B visa policy to help you understand the different courses of action available to you. Reeves’ team is made up of some of the best immigration attorneys in the country who can explain your legal options and help you with your H-1B visa status. Contact us today and let’s talk about how we can help.
