Mark A Ivener, A Law Corporation

H-1B Update: FY 2010 Filing Starts April 1

U.S. Citizenship and Immigration Services (USCIS) has announced that it is accepting fiscal year (FY) 2010 H-1B applications starting on April 1, 2009. In recent years, H-1B numbers have been used up on the first day of the filing period, which has led to more and more applications being filed in a rush. To alleviate difficulties caused by so many H-1B applications being filed on the same day, USCIS has put in place a five-day window for FY 2010 H-1B filings if the agency receives 65,000 or more H-1B applications within the first five business days in April, ending April 7, 2009. This means that if that situation occurs, the selection process (“lottery”) will be based on petitions received during all of the five days, and the receipt date for all of those cases likely will be the same: April 8, 2009.

Exempt from the 65,000 cap are those who: (1) are employed at, or have received offers of employment from, an institution of higher education, or a related or affiliated nonprofit entity; (2) are employed at, or have received offers of employment from, a nonprofit research organization or a governmental research organization; or (3) have earned a master’s or higher degree from a U.S. institution of higher education. There is a 20,000 cap on master’s degree exemptions.

The following are highlights of recent H-1B developments:

Interim final rule. USCIS issued an interim final rule effective March 24, 2008, governing petitions filed on behalf of workers subject to the annual numerical limitations applicable to the H nonimmigrant classification. This rule provides that USCIS will include petitions filed on all of those first five business days in the random selection process if USCIS receives a sufficient number of petitions to reach the applicable numerical limit (including limits on exemptions) on any one of the five business days on which USCIS may accept petitions. USCIS has determined that a filing period of five business days is sufficient to account for a wider range of mail delivery times offered by the various mail delivery providers available to the public.

This rule also provides that if both the 65,000 and 20,000 caps are reached within the first five business days available for filing H- 1B petitions for a given fiscal year, USCIS must first conduct the random selection process for petitions subject to the 20,000 cap on master’s degree exemptions before it may begin the random selection process of petitions to be counted toward the 65,000 cap. After conducting the random selection for petitions subject to the 20,000 cap, USCIS then must add any non-selected petitions to the pool of petitions subject to the 65,000 cap and conduct the random selection process for this combined group of petitions. Therefore, those petitions that otherwise would be eligible for the master’s degree exemption that are not selected in the first random selection will have another opportunity to be selected for an H-1B number in the second random selection process. This rule also clarifies that those petitions not selected in either random selection will be rejected.

To ensure the fair and equitable distribution of cap numbers, the interim rule also precludes a petitioner (or its authorized representative) from filing, during the course of any fiscal year, more than one H-1B petition on behalf of the same beneficiary if such person is subject to the 65,000 cap or qualifies for the master’s degree exemption. USCIS said it recognizes that, on occasion, an employer may extend the same worker two or more job offers for distinct positions and therefore have a legitimate business need to file two or more separate H-1B petitions on behalf of the same person. This rule precludes this practice if the beneficiary is subject to the numerical limitations or qualifies for the master’s degree exemption.

In cases where USCIS does not discover that duplicative or multiple petitions were filed until after approving them, the rule also provides that USCIS may revoke all such petitions if they were approved after this rule becomes effective.

The rule does not, however, preclude related employers from filing petitions on behalf of the same worker. USCIS said it recognizes that an employer and one or more related entities (such as a parent, subsidiary, or affiliate) may extend the same worker two or more job offers for distinct positions and therefore have a legitimate business need to file two or more separate H-1B petitions on behalf of the same person.

For example, USCIS noted, a Fortune 500 company may be the parent company of numerous U.S.-based subsidiaries whose business is to engage in either the food, beverage, or snack industries. Each line of business may, in turn, be divided into several business units and operate distinct companies (e.g., restaurant, bottled beverage plant, cereal manufacturer) with different EIN numbers and addresses. Although all the subsidiaries are ultimately related to the parent company through corporate ownership, this rule does not prohibit different subsidiaries from filing one H-1B petition each on behalf of the same worker so long as each employer/subsidiary has a legitimate business need to hire the worker for a position within that subsidiary’s corporate structure. Thus, in this example, if the bottled beverage plant owned by the Fortune 500 company and the cereal manufacturing company owned by the same Fortune 500 company are each in need of the services of a Chief Financial Officer, both may file one petition each on behalf of the same worker. A subsidiary should not file an H-1B petition for a worker just to increase the person’s chances of being selected for an H-1B number where that subsidiary has no legitimate need to employ the worker and is, instead, only filing a petition to facilitate the worker’s hiring by a different, although related, subsidiary.

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H-1B employers receiving TARP funding. Meanwhile, USCIS has announced additional H-1B requirements for employers receiving Troubled Asset Relief Program (TARP) funding before hiring H-1B specialty occupation workers. The new “Employ American Workers Act” (EAWA), signed into law by President Obama as part of the American Recovery and Reinvestment Act on February 17, 2009, was enacted to ensure that companies receiving covered funding do not displace U.S. workers. Under this legislation, any company that has received covered funding and seeks to hire new H-1B workers is considered an “H-1B dependent employer.” All H-1B dependent employers must make additional attestations to the Department of Labor (DOL) when filing the Labor Condition Application (LCA).

EAWA applies to any LCA and/or H-1B petition filed on or after February 17, 2009, involving any employment by a new employer, including concurrent employment and regardless of whether the beneficiary is already in H-1B status. The EAWA also applies to new hires based on a petition approved before February 17, 2009, if the H-1B employee had not started working before that date.

EAWA does not apply to H-1B petitions seeking to change the status of a beneficiary already working for the employer in another work-authorized category. It also does not apply to H-1B petitions seeking an extension of stay for a current employee with the same employer.

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Revised Form I-129. USCIS has revised Form I-129, Petition for Nonimmigrant Worker, to include a question asking whether the petitioner has received covered funding. USCIS has posted this form.

While USCIS encourages petitioners, whenever possible, to use the most up-to-date form, the agency said it will not require use of the revised form in time for the start of the filing period for fiscal year 2010. However, USCIS urges H-1B petitions who have already prepared packages for mailing using the previous Form I-129 (January 2009 version) to complete only the page in the revised version of the Form I-129 (March 2009) that has the new question on EAWA attestation requirements and to file this single page with the prepared package. The single page referenced is the first page on the H-1B Data Collection and Filing Fee Exemption Supplement.

USCIS reminds petitioners that a valid LCA must be on file with DOL at the time the H-1B petition is filed with USCIS. This means that if the petitioner indicates on its petition that it is subject to the EAWA, but the LCA does not contain the proper attestations relating to H-1B dependent employers, USCIS will deny the H-1B petition.

Meanwhile, Bank of America has withdrawn many job offers to MBA students graduating from U.S. business schools because of the H-1B limitation on TARP funding. About a third of MBA students at leading U.S. schools who go into finance and banking jobs come from outside the U.S. David Schmittlein, dean of MIT’s Sloan School of Management, worried that “[t]here might be an inclination for people from around the world to vote with their feet.”

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About the Author

Mark A. Ivener, A Law Corporation, a nationally recognized law firm, has successfully assisted hundreds of clients in immigration matters.