USCIS Announces H1-B Cap Reached

The USCIS announced on April 5, 2013 that the H-1B cap was reached in the first week petitions could be filed for the fiscal year beginning October 1, 2013. Because more than 85,000 petitions were submitted, a computer generated lottery will be held to determine which petitions will be processed. USCIS will take a few days to data entry the information required, and then will first conduct the lottery for the 20,000 advanced degree graduates. All remaining advanced degree graduates will be entered into the regular cap lottery for the remaining 65,000 visas. The remaining petitions will be rejected and returned to the petitioners. Premium processing for those petitions both requesting premium processing (and paying the additional fee) and selected will begin to be processed on April 15. The remaining petitions will be processed over the next few months, presumably all before the designated start date of October 1, 2013.

The "cap-gap" regulation provides that beneficiaries of the selected H-1B petitions currently employed pursuant to Optional Practical Training will be permitted to continue working until the H-1B becomes effective on October 1, although the Optional Practical Training may expire before this date.

The strong demand for the H-1B visa, often referred to as the high tech visa because it is relied upon by employers seeking high skilled technology workers, reflects the growing economy. We hope that this strong demand, and the adverse affect it will have on employer's ability to hire engineers and technology professionals between now and October 2014 will encourage Congress to provide relief as Comprehensive Immigration Reform is debated over the coming weeks.
 

Prepare for the H-1B Cap: Filing season begins April 1, 2013

A new year brings new opportunities and challenges, and it's time for American employers to begin considering filing H-1B petitions for prospective new foreign national employees. The H-1B visa category provides for the temporary employment of foreign nationals who will work in “specialty occupations,” or those jobs for which at least a bachelor’s degree in a particular field is required (for example, engineers, teachers, accountants, and many professional information technology positions). The problem is that there are limited numbers of H-1B visas available each year, and this year we expect these numbers to be quickly claimed.

There is a limit (or "cap") of 85,000 H-1B visas available each year: 65,000 for bachelor degree-level candidates and 20,000 for advanced degree graduates of American universities. These petitions can be submitted to U.S. Citizenship and Immigration Services (USCIS) on or after April 1, 2013 for employment beginning no earlier than October 1, 2013 (this is the beginning of the government's 2014 fiscal year, which runs from October 1, 2013 to September 30, 2014). However, we anticipate that the available H-1B visa numbers will be exhausted within the first week employers are eligible to file new H-1B petitions. If this occurs, USCIS will conduct a computer-generated random selection process, or lottery, for submitted H-1B petitions to select which petitions will be accepted for adjudication. If approved, H-1B employees will be eligible to receive an H-1B visa number and begin working for their petitioning employers.

The limit of 85,000 H-1B visas is specific for potential employees initially seeking to acquire H-1B visa or status, and does not impact current H-1B employees. Accordingly, cap-subject individuals include those acquiring the H-1B visa or status for the first time, such as foreign (F-1) students changing to H-1B status and individuals abroad who plan to enter the U.S. for the first time using an H-1B visa.

Each year the H-1B cap typically is reached well before the end of the fiscal year. For the fiscal year 2013, all H-1B visas were exhausted by June 11, 2012. Due to an improving economy, as well as an uncertain number of H-1B candidates who failed to get a visa number last year or who are waiting to apply this year, we advise employers to be proactive and move quickly to ensure their H-1B petitions are prepared and ready to file no later than April 1, 2013.

Once the H-1B cap has been reached, no new petitions may be filed until the next fiscal year (April 1, 2014 for employment beginning October 1, 2014). This can make both hiring and planning an employment start date difficult. For example, although employers can file petitions up to six months in advance of the requested effective date, which makes the April 1 filing date so critical, the approved petition will not be valid until October 1 of that year. Thus, even though employers may file petitions on or after April 1 for the next fiscal year, the petition will not be effective until October 1. This issue particularly impacts foreign (F-1) students, who often have post-graduate work authorization to allow them to remain in the U.S. and work while awaiting the H-1B effective date. In limited situations, other visa categories may be available in lieu of the H-1B. For other cap-subject individuals, such as those currently abroad or who do not have H-1B status, they must wait until October 1 before commencing employment.

H-1B Cap has been reached for FY2013

Yesterday, the U.S. Citizenship and Immigration Services announced that the H-1B cap has been reached for the Fiscal Year 2013, which begins October 1, 2012. Accordingly, no H-1B petitions can be filed until April 1, 2013, for potential employees who are cap-subject to be able to begin working on October 1, 2013.

Each fiscal year, the law permits 20,000 "master cap" cases for the H-1B beneficiaries who have obtained graduate degrees from U.S. universities and 65, 000 "regular cap" cases. In most instances, cap-subject individuals are those who are acquiring H-1B status for the first time, such as international students who are seeking to change status from F-1 to H-1B or those who are seeking to enter the U.S. for the first time on H-1B status.

Accordingly, those who have already obtained H-1B status and are merely seeking to change employers or extend the H-1B status for additional years are not subject to the cap. Certain employer are exempt from the cap including: (1) institutions of higher education, (2) a nonprofit organizations affiliated with an institution of higher education, and (3) nonprofit or governmental research organizations. Individuals who have been working for a "cap exempt" employer and are seeking to change to a "cap-subject" employer must wait for an available visa beginning on October 1, 2013.

USCIS Announces the H-1B Cap has been reached

This afternoon, the USCIS announced that it has received sufficient petitions for the H-1B visa to reach the statutory cap for Fiscal Year 2012. The H-1B cap is 65,000 per fiscal year, and an additional 20,000 visas are allocated to advance degree graduates of United States universities. The "masters cap" was reached on October 19, 2011, and the regular cap was reached on November 22, 2011. Thus, any petition not filed before November 22 will be rejected. Filing will open up again for Fiscal Year 2013 on April 1, 2012 to begin work on or after October 1, 2013.

The cap does not affect individuals who have already been granted H-1B status and are extending their stay or moving to a new employer. Additionally, certain employers including universities and affiliated non-profit research centers and hospitals, are not subject to the cap. For more information on the H-1B cap, see our previous posting.
 

USCIS Restores Practice of Sending Notices to Counsel of Record

On October 7, 2011, we reported that the USCIS changed its procedures regarding the delivery of approval notices. Effective September 12, 2011, notices were sent to the applicants or petitioners instead of counsel, as had been the long standing practice. There were numerous complaints through several channels, and the USCIS hosted a "Stakeholder Engagement" session to receive feedback on October 12. A week later, Director Alejandro Mayorkas announced that the policy would be reversed, and the USCIS would again send approval notices to counsel of record. The reprogramming of the system to restore the policy will take approximately 6-8 weeks, but should eliminate the problems created by the sudden change in this long standing practice.
 

I-9 Interim Rule From 2008 Now Final

We previously reported on an interim I-9 rule from December 2008 (see U.S. Citizenship and Immigration Services Announces Revised I-9 Form).  Citizenship and Immigration Services now has finalized the interim rule. The final rule is effective May 16, 2011. As a practical matter, the final rule continues the provisions we discussed in this previous blog from two years ago. Employers therefore simply should continue to follow these provisions as they have for the past two years.

New H-1B Pre-Filing Registration On the Horizon

The Proposed Regulation

U.S. Citizenship and Immigration Services (CIS) announced a proposed rule that would require employers of H-1B workers to complete a pre-filing registration before submitting petitions for individuals subject to the annual H-1B cap. The earliest it would go into effect would be January 2012. Once effective, employers will complete an online registration for each prospective, cap-subject H-1B employee. CIS then will provide a confirmation instructing that the employer may file a petition on behalf of the specific person. Employers still may file petitions for more than one person, but a separate pre-registration will be required for each sponsored employee.

The goal of the new rule is to allow H-1B filings only for cases that will secure one of the limited H-1B visas each year. The current system allows filing of H-1B petitions until CIS announces that the cap has been reached. Because there usually is a delay between the announcement and employers continuing to file petitions, many petitions often are rejected. The new rule seeks to alleviate this problem by allowing only pre-registered employers to file cap-subject H-1B petitions.
 

As under the current system, CIS will use a random selection process in certain situations to ensure fairness in allocating H-1B visa numbers. For example, if CIS anticipates receiving more than 85,000 registrations for the April 1 filing date, it will provide a registration period of at least two weeks in March and conduct a random selection at the end of the registration period to allocate the 85,000 visas. In other cases, when H-1B visas continue to be eligible after April 1, CIS may close the registration period and conduct a random selection to allocate the remaining visas based upon the filings it received on the final registration day.

The Big Picture – Immigration Reform

CIS has been discussing this proposed regulation for several years. In 2007, employers filed approximately 130,000 petitions on April 1. CIS conducted a random selection process to allocate the limited number of visas and then rejected the surplus petitions. Employers whose petitions were rejected were left with nothing to show for the expenses they incurred in preparing and filing their petitions. 2007 also was the year immigration reform stalled. The hope had been that Congress would increase the number of H-1B visas and avoid the annual cap and corresponding frustration over rejected petitions, a frustration that grew the next year when 166,000 petitions were filed on April 1, 2008. However, the recession, the diversion of health care reform, and the 2010 mid-term elections have placed immigration reform on the backburner. Accordingly, CIS again is looking at administrative solutions to help employers achieve more predictability, if not relief, in the H-1B filing system. Until Congress increases or lifts the annual quota, this new pre-registration system likely will remain in place.

How to Comment on the Proposed Regulation

CIS is accepting written comments on the proposed rule for a 60-day period, from March 3 to May 2, 2011. Interested parties may submit comments referencing "DHS Docket No. USCIS- 2008-0014" via the web portal (www.regulations.gov), e-mail (rfs.regs@dhs.gov) or mail/courier (Chief, Regulatory Products Division, U.S. Citizenship and Immigration, Services, Department of Homeland Security, 20 Massachusetts Avenue, NW., Washington, DC 20529-2020).

Background Information on the H-1B Visa Category

The H-1B visa category is for the temporary employment of foreign nationals who will work in “specialty occupations.” Specialty occupations generally are those jobs for which at least a bachelor’s degree in a particular field is required. Examples include engineers, accountants and many information technology positions.

Cap-subject petitions are those filed for individuals acquiring the H-1B visa or status for the first time, such as F-1 students changing to H-1B status and individuals abroad who plan to enter the U.S. for the first time using an H-1B visa. These cases often are referred to as “cap-subject” cases because they require one of the 85,000 allotted visas (65,000 for bachelor-level candidates and 20,000 for U.S. graduate degree candidates). The 85,000 visas are for the federal fiscal year, which runs October 1 to September 30. Employers can file H-1B petitions up to six months in advance. For this reason, April 1 is the first day employers can file petitions for the next fiscal year, i.e. for an October 1 effective date.

The cap does not apply to one who already has an H-1B visa or status. An exception that private sector employers should note, however, is that an H-1B foreign national currently working for a university or affiliated nonprofit, a nonprofit research organization or a governmental research organization in most cases will be subject to the cap. These organizations are exempt from the H-1B cap, and when a foreign national transitions to a non-exempt employer, he/she then becomes cap-subject.

H-1B Employer Assessed Back Wages and Fined

The U.S. Department of Labor announced this week a $638,449 back wage consent order and $126,778 civil fine against a New Jersey IT consulting firm, Peri Software Solutions, Inc. The announcement indicated that the back wages resulted from the employer's failure to compensate the H-1B workers as required under Department of Labor regulations. The civil fine arose from two issues:  the employer failed to provide notice of its intent to employ H-1B workers and it sued former employees "for early cessation of employment."

The announcement may raise more questions than it answers concerning the specific facts involved, but it serves as a good reminder for H-1B employers that the applicable regulations are very exacting and can be costly when disregarded.  While this case appears to have involved a failure to pay the required wage rate, employers may be surprised to learn that the wage obligation continues as long as the H-1B petition remains valid, which in many cases can be for up to three years. Even after an H-1B worker has resigned or been terminated, the Department of Labor requires the employer to pay the worker's wages until U.S. Citizenship and Immigration Services (USCIS) has revoked the H-1B petition. The H-1B regulations in fact require employers to notify USCIS when the H-1B worker's employment ends. Requesting revocation of the petition therefore complies with USCIS regulations and avoids a potential Department of Labor assessment of back wages.

 

The civil fine similarly is a good reminder of the notice requirement of the H-1B petition process. Employers must provide notice at the place of employment that it intends to employ H-1B workers at that location. The notice may be provided through a paper posting or electronic communication and must contain information concerning the occupation, salary and intended period of employment. In situations where the job location may change, such as IT consulting positions, there are specific guidelines for when and where the notice must be provided.

 

The H-1B visa program is a useful means for employers to hire and retain qualified noncitizen professionals for positions that require at least a bachelor's degree. Examples include many IT positions, engineers and financial analysts. And although the regulations contain many traps for the unwary, with careful planning and counsel, employers can satisfy the requirements and concentrate on running their businesses.

Time is running out to file H-1B petitions for current fiscal year

At a December 1, 2009 seminar in New York, representatives of U.S. Citizenship and Immigration Services (USCIS) provided an update on the H-1B cap numbers for the October 2009 – September 2010 fiscal year (please see my earlier post for more on this topic -- The H-1B "Cap" - 2010 Fiscal Year Is The Canary In The Mine) .

While a recent report indicated that 58,900 petitions had been filed against the 65,000 cap, USCIS explained that the low number of filings for nationals of Chile and Singapore (who benefit from a set aside of 6,800 visas) means that there still are visas available. USCIS also confirmed that there were approximately 2,000 petitions filed in late November. This makes it difficult to predict how much longer visas will be able for the current fiscal year. Once the cap has been reached, employers will need to wait until April 1, 2010 to file a petitions requesting an October 1, 2010 effective date. Given this recent announcement, employers that still want to file H-1B petitions for the current fiscal year likely will need to do so soon. Experience has shown that there is a rush of petitions as the filings approach the 65,000 cap. The USCIS announcement concerning recent filings suggests that this rush already has begun.

New I-9 Form Implementation Delayed Until April 3, 2009

On Friday, January 30, 2009, USCIS announced that it was delaying the implementation of the new I-9 form and regulations published during the final days of the Bush Administration. On January 20, President Obama issued an executive order requiring review of all new regulations not yet effective.

Implementation of the new I-9 form, which for the first time requires new employees to distinguish between a representation of U.S. citizenship or non-citizen nationality and also reduces the number of acceptable documents, has been delayed for another 60 days. The new effective date for this form and the new requirements is April 3, 2009. The regulations also prohibited the use of some expired documents to demonstrate citizenship or identity. Existing regulations permit the presentation of expired driver’s licenses or passports. The now delayed regulation, however, requires all documents to be valid at the time they are submitted.

Unlike prior changes in the I-9 form, employers cannot use the new form until its effective date, and must use it after the effective date. Prior changes permitted the use of either form until the effective date of the new form, usually announced several months in advance. Thus, employers should continue to use the existing I-9 form until April 3, 2009. It is also possible that the new Administration may change the form or regulations before the new effective date.  Please continue to check our blog for future updates.

USCIS to Start Mailing Rejection Notices for April 1, 2008 H-1B Filings

On June 12, 2008, U.S. Citizenship and Immigration Services (USCIS) informed the American Immigration Lawyers Association that the H-1B random selection process has been completed. USCIS completed the intake and receipt processes for all filings as of May 24, 2008 and began mailing rejection notices the week of June 9. Therefore, if an employer has not yet received a filing confirmation (Form I-797C Notice of Action), it likely means that the petition was not selected in the random process and that the rejection notice will be forthcoming.

Individuals whose petitions were rejected still may have some planning options available to remain in the United States and/or continue working. For F-1 students with “STEM” degrees (Science, Technology, Engineering, Mathematics), if they are or will be employed by an employer that participates in the “E-Verify” employment eligibility verification system, they can request an additional 17 months of Optional Practical Training work authorization. Whether an employer wishes to participate in E-Verify requires careful consideration, as there are pros and cons depending upon the size and nature of the employer's workforce.

Other planning options for individuals may include pursuing or continuing graduate studies, converting to a dependent immigration status (such as F-2 or H-4) if there is a qualifying spouse, or pursuing TN work authorization for eligible Canadian or Mexican citizens.

If there is no other viable current option, there still remains the opportunity to file another H-1B April 1, 2009 for the next fiscal year (October 1, 2009 – September 30, 2010). In the meantime, employers that have been negatively impacted by the limited number of H-1B visas may wish to contact their congressional representatives to encourage increasing the quota as part of meaningful immigration reform.