October 1, 2007, marks the beginning of the new fiscal year, when the new allotment of H-1B visas becomes available.

The H-1B filing season begins on April 1, six months before the beginning of the fiscal year. Last year, the U.S. Citizenship and Immigration Services (USCIS) ran out of H-1B visas on May 26, 2006, less than two months after filing began. Those individuals holding U.S.-awarded master’s degrees, for whom an additional 20,000 H-1Bs were available, had until July 26, 2006, in which to file, when the USCIS ran out of that allotment of H-1B visas. The question on everyone’s mind is: How soon will the USCIS run out of H-1B visas after the filing season begins on April 1, 2007? Unfortunately, the answer is, sooner than you may think.

While various bills have been pending in Congress for many months that, if enacted into law, may increase H-1B numbers, it is unlikely that any new allotment will be available before the beginning of the fiscal year. If Congress does not increase H-1B numbers for the coming fiscal year, it is possible — indeed probable — that the cap will be reached shortly after employers may begin filing new petitions on April 1, 2007.

Employers should plan strategically and file petitions on or very soon after April 1, 2007, in order to ensure that H-1B numbers will be available for their workers who need them. Premium processing (15- day processing for an additional USCIS filing fee of $1,000) is still available if it is economically feasible for the employer to pay it, but may not be necessary since approved petitions will not be valid until October 1, 2007. As in past years, an H-1B number is set aside when an H-1B petition is received, regardless of whether an employer chooses to use premium or regular processing. However, employers should be aware that the employee may not depart the United States while a change of status petition is pending. In cases where travel is anticipated after filing, premium processing is advised. Particularly at risk are students with Optional Practical Training (OPT) status following their graduation from colleges or universities. For recent graduates who are working on OPT with Employment Authorization Documents (EADs), it is of utmost importance that the company file petitions as early as possible in order to avoid gaps in employment eligibility after the EADs expire. Those with EADs that will expire before October 1, 2007, may not continue working between their EAD expiration dates and their H-1B start date (October 1, 2007). Those with EADs that will expire more than 60 days before October 1 must depart the United States, obtain H-1B visas at U.S. embassies abroad (after the petitions are approved), and then use the visas to return to the United States in late September.

Several categories are not subject to the annual H-1B cap. These include employees being sponsored by institutions of higher education or related or affiliated nonprofit entities, or by nonprofit research organizations or governmental research organizations. (Please note that these individuals may not change jobs to a non-exempt H-1B company once the cap has been reached since they were never counted against the cap.) Individuals from Chile and Singapore can continue to qualify for a small pool of H-1B numbers set aside under free trade agreements.

Individuals who are already present in the United States in H-1B status may extend or change H-1B employers without being subject to the cap.