With widespread media attention on the Deferred Action for Childhood Arrivals (DACA) policy expiration and immigration policy negotiations, it is important not to overlook the start of the H-1B “cap” case season. With no time to waste, employers must determine their need for H-1B cap filings and immediately start preparation, well in advance of the five-day filing window starting April 2, 2018. The H-1B program changes seen in the past year, while significant, have been limited to policy and practice changes. At this time, the numerous proposals for changes to law and regulation are still only proposals. The H-1B cap filing timing and procedures have not changed and, despite the challenges discussed below, the cap season is still a high priority and necessity for many US employers.
The H-1B visa classification is appropriate for foreign workers who will fill positions that require at least a bachelor's degree or equivalent. There is an annual limit of 65,000 first-time H-1B filings, and an additional 20,000 first-time H-1B filings can be accepted for foreign nationals who have completed US master's or higher-level degrees. These numerical limitations are referred to as the H-1B cap. It is a virtual certainty, based on historical trends, that both the regular and advanced degree H-1B caps will be exceeded within the minimum five day filing period. This minimum filing period is the first five business days of April, meaning that for Fiscal Year 2019 (FY19), this filing period is April 2-6, 2018. In past years, when the number of filings received during this five-day period has exceeded the cap limits, US Citizenship and Immigration Services (USCIS) has conducted a random lottery to determine which cases to process. If this occurs, all cap-subject H-1B petitions received from April 2-6 will be entered into a lottery to select cases for adjudication. Cases not selected are rejected. Since these filings are for FY19, accepted petitions must request a validity date of October 1, 2018, the first day of the government’s fiscal year. Thus, H-1B employment cannot begin until October. Any prior US employment will require an alternative employment authorized status.
Important Filing Considerations: Timing and Strategy
A government shutdown, even if brief, can have a major impact on a time-sensitive H-1B petition filing. All H-1B petitions begin with preparation of a Labor Condition Application (LCA) with the US Department of Labor (DOL). H-1B filings must be accompanied by a certified LCA. If there is a government shutdown, the DOL will not process LCAs. As this is an online process, it will not even be possible to submit the LCA during the period of government shutdown.
The LCA process dictates, to a large extent, the overall H-1B preparation timeframe. The DOL may take as many as seven to ten business days to adjudicate the LCA. In addition, first-time H-1B employers should allow an additional three to five days for processing as the DOL will often verify the federal employer identification number (FEIN). In addition, the DOL iCert portal, used for LCA submission, is prone to technical problems, particularly during high volume periods. These high demand periods and related technical glitches may be exacerbated in anticipation of, or following, a government shutdown. Of course, these time frames do not take into consideration the information gathering, legal analysis, and LCA preparation which must precede filing.
“Buy American, Hire American” Policy Impacts Adjudications
The Trump Administration’s focus on US immigration includes particular attention to the widely-used H-1B program. This has ushered in an era of H-1B unpredictability with unannounced shifts in adjudications standards under the “Buy American, Hire American” (BAHA) policy. Without new H-1B laws or regulations, USCIS has been drilling down into the core H-1B requirements and applying novel interpretations to the H-1B elements.
For FY19, more than ever, H-1B preparation requires awareness of adjudication trends and thorough analysis to identify areas of potential USCIS challenge within each case. For example, H-1B requirements are tied to the complexity of the position and, in turn, the need for at least bachelor’s level education in specific discipline(s). In many instances, USCIS no longer gives much weight to employer statements and attestations regarding the offered position’s duties and requirements. USCIS has responded to BAHA by a series of new adjudication policies leading to commonplace challenges to H-1B eligibility. It has become necessary to go beyond standard position documentation and consider the availability of independent or alternative evidence of the nature and difficulty of the offered position. These strategies are particularly important for IT professionals. In March 2017, the USCIS reversed longstanding H-1B policy regarding the H-1B eligibility of computer programming positions. This policy reversal is being applied both to computer programmers as well as related positions which involve limited programming duties.
The other “hot” H-1B trend includes scrutiny of entry-level H-1B positions. Starting shortly after the FY18 cap season, USCIS began challenging H-1B filings for entry-level professional positions. The LCA, discussed above, includes a designation of which of the four wage levels is applicable. Challenges emerged in cases designating a level one (entry) wage requirement in the LCA. In furtherance of BAHA, USCIS initiated questioning of the complexity of positions with level one wage designations. Arguments and evidence of job complexity have to be balanced with the level one (entry) wage, as the USCIS wage level analysis also led to denials for improper (low) wage classification. It is very important to properly assess the wage level under established DOL guidance, and to be able to defend the selection, if challenged.
Some common areas for analysis before filing an H-1B petition are:
- What are the employer’s actual minimum requirements for the position? What is the corresponding wage level? Does the offered salary meet the DOL required wage?
- How does the potential employee's education (or equivalent) correlate to the knowledge and skills needed to perform the duties of the position?
- What is the proper DOL occupational classification? What does the DOL view as the normal requirements for the classification?
- Can the employer establish the availability of professional work in the offered position? Is the job consistent with the employer’s business? In the context of employee placement at third-party sites, is there end-client documentation? Is there documentation of an employer-employee relationship with the right to control the H-1B worker?
In light of these issues, employers need to move forward without delay to allow time for well-documented H-1B petitions with full consideration of current adjudications trends. Given the likelihood of a FY19 H-1B cap lottery and BAHA challenges, employers need to carefully select H-1B candidates and, in some cases, explore other possible visa options for employees.
Compliance Matters: Approval is Only the Beginning
As a reminder, the employer’s H-1B responsibilities do not end after the filing of a successful petition. In addition to Form I-9, Employment Eligibility Verification, needed for all employees, a Public Access File is required for the LCA and related compliance documents. Employers must also be aware of potential government site visits conducted as an H-1B anti-fraud tool. Enforcement measures are equally focused on employers and foreign nationals. For example, Immigration and Customs Enforcement (ICE) is increasing its I-9 investigations to create a “culture of compliance” in an area often overlooked by employers. The trend toward employer compliance is not novel, but is heightened under BAHA and should send a strong compliance signal to all employers.
This H-1B season will procedurally be the same as past cap seasons, with case preparation in February and March, for April 2-6 filings. However, adjudication trends foretell ever more stringent scrutiny under BAHA. For the great many employers who need H-1B employees, the focus must be on documenting the requirements of the position, job duties and wage analysis. With a once-a-year filing opportunity, companies must work closely with adept counsel to prepare petitions that can withstand the BAHA driven standards. Employers who are successful with their H-1B filings must augment their compliance programs to incorporate the H-1B related Public Access File requirement and site visit potential. Bringing in experienced counsel to prepare H-1B petitions and LCA Public Access Files reduces exposure in the event of a site visit or government audit for those employers who need H-1B workers.