On Oct. 23, 2023, the Department of Homeland Security (DHS) announced the Notice of Proposed Rulemaking (NPRM) to amend H-1B regulations. The purpose of the NPRM is threefold: 1) to modernize and improve the efficiency of the H-1B program; 2) to provide greater benefits and flexibilities; and 3) to improve integrity measures. This proposed regulation is open for public comment until Dec. 22, 2023. Comments can be submitted through the Federal eRulemaking Portal, referencing DHS Docket No. USCIS-2023-0005. 

The proposed rule will not take effect until the comment period ends and DHS publishes a final regulation. It is not clear if new provisions will be implemented in time for the upcoming cap registration season in March 2024.

This blog post summarizes the proposal’s key points.

  1. Modernization and Efficiencies

DHS intends to streamline requirements for the H-1B program with the following proposals:

Revisions to the definition of ‘Specialty Occupation.’ U.S. Citizenship and Immigration Services (USCIS) seeks to revise the regulatory definition and standards for a “specialty occupation” by clarifying the following:

  • There must be a direct relationship between the required degree field and the duties of the position.
  • A position will not qualify as an H-1B Specialty Occupation if it solely requires a general degree without further specialization (i.e., business administration, an unspecified quantitative field, or an engineering degree in any field of engineering).
  • Multiple degree fields required will not automatically disqualify the petition, but the petitioner has the burden of proof to explain how those disparate fields of study relate to the job duties.

Amend the Criteria for Specialty Occupation Positions. USCIS seeks to revise the criteria for specialty occupations by clarifying the following in the NPRM:

  • Currently, the regulatory criteria states that a bachelor’s degree is “normally” required for the position. The proposed rulemaking seeks to clarify that “normally” does not mean “always.”
  • Historically the regulations utilized a four-prong analysis to determine whether a position qualified as a specialty occupation. The proposed rule seeks to change this to a three-prong analysis by consolidating the second prong into the fourth.
  • When a beneficiary is staffed at a third party, DHS seeks to add the phrase “or third party if the beneficiary will be staff to that third party.” This change would allow the petitioner to use the third party’s typical requirements to prove specialty occupation.

Amended Petitions. Currently, an H-1B amendment is required when there is a material change in the terms of the H-1B employment, including a change in job duties, change in the worksite location outside the geographic area of employment, change in hours, or other changes that impact the conditions outlined in the underlying approved H-1B petition. The proposed rule seeks to clarify when an amended petition must be filed if there is a change in the worksite location. It also seeks to clarify when an amended or new petition is required for short-term placement of H-1B workers. The NPRM proposes the following: 

  • Any change in worksite location that reflects a material change requires a new petition.
  • A new or amended petition must be filed before the change takes place.
  • An amended or new petition is not required when the beneficiary is going to a non-worksite location to participate in employee development.

Deference. The proposed rule seeks to codify existing deference policy where adjudicators generally should defer to a prior determination involving the same parties and underlying facts if there is no material change. Codifying the deference policy is designed to better ensure consistent adjudications.

Maintenance of Status. According to the proposed rule, evidence of maintenance of status must be included with the initial filing of petitions that request to extend or amend the beneficiary’s stay. The NPRM also clarifies:

  • Petitioners should provide evidence with the initial filing, rather than waiting for a request for evidence.
  • The changes would impact the following employment-based classifications: E-1, E-2, E-3, H-1B, H-1B1, H-2A, H-2B, H-3, L-1, O-1, O-2, P-1, P-2, P-3, Q-1, R-1, and TN nonimmigrants.
  • Such evidence may include paystubs, W-2 forms, quarterly wage reports, tax returns, contracts, and work orders.

Eliminating the Itinerary Requirement for H Programs. The proposed regulation seeks to eliminate the itinerary requirement for H-1B and H-2 petitions, as the information provided in an itinerary is largely duplicative of information already provided in the Labor Condition Application (LCA).

Validity Expires Before Adjudication. DHS proposes to allow H-1B petitions to be approved or have their requested validity period dates extended if USCIS adjudicates and deems the petition approvable after the initially requested validity period end-date, or the period for which eligibility has been established, has passed. This generally would occur if USCIS deemed the petition approvable upon a favorable motion to reopen, motion to reconsider, or appeal.

  1. Benefits and Flexibilities

DHS proposes to modernize the definition of employers who are exempt from the annual statutory limit on H-1B visas and provide further benefits and flexibilities in the regulations. The proposed regulation allows additional flexibility for both beneficiaries and nonprofit and government research organizations.

H-1B Cap Exemptions. The NPRM proposes the following:

  • Replace “primarily engaged” and “primary mission” with “fundamental activity.” Such change would allow flexibility for beneficiaries whose work contributes (but does not predominately further) the qualifying organization’s purpose.
  • Clarify that a qualifying employer can have more than one “fundamental activity.”
  • Change the phrase “the majority of” to “at least half” to permit beneficiaries flexibility to qualify for cap-exempt status if they spend 50% of their time performing job duties at a qualifying research organization and 50% at a cap-exempt employer.
  • Clarify that performing at least 50% of the duties at a qualifying cap-exempt employer does not mean those duties need to be performed physically onsite.
  • Eliminate the requirement that the petitioner must show a direct correlation between the beneficiary’s duties and the essential purpose, mission, objectives, or functions of the qualifying organization.
  • Amend the definition of “nonprofit or tax exempt organizations” and eliminate the requirement to provide an IRS letter demonstrating the petitioner has been approved as a tax exempt organization “for research or educational purposes.” The petition still needs to provide documentation that it meets this requirement, but it does not need to be in the form of an IRS letter.

Automatic Extension of Authorized Employment. DHS proposes to provide flexibilities and address “cap-gap” issues by extending F-1 status and related work authorization until April of the relevant fiscal year. Currently, cap-gap is provided only until Oct. 1 of the relevant fiscal year.

Start Date Flexibility for Certain H-1B Cap-Subject Petitions. DHS also proposes greater flexibility on the requested H-1B employment start date listed on the Form I-129 petition to permit start dates that are after Oct. 1. Specifically:

  • The H-1B petition must be a nonfrivolous filing.
  • The requested start date cannot be more than six months beyond the filing date of the petition.
  • If the H-1B petition with the underlying cap-gap extension is denied before April 1, the cap-gap would end, and the F-1 student would have 60 days to depart the United States or take other action to maintain their status in the country.
  1. Integrity

DHS proposes to address H-1B Cap registration “abuse” by changing the way USCIS selects registrations. Several anti-fraud safeguards would be made to the current registration system to bolster the selection process and reduce the possibility of misuse and “gaming” of the system.

H-1B Registration System. Each beneficiary would have the same chance of being selected, regardless of how many registrations are submitted on their behalf. 

  • DHS proposes to select registrations by unique beneficiary rather than by registrations. Each unique individual would be entered into the selection process once, regardless of how many registrations were submitted on their behalf.
  • Related entities would not be allowed to submit multiple registrations for the same beneficiary.
  • The NPRM seeks to codify USCIS’s authority to deny an H-1B petition, or revoke an approved H-1B petition, if the underlying registration contains a false attestation or is otherwise invalid.

Beneficiary-Centric Selection. Beneficiaries would be allowed to have more than one registration submitted on their behalf, but each beneficiary would be entered in the selection process only once. Thus, if a random selection were necessary, selection would be based on each unique beneficiary, rather than each registration.

  • Previously, registrants have been able to bypass the passport requirement by indicating that they do not have a passport. The proposed regulation would require registrants to have a valid passport at the time of registration.
  • These changes may provide beneficiaries with greater autonomy with respect to their H-1B employment.

Bar on Multiple Registrations Submitted by Related Entities. Currently, DHS does not allow related entities to file multiple petitions for the same beneficiary. The proposed change would also bar related entities from submitting multiple registrations.

Registrations with False Information or that Are Otherwise Invalid. Currently, the regulations state if the petition contains material that is not true and correct, inaccurate, fraudulent, or misrepresents a material fact, the petition is subject to grounds for denial or revocation. DHS seeks to codify those requirements and extend the same requirements to the information provided in the registration. Furthermore, if a petitioner submits more than one registration per beneficiary in the same fiscal year, the proposed regulations will consider all of the registrations to be invalid.

Alternatives Considered. DHS plans to continue using the registration system and will not revert to the old paper-based filing system. Efforts will be made to continue to enhance the registration system, and DHS welcomes public comment on this issue.

Provisions to Ensure Bona Fide Job Offer for a Specialty Occupation Position. The proposed rule would codify USCIS’s authority to request contracts, work orders, or similar evidence to establish the contractual relationship between all parties as well as state the minimum educational requirements to perform the job duties. The rule also seeks to codify the requirement that the petitioner establish that non-speculative employment exists at the time of filing the petition. The NPRM would:

  • Provide USCIS authority to ensure the LCA properly supports and corresponds with the petition.
  • Alter the definition of “United States Employer” and remove the reference to Employer-Employee relationship from the definition.
  • Codify the existing requirement that the petitioner has a bona fide job offer for the beneficiary to work within the United States and add clarification that the bona fide job offer may include “telework, remote work, or other off-site work in the United States.”
  • Add a new requirement that the petitioner has a legal presence in the United States.

Beneficiary-Owners. DHS proposes to clarify that beneficiary-owners may be eligible for H-1B status even when the beneficiary possesses a controlling interest in that petitioner.

  • Conditions would apply when the beneficiary owns more than 50% or has more than 50% of the voting rights of the petitioner. Conditions would not apply if the beneficiary does not own a controlling interest.
  • The beneficiary must perform specialty occupation duties more than 50% of the time and can also perform non-specialty occupation duties that involve owning and operating the business.
  • Validity period of such petitions would be limited to 18 months. Subsequent extensions would not be limited and could be approved for up to three years.

Site Visits. DHS proposes to codify its existing authority to conduct site visits to maintain the integrity of the H-1B system. The NPRM would:

  • Establish consequences for failure to comply with site visits, including denial or revocation of the petition.
  • Clarify that public inspections would include onsite visits, interviews with officials, review of records related to compliance or any records USCIS deems pertinent to the facts related to the petition, as well as interviews with any individual.
  • Clarify that inspections may occur at the petitioner’s headquarters, satellite locations, or any location where the beneficiary will work, including the beneficiary’s home or third-party worksites.

Third Party Placement. DHS proposes to clarify that if an H-1B worker will be placed at a third party’s organization, USCIS will consider the requirements of that third party, and not the petitioner, to determine whether the position is a specialty occupation.

On Oct. 6, 2020, the Department of Homeland Security (DHS) announced the Interim Final Rule (IFR), “Strengthening the H-1B Nonimmigrant Visa Classification Program.” This rule will be effective 60 days after publication in the Federal Register, with stakeholders given a 60-day comment period on the substance, then another 30-day comment period on new information collections proposed in the rule.

The rule largely focuses on “revamping” two large components of the H-1B program: 1) the definition of specialty occupation; and 2) third part worksites.

The term “specialty occupation” in the current regulations is defined in 8 C.F.R. 214.2: “Specialty occupation means an occupation which requires theoretical and practical application of a body of highly specialized knowledge in fields of human endeavor including, but not limited to, architecture, engineering, mathematics, physical sciences, social sciences, medicine and health, education, business specialties, accounting, law, theology, and the arts, and which requires the attainment of a bachelor’s degree or higher in a specific specialty, or its equivalent, as a minimum for entry into the occupation in the United States.” In addition, the criteria as currently listed are:

  1. A baccalaureate or higher degree or its equivalent is normally the minimum requirement for entry into the particular position;
  2. The degree requirement is common to the industry in parallel positions among similar organizations or, in the alternative, an employer may show that its particular position is so complex or unique that it can be performed only by an individual with a degree;
  3. The employer normally requires a degree or its equivalent for the position; or
  4. The nature of the specific duties are so specialized and complex that knowledge required to perform the duties is usually associated with the attainment of a baccalaureate or higher degree.

8 C.F.R. 214.2(h). In the IFR, DHS is dropping the words “usually” or “normally required,” or “common to the industry” and will require the petitioner to establish that a bachelor’s degree is a specific specialty or its equivalent is a minimum requirement for entry into the occupation by showing that this is ALWAYS the requirement for the occupation as a whole.

Another large area of proposed change is with Third Party Placements. There will be a new employer-employee relationship definition, as described below. In addition, if the H-1B beneficiary’s worksite is a third-party site, that will be a factor in determining whether an employer relationship with that beneficiary exists. Employers will also need to review carefully whether there is a co-employment issue with the third-party placement firm. Third-party sites will now be subject to site inspections.

Below is a summary of the proposed changes, by topic:

  1. Site visits: USCIS may conduct on-site inspections and other compliance reviews any time after the filing of an H-1B petition. USCIS can also conduct a pre-approval inspection for an H-1B petition. The site inspection could be at the petitioner or the third-party worksite. Non-cooperation may result in the denial or revocation of the H-1B petition.
  2. Employer-employee relationship: The petitioner must establish that the offer of employment is based on a valid employer-employee relationship. The following are all the factors USCIS will weigh:
    1. Where the H-1B beneficiary does not have an ownership interest:
      1. Whether the petitioner supervises the beneficiary, and where the supervision takes place;
      2. If the supervision is not at the petitioner’s worksite, how the petitioner is able to maintain the supervision;
      3. Whether the petitioner has the right to control the work of the beneficiary on a day-to-day basis and assign projects;
      4. Petitioner provides the tools for the beneficiary to perform the duties;
      5. The petitioner hires, pays, and can fire the beneficiary;
      6. The petitioner evaluates the work product of the beneficiary;
      7. The petitioner claims the beneficiary as an employee for tax purposes;
      8. The petitioner provides employee benefits;
      9. Beneficiary uses proprietary information of the petitioner to perform work;
      10. Beneficiary produces an end product that is directly linked to the petitioner’s line of business;
      11. The petitioner has the ability to control the manner and means the work is performed.
    2. Where the H-1B beneficiary does have an ownership interest, there will be additional factors, including:
      1. Hiring, firing, and rule setting for the beneficiary and its work;
      2. Beneficiary reports to someone higher in the entity;
      3. If the beneficiary is able to influence the entity;
      4. Whether the contracts or agreements make it clear the beneficiary is an employee;
      5. Whether the beneficiary shares in the profits, losses, and liabilities of the entity.
  3. Specialty Occupation defined:
    1. Theoretical and practical application of highly specialized knowledge in fields of human endeavor, and
    2. The position requires a U.S. bachelor’s degree or higher in a directly related specific specialty. The studies must be directly related to the position, and the position is not considered specialty occupation if attainment of a general degree, such as business administration without a specialization, is sufficient. A position may allow a range of degrees, but each qualifying degree field must be directly related.
  4. Criteria for specialty occupation- must satisfy at least one of the following:
    1. U.S. bachelor’s degree or higher in a specific field is the minimum requirement for the position;
    2. U.S. bachelor’s degree or higher in a specific field is the minimum requirement for entry into parallel positions at similar organizations in the industry;
    3. Employer has a practice of requiring a U.S. bachelor’s degree or higher in a specific field for the petitioner. There must be proof that the job duties require such a degree;
    4. Specific duties are so specialized, complex, or unique that they can only be performed by one with a U.S. bachelor’s degree or higher in the specific field.
  5. Demonstrating sufficient work
    1. Petitioner must demonstrate there is sufficient work for the H-1B duration requested;
    2. If a third-party worksite, the petitioner must submit contracts, work orders, or other evidence that there is 1) sufficient specialty occupation work, and 2) a valid employer/employee relationship.
  6. Maximum validity period requested on an H-1B petition: three years for H-1B; one year for third-party worksite.

Redefined terms:

  • Third-party worksite: A worksite that is not the beneficiary’s residence in the U.S. that is not owned or leased, and not operated by the petitioner.
  • U.S. Employer: Engages the beneficiary to work; has an employer-employee relationship; has an IRS FEIN.
  • Worksite: Physical location where the work is actually performed. Each location must be on the LCA.

In response to the Trump administration’s stance on immigration enforcement, California is considering legislation (Assembly Bill 450 (Chiu)) which would prohibit employers from providing federal immigration officials with access to nonpublic areas of the workplace without a judicial warrant. While aiming to provide new protections to workers, the bill’s broad language does not eliminate any employer obligations currently arising from Federal law. It does, however, have the potential to create contradictory and burdensome new requirements for employers in cases of government worksite investigations and internal audits conducted for compliance purposes.

AB 450 was introduced in February of this year and has been amended several times. The bill specifically references I-9 audits in many sections, while generally referencing government worksite enforcement actions in others. AB-450 would require employers to, among other things, notify all employees and their representatives, in writing, within 24 hours, that a worksite enforcement action has occurred. The requirement for notification of employee representatives probably refers to unions, but there are other circumstances when an employer may know an employee has legal representation (i.e. active workers compensation claims brought on behalf of employees). This requirement could arguably require an employer to maintain a list of the representatives of all employees for use in the event of such action. Moreover, the bill’s broad language may extend its notification requirements to include routine site visits performed for H-1B, L-1, and other nonimmigrant visa workers, as well as any other immigration-related inquiries conducted by any U.S. government agency, such as the U.S. Department of State or the U.S. Department of Labor. In addition to requiring notice in cases of government action, the bill would also require employers to notify the California Labor Commissioner prior to performing a self-audit of Forms I-9, a process many employers undertake to ensure compliance with Federal law.

The penalties AB 450 proposes for violations are significant. Employers who fail to comply could be assessed from $2,000 to more than $5,000 for a first violation and from $5,000 to more than $10,000 for each subsequent violation.

AB 450 passed the Assembly on May 31 and has been referred to the Senate Labor and Industrial Relations and Senate Judiciary Committees. Because it is keyed fiscal, the deadline for action by these policy committees is June 14, just prior to the legislature’s month long summer recess. We will keep you updated on the bill’s progress as it could have a significant impact on the internal policies of any California employer.

The U.S. immigration agency’s busiest day of the year was marked with reminders about the dark side of the H-1B visa program.  Acceptance of H-1B cap-subject petitions started on April 3, 2017. But the flurry of H-1B filings were met with announcements from agencies involved with the H-1B program about measures designed to tighten policies and further regulate the H-1B program. These agency announcements indicate a coordinated message of cracking down on H-1B fraud in order to protect the U.S. worker.

USCIS Press Release and Policy Memorandum  

While some U.S. Citizenship and Immigration Services (USCIS) employees were busy accepting what is expected to be several thousand H-1B petitions at its Vermont and California Service Centers on April 3, 2017, opening day of the 2017 H-1B lottery, other USCIS employees were putting the finishing touches on a press release outlining new plans to combat employer fraud and abuse in the H-1B visa program.

USCIS Press Release:

The release, titled “Putting American Workers First: USCIS Announces Further Measures to Detect H-1B Visa Fraud and Abuse,” was a clear signal by USCIS that it plans to improve the integrity of the H-1B program and ensure that the program is in no way harming U.S. workers. USCIS said that its site visits, operated by its Fraud Detection and National Security (FDNS) directorate, will focus on employers who place employees offsite as well as employers who are H-1B dependent. H-1B dependency, which is defined by statute, means a high percentage of an employer’s workforce is made up of H-1B workers. This initiative is yet more evidence that USCIS is taking aim at third-party staffing companies. The press release also provided a USCIS email address for reporting suspected incidents of H-1B fraud and abuse and also reminded the public about additional ways it can let authorities know about possible misuse of the H-1B program via a Department of Labor form and by contacting Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) unit.

USCIS Policy Memorandum:

On March 31, 2017, USCIS issued a policy memorandum to rescind the Dec. 22, 2000 guidance on H-1B computer-related positions.  This March 2017 memorandum includes guidance that the Occupational Outlook Handbook (OOH), a long relied-upon resource for petitioners and attorneys alike to classify jobs and to confirm their status as specialty occupations, should no longer be used as the main resource to determine whether a position is a specialty occupation position.  The guidance focuses heavily on the job code for “Computer Programmers,” which it notes may not qualify as a specialty occupation because most programmers have a bachelor’s degree, but some do not.  Most notably, this guidance includes discussion about the Wage Level and corresponding prevailing wage, suggesting that a job that is coded at a Level I prevailing wage should be scrutinized heavily because it would “likely contradict a claim that the proffered position is particularly complex, specialized, or unique compared to other positions within the same occupation.”

Department of Justice’s Immigrant and Employee Rights Section

The Department of Justice’s Immigrant and Employee Rights Section (IER), formerly known as the Office of Special Counsel for Immigration-Related Unfair Employment Practices, also chimed in on H-1B cap opening day with a reminder to H-1B employers that they may not discriminate against U.S. workers. IER, which is responsible for enforcing the anti-discrimination provision of the Immigration and Nationality Act (INA), explained in its press release that employers may violate the INA if they prefer to hire H-1B visa holders over U.S. workers.

Department of Labor’s Press Release

The Department of Labor (DOL) is the most recent agency to issue a press release for the purpose of combatting H-1B fraud, expressing support for the efforts of its colleagues at USCIS and DOJ, while adding its own plans. In addition to increasing its coordination with other federal agencies to investigate and prosecute misuse of the H-1B program, DOL said it is considering changes to the Labor Condition Application, which is a required part of the H-1B visa petition process, “to provide greater transparency for agency personnel, U.S. workers and the general public.” The DOL also said it would continue with its stakeholder engagements on how to improve the H-1B program so as to provide greater protections to US workers.

GT will continue to follow and report on and analyze these agency announcements and guidance.

Employers take note: If you file a new Labor Condition Application (LCA) for an H-1B employee to reflect a change in work location that is outside the metropolitan statistical area (MSA) of the original worksite stated on the LCA and corresponding H-1B petition originally filed for the H-1B employee, then you must also file an amended or new H-1B petition to reflect this material change.  Failure to do so will be considered a material deficiency by U.S. Citizenship and Immigration Services (USCIS) and grounds for revocation of the underlying H-1B petition.  Employers should also note that USCIS is expected to make 30,000 administrative H-1B and L-1 site visits this year with this being one of the agency’s top investigative priorities, thereby increasing the need for employers to ensure compliance with this rule for all active H-1B employees.

Continue Reading EFFECTIVE IMMEDIATELY: Restrictive AAO Decision Finds Change of Work Area Requires H-1B Amendment Filing

FOR THE WEEK OF SEPT. 26, 2022

DHS

  • TPS for Burma extended 18 months
    • Extended from 11/26/2022 through 5/25/2024
    • Notice will be published in the Federal Register on 9/27/2022

IER – DOJ activity

  • Focus on online job postings containing discriminatory preferences
  • Postings discriminated against non-U.S. citizens because they contained citizenship restrictions
  • Previous investigations in June 2022 regarding job postings that showed preference for foreign workers
  • Carefully review job postings and provide training to talent acquisition/recruiters

FOR THE WEEK OF SEPT. 19, 2022

USCIS

  • USCIS accepts premium processing for certain pending EB-1 and EB-2 I-140 petitions
    • Starts September 15, 2022
    • Multinational manager I-140s received by USCIS on or before 1/1/2022
    • National interest waiver (NIW) I-140s received by USCIS on or before 2/1/2022
    • Adjudication within 45 days of filing premium processing request

FOR THE WEEK OF SEPT. 13, 2022

I-9

  • TPS Extended for Venezuela
    • EADs automatically extended through Sept. 9, 2023.

USCIS

  • USCIS submitted a declaration in a Federal court case about employment-based visa number availabiity
    • EB-1, EB-2 and EB-3 unavailable for the rest of September 2022
  • Narrower “public charge” rule adopted, effective December 2022
    • Less stringent than Trump-era public charge rule
  • FY2023 EB AOS FAQs
    • Employment-based limit for immigrant visa numbers in 2023 projected to be 200,000, which is 80,000 fewer than 2022

FOR THE WEEK OF SEPT. 6, 2022

I-9

  • Auto extend for Employment Documents
  • EADs: using Nunc pro tunc to obtain an Auto extension
  • Proposed regulation about remote document inspection
  • COVID-related flexibility regarding remote document inspection ending in October 2022

DOL

  • Review of H-2B worksites for compliance
  • $7.2 million investment in PERM system

USCIS

  • Flexibility regarding RFE deadlines extended for the last time
  • DACA final rule announced
  • Credit card usage for filing fees
    • Form G-1450 per application/petition filed
    • $24,999.99 per day limit
    • EB-5 payment for I-956F forms with $17,795 filing fee is successful

IER – DOJ activity

Acquisitions/M&A

Third-party contractors

  • FDNS visits to customer sites to verify third-party contractors
    • FDNS focus on contractors who hire TN, H-1, H-1B1 and E-3 employees and place them at customer sites.
    • Prepare for visits by any government employee who may want to interview direct employees and/or contractors.

Update on USCIS Efforts to comply with “Buy American and Hire American”

On April 4, 2018, the Director of USCIS, Lee Francis Cissna, penned a letter to Chairman Grassley to update him on USCIS’ efforts to comply with the April 2017 Executive Order, “Buy American, Hire American.”  The contents of the letter are broken into three parts:  1) Current action items for USCIS; 2) Past items; and 3) Proposed future items to address. Below are the pending changes, proposed changes, and made changes that have occurred since the Executive Order:

Continue Reading Update on USCIS Efforts to comply with “Buy American and Hire American”

shutterstock_98569004This week, the Student and Exchange Visitor Program (SEVP) published its quarterly “SEVIS by the Numbers” report announcing that there are over one million international students in the United States.  Many of these students will seek employment with U.S. companies using work authorization granted to them pursuant to their F or M visa status.  In response to this growing population, employers must familiarize themselves with certain compliance requirements that were passed in May 2016, as outlined below.

By way of background, the SEVP monitors F and M students and their dependents while in the United States to ensure that rules and regulations are followed by international students. Additionally, the SEVP manages the Student and Exchange Visitor Information System (SEVIS), which contains information on international students and the schools that enroll them.

According to the July 2016 “SEVIS by the Numbers” report, published on Aug. 30, there are 1.11 million international students with F (academic) or M (vocational) status enrolled at schools in the United States as of July 2016, demonstrating a 5.5 percent increase from July 2015. The top three countries of citizenship of these international students are China, India and South Korea. By continent, 77 percent of all F and M students originate from Asian nations, followed by 7 percent from Europe, 6 percent from North America, 5 percent from South America, 4 percent from Africa and 0.5 percent from Australia/Pacific Islands.  The report also provides statistics on F and M students by gender, indicating that 57 percent of all F and M students studying in the United States are male. According to the report, Eastern Europe sends the most females (57 percent of F and M females studying in the United States) and Western Asia the most males (76 percent of males studying in the United States).

Further, the July 2016 report indicates that 42 percent of all F and M students (or 466,964) are studying in STEM fields. Thus, the number of active STEM F and M students studying in the United States has increased by 15.2 percent since July 2015. Of the 466,964 F & M students studying in STEM fields in the United States, 87 percent (406,732) originate from Asia.

Pursuant to the May 10, 2016 STEM OPT extension rule, students who have earned a STEM degree from a U.S. school are eligible for a 24-month extension of their Option Practical Training (OPT), for a total opportunity of up to 36 months of employment authorization in the United States (a seven-month increase from the prior 17-month STEM OPT extension). The extended time period offers a number of benefits to both international students and U.S. employers wishing to hire them. Most notably, the seven-month extension provides F-1 STEM OPT holders additional opportunities to be selected in the annual H-1B lottery. As the number of international students continues to rise, the annual H-1B cap will continue to be challenged, heightening the benefit of additional opportunities to apply under the H-1B cap.

In addition to offering substantial benefits, the May 10 rule imposes additional compliance requirements on STEM OPT employees, their schools and their employers:

  • In order to employ an F-1 STEM OPT holder for the duration of his or her 24-month extension, the employer must have a Federal Employer Identification Number (FEIN) and be enrolled in E-Verify.
  • STEM OPT employees must work with their employer to complete Form I-983 “Mentoring and Training Plan.” Employers must evaluate student progress by signing an evaluation on an annual basis – first during the initial 12-month period and finally at the conclusion of the STEM OPT extension.
  • Employers are required to attest that they are not replacing full- or part-time, temporary or permanent U.S. employees with STEM OPT employees.
  • Employers must report the early departure of a STEM OPT employee to the student’s Designated School Official (DSO) within five days of departure when the student terminates or departs his or her employment before the end of the authorized OPT period.
  • Employers of STEM OPT employees are required to guard against adverse action to full- or part-time U.S. employees by ensuring the STEM OPT employee’s duties, hours, and compensation are commensurate with similarly situated U.S. employees; the company has sufficient resources and trained personnel available to provide training in the specified opportunity; and the opportunity will help the student attain his or her training objectives.
  • STEM OPT employees must update their DSO about any personal name or address changes, as well as any changes to his or her employer’s name or address.
  •  STEM OPT extensions are only available to students with degrees from school accredited by an accrediting agency recognized by the U.S. Department of Education.

Further, under the new STEM OPT rule, DHS will conduct announced and unannounced employer-site visits to ensure that international students and employers are following the formal training plans that were provided to DHS in order to obtain STEM OPT extensions.

In light of the increasing number of international students, employers should be aware of the updated requirements for STEM OPT extensions. U.S. employers should also verify these employees’ need to change to H-1B status to ensure continued work authorization beyond the expiration of their OPT. U.S. employers should plan to file all H-1B cap petitions for FY2018 by March 31, 2017.

Today DHS released an advanced copy of its final rule allowing foreign students with degrees in Science, Technology, Engineering, and Mathematics (STEM) to extend their Optional Practical Training (OPT) for an additional 24 months.  DHS will publish the final rule in the Federal Register this Friday.  The rule will go into effect on May 10.  Beginning May 10, students who are currently in the U.S. under their 17-month STEM OPT extension will be able to file to extend their OPT for an additional 7 months.

This rule gives foreign students with STEM degrees the opportunity to work in the United States for up to 36 months.  The extended time period offers a number of benefits to foreign students and U.S. employers that wish to hire them.  By defining fields of study that qualify for STEM in accordance with the Department of Education’s Classification of Instructional Program (CIP) categories, the new rule expands on the permissible fields of study that were authorized under the old STEM rule.  Notably, increasing OPT work authorization from 29 months to 36 months will give F-1 STEM OPT holders more chances at being selected for an H-1B visa number in the annual H-1B lottery.  The rule also redresses the U.S. District Court for the District of Columbia’s vacatur of the 2008, 17-month Optional Practical Training (OPT) STEM Extension rule, and part of the contentious legal battle surrounding the overall validity of the STEM extension program, which is expected to be decided by a Federal court in May.

In addition to offering significant benefits, the rule imposes additional compliance requirements on STEM OPT workers and the U.S. employers who hire them:

  • STEM OPT students, with the cooperation of their employers, will be required to prepare and execute a formal training plan that identifies learning objectives and plans for achieving those objectives.  This information will be collected on Form I-983, Training Plan for STEM OPT students.  Employers will also need to evaluate student progress by signing an evaluation on an annual basis – the first one during the initial 12-month period and the final one at the conclusion of the STEM OPT extension.
  • STEM OPT students must inform their designated school official (DSO) about any name or address changes, and any changes to their employers’ names or addresses.
  • Employers hiring STEM OPT workers will be required to guard against adverse action to full- or part-time U.S. workers by ensuring the STEM OPT employee’s duties, hours, and compensation are commensurate with similarly situated U.S. workers; the company has sufficient resources and trained personnel available to provide training in the specified opportunity; and the opportunity will help the student attain his or her training objectives.
  • Employers will be required to attest that they are not replacing full- or part-time, temporary or permanent U.S. workers with STEM OPT students.
  • STEM extensions will only be available to students with degrees from schools accredited by an accrediting agency recognized by the U.S. Department of Education.
  • Employers must notify the foreign student’s DSO within five business days of when a foreign student terminates or leaves his or her employment before the end of the authorized OPT period.

Under the new rule, DHS will conduct announced and unannounced employer-site visits to ensure that employers and foreign students are following the formal training programs that were provided earlier to DHS to obtain STEM OPT extensions.  These site visits are designed to reduce fraudulent use of the F-1 status.  DHS will provide a notice of inspection at least 48 hours prior, unless the site visit is the result of a complaint or potential noncompliance with the STEM OPT extension regulations.

As welcome news to employers and foreign students, the rule extends cap-gap protection for those H-1B petition beneficiaries that are selected in the H-1B cap.  Under the rule, an F-1 student’s duration of status and employment authorization are automatically extended until September 30 if an H-1B petition is timely filed on behalf of the student, and approved by U.S. Citizenship and Immigration Services (USCIS).

In light of this new rule, employers should review their OPT population to determine which workers will be eligible for further STEM extensions.  U.S. employers should also verify whether these employees need to change to H-1B status to ensure there is no interruption in their U.S. work authorization beyond the expiration of their OPT.  U.S. employers should plan to file all H-1B cap petitions for FY 2017 by March 31, 2016, keeping in mind some new factors affecting this year’s H-1B cap season.

GT will provide an additional update to this situation once USCIS releases Form I-983 and related guidance.