Preparing for FY2017 H-1B Filings

USCIS Will Begin Accepting H-1B Cap Petitions on April 1, 2016

The filing period for “new” H-1B petitions to be counted against the annual H-1B cap for Fiscal Year (FY) 2017 will begin on Friday, April 1, 2016. Cap-subject H-1B petitions will have an employment start date of October 1, 2016. In preparation for the opening of the FY 2017 H-1B filing period, employers are strongly encouraged to begin identifying current and future employees who will need H-1B visa status to be legally employed in the United States. Individuals currently employed as F-1 students or J-1 trainees, individuals seeking to change to H-1B status from another visa status (such as L-1, TN, O-1, or E-3), and individuals outside of the United States commonly require a cap-subject H-1B petition be filed on their behalf.

In past years the number of H-1B petitions filed on April 1st has far exceeded the number of available visas and U.S. Citizenship and Immigration Services (USCIS) has conducted a random lottery to determine which cases will be processed. Only petitions received by USCIS during the first five business days of April are included in this lottery, so it is imperative that we file all new H-1B petitions in a timely fashion. Please read the following discussion of the H-1B cap process and consider whether you or your company need to file an H-1B petition on April 1, 2016.

Who Needs to File an H-1B Petition on April 1st?

Only “new” H-1B petitions are subject to the numerical cap and must be filed on April 1st. If a person was previously granted status as an H-1B nonimmigrant and has not spent a full six years in the United States in H-1B status, then an H-1B petition filed on behalf of that person is not subject to the cap. This includes H-1B extensions, changes of employer petitions, and amendments. It also includes H-1B petitions filed on behalf of people who are outside of the United States but who have previously been approved for H-1B status or issued an H-1B visa.

How Does the USCIS Process Work?

USCIS will begin accepting H-1B petitions subject to the FY 2017 cap on April 1, 2016. The H-1B cap for FY 2017 is 65,000. In addition, the first 20,000 H-1B petitions filed on behalf of individuals with a U.S. Master’s degree or higher are exempt from the fiscal year cap of 65,000. Last year, U.S. employers filed nearly 233,000 new H-1B petitions in the first five business days, which meant that only about 36% of the cases were accepted for processing. We expect that there will be a similar demand for new H-1B cap petitions this year.

If USCIS receives more H-1B petitions than it can accept during the first five business days (April 1 to April 7), which is highly likely again this year, USCIS will use a computer-generated random lottery system to select the petitions that it will process. Presuming that the random lottery is again required for FY 2017, USCIS will reject petitions that are not selected in the lottery, as well as petitions received after April 7, 2016. USCIS will first conduct a random lottery process for the petitions filed on behalf of individuals with a U.S. master’s degree or higher (advanced degree exemption), and then any advanced degree petitions not selected as part of the 20,000 exception will be considered among the random lottery process for the 65,000 limit.

H-1B petitions that are accepted in the lottery will receive a “receipt notice” by mail from USCIS. H-1B petitions that are rejected will be returned to the employer (or the immigration law firm), along with uncashed filing fee checks. It may take until the end of May 2016 to know for certain if a particular H-1B petition has been selected in the random lottery or has been rejected.

H-1B cap petitions can also be filed with a Premium Processing request (which guarantees review of the petition by USCIS within 15 calendar days and issuance of an approval, denial, or Request for Evidence), but the 15 day clock for adjudication of such Premium Processing H-1B petitions will likely begin in mid-April, based on prior years’ experience. USCIS should issue receipt notices for all H-1B cap petitions filed with Premium Processing requested by the end of April 2016. Filing an H-1B petition requesting premium processing will not increase the chances of obtaining an H-1B under the cap. However, as noted above, one benefit of filing a cap subject H-1B petition with a request for premium processing is that a receipt notice will usually be issued faster than if filed under regular processing. Therefore, the petitioner and beneficiary should learn more quickly whether or not the petition has been chosen in the lottery.

What Can Employers Do Now to Prepare for the FY 2017 H-1B Cap?

Since the annual fiscal year limitation for H-1B visas is expected to be reached during the first week of the filing period again in FY 2017, employers should immediately begin identifying individuals for whom H-1B sponsorship will be needed to allow sufficient time for H-1B petition preparation, including the time required to file and receive certification of the Labor Condition Application (LCA). The LCA, which is submitted online to the U.S. Department of Labor (DOL), is a prerequisite to a properly-filed H-1B petition. The DOL can take up to 10 days to certify an LCA. Employers must take this processing time into consideration to ensure timely approval of the LCA and the ability to mail the H-1B petition for delivery to USCIS between April 1 to April 7, 2016. Employers should contact the McCown & Evans attorney with whom you normally work as early as possible to initiate any cap-subject H-1B petitions.

How do Employers Identify Employees and Candidates Who Will Require FY 2017 H-1B Cap Sponsorship?

Carefully review a comprehensive list of employees that identifies each individual’s immigration status. The best source for this information is an immigration case status report for all foreign national employees. Look for the following situations:

  1. F-1 Students Working with Optional Practical Training (OPT) or Curricular Practical Training (CPT)

If your company plans to retain these employees then they must be included in the H-1B cap filings.

  1. J-1 Trainees or Interns

As with employees working with OPT or CPT, these employees will almost certainly require H-1B sponsorship.

  1. L-1A or L-1B employees

L-1 visas are limited to five years duration for L-1B specialized knowledge workers and seven years total for L-1A managers or executives. If an L-1 employee reaches the maximum period of stay authorized under the L-1 visa, then he or she might be required to depart the United States for a full year to reset the five or seven year “clock.”

Consider changing these employees to H-1B status. While the H-1B visa is limited to six years duration, there are exceptions to that maximum period for those who are in the green card process. If a person is likely to reach the five or seven year maximum in L-1 status before receiving a green card, then changing him or her to H-1B status is a good strategy for keeping the person work authorized in the United States.

  1. TN employees

Consider whether Canadian or Mexican employees in TN status would be better off in H-1B status. Employers may want to change TN workers to H-1Bs for two reasons. First, TN status is available for only a few specific occupations. Employers wishing to promote or change the employee’s position to one that is not included in the TN occupation list would not have the same restriction if the employee were in H-1B status. Second, employers wishing to sponsor employees for green cards should consider moving the TN employees to H-1B status because there can be restrictions (including international travel restrictions) in changing a person from TN status to green card status. These restrictions do not apply to H-1B employees.

  1. E-3 (Australia) or H-1B1 (Chile or Singapore) employees

As with employees in TN status, there can be restrictions in changing an employee’s status from either E-3 or H-1B1 status to a green card. Consider applying for H-1Bs for these employees to pave the way for a smoother green card process.

  1. Employees with dependent EADs (L-2, H-4, E-2 or J-2 spouses)

If an employee has employment as the spouse of an L-1, H-1B, E-2, E-3 or J-1 visa holder then his or her work authorization is dependent on the employment status of the employee’s spouse and on the continuity of the employee’s relationship with his or her spouse. Changing these employees to H-1B status will eliminate the risk that the employee loses work authorization if his or her spouse’s employment ends or if the couple divorces.

  1. New H-1B candidates living abroad

Identifying these candidates can be tricky. Cast a wide net throughout your organization by alerting hiring managers, recruiters and other interested parties that they should identify potential H-1B candidates as soon as possible. Share this update with them to provide context.

When Should Employers Initiate the H-1B Cap Filing Process?

While cap-subject H-1Bs cannot be filed with the USCIS until April 1st, initiating the process early provides important advantages. First, starting early allows time to identify all of the documents needed from the company and the employee. This is particularly important in cases where the candidate will need a credentials evaluation. Advance planning also allows more time to discuss the case, delve deeply into tricky issues and, where appropriate, develop alternate immigration strategies. Finally, preparing the case well in advance helps avoid last-minute stress.

Thinking Ahead: What to do for Employees Who Are Not Selected in the H-1B Lottery?

“Hope for the best and plan for the worst” is an apt sentiment during H-1B cap season. For employees who are not selected in the random lottery, it is useful to consider alternatives.

  1. STEM Extension of Optional Practical Training (OPT) Employment Authorization

Certain students currently in F-1 status in the United States may extend their 12-month period of post-completion Optional Practical Training (OPT) for an additional 17 months of STEM OPT (for a total of 29 months). To qualify for this extension, all of the following criteria must be met:

  • The student must be in a current period of post-completion OPT based on graduation from a bachelor’s, master’s, or doctorate degree in science, technology, engineering, or mathematics that has been designated as a “STEM field” by Immigration and Customs Enforcement (ICE)
  • The student must obtain a Form I-20 from his/her university authorizing the STEM OPT extension and file an application for an Employment Authorization Document (EAD) on Form I-765 before the current period of post-completion OPT expires
  • The student must be employed by (or have an offer of employment from) a U.S. employer in a field directly related to the student’s major area of study, and
  • The student’s current or prospective employer must be enrolled in the Department of Homeland Security’s E-Verify employment verification program

Changes have been proposed to this rule that would extend the additional period to 24 months. Please review our update on those proposed rules. Once this proposed rule is finalized, it may be possible for students already approved for the 17-month STEM OPT to request an additional 7 month STEM OPT extension, which might be enough time to apply for an H-1B again in FY 2018.

  1. O-1 Visa

O-1 visas are available to people with extraordinary ability in the sciences, arts, education, business, or athletics, as demonstrated by their achievement of sustained national or international acclaim. These visas serve as excellent replacements for H-1B visas for employees who have a record of high achievement. Individuals seeking to qualify for O-1 status must demonstrate their achievements through extensive documentation from objective sources in their occupational field, including expert affidavits, contracts, awards, and other documentation.

National or international acclaim can be demonstrated by receipt of a major internationally-recognized award, such as the Nobel Prize, or by documenting accomplishments in at least three of the following categories:

  • Receipt of nationally or internationally recognized prizes or awards for excellence in the field
  • Membership in an association in the field that requires outstanding achievement of its members, as judged by recognized national or international experts
  • Published material in professional or major trade publications or major media about the prospective employee
  • Judgment of the work of others in the field
  • Original scientific, scholarly, or business-related contributions of major significance in the field
  • Authorship of scholarly articles in the field in professional journals or other major media
  • Current or previous employment in a critical or essential capacity for organizations and establishments that have a distinguished reputation
  • High salary or other remuneration commanded for services in relation to others in the field, as evidenced by contracts or other reliable evidence
  • Other comparable evidence

Dependents (spouses and unmarried children under 21 years of age) of O-1 workers are entitled to O-3 status. However, dependents in O-3 status are not authorized to work in the United States.

  1. H-3 Trainee Visa

U.S. employers can sponsor foreign workers for training for up to 24 months using an H-3 trainee visa. Unlike J-1 visas, which allow for on-the-job training, H-3 visas are for more formal training that does not involve productive work or where the productive work is not an essential part of the training. The training also must be of a sort that is not available in the individual’s home country and the training must aid the individual in pursuing a career outside of the United States. H-3 training plans must be very detailed and the means of instruction must include a classroom component.

The H-3 visa can be filed with a request for premium processing, so USCIS will act on the case within 15 calendar days of receipt of the petition. Dependents (spouses and unmarried children under 21 years of age) of H-3 visa holders are eligible for H-4 dependent visas, but H-4 spouses of H-3 workers are not allowed to work in the United States.

  1. Permanent Residence (Green Card) Processing

The permanent residence process usually involves three distinct stages of processing. During the third stage of processing, called Adjustment of Status, the foreign national beneficiary qualifies to remain and work lawfully in the United States until the green card is approved. In certain green card categories, it is possible to initiate the permanent residence process by concurrently filing an I-140 immigrant petition, Adjustment of Status application, and EAD application, resulting in work authorization being approved in about three months. These I-140 immigrant petition categories include:

Therefore, for a foreign national employee who has at least three months of remaining lawful status either through F-1 OPT, J-1 visa status, or another lawful status, it may be possible to devise a strategy by which the employee qualifies to remain legally in the United States and work authorized.

  1. Employment Authorization for Dependent Visa Holders

It is worth asking your employees about the visa status of their spouses. If your employee’s spouse has E, L or J-1 status then your employee may apply for the corresponding dependent status (E-2, E-3D, L-2 or J-2) and then obtain an employment authorization document (EAD). If your employee’s spouse has an H-1B visa and has reached certain milestones in the green card process (i.e., has an I-140 approval or has been approved for an H-1B extension beyond the 6th year based on a PERM application or I-140 petition filing), then your employee can apply for H-4 status and obtain an EAD.

The processing time for dependent visa EADs is approximately 60-90 days. The validity period of the EAD is tied to the validity period of the underlying visa status of the principal visa holder. So, for example, if your employee’s spouse has 18 months of remaining visa status at the time that your employee files for dependent visa status and an EAD, then the EAD will be issued for no more than 18 months (less the processing time of the EAD).

Please contact your attorney at McCown & Evans with any questions!

 

Disclaimer

This information is for general use only. You should consult a licensed attorney for legal analysis and advice regarding the specific details of your case.