On August 12, 2015, a federal judge in Washington D.C. ruled that the Department of Homeland Security (DHS) improperly enacted a 2008 rule extending “Optional Practical Training” (OPT) for eligible foreign students in STEM (Science, Technology, Engineering, and Math) fields by 17 months without notice and comment. Washtech(Washington Alliance of Technology Workers v. DHS, 1:14-CV-00529)  Immediate application of this ruling would have jeopardized the employment of thousands of foreign workers in the United States, but Judge Ellen Segal Huvelle has stayed her ruling until February 12, 2016, providing DHS with an opportunity to submit this rule for proper notice and comment in light of the significantly disruptive impact that the court’s ruling would otherwise have.

 On March 28, 2014, a union called the “Washington Alliance of Technology Workers” challenged the DHS regulation at 8 C.F.R. Section 214.2(f)(10)(ii)(C) in the U.S. District Court for the District of Columbia. Among other claims, the plaintiff organization argued that the DHS lacked authority to issue this rule and that DHS acted improperly to issue this rule without notice and comment. Judge Huvelle found that DHS had substantive authority to issue this rule pursuant to its delegation by Congress, but she also found that the DHS had failed to demonstrate “good cause” for dispensing with the notice and comment requirement when enacting these regulations.

 The DHS and its predecessor agency, the Immigration and Nationalization Service (INS), have provided some form of practical training to foreign students for over 70 years. The OPT program provides foreign students who complete a postsecondary degree program in the United States (bachelors, masters, and Ph.D. programs) an opportunity to gain practical work experience at the conclusion of their academic program. All eligible students receive a 12-month period of work authorization at the conclusion of their program. In 2008, the DHS cited a shortage of workers in STEM fields and the constraints that the low H-1B quota posed to their continuing employment by U.S. employers when it provided an additional 17-month extension to students in these fields.

 In addition to extending OPT authorization for STEM graduates, the 2008 rule also:

  1. Made the H-1B “cap-gap” provision automatic, thereby ensuring that F-1 OPT trainees could automatically change to H-1B status even if their OPT ended prior to the October 1st start date of their H-1B status;  AND
  2. Provided students with a 60-day time period after graduation to file their OPT requests. The earlier version of the rule required students to file this application before graduating from their degree program.

This decision jeopardizes these important benefits to U.S. employers and foreign workers and makes it more likely that immediate changes to the OPT regulations, particularly as they relate to STEM graduates, will be forthcoming. The November 20, 2014 policy memo issued by the Secretary of DHS, Jeh Johnson, and a recent White House report on modernizing the immigration system have cited changes to the OPT program as a fundamental priority. Any such changes are likely to achieve two goals:

  1. Address the shortage of U.S. workers in STEM fields;
  2. Protect the interests of U.S. workers by ensuring that any work/practical experience gained by students is adequately tied to the student’s course of study.

The clock is now ticking on these changes in light of Judge Huvelle’s decision. Since there is no guarantee that a new rule will go through notice and comment and be implemented by February 12, 2016, it is essential that educational institutions and employers begin preparing for the possibility that the OPT STEM extension will no longer be available during next year’s H-1B cap season. Employers seeking to employ foreign STEM graduates who are currently employed in OPT status on a longer-term basis cannot assume that the STEM extension will be available and must immediately begin planning for next year’s H-1B cap season, which will require the filing of an H-1B petition during the first week of April (when the H-1B lottery is conducted). The preparatory steps include obtaining a certified labor condition application from the Department of Labor and preparing appropriate documentation for an H-1B petition. Additionally, employers would be well-advised to consider any other nonimmigrant visa options available to foreign STEM graduates that are not subject to a quota, which could include an O visa or TN visa in certain circumstances.

Judge Huvelle’s decision and the uncertainty of the STEM extension regulation raise many uncomfortable questions for employers seeking to hire foreign STEM graduates.