The need for a modernization of the H-1B Program has been in the pipeline and in discussion throughout the Biden years, but only in the waning days of the administration did the Department of Homeland Security (DHS) issue regulations which will significantly overhaul the program with the following significant changes. The changes include:
- Codifying the ‘Deference Policy’ - New H-1B regulations mandate that when adjudicators review an H-1B petition with the same parties and underlying facts, adjudicators should defer to the prior decision made in a case submission unless a material error in the prior H-1B approval is discovered or a material change affects the foreign national’s eligibility for the visa classification.
- Evidence of maintenance of status - When requesting a change of status or extension of stay, the foreign national must furnish evidence of maintenance of status with the specific request made.
- Locations of employment - Itinerary requirements are eliminated from H1B classification petitions, as the underlying Labor Condition filed concurrently with the H-1B petition covers location(s) of employment.
- Definition of ‘specialty occupation’ – By way of background, historically the H-1B classification has been granted to foreign nationals entering the U.S. to perform services in a ‘specialty occupation’ for a U.S. employer. Specialty occupations have been defined as ones that require a ‘theoretical and practical application of a body of highly specialized knowledge’ and attainment of a bachelor’s or higher degree in a specific specialty (or its equivalent) as a minimum for entry to the United States.
Since the 1970’s when the definition was included in the H-1B regulations, the definition of “specialty occupation” has evolved and the USCIS analysis now includes:
- Specialty Occupation Credentials
Is the proffered position a specialty occupation and does the degree correlate to the job duties, and does the prospective H-1B employee qualify for the specialty occupation by virtue of their own educational credentials or combined education and professional-level experience?
- Program Coursework
The title of a degree conferred by an educational institution itself may not be determinative as to whether one qualifies for a job offer in a ‘specialty occupation’; USCIS will review the coursework of an underlying educational program and course of study to determine the direct relationship between the program and completion of coursework and the ‘direct’ correlation between course of study and duties of the position offered.
- Degree Requirements
When a U.S. employer alleges that a job offer for H-1B purposes normally requires a degree requirement, USCIS has stated that this doesn’t mean it ‘always’ makes a foreign national eligible for the job offer and it will determine whether a specific bachelor’s degree or higher is normally required to perform the duties of the position offered.
- Continued Evaluation
USCIS will continue to consider a course of study, work experience, skills and related factors to determine whether a foreign national qualifies for the duties of the position offered and it will focus on a ‘match between the required skills and job duties.
- ‘Direct’ and ‘Logical’ Connection to Duties
When considering that specific knowledge might be required for a specialty occupation, USCIS will consider a range of qualifying fields, but all fields must be ‘directly related’ to the job duties; that is, they must have a ‘logical connection’ between the degree or its equivalent – but an ‘exact’ connection is not required. H-1B prospective beneficiaries with generic bachelor’s or master’s degrees in business administration, or those with engineering degrees will be challenged on the coursework they have undertaken and its ‘direct’ and ‘logical’ connection to the proffered job duties.
- ‘Specialty Occupation’ for Entrepreneurs
Foreign national entrepreneurs and business owners may qualify to file for their own H-1B petitions for their own companies; however, the specific duties must qualify for a ‘specialty occupation’ – duties cannot be merely administrative but must on the whole be considered those qualifying one in a ‘specialty’ occupation.
Maintaining H-1B Program Integrity
USCIS has indicated that to assure that the H-1B program remains bona fide, certain additional criteria are mandatory and demanded of U.S. employers:
- Codification of USCIS authority to request contracts/evidence to assure that a position is bona fide, and the underlying labor condition secured from the U.S. Department of Labor supporting the H-1B petition corresponds to the proffered position.
- Elimination of requirement to document the employer-employee relationship and no need for employer to furnish specific day-to-day assignments for the entire time that the H-1B beneficiary will work for employer. This was common in third-party placement H-1B petitions filed by placement companies if employment was not direct.
- Confirms that the U.S. employer no longer requires that the U.S. employer must establish the right to control the foreign national H-1B daily work.
- Changes the definition of “United States employer” to require that the U.S. petitioning entity maintain a legal presence in the United States and be amenable to service of process in the United States.
Third-Party Placement
USCIS has, over the past decade and more, put up much resistance to staffing companies that might participate in the H-1B program. The regulations now confirm that these third-party placement arrangements are now permissible and allow for more flexibility in not demanding intended limitation of H-1B validity to end-date contracts, work order or similar documentation which had been demanded routinely for these filings.
Cap-Exempt H-1B Entities
While private industry is subject to the H-1B annual cap limitations, some research organizations and universities have historically been ‘cap-exempt’. Over 300,000 H-1B ‘cap-exempt’ filings are submitted annually for qualifying entities. The USCIS regulations have now been expanded to increase the definition of ‘cap-exempt’ entities, therefore allowing more organizations to qualify in this category.
Work-Site Visits
USCIS will increase its site visit program through FDNS (Fraud Detection and National Security Directorate). Historically, FDNS has made on-site visits to U.S. employers with no advance notice and demanded payroll records, visits with managers and H-1B visa designates on-site performing their jobs. It has even visited H-1B beneficiaries at their remote work (home) locations without advance notification. It is expected on-site visits will increase to ensure compliance with the program, especially given past abuse of the H-1B lottery submissions. In the last few years, after initial introduction of the online H-1B pre-registration system, many U.S. companies gamed the system by colluding with others or submitting multiple petitions for the same foreign national. A strong effort to reduce fraud took place in the latest H-1B filing period which concluded in March 2024. We expect increased site visits and more scrutiny and regulations governing the H-1B pre-registration submissions going forward.
F-1 Student Visa Applicants
Flexibility and loosening for F-1 students in Optional Practical training status will become effective in order that foreign students may transition more easily to H-1B status with additional “Cap-Gap” rules expanding on their ability to remain in the U.S. without interruption.
Conclusion
In the early days, the H-1B visa was not capped by number, and the definition of ‘specialty occupation’ was much more flexible as compared to the current increased and tightening of regulations. Limitation of visa availability and tremendous demand of U.S. companies to hire foreign talent made it clear that an overhaul of the regulations was required. However, to remain competitive in the global marketplace, and for the United States to remain a leader in technology, the sciences and all fields, increasing the numbers of ‘capped’ H-1B visas would have been warranted and more creativity regarding other visa options for entrepreneurs and others would be available.
The H-1B regulations are considered ‘final’ as of January 17, 2024. However, it remains to be seen if the incoming administration will once again review the regulations and have DHS issue new H-1B regulations through notice and comment rulemaking, which would take many months to achieve and finalize.
Other nonimmigrant visa options, including the O1 visa for extraordinary workers, the E visa for executive, managerial and essential skilled workers from qualifying countries and more, remain backups available for consideration in the event that one may not be selected in the H-1B lottery or not qualify in the first instance.
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