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January
2009 Newsletter January 8, 2008 DEAR CLIENTS AND FRIENDS: This is an important, first reminder to our current, past, and potential clients that the H-1B application period will open on April 1, 2009. If you are intending to file for new H-1B employment, you may very well be subject to the H-1B cap (or quota). If so, I strongly advise you to begin the H-1B application process soon, since it is imperative that filings subject to the H-1B quota be received at U.S. Citizenship and Immigration Services (USCIS) promptly on April 1, 2009. Any delay in filing may very well result in a rejection of the H-1B petition owing to the expected exhaustion of the H-1B visa numbers. So, please note: Although H-1B positions subject to the cap cannot actually begin until October 1, 2009, it is important to file the petition for arrival on April 1, 2009, owing to the anticipated high demand on the finite number of H-1B visas. For the past two years, the H-1B cap has been reached within 24 hours of the date on which the application period opened. As a result of the number of filings exceeding the H-1B quota allotment, USCIS has instituted a lottery system to select filings sufficient to meet the quota. While we understand that the current recession may temper employers’ immediate needs for H-1B workers and thus result in fewer H-1B filings than has been the case for the past several years, the fact remains that the H-1B quota is limited and will probably be insufficient to meet the full demand by employers. For the foreseeable future, we must assume that the H-1B cap will be reached on the very first day and as such, it is imperative that cap-subject H-1B petitions be filed as soon as the application period opens. Over the past five years, the cap has been exhausted each year at a progressively earlier date, and in the past two years, a lottery system was instituted since the volume of new H-1B petitions on the first day exceeded the cap. Unless Congress increases the H1B cap, the best strategy certainly for this year will be to file on the opening day of the H-1B application period. In short, it is a situation of "first come, first served," and even here, the allocation of an H-1B visa number may still be subject to a lottery distribution. Therefore, we encourage employers to make hiring plans and extend job offers now in order to file their H-1B petitions so as to arrive at USCIS exactly on the first day of the new application period on April 1, 2009. If you have questions about the H-1B cap and/or wish to discuss the impact of the H-1B cap on your own situation, we encourage you to contact us. Let's go over a few fundamentals that pertain to the H-1B cap. WHAT IS THE H-1B CAP? The H-1B cap is the annual limit of 65,000 new H-1B visas that are available each federal fiscal year. (The fiscal year runs from October 1 - September 30.) The maximum level of 65,000 H-1B visas is set by Congress. The actual number of usable H-1B visas is less than this figure since free-trade agreements with Chile and Singapore borrow a portion of the H-1B numbers under the cap. As a consequence, the number of available H-1B visas for the worldwide quota actually stands at 58,200 (although there is a slim possibility that these unused free trade "H-1B1" visas will be added back into the cap at the end of the fiscal year). Additionally, there are an extra 20,000 H-1B visas available for foreign workers who have graduated from a U.S. university with a Master’s or higher degree (such as a Ph.D., J.D., LL.M., M.D.). While this addition of 20,000 extra H-1B visas for this select category of workers was a welcome addition to the H-1B laws, demand for H-1B workers was so high that last year even these 20,000 H-1B visa numbers were claimed on the very first day. USCIS received approximately 31,200 petitions for workers with Master’s or higher degrees from U.S. universities, requiring USCIS to first conduct a lottery specifically for the 20,000 extra visa numbers. Any U.S. Master’s degree holders who did not get selected in that first lottery were then “spilled over” and included in the “regular” lottery for the 65,000 visa numbers for workers with only a Bachelor’s degree (or with a Master’s or higher degree that was earned overseas). Thus it must be kept in mind that while having a Master’s or higher degree from a U.S. university increases chances of receiving an H-1B cap number, it does not guarantee getting a cap number. WHO IS SUBJECT TO THE H-1B CAP? Generally, the H-1B cap applies to the following two situations: 1) any first-time H-1B applicant; or 2) to foreign nationals already holding H-1B status who are moving from university to non-university employment. (Typical examples: F-1 students who have "optional practical training" (OPT) and need to change into H-1B status for the first time; H-1B university researchers who are moving into employment in the for-profit sector; prospective hires who are overseas and have never worked in the United States in H-1B status before; etc.) It is important to consult with legal counsel to determine whether or not an individual case is subject to the H-1B cap. WHAT ARE THE KEY DATES IN THE H-1B PROCESS? At this present moment, there are no more new H-1B visas available for a foreign national worker to either enter the United States or receive a "change of status" to start work any earlier than October 1, 2009, unless the case can been filed on a "cap-exempt" basis (see further below). However, the vast majority of foreign national new hires working at private for-profit companies are subject to the H-1B cap. We refer to this most common category of foreign workers as being "cap-subject." No foreign worker who is cap-subject can obtain H-1B status and start working before October 1, 2009. By law, H-1B petitions can be filed up to six months prior to the requested start-date for the H-1B status. Therefore, to have H-1B status starting on October 1, 2009, employers can file H-1B petitions starting on April 1, 2009. For the past several years, the H-1B cap has been exceeded each year. Once the H-1B numbers have been used up, cap-subject H-1B petitions cannot be approved for the balance of the federal fiscal year. Each year, the H-1B cap has been reached more quickly. While we obviously do not know when the cap will be reached this year, we believe that the cap will be exceeded again on the opening day of the new H-1B application period. As such, the lesson from recent years is to file H-1B petitions for arrival at USCIS exactly on April 1 so as to maximize the chances that an H-1B number will be available so as to enable the petition to be approved. To be fully prepared to have your H-1B petition arrive at USCIS on April 1, 2009, requires advance planning. As many employers and H-1B workers may recall, one key prerequisite to filing an H-1B petition is obtaining an approved “Labor Condition Application” (LCA, Form ETA-9035) from the US Department of Labor (DOL). The LCA is a required 5-page form in which the prospective employer promises to pay the required wage for the position, as well as to comply with other H-1B working condition requirements (no benching without pay, equivalent benefits, etc.). For the past several years, LCAs have been submitted to DOL online, with the DOL website approving the vast majority of LCAs instantly. Recently, DOL has warned that review of LCAs will become stricter, with DOL officers individually reviewing the cited wage source in LCAs more closely and more often. This may mean that LCA applications may take much longer, potentially days or even weeks to be approved, thus delaying H-1B filing. This possibility further counsels beginning new H-1B cases early, preferably during the month of February, so that the case is signed, packaged and ready to arrive at USCIS on April 1, 2009. HOW DOES THE H-1B CAP POTENTIALLY AFFECT YOU? For employers that anticipate a need to hire any foreign national who will need H-1B status on or after October 1, 2009, our firm recommends that the interviewing and selection processes should be finalized at this time. Cap-subject job offers should be made with a clear understanding that the worker will not be able to start work prior to October 1, 2009. Once the hiring decision is finalized, all parties should take prompt and appropriate steps to prepare and file the H-1B petition for arrival at USCIS on April 1, 2009, with the understanding that USCIS may again need to institute a random lottery system to allocate an inadequate number of H-1B visa numbers to such timely filed petitions. WHAT CASES ARE EXEMPT FROM THE H-1B CAP? Given the harsh reality of the H-1B cap and especially the lottery for the past two years, it is critically important to consider whether a case might be exempted from the H-1B cap. If a case is exempted from the H-1B cap, it can be filed and approved at any time of the year. Therefore, the first responsibility in H-1B practice is to determine whether a new case truly is subject to the H-1B cap. Let's summarize briefly the major grounds under which a case would be exempt from the H-1B cap: 1. Employment at an institution of higher education, or a non-profit entity that is related or affiliated to an institution of higher education— this includes situations where the employer might itself be a for-profit entity (which would normally not be cap-exempt), but the employee will perform job duties AT a qualifying institution that directly and predominately further the normal, primary, or essential purpose, mission, objectives or function of the qualifying institution; 2. Employment at a non-profit research organization or a governmental research organization; 3. Employment of an H-1B worker who has already been counted against a previous year’s H-1B cap and has not used up his/her full allotment of H-1B eligibility; 4. Physicians who have previously received J-1 waivers based on service in medically underserved areas; 5. Split employment situations in which the foreign national is concurrently working part time at a university (or cap-exempt entity) and the balance of time at a for-profit (or cap-subject) business; 6. H-1B extensions filed for foreign nationals already working at "cap-subject" employers. Determining whether a case is subject to or exempt from the H-1B cap is a complex legal question that requires examination of a range of factors, including: the structure of the petitioning employer, the particular facts, and the immigration history of the individual. As a recipient of this email, we encourage you to contact us if you have any questions about the information contained in this email and how it may affect you. Thank you and we hope to hear from you. Cordially, ROBERT D. ARONSON This memorandum is one of a series of communications prepared as a general public service to our clients and friends. The information herein presented is not intended nor should it be utilized as legal advice on any specific situation. Furthermore, given the rapid pace of change, the veracity of this information is constantly subject to modification and/or reversal. Rather, this piece represents a good faith attempt to orient clients and other interested parties served byAronson& Associates to current immigration developments. This piece in no manner supercedes the need to seek competent legal advice when engaged in activities carrying possible immigration-related consequences. |
Aronson & Associates,
P.A. |