The Senate Judiciary Committee spent several days last week discussing the almost 300 amendments proposed by committee members. Many of the more anti-business and anti-H-1b amendments proposed by Sens. Grassley and Durbin were defeated however, several measures did pass. TechServe Alliance has posted a brief summary. Advocacy, education, and lobbying continues to be needed to protect the utilization of H-1b visas by staffing and consulting firms.

Both IT and health care staffing companies  have traditionally been major users of H-1b visas.  Due to the recent prediction by the USCIS of the H-1b quota for FY 2014 likely being reached in the first week of filing,  many staffing companies are concerned that the artificial restrictions being placed on hiring of the best candidates possible will harm their growth in 2013.  Staffing Industry Analysts (SIA), a leading professional association for companies employing or using contingent workers, recently published on this topic. One of our partners, Mike Hammond was quoted in the article.

Last week, the U.S. Consulate in Hyderabad announced changes to the process of submission of documents for H-1b and L-1 visa issuance. No longer will they require documents to be submitted in advance to the VFS but, documents must be brought in person at the time of the interview.  This change also applies to persons that are part of the BEP program.

Earlier this week, Senator Grassley publicly announced that he had released his hold on HR 3012. If you recall, HR 3012 was a bill that had passed the House by a margin of 389-15 and essentially eliminated decades of national origin discrimination by eliminating the per country limits applied to the distribution of immigrant visas (green cards).  Unfortunately, when HR 3012 reached the Senate for consideration, Senator Grassley singularly put a hold on it, much as a petulant child will threaten to take his ball and go home if everyone else refuses to play by his rules.  As oft is the case in politics, if you have an unpopular provision that stands no chance of success standing on its own merits, you hold a popular piece of legislation hostage until everyone caves.  As a strategic ploy, Machiavelli would be proud and Senator Grassley finally got his way and succeeded in attaching additional rules to the H-1b program. (As an aside, I agree with Senator Grassley that the H-1b program does need review and reforms but, unlike this approach, I’d like that review to be done in the open, with a full public hearing and any proposed changes accepted or rejected on their merits.)  The amendment that I think will most adversely impact employers is not the annual review of employers that have more than 100 employees and have at least 15%  H-1b workers, or the lack of any judicial review,  or even the change which allows the DOL to investigate an employer for possible LCA violations without a complaint but, it is the change that allows the DOL the unfettered ability to delay the issuance of an LCA for an indeterminate amount of time. Under the present system, the DOL must certify an LCA within 7 days unless it is “incomplete”. This time limit insures that employers can quickly file an H-1b visa petition.  This quick turnaround is particularly important given the small number of H-1b visas available each year under the quota and in circumstances where H-1b workers are transferring from one U.S. employer to another. Under the Grassley amendment, there would be no such 7 day requirement and an investigation and delay in the issuance of an LCA can be initiated by the DOL under the vague rubric of ” clear indicators of fraud, misrepresentation of material fact, or obviously inaccurate”. If fraud hadn’t been so bastardized by the USCIS previously and on the record, then maybe this wouldn’t be so alarming but, fraud has been defined to include such factors as: an address change, having less than 25 employees,  less than $10 million in revenues, and a web-site under construction, among others.   When a U.S. employer chooses to hire an H-1b worker and expend the $5,000 to $10,000 in attorney and government fees required, it is looking for certainty in timing and adjudication.  Over the past 2 years, the certainty associated with adjudication has been removed as the USCIS and the DOS by internal memo and policy have changed the rules where today, you aren’t even certain that a software engineer with a US Master’s degree is going to given an H-1b visa and now, if this amendment takes effect, the timing of the process will give way to uncertainty.  Senator Grassley, keep your investigations and annual reviews because as an attorney, I applaud extra regulatory requirements and burdensome reviews that require my clients to retain me and pay me copious amounts of money but, initiate the investigations after the certification of the LCA’s.  You can always revoke the LCA’s and impose large fines if you truly find fraud. To do otherwise, will cause employers, often smaller ones, to lose business opportunities and will encourage the outsourcing of projects abroad where the start of the project need not be delayed until the completion of an LCA investigation and the filing of an H-1b visa. The vast majority of U.S. employers want to play by the rules but, in turn, they are seeking certainty and assurances that the government agencies  will also play by the rules.  With this latest amendment, we will now have neither.

On March 12, 2012, the United States District Court for the Southern District of Ohio: Eastern Division issued a decision on specialty occupations in Residential Finance Corporation v. U.S. Citizenship and Immigration Services. In this case, Residential Finance Corporation submitted an H-1b petition on behalf of Geza Rakoczi. It hoped to hire him as a market research analyst. The Beneficiary graduated from Franklin University and has a Bachelor of Science degree in marketing and finance. USCIS denied the petition and concluded that there was no specialty occupation involved in the position. It reached this decision after reviewing the Occupational Outlook Handbook classification for market and survey research jobs. USCIS concluded that these positions do not have a specific specialty requirement because the handbook does not include a specific specialty requirement. Instead, the handbook only mentions that a bachelor’s degree is the minimum requirement. Consequently, USCIS stated that there was no specialty occupation involved. The Southern District of Ohio corrected USCIS by stating that the “record indicates that a minimum requirement for entry into the position of a market research analyst is the specialized course of study in which Rokoczi engaged.” Furthermore, the court noted that USCIS’s reasoning and behavior “constitute[ed] a litany of incompetence that presents fundamental misreading of the record, relevant sources, and the point of the entire petition” and suggested that USCIS “should afford Plaintiff and Rokoczi a bare minimum level of professionalism, diligence, and reasoning.”

This week, the USCIS released revised FAQ’s clarifying portions of the Jan 2010 Neufeld memo.  The original Neufeld memo declared that staffing cos. engaging in staff augmentation were not employers as that term was going to be interpreted by the USCIS. After a significant amount of lobbying by various business and legal groups, most notably TechServe Alliance, the USCIS has now modified their position.  Specifically, question thirteen notes that there are situations in the consulting / staffing world that would constitute a valid employee – employer relationship.  USCIS noted that adjudicators would consider the following factors in reviewing the relationship: “whether the petitioner pays the beneficiary’s salary, whether the petitioner will determine the beneficiary’s location and relocation assignments . . . , and whether the petitioner will perform supervisory duties such as conducting performance reviews, training, and counseling.”  Question five which specifically states that end client letters are not required is not a change but, has been a part of the policy since August of 2011. We are very pleased to see this guidance from USCIS. We are hopeful that the adjudicators at the Service Centers and Consular officials take note of this guidance and follow it.

On Jan 12th, Mike Hammond will be one of the speakers for a webinar event being sponsored by TechServe Alliance . The topic will be  ”Utilizing H-1Bs within Your Contingent Workforce: Understanding the Changing Landscape” The webinar is offered to TechServe members only.

Many people are wondering what caused the H-1b cap to be reached so much more quickly this year. Information that the cap would be met in November, two and a half months earlier than past years, caused many employers to scramble to submit petitions. At the Hammond Law Group, we believe that there are several reasons why the cap was reached at an earlier date. Perhaps most obviously, IT industry groups, such as TechServe Alliance, have noted consistent increases in hiring throughout this year. As a result, many IT organizations submitted an increased number of H-1b petitions this year for foreign workers who they hoped would fill these positions. In addition, the U.S. Consulates in India are denying a large amount of the L-1 visas. By decreasing the amount of L-1 visas available to Indian personnel, many organizations have resorted to using the H-1b visa to ensure that their personnel are able to enter the United States and work. Finally, Department of Homeland Security Secretary Napolitano and U.S. Citizenship and Immigration Services Director Mayorkas announced on August 2, 2011 that foreign entrepreneurs could use non-immigrant and immigrant visas to obtain status in the United States. It is possible that a number of H-1b visas were absorbed by foreign entrepreneurs. While all of these reasons likely contributed to the quick rate at which the H-1b visas were used up, we believe that the high rate of denials of the L-1 visa at U.S. Consulates in India and the increased hiring occurring in the IT industry caused the cap to be reached at an earlier date.

With the H-1b quota exhausted last week, my morning has been filled with stories like;  We promised this person a job and they have already planned on moving ? But, this project depends upon me getting this new candidate on board ? I already promised the client ? All of these questions, can be summed up by “now what?”  For many situations, unfortunately, there may not be any viable alternatives however, each case should be analyzed to determine if there are options available. The following may be viable scenarios: 1. Make sure your candidate is not cap-exempt by virtue of a prior H-1b, maybe even many years ago 2. Consider alternative visa options such as the O or L 3. Consider  whether your candidate can extend their OPT via a STEM extension 4. Consider whether your candidate can return to school and be authorized for employment under a CPT program 5. Consider the spouse of your candidate and whether or not their occupation offers any options for employment eligibility 6. Consider any residency options 7. Consider off-shoring your project until Oct 2012 In addition, make sure you contact your esteemed member of Congress and let him or her know the negative impact the H-1b cap has on your business. They will not listen but, you will feel better by making the effort.   

Also, keep in mind that many H-1b petitions are not subject to the H-1b cap. These include:  1. H-1b extensions for your own employees 2. H-1b transfers i.e. new employees joining you who currently have an H-1b with another company 3. H-1b petitions filed by cap-exempt organizations 4. Persons who have previously been counted under the cap and not yet exhausted a full 6 years in the U.S.  

Filings for Fiscal year 2013 can be mailed in only 124 days !

The USCIS announced today that as of Fri. Nov 18th, 61,800 H-1b cap subject petitions have been received. In all likelihood, sufficient petitions have already been received to exhaust the remaining 3,200 but, no official announcement has been made.