At the Intersection of Export Control Regulations and Employment Discrimination Law

Date01 September 2008
Published date01 September 2008
DOIhttp://doi.org/10.1111/j.1744-1714.2008.00064.x
At the Intersection of Export Control
Regulations and Employment
Discrimination Law
Debra Burke
n
I. INTRODUCTION
Assume that Technology University hires as a professor in its Engineering
Department a Chinese national who is on an H-1B visa
1
and in the process
of applying for permanent residence. Faculty in the department are work-
ing on improving inertial navigations systems under a government grant.
Because that technology is subject to control under domestic export con-
trol regulations, unless what the Chinese faculty member is working on is
in the public domain, a license is required to release the requisite technical
data to him. But because technology transfers with military applications to
China are prohibited, such a license will not be issued. Therefore, unless
r2008, Copyright the Author
Journal compilation r2008, Copyright the Author
565
American Business Law Journal
Volume 45, Issue 3, 565–610, Fall 2008
n
Professor, Western Carolina University. B.A., M.P.A., J.D., University of Texas, Austin.
1
H-1B visa status is a nonimmigrant classification that permits foreign professionals to enter
the United States on a temporary basis to work in their field of expertise. Individuals working
under H-1B visas may be employed for as long as three years initially with extensions not
exceeding three years. The visa is designed for foreign nationals performing services in a
specialty occupation (e.g., physicians, professors, engineers, computer systems analysts and
programmers) which require either a baccalaureate or higher degree or a required license,
other official permission to practice a professional occupation, or the equivalency of a degree
or certification as acquired through a combination of education, training, and/or
experience. U.S. Department of Homeland Security, Characteristics of Specialty Occu-
pation Workers (H-1B): Fiscal Year 2003, http://www.uscis.gov/files/article/FY03H1BFnl
CharRprt.pdf (last visited Mar. 24, 2008). Foran overview of the H-1B visa program, includ-
ing a discussion of the changes made by 1990 legislation, see Brian John Halliday,In Order to
Hire the Best Personfor the Job, We Have to Do What?: A Look at the H-1B Visa Program: The Short-
TermSolution for Continued American Competitiveness in the Global High-Technology Marketplace,11
J.L. & PUB.POLY33 (1999); Leah Phelps Carpenter, Comment, The Status of the H-1B Visa in These
Conflicting Times,10TULSA J. COMP.&INTLL. 553 (2003).
the university is convinced that the data he needs fall under an exemption
for fundamental research, the Chinese professor must be excluded from
participation in the project. If the university erroneously concludes that
the exemption applies, it could lose millions of dollars in future federal
grants and face penalties as well.
Regulation of so-called ‘‘deemed exports’’ under U.S. law impacts the
employment of foreign nationals. But do such restrictions adversely affect
the conditions of the employment of foreign national employees in an im-
permissible discriminatory manner? Title VII of the Civil Rights Act of
1964 makes it an unlawful employment practice for an employer to fail to
hire, to discharge, limit, segregate, or classify any individual in a discrim-
inatory manner or to otherwise discriminate as to compensation, terms,
conditions, or privileges of employment, because of the individual’s na-
tional origin. This prohibition embraces foreign nationals working in the
United States for covered employers, regardless of their citizenship or
work authorization. Further, the Immigration Reform and Control Act of
1986 prohibits employers from discriminating against certain classes of
foreign nationals authorized to work in the United States with respect to
hiring, referral, or discharge because of citizenship status. These laws are
aimed at eliminating arbitrary discrimination based on stereotypical con-
clusions instead of performance criteria.
Nevertheless, regulations designed to preclude the exportation of
sensitive information seem to inject a degree of arbitrariness into the
classes of persons who are prohibited from receiving what is considered
sensitive information. Federal laws regulate the distribution of strategically
important products, services, and information to foreign nationals and
countries in the interest of national security. Such a regulatory scheme
necessarily must balance the desire for free trade and globalization, which
is required for economic growth, with the increasingly important need to
maintain national security. But given their propensity to affect adversely
the conditions of employment of some foreign nationals working in the
United States, should they also balance the need to protect persons from
stereotypical discrimination?
This article considers this potential for conflict, as well as the role
national security justifications play in resolving the issue. Part II addresses
the overall export control environment for U.S. businesses, describing the
applicable international accords and domestic statutes controlling exports.
Parts III and IV delve into the various and overlapping domestic regula-
tions in the area. Part V briefly summarizes relevant employment law
566 Vol. 45 / American Business Law Journal
principles. Once the legal background has been laid, Part VI then discusses
the intersection of these opposing legislative goals, arguing that national
security and global economic growth on the one hand and equal oppor-
tunity in employment on the other are not mutually exclusive. Part VII
concludes with a recommendation that pending changes in deemed export
licensing regulations be sensitive to preserving another critical American
value: equality in employment.
II. THE ENVIRONMENT OF EXPORT CONTROLS
Control of sensitive exports from the United States is governed by both
international accords and federal law. These next sections elucidate the
overarching rubric and goals of regulations affecting U.S. business prac-
tices.
A. The International Environment
Formal international and domestic export restrictions for both weaponry
and technology with the potential for military applications have been in
place for decades.
2
The United States is a party to a number of multilateral
nonproliferation regimes.
3
Today, the primary international framework
for export controls of weapons and associated technology that affects U.S.
interests is the Wassenaar Arrangement (WA).
4
This association of forty
2
For an excellent overview and historical examination of the structure of export control re-
gimes, see Peter Swan, A Road Map to Understanding Export Controls: National Security in a
Changing Global Environment,30AM.BUS. L.J. 607 (1993).
3
These include the Nuclear Suppliers Group, a group of thirty-nine member states that seeks
to curb the proliferation of nuclear weapons through the implementation of guidelines to
control nuclear and nuclear-related exports, see Nuclear Suppliers Group, http://www.nuclear
suppliersgroup.org/ (last visited Mar. 23, 2008); the Missile TechnologyControl Regime, con-
sisting of thirty-four partners which apply a common export policy to a common list of con-
trolled items, including all key equipment and technology needed for missile development,
production, and operation, see The Missile Technology Control Regime, http://www.mtcr.info/
english/index.html (last visited Mar. 23, 2008); and The Australia Group, consisting of thirty-
eight participating countries which have agreed though their export policies to thwart the
acquisition of chemical and/or biological weapons by certain states and terrorists desiring that
capability, see The Australia Group, http://www.australiagroup.net/en/index.html (last visited
Mar. 23, 2008).
4
The WA is the successor to the former Coordinating Committee on Export Controls (Co-
Com) the export control regime of the Cold War era that disbanded after the fall of the Soviet
2008 / Export Control Regulations and Employment Discrimination Law 567

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