Many employers hire talented university graduates in Science, Technology, Engineering and Mathematics (STEM) because these students typically bring updated, sophisticated technical skills that hold the keys to innovation and business success.

The U.S. government has recently announced an expanded program that provides many foreign STEM graduates with an extended employment period of 24 months over and above their 12-month period of F-1 Optional Practical Training (OPT). Only employers enrolled in the E-Verify program can participate in this expanded STEM OPT opportunity. In contrast to the tight quota restrictions governing many H-1B petitions, there are no numerical limitations on the number of STEM graduates who can qualify for employment eligibility. Nor are there any filing fees required of the employer. Rather, a qualifying STEM graduate can receive an Employment Authorization Document (EAD) that will allow him/her to be employed without significant delay.

The basic value to employers of this expanded STEM OPT program is the following:

  • It provides qualifying STEM graduates with up to two years of employment authorization over and above the one-year period of OPT previously granted to qualifying F-1 foreign students;
  • An employer can employ STEM graduates for up to a three-year period of time;
  • Much of the application process is performed directly by the STEM student, thereby minimizing the time and expense required from the employer to qualify STEM graduates for employment eligibility; and
  • Strategically, this three-year period of employment and immigration status provides an employer with a meaningful opportunity to retain its STEM student employees for the long term by providing multiple opportunities to file an H-1B petition and/or to sponsor a STEM graduate for permanent resident status.

This new STEM OPT program, while expanding the period of allowable employment, also imposes some new responsibilities on employers. Specifically, the law requires an employer to define a meaningful training program for any employed STEM graduate as well as to make resources available to supervise, evaluate and administer the educational/training component of the employment.

More specifically, in contrast to the STEM OPT provisions valid through May 9, 2016, the new Rule creates the following employer responsibilities:

  • Employers now need to develop and define, together with the STEM student, a training program that will further the educational objectives of the student’s STEM course of study;
  • The training program needs to be formally filed on a new government form—the I-983—to the STEM student’s university for review and approval;
  • The employer needs to establish its intention to pay the STEM student a competitive, non‑discriminatory wage that is calculated based either on the employer’s internal wage structure and/or the prevailing wage figure of similarly employed professionals in the local area;
  • The employer needs to certify that the STEM student will not displace a U.S. worker; and
  • The employer needs to agree that it will notify the STEM student’s university of any major changes in the student’s employment under the STEM OPT program.

In short, this new Rule meaningfully expands the duration under which an employer can hire a STEM graduate and creates better long-term options enabling an employer to potentially retain the student on a longer-term basis. But the law further imposes legally enforceable obligations on the employer to inject a training component into the employment position and to meet certain other standards in its employment of the STEM student.