Seyfarth Synopsis: The Department of Homeland Security (DHS) published its regulatory plan for 2018, which aligns with President Trump’s Executive Order, Buy American Hire American.

Although the specifics of each proposed rule will remain confidential until published in the Federal Register, the Regulatory Agenda does provides insight on what is likely ahead.  Changes to the existing visa programs will be accomplished through a notice and comment period, and will not become effective immediately.

H-1B Cap Lottery Pre-Registration and Selection

DHS will propose a rule that would require all H-1B petitioners to pre-register for the H-1B lottery.  Only those petitioners that have been selected in the lottery could then submit H-1B petitions for that fiscal year.

As introduced in the Buy American Hire American Executive Order, DHS is also expected to propose a priority system for the allocation of H-1B visa numbers.  Priority would be given to the beneficiaries that DHS deem to be the most highly skilled and also the highest paid. (Potential Publication Date: February 2018)

H-1B Eligibility

The proposed rule would revise the definition of “employer-employee relationship” and add new requirements designed to ensure that employers pay appropriate wages to H-1B workers.  In addition, the rule is expected to raise the standard on what constitutes a specialty occupation with the stated goal to “increase the focus on truly obtaining the best and brightest.” (Potential Publication Date: October 2018)

Termination of H-4 Work Authorization

DHS will propose the elimination of the February  2015 regulation permitting certain H-4 spouses to apply for employment authorization.  (Potential Publication Date: February 2018)

Revisions to Practical Training for Foreign Students

Immigration and Customs Enforcement (ICE) may issue a proposed rule to reform the practical training programs for foreign students.  Revisions will likely include additional employer obligations and possibly a rescission or limitation of the Obama Administration’s extension of STEM Optional Practical Training from 17 to 24 months.  (Potential Publication Date: October 2018)

Summary

DHS’s Regulatory Agenda for 2018 contains many changes that could greatly affect employers’ business immigration programs as they pertain to individuals in H-1B, H-4 and F-1 status.  Although some of these proposed rules could be introduced as early as February 2018, the rules must first go through a notice and comment period followed by a formal approval process that will take many months to pass.  Seyfarth Shaw LLP will closely monitor these developments.

Seyfarth Synopsis: This blog post is intended to enable employers to identify any current employees and employment candidates who may require H-1B work permit sponsorship before October 1, 2019. We recommend that employers identify any such candidates as soon as possible, as on April 2, 2018, United States Citizenship and Immigration Services (USCIS) will begin accepting H-1B petitions for the fiscal year 2019 H-1B quota (which begins on October 1, 2018). It is likely that, as in previous years, USCIS will receive H-1B requests far in excess of the annual quota within the first week of filing eligibility, in effect resulting in a random lottery-type selection process. This occurred last year in the 2018 H-1B cap, which was reached in the first week of filing eligibility based on USCIS receiving over 199,000 H-1B cap petitions. The most conservative and recommended approach is to submit all 2018 cap cases during the first week of filing eligibility, which begins on April 2, 2018.

Background

There is an annual limit on the number of H-1B petitions that USCIS can approve during the government’s 2019 fiscal year (beginning October 1, 2018 and ending September 30, 2019). The H-1B cap for fiscal year 2019 is 65,000 (of which about 6,800 are reserved for nationals of Chile and Singapore under Free Trade Agreements with those countries). USCIS will begin accepting petitions for FY 2019 on April 2, 2018.

There is an additional quota of 20,000 H-1Bs reserved for persons holding a master’s degree or higher awarded by an accredited college or university in the United States. To be eligible for the “master’s cap,” the employee must have completed the master’s degree program prior to the filing date. This additional quota of 20,000 H-1Bs has historically not been exhausted as early as the general H-1B quota of 65,000. However, both the regular cap and the master’s cap were exhausted last year during the first week of availability.

If USCIS receives more than 20,000 H-1B petitions towards the so-called master’s cap, a separate lottery process is applied. USCIS will apply the random selection process to the master’s cap petitions prior to conducting the regular H-1B lottery. Any master’s cap petitions not selected in the master’s lottery will be eligible for selection in the regular H-1B lottery, effectively being granted two opportunities at H-1B status.

Exceptions

With some exceptions, current H-1B workers are not subject to the annual cap. Non-cap cases include H-1B workers extending their status, changing from one H-1B employer to another, changing the terms of existing H-1B employment, or filing for a second (concurrent) H-1B position. In addition, foreign nationals seeking to work for an institution of higher education, for a related or affiliated nonprofit entity, or for a nonprofit research organization or a government research organization are not subject to the H-1B cap.

Anticipated Unavailability of H-1B Work Permits Means Filing Early

In 2008, USCIS announced that it would apply the lottery process to all H-1B petitions received during the first five business days of the cap period, even if enough petitions were received to fill the annual quota on the first day of the filing period (i.e., April 1). We do not know how quickly the H-1B numbers will be exhausted this year, but the most conservative strategy is to assume that the H-1B numbers will be unavailable after the initial five-day filing period. Once the H-1B numbers are exhausted, new H-1B work permits will not be available until October 1, 2019.

Thus, to maximize the likelihood that affected employees will obtain an H-1B number effective as of October 1, 2018, employers must be in a position to file the H-1B petition with the government between Monday, April 2, 2018 and Friday, April 6, 2018. We are preparing “cap-subject” H-1B petitions at this time and recommend that employers begin the process now for any employees or candidates who need an H-1B.

Persons Affected

The persons who need to file an H-1B include any current employees who hold F-1 student status and who will thus need H-1B status to continue working once their F-1 Employment Authorization (known as Optional Practical Training or “OPT”) expires. In addition, any pending hires should be assessed to determine whether an H-1B will be needed for eventual continued employment, including those in J-1 academic programs with limited practical training time as well as those who currently reside outside the United States. Further, any current employees who hold TN, E-3, or L-1 status and who are beginning the green card process may need to convert to H-1B status.

“Cap-Gap” Relief for F-1 Students

Under a rule issued in 2008, DHS grants “cap-gap” relief to F-1 students whose OPT expiration dates fall between April 1, 2018 and September 30, 2018 and whose employers have filed H-1B petitions on their behalf. Such students will be given a bridge of both status and work authorization until October 1, 2018. This means that individuals in the U.S. in F-1 status who are completing OPT and whose employers have filed H-1B “change of status” petitions on their behalf will have their work authorization automatically extended until October 1, 2018 (the required start date on the H-1B petition), provided that the H-1B petition is received and approved. These individuals will not experience the gap in employment eligibility or in status that may otherwise have occurred. If the petition is rejected or denied prior to October 1, 2018, the “cap-gap” employment eligibility ends immediately.

In addition, the 2008 “cap-gap” rule grants a bridge of status — but not work authorization — to individuals in the U.S. during the 60-day grace period following completion of their F-1 status who do not hold a valid EAD. This means that individuals in the U.S. in F-1 status who are in their 60-day grace period and whose employers have filed H-1B “change of status” petitions on their behalf will have their status, but not employment authorization, automatically extended until October 1, 2018, provided that the H-1B petition is received and approved.

Alternatives to the H-1B Work Permit

In some cases, there may be alternatives to the H-1B work permit. If an affected employee falls into one of the following categories, that employee may not need to file for an H-1B work permit in April:

• Citizens of Canada or Mexico who are eligible for a TN visa. Please note, however, that not all H-1B eligible Canadian or Mexican employees will qualify for TN status.  In addition, TN visa classification falls under the North American Free Trade Agreement (NAFTA) which continues to be closely examined by the current administration.
• Citizens of Australia, Chile, or Singapore.
• The spouse of an L, E or H-1B work permit holder, who is eligible for spousal employment authorization (EAD).
• J-1 nonimmigrants who have at least 18 months of academic training available as of April 1, 2017.
• With limited exceptions, H-1B employees who have held H-1B status at any time during the last six years with a cap-subject employer.
• A foreign national who is married to a U.S. citizen and has received or will receive an Employment Authorization Document in connection with the pending green card process.
• Certain other foreign nationals who may qualify for O, E, or L visas.

Conclusion

Employers must act now to identify and begin H-1B processing for candidates or current employees who require sponsorship and who do not meet one of the above exceptions. If an employer misses the filing deadline for an employee who requires H-1B sponsorship, the employee can lose legal status in the United States, including permission to work.

Seyfarth Synopsis: On September 18, 2017, U.S. Citizenship and Immigration Services (USCIS) announced that effective immediately it would resume premium processing for H-1B petitions filed subject to the Fiscal Year (FY) 2018 cap.

USCIS temporarily suspended premium processing of all H-1B petitions on April 1, 2017 with the stated goal of addressing significant backlogs in case processing.  Over the last few months, the agency incrementally reinstated premium processing service for lower-volume filings including certain H-1B petitions that are not subject to the H-1B cap as well as H-1B petitions filed on behalf of physicians under the Conrad 30 waiver program.  On September 18, 2017, the agency reinstated and will immediately accept premium processing requests for pending H-1B petitions that were filed under the Fiscal Year 2018 cap.  This includes H-1B petitions filed under the annual quota of 20,000 U.S. Master’s degree petitions as well as those filed under the general H-1B cap of 65,000 petitions.  Unfortunately, premium processing service remains suspended for H-1B petitions that are filed to extend an employee’s status or change employers.

When a petition is filed under premium processing, the petitioner includes an additional filing fee of $1,225.  This additional filing fee requires USCIS to adjudicate the petition within 15 days of receiving the request.  Petitions are either approved or a Request for Evidence (RFE) is issued by USCIS within that 15-day time period.  Premium processing requests can be filed with the initial filing of a petition, or at a later date by referencing the petition’s receipt number.  Since the quota of H-1B cap petitions has already been reached, this service is only available to currently pending H-1B cap cases for FY 2018.

With the reinstatement of this service, Employers should carefully review their pending H-1B cap lists and strongly consider submitting a premium processing request for any pending FY 2018 cap cases in which the beneficiary has an expired F-1 Optional Practical Training (OPT) employment authorization card and is relying on “Cap Gap” for work authorization through September 30, 2017.  Any beneficiary relying on “Cap Gap” whose H-1B petition is still pending on October 1, 2017 will lose employment authorization until his or her H-1B petition is approved.  Employers should also consider prioritizing premium processing requests for employees in a different status who are facing imminent expirations of work authorization as well as those with upcoming international travel plans that require an H-1B visa stamp for reentry.

Summary

Premium processing of FY 2018 cap H-1B petitions has resumed.  Your contacts at Seyfarth Shaw LLP will work with you to determine which cases should be considered for immediate premium processing upgrades.  In addition, we will continue to monitor USCIS announcements with regard to reinstatement of premium processing for other types of H-1B petitions.

Seyfarth Synopsis: The EO orders the Departments of State, Justice, Labor, and Homeland Security to propose new rules and issue new guidance to “protect the interests of U.S. workers” and “promote the functioning of the H-1B visa program.”

On Tuesday, April 18, President Trump signed an Executive Order (EO) instructing the Secretary of State, the Attorney General, the Secretary of Labor, and the Secretary of Homeland Security to propose new rules and issue new guidance “as soon as practicable and consistent with applicable law” to “protect the interests of U.S. workers,” within the administration of the U.S. immigration system. Moreover, the EO instructs the agencies to “suggest reforms to help ensure that H-1B visas are awarded to the most-skilled or highest-paid” foreign nationals.

The EO neither creates any specific new requirements for employers nor directs the affected agencies to take any action other than prepare substantive proposals at a future uncertain date. According to statements made by the President and Senior Administration Officials, the EO aims to dismantle the computer generated H-1B visa lottery system and the current four-tiered prevailing wage system as well as ferreting out fraud and abuse within the existing H-1B program.  Implementation of such recommendations would require congressional action.

Seyfarth Shaw will continue to closely monitor the Departments reactions to the EO, and we will provide updates as developments occur.

Seyfarth Synopsis: USCIS completes the lottery process and receives 199,000 H-1B cap petitions.

On April 17, 2017, United States Citizenship and Immigration Services (USCIS) announced that it received 199,000 H-1B petitions to meet both the Master’s and regular H-1B quotas (or “caps”) for Fiscal Year 2018, which begins on October 1, 2017.  This means that USCIS received more than double the number of available H-1B petitions in the first week of filing, and that more than 20,000 of these petitions were filed under the Master’s cap.  However, the number of petitions decreased this year, down from more than 236,000 petitions filed for Fiscal Year 2017.

In addition, USCIS announced that they completed a computer-generated random selection process — the lottery — for all cap-subject filings received from Monday, April 3 through Friday, April 7, 2017 to determine which filings to adjudicate.  USCIS first conducted the lottery process for H-1B petitions subject to the Master’s cap, which sets aside 20,000 H-1B visas for holders of U.S. Master’s degrees or higher degrees.  Any Master’s cap petitions not selected in the Master’s lottery were eligible for selection in the regular H-1B lottery, effectively providing two opportunities for an H-1B visa.  USCIS will now begin the process of sending Receipt Notices for petitions selected in the lottery while rejecting and returning petitions, together with the associated filing fees, that were not selected in the lottery.

For additional background information on the H-1B visa program and the cap, please see our previous One Minute Memo titled, “H-1B Work Permit Filings: Will You Beat the Cap?”