Twelve Alternatives to the H-1B Visa
If you needed an H-1B this year and did not get one, or you are worried that you will not be able to hire the right people this year because there are no H-1B visas available, then you may be interested in this article. There are a number of ways to work around the H-1B cap. Some of the options are obvious and some are creative. The following discussion describes 12 options that McCown & Evans has used in the past to help our clients secure the services of foreign employees. We welcome your inquiries and look forward to discussing these options with you.
Alternative One: STEM Extension of Optional Practical Training 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 24 months of STEM OPT (for a total of 36 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 or higher degree in science, technology, engineering, or mathematics from an accredited and SEVP-certified institution that has been designated as a “STEM field” by Immigration and Customs Enforcement (ICE); OR the student must be in a current period of post-completion OPT based on graduation from a non-STEM degree but has a prior STEM degree at the bachelor’s level or higher that was gained within 10 years of applying for the STEM OPT extension. The student must have received both degrees from currently accredited and SEVP-certified institutions and cannot have already received a STEM OPT extension based on the previous degree. The practical training opportunity also must be directly related to the previously-obtained STEM degree;
- 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.
If timing is an issue, note that a Form I-765, Application for Employment Authorization, seeking Optional Practical Training (OPT) or a STEM OPT extension can be submitted with Premium Processing for an additional fee.
Alternative Two: Exemptions From the H-1B Cap
Certain categories of H-1B employers are exempt from the annual numerical limit placed on new H-1B visas. These employers may qualify to sponsor H-1B employees at any time during the year, and even after the H-1B cap has been reached. The following is a list of the pertinent categories of “cap-exempt” employers.
– Institutions of higher education:
Generally speaking, these are universities, teaching hospitals, or other educational organizations above the high school level.
– Non-profit research organizations or governmental research organizations:
These are organizations that have as their principal function (which generally must be stated in their charter/formation documents) the conduct of basic and/or applied research, usually in the sciences, social sciences, or humanities. Basic research is defined as research that advances scientific knowledge. Applied research is defined as research to gain knowledge to determine the means by which a specific, recognized need may be met, usually having specific commercial objectives. It is possible for a non-profit organization that is not entirely committed to research to argue that it is primarily engaged in research activities.
– Non-profit organizations affiliated to institutions of higher education:
For non-profit organizations, this is a flexible category. It is possible to enter into an affiliation agreement with a university or other institution of higher education for a wide variety of purposes. McCown & Evans has assisted a number of non-profit organizations to formalize relationships with universities for the purpose of qualifying for a cap exemption under this category, including a legal services provider, a medical organization, and a software development association.
One creative solution for a prospective H-1B employee who was not selected under the cap is for the employee to first gain part-time H-1B employment through sponsorship by a cap-exempt employer (i.e. a university, non-profit research organization, or non-profit organization affiliated with a university) and then file a concurrent part-time H-1B petition with U.S. Citizenship and Immigration Services (USCIS) for a cap-subject employer, such as a for-profit company. In such circumstances, neither petition will be subject to the H-1B cap. Please note, however, that the employee must remain employed by the cap-exempt entity to maintain legal H-1B status while working for the cap-subject employer.
In this situation, the employee may still enter the lottery for a cap-subject H-1B even while working for the cap-exempt employer and working concurrently for the cap-subject employer.
Alternative Three: J-1 Exchange Visitor Visas
– J-1 Trainees
J-1 visas are available to individuals participating in on-the-job training programs and therefore are often good options for newly-hired employees who will be learning skills particular to a company’s systems, procedures, or technologies. J-1 programs for trainees allow foreign nationals to complete paid or unpaid training programs with private companies or non-profit organizations. The company or organization, or its attorneys, may work with an approved J-1 program sponsor to acquire J-1 visas for prospective trainees. In order to qualify as a J-1 trainee, the foreign national must enter the U.S. to participate in a structured and guided work-based training program in his or her field and meet one of these requirements:
- The foreign national must have a degree or professional certificate from a foreign post-secondary academic institution and at least one year of related work experience in his or her field acquired outside the U.S; OR
- The foreign national must have five years of related full-time work experience outside the U.S. in his or her field.
The J-1 trainee can be admitted to the U.S. for a period of up to 18 months. Upon the completion of a J-1 training program, the individual may not apply for an additional training program until he or she has resided for two years outside the U.S.
– J-1 Interns
J-1 programs for interns also allow foreign nationals to enter the U.S. to participate in work-based internship programs to build on academic experience or to develop practical skills in the academic or career field. The company or organization, or its attorneys, may work with an approved J-1 program sponsor to acquire J-1 visas for prospective interns. In order to qualify as an intern, the foreign national must meet one of these requirements:
- The foreign national must be currently enrolled in and pursuing studies at a degree or certificate granting post-secondary academic institution outside the U.S.; OR
- The foreign national must have graduated from a degree or certificate granting post-secondary academic institution outside the U.S. no more than 12 months prior to the internship program start date.
The maximum duration for an internship program for a J-1 intern is 12 months, but an individual may participate in an additional internship in certain situations. If the individual no longer qualifies for an internship because he or she no longer has student status abroad or is not within 12 months of graduation, the individual can potentially apply for J-1 trainee status.
– J-1 Research Scholars
J-1 programs for research scholars allow foreign nationals with research backgrounds to work in a research capacity for a U.S. employer, which can include a for-profit private company. The company or organization, or its attorneys, may work with an approved J-1 program sponsor to acquire J-1 visas for prospective research scholars.
The J-1 research scholar can be admitted to the U.S. for a period of up to five years.
Note on Dependents: Dependents (spouses and unmarried children under 21 years of age) of J-1 exchange visitors are entitled to J-2 status and may qualify for work authorization in the United States as long as the employment is not required for the support of the principal J-1 exchange visitor. A creative strategy for a prospective H-1B worker who was not selected under the cap and who does not qualify for J-1 status might be for the individual’s spouse to obtain a J-1 trainee or intern visa, which will allow the prospective H-1B worker to apply for work authorization as a J-2 dependent.
J-1 exchange visitors are expected to return to their country of last residence after completion of training in the United States. While there is often no bar to a J-1 visa holder obtaining H-1B or another work-authorized status in the future, the State Department or J-1 Program Sponsors may scrutinize employers who sponsor a foreign national to participate in a J-1 training or internship program and later sponsor the same person for a work visa such as an H-1B. In addition, some J-1 trainees or interns may be subject to a two-year foreign residence requirement following completion of their J-1 programs if the training or internship category falls under the “Skills List” of skills identified as being in short supply in the J-1 visa holder’s country of last residence, or if the J-1 program involves financial support from the U.S. government or the person’s foreign government. If the two-year foreign residence requirement applies due to the Skills List, no-objection waivers are available and are generally possible to obtain. Waivers of the two-year foreign residence requirement based on receipt of government funding are much more difficult to obtain.
Alternative Four: Day-1 CPT Work Authorization
One option for a prospective H-1B employee who was not selected under the cap is for the employee to enroll in a special “Day-1 CPT” degree program with a U.S. university and obtain or extend F-1 status in order to apply for Curricular Practical Training (CPT). Day-1 CPT authorization is approved at the discretion of the U.S. university and authorizes the F-1 student to work either part-time or full-time. The employment authorization begins immediately upon the start of the new academic program. This CPT authorization can allow the prospective H-1B employee to continue working for the U.S. employer until H-1B authorization can be obtained in a subsequent year. Moreover, if the Day-1 CPT degree program is for a higher level (such as a Master’s degree, where the employee’s prior degree was a Bachelor’s degree), the employee may even be eligible for a new period of OPT and even STEM OPT after completing the Day-1 CPT degree.
Day-1 CPT programs receive close scrutiny from USCIS. The area of study must align with the work that the employee performs with the host employer. Also, the programs must involve specified periods of in-person attendance at the university.
Alternative Five: E-2 Investor Visas
The E-2 treaty investor classification allows individuals who are nationals of countries with which the United States maintains certain treaties to come to the United States to run businesses in which they have made a “substantial” investment and in which they have at least a 50% ownership stake. Whether the actual amount invested is substantial depends on the type of business and the amount normally necessary to establish a viable enterprise. In most cases, an investment of $100,000-$150,000 will be sufficient.
The E-2 category also allows U.S. companies with treaty nationality (i.e. at least 50% ownership by individuals who are nationals of a treaty country) to sponsor employees having that same nationality on E-2 visas. A current list of the treaty countries can be found at this website.
E-2 visas can be issued for up to five years and are renewable indefinitely as long as the company and the visa holder continue to qualify for E-2 status.
Dependents (spouses and unmarried children under 21 years of age) of E-2 visa holders are also eligible for E-2 dependent visas, and E-2 spouses are work authorized incident to status in the United States. A creative strategy for a prospective H-1B worker who was not selected under the cap but whose spouse is a national of an E-2 treaty country is for the individual’s spouse to obtain an E-2 investor visa based on employment with a company in which the spouse is at least a 50% owner, or with a company that is at least 50% owned by individuals who are nationals of the same treaty country as the spouse. A viable strategy for a prospective H-1B worker who was not selected under the cap might be for the individual’s spouse to obtain an E-2 visa, which will allow the prospective H-1B worker to work under E-2 status as a dependent.
Alternative Six: O-1 Visas
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; or
– 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.
Alternative Seven: L-1 Intracompany Transferee Visas
Individuals who were employed by a company abroad in the three-year period prior to their admission to the U.S. (e.g. on an F-1 or J-1) may qualify for L-1 intracompany transferee status if that foreign company has a “qualifying organization” in the U.S. that will employ the foreign national and both the foreign and U.S. entities are doing business.
Companies can apply for an L-1 visa for an employee who, within the three preceding years their admission to the U.S., was employed outside the United States for a continuous year and seeks to be employed by a related entity in the U.S. The employee must be coming to work in the United States in an executive (L-1A), managerial (L-1A), or specialized knowledge (L-1B) capacity and must have been employed abroad by the related entity in an executive, managerial or specialized knowledge role.
L-1 status is generally approved for an initial period of three years and can be extended for up to a total of seven years for the L-1A category or five years for the L-1B category. After the end of the maximum L-1 period of stay, an individual must reside outside of the United States for a full year before becoming eligible to reapply for L (or H) status (although they may qualify for other nonimmigrant status or have secured a green card by then).
Individual L-1 petitions are filed with USCIS and, once approved, the individual will have their status changed within the U.S. or will apply for an L-1 visa abroad and then enter the U.S. to begin work for the U.S. entity.
In some cases, companies have already obtained “blanket” approval, which provides continuing approval of itself and some or all of its parent, branches, subsidiaries and affiliates as qualifying organizations. In these instances, the foreign national can apply for their visa directly at the U.S. consulate abroad (usually in their home country) and will be work authorized in L-1A or L-1B status upon arrival in the U.S.
Dependents (spouses and unmarried children under 21 years of age) of L-1 workers are entitled to L-2 status and L-2 spouses are work authorized incident to status in the United States (which means they are work authorized upon securing L-2 status through a change of status or admission into the U.S. on an L-2 visa).
So, in addition to seeing if the prospective H-1B worker themselves may qualify for an L-1, one should also determine if their spouse may qualify for L-1 status based on their prior foreign employment and current (or potential) U.S. employment. This would allow the prospective H-1B worker to work under L-2 status as a dependent of the L-1 principal.
Alternative Eight: Free Trade Visas for Citizens of Canada, Mexico, Australia, Chile, and Singapore
The United States has created special visas under its free trade agreements with Canada, Mexico, Australia, Chile, and Singapore. Therefore, if a company is seeking to hire an employee who is a citizen of one of these countries, there is a chance that there will be a visa option for that employee that is free from any annual quota issue. The visas for Australia (E-3 visa), Chile (H-1B1 visa), and Singapore (H-1B1 visa) are virtually identical to the H-1B visa in their eligibility criteria. Therefore, if the prospective employee would have qualified for an H-1B visa, then he or she will probably qualify for the E-3 or H-1B1 visa. Canadian and Mexican employees seeking TN visas face a different set of qualifying criteria because TNs must be employed in one of the qualifying occupations on the list established under the U.S.-Mexico-Canada Agreement (USMCA, formerly NAFTA). Companies seeking to hire a person using a TN visa are advised to seek advice from McCown & Evans regarding eligibility criteria.
Dependents of H-1B1 and TN visa holders are not allowed to work in the United States. However, dependent spouses in E-3D status are considered work authorized incident to status in the United States. A creative strategy for a prospective H-1B worker who was not selected under the cap and who does not qualify for E-3 status because he or she is not an Australian citizen might be for the individual’s Australian spouse to obtain an E-3 visa, which will allow the prospective H-1B worker to work under E-3D status as a dependent.
Alternative Nine: H-3 Trainees
U.S. employers can sponsor foreign workers for training for up to 24 months as H-3 trainees. 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 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.
H-3 petitions can be filed with a request for premium processing, so USCIS will act on the case within 15 business 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.
Alternative Ten: Employment Authorization for Dependent Visa Holders
It is worth asking your employees about the visa status and nationality 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-1/E-2, E-3D, L-2, or J-2) and then work under E-1/E-2, E-3D, L-2, or J-2 status as a dependent. Please note that E and L spouses are work authorized incident to status, while J-2 spouses must first obtain an 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 varies greatly and is likely to be more than seven months. 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).
If possible, consider filing the dependent Change of Status petition and EAD application concurrently with the primary status holder’s petition. USCIS recently resumed its policy of bundling the adjudication of Forms I-539 (e.g., requests for extension/change of H-4 or L-2 dependent status) and Forms I-765 (e.g., requests for H-4 EADs) that are filed by H-4 and L-2 dependents concurrently with Form I-129, Petition for Nonimmigrant Worker.
Alternative Eleven: 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 eight to ten months. These I-140 immigrant petition categories include:
– EB-1 Extraordinary Ability – for criteria, see this page
– EB-1 Outstanding Professor or Researcher – for criteria, see this page
– EB-2 National Interest Waiver – for criteria, see this page
Therefore, for a foreign national employee who has at least eight months of remaining lawful status either through F-1 OPT or STEM OPT, J-1 status, dependent 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 obtains work authorization through the permanent residence process without ever obtaining H-1B status.
Note that the foreign national employee’s “priority date” must be “current” – i.e., eligible for filing according to the current month’s Visa Bulletin published by the U.S. Department of State – to file an Adjustment of Status application together with an EAD application. The U.S. government issues a limited number of green cards each year and people born in India and China (as well as other countries, potentially) face long waiting periods before they are eligible to obtain employment authorization through these green card categories.
For those born in a country other than India or China (or who have a spouse born in a country other than India or China to which they can “cross charge,”) the EB-2 National Interest Waiver I-140 petition is a compelling and flexible option for quick employment authorization. To qualify, applicants must show that they have a particularly high level of skill in their field of endeavor and that their work benefits the country as a whole. A person seeking a National Interest Waiver may also self-petition, which means that the person would not need an employer sponsor.
Alternative Twelve: Employment at an Affiliated Overseas Company
Individuals who do not qualify for an H-1B cap visa could also consider work at an overseas affiliate or subsidiary of the U.S. company. Many countries offer work permit options including those that require the testing of the local labor market, intracompany transfer work permit options, and treaty-based work permits. While many jurisdictions have protections in place so that its citizens and legal residents can have first priority on job opportunities, highly skilled workers are desired in many locations.
For employers who do not have any overseas affiliates or subsidiaries, it might be worth researching digital nomad options for the employee to apply for a digital nomad visa to work remotely in a foreign country for the U.S. company.
Employers who are interested in further exploring overseas work authorization options are encouraged to contact their attorney at McCown & Evans LLP and our in-house global immigration professionals.
McCown & Evans will continue to monitor the new policies and will provide additional updates as information is released. And, as always, reach out to your attorney at McCown & Evans with any questions. If you are a new client, please contact us at (415) 432-5300 or by email to info@mccownevans.com.