The House Judiciary Committee is currently reviewing a bill that would require employers to pay high-skilled foreign temporary workers hired under the “exempt” category of the H-1B visa program at least $100,000 a year, up from a current minimum of $60,000, and index the new minimum to inflation. Known as the “Protect and Grow American Jobs Act,” the bill is sponsored by California Republican Representative Darrell Issa, a major supporter of President-Elect Donald Trump.
The H-1B visa program is intended to make it easier for American companies to hire foreign workers with specialized skills or advanced degrees. Hiring foreign employees under the high-skill “exempt” category of the H1-B law lowers several barriers to hiring.
President-elect Trump has been vocal about plans to curtail or reform the program, arguing that, instead of hiring top-tier foreign talent, companies are using it primarily to hire entry-level foreigners on the cheap, even when there are Americans who could fill a job.
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There is substantial evidence to support that argument. Ars Technica highlights recent Congressional testimony from Howard University public policy researcher Ronil Hira, who argued that “the H-1B program is most definitely harming American workers, harming them badly, and on a large scale.” One dramatic example came to light last year, when a group of tech workers filed suit against Disney, saying they had been forced to train their foreign replacements, in violation of the H-1B law’s intent. That suit was dismissed on a technicality, highlighting the necessity of legislative reform.
A 1998 revision to the program set a pay floor for H-1B “exempt” workers with the intention of preventing those sorts of abuse. But the currently proposed bill argues that the revision’s wage requirements were not indexed to wage growth, and have provided declining protection for American workers in the years since.
While permanently raising the minimum wage for H1-B workers would in theory make hiring foreigners less attractive, it’s also possible companies would also respond by fully offshoring more technical jobs.
Other possible revisions to the program, which Trump discussed during a major roundtable with tech leaders in December, could include charging more for applications or reserving visas for companies offering the highest salaries.
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One other possibility would be specifically restricting the use of H1-Bs by outsourcing or temporary-labor firms. Those firms currently receive the majority of H1-Bs, and have been the focus of allegations of abuse, including in the Disney case.
Trump has broadly been seen as antagonistic to the technology sector, thanks to his stances on cybersecurity and other factors. The H1-B reform push, though, could open a rift between companies, who may have to pay more for talent, and American employees, who could see benefits in wage growth and job security.