The Department of Homeland Security (DHS) released a proposed rule in mid-October which could have significant impacts on the H-1B visa program, affecting both employers and prospective employees.
The proposed rule contains important elements impacting all prospective employers and tens of thousands of H-1B beneficiaries. The rule is intended to increase fairness in the H-1B cap process, expand and better define specific eligibility requirements, and increase flexibility in key areas for both employers and applicants.
The rule is now open for public comment, after which DHS will publish it in final form, presumably early in 2024. Briefly, here’s a summary of what’s changed in the proposed rule.
H-1B cap registration/beneficiary based selection
To safeguard against abuse, the new regulations specify that each cap-subject beneficiary will only be registered for the lottery once, regardless of how many registrations are submitted in their name. This change will ensure that each beneficiary has the same odds of selection and prevent organizations from misusing the registration system by filing multiple registrations for a single beneficiary.
The Department of Homeland Security said this change was intended to “reduce frivolous registrations” and also “harmonize the expectations for petition filing and registration submission.”
“This provision may serve as an additional deterrent to further reduce the incentive for companies filing multiple registrations to have a higher chance of selection,” the narrative in the proposed rule reads. “This change may benefit petitioners whose chances of selection have been negatively affected by companies filing multiple registrations to increase the chances of selection.”
Expansion of “cap-exempt” eligibility
The new guidelines would expand the eligibility criteria for cap-exempt status.
The changes broaden the definition of nonprofit and governmental research organizations to allow groups that conduct “research as a fundamental activity but are not primarily engaged in research or where research is not a primary mission” to meet the regulatory definition of a nonprofit research entity.
Further, the new rule changes the requirement that foreign nationals must be “directly employed by a qualifying organization” to be eligible for an H-1B cap exemption. Instead, the applicable individuals can be cap exempt if they “provide essential work, even if their duties do not necessarily directly further the organization’s essential purpose.”
“These proposed changes are intended to clarify, simplify and modernize eligibility for cap-exempt H–1B employment, so that they are less restrictive and better reflect modern employment relationships,” the rule reads. “The proposed changes are also intended to provide additional flexibility to petitioners to better implement Congress’s intent to exempt from the annual H–1B cap certain H–1B beneficiaries who are employed at a qualifying institution, organization or entity.”
H-1Bs for business owners
The proposed rule would allow the issuance of H-1B status to business owners who own interest in the H-1B petitioning entity. This proposed change would be subject to certain conditions where the beneficiary owns a controlling interest in the petitioner.
The Department of Homeland Security proposes that the “bona fide job offer” to the potential H-1B recipient can include “telework, remote work or other off-site work within the United States.”
“While USCIS currently allows these types of work arrangements (provided they are consistent with the certified LCA and other regulatory requirements), the regulations do not state this expressly,” the rule reads. “DHS believes this clarification is helpful as more businesses allow and more workers choose telework, remote work or other types of work arrangements.”
Additional “cap gap” time for F-1 student visa holders
The Department of Homeland Security (DHS) has proposed lengthening the automatic cap-gap extension from October 1 of the applicable fiscal year to April 1 in order to “avoid disruption to U.S. employers that are lawfully employing F-1 students while a qualifying H-1B cap-subject petition is pending.”
DHS estimated in the final rule that almost 32,000 F-1 students annually could benefit from the change by avoiding disruption to their employment.
Revised Definition of qualifying specialty occupation
The new rule proposes changing the definition of a specialty occupation to clarify that there “must be a direct relationship between the required degree field(s) and the duties of the position; there may be more than one acceptable degree field for a specialty occupation; and a general degree is insufficient.” The new rule would clarify that “normally” does not mean “always” within the criteria for a specialty occupation.
In addition, the proposed change acknowledges that while a position may allow a range of degrees, there must be a direct relationship between the required degree field(s) and the duties of the position.
“As in the past, to establish a direct relationship, the petitioner would need to provide information regarding the course(s) of study associated with the required degree, or its equivalent, and the duties of the proffered position, and demonstrate the connection between the course of study and the duties and responsibilities of the position,” the rule published in the Federal Register reads. “Lastly, when an H-1B beneficiary is staffed to a third party, the requirements of the third party, not the petitioner, would be used to determine whether the position qualifies as a specialty occupation.”
Deference to prior approvals.
The proposed rule would codify USCIS’ current policy of affording deference to its prior adjudications when there has been no material change to the parties or the facts underlying the case. This would give employers and beneficiaries greater stability and predictability when seeking the extension of an employee’s visa status.
The new regulations may not become law exactly how they were published in the Federal Register on Oct. 23, 2023.
The rule is subject to a 60-day public comment period, which will close on Dec. 22, 2023. The Biden administration and the DHS will then evaluate the comments and make any applicable changes before releasing a final rule, likely in 2024.
The attorneys at Garfinkel Immigration Law Firm continue to monitor the situation closely and will alert clients as more information becomes available. Please contact the Garfinkel Immigration attorneys with questions or to receive further information.