H-1B and L-1 visa reforms passed by Congress

News Release from Jewell & Associates - November 22, 2004 On Sunday, November 21, 2004, Congress passed the Fiscal 2005 Omnibus Appropriations Bill (H.R. 4818), which contains significant amendments to the H and L visa categories.  The bill will be presented to the President for signature shortly.  Upon signing by the President, the bill will have been enacted into law.  Some of the bill’s key immigration provisions include:

20,000 new H-1Bs: The new law will exempt from the annual H-1B cap 20,000 H-1Bs with advanced degrees from U.S. universities. This provision will go into effect 90 days from the date of enactment.

Increase in H-1B filing fees: Effective immediately upon enactment, the new law will restore the supplemental H-1B filing fee known as the “ACWIA fee,” and increase it to $1,500 per petition. Employers with no more than 25 full-time employees in the U.S. will be assessed only half of the full fee, however. In addition, each petition for an initial H-1B will carry a $500 supplemental fee that will go into a government account to be used for fraud-detection.


Change in calculation of the prevailing wage: The new law will eliminate the “95% rule” and instead require H-1B employers to pay at least 100% of the local prevailing wage for the occupation in question. However, the law will also require governmental surveys made available to employers for purposes of determining the prevailing wage to provide four levels of wages commensurate with experience, education, and the level of supervision. If a two-level wage survey is used (such as the widely used OES Survey, which provides only an “entry level” and an “experience” wage), the law will provide a formula for calculating the two additional intermediate levels. These provisions will go into effect 90 days from the date of enactment.


Restoration of requirements for “H-1B-dependent” employers: The new law will restore the requirement that employers who meet the definition of “H-1B dependent” or of “willful violators” make a non-displacement attestation (an attestation that U.S. workers have not been displaced) in connection with any H-1B filings. This provisions will go into effect 90 days from the date of enactment.


Limits on placement of L-1Bs at client sites: The new law will prohibit L-1Bs from being principally stationed at the worksite of an unaffiliated employer if L-1B employee will be controlled and supervised by the unaffiliated employer, or if placement of the L-1B employee at the third-party site is part of an outsourcing arrangement instead of in connection with the provision of a product or service involving specialized knowledge specific to the L-1B employer. This provision will apply to initial, extended or amended L-1B petitions filed 180 days from the date of enactment.


Restores 12-month service requirement to blanket L-1s: The new law replaces the requirement that beneficiaries of “blanket” L-1 petitions have only six months of service to the employer abroad with a twelve-month requirement. The twelve-month rule will apply only to requests for initial L-1 classification filed on or after the 180th day from the date of enactment.


© Jewell & Associates 2004

H-1B Cap for FY2005 nearly reached

News Release from Jewell & Associates - August 20, 2004 Government authorities confirmed a rumor today that approximately 40,000 H-1B petitions that count against the 65,000 cap on new H-1B approvals for FY 2005 (10/1/2004 through 9/30/2005) either have been approved or are in the queue for adjudication.  The 65,000 cap includes a number of H-1Bs reserved for citizens of Chile and Singapore under the recent Free Trade Agreement with those countries.  Allowing for the Chile/Singapore set-aside, it is probable that new, cap-subject H-1B petitions filed with USCIS (the former INS) after September 2004 will not be accorded approval under the FY 2005 cap.  H-1Bs under the FY 2006 cap will not be effective until October 1, 2005.

It is important to note that only “new” H-1B petitions are subject to the annual cap. Petitions to amend or extend an existing H-1B or to change H-1B employers are not subject to the cap. Employers planning to file “new” H-1B petitions should consult with their immigration counsel as soon as possible on the appropriate strategy for such cases.

© Jewell & Associates 2004

Labor certifications under DOL’s proposed PERM program

News Release from Jewell & Associates - June 10, 2004

We reported last year on PERM (Program Electronic Review Management), a proposed federal regulation that would replace the current Department of Labor (DOL) labor certification regulations that govern the way employers sponsor employees for U.S. permanent residence (a “green card”).  The PERM proposal would replace current DOL regulations, with an automated processing system.  DOL published the proposed PERM rule in the Federal Register on May 6, 2002 and accepted comments until July 5, 2002.  DOL sent a final rule to the federal Office of Management and Budget (OMB) on February 23, 2004 for review that was expected to take 90 days, i.e., until late May 2004.  Although a final rule has not yet been published, DOL has begun recruiting for PERM-related government positions and has solicited bids for the technology that must be in place to process PERM applications.  For these reasons, we believe a final rule is imminent.  DOL has stated that there will be a 120-day period between the publication of a final rule and its effective date.  Therefore, if (hypothetically) a final rule were published in June 2004, labor certification applications filed under PERM could be filed as early as October 2004.

Summary of the existing system: “Slow track” and “fast track” labor certification applications (valid to approximately late 2004, when PERM is expected to replace current processes)

Permanent residence (the “green card”) based on employment normally requires a recruitment exercise to establish the unavailability of qualified U.S. workers.  Exceptions exist for multinational executives/managers, outstanding professors and researchers, and individuals of extraordinary ability.

Currently, and until approximately late 2004 when the U.S. Department of Labor (DOL) is expected to implement its PERM program, the federal regulations provide two ways to apply for a labor certification, i.e., certification by DOL that the employer has recruited and has not found qualified, available U.S. workers:

  1. Fast track / reduction-in-recruitment / RIR method:  The employer advertises in print media and other media over the course of several months, then files the application with a request that government-supervised recruitment be waived.  A final decision from DOL currently takes about two years from the time of filing, though some regional variations in timing exist.
  2. Slow track / non-reduction-in-recruitment / non-RIR method:  The employer files a “bare bones” application with no evidence of recruitment, and states that it will comply with government-supervised recruitment.  The government-supervised recruitment will take place at least a year later (though some regional variations in timing exist), and will consist of a three-day newspaper ad or a single ad in a professional journal, plus internal posting.  Provided that the recruitment yields no qualified, available U.S. workers, a labor certification should be issued, but such approval may be four or more years from the time of filing (again, regional variations exist).

Summary of the proposed PERM system (expected to replace the current labor certification system in late 2004)

The summary below is based on the proposed PERM rule.  The final rule on PERM may be different from the proposed rule.

The biggest changes embodied in the PERM proposal are:

  1. The employer will lose some flexibility in describing job requirements and evaluating applicants:  Generally speaking, job requirements must be stated in terms of degree and experience only.  Listing of alternate ways of satisfying requirements will not be permitted.  Requiring special skills, beyond the degree and experience requirements, will not be allowed unless the skills are “normal” to the occupation and the employer has recently employed a U.S. worker with the same skills in the same occupation. Any extra requirements may not be allowed, though it is expected that DOL in its final PERM rule will provide for employer’s to justify such requirements based on business necessity.  U.S. workers who do not meet the requirements but who could be trained in a “reasonable period of on-the-job training” must be considered qualified.
  2. The employer will always recruit in advance of filing:  The proposed regulation sets forth the types of recruitment that must be done, depending on the type of position.  For most professional jobs, the recruitment will involve a combination of print advertising, three additional forms of recruitment (e.g., Internet site, on-campus recruiting, job fairs, headhunters) and, if the employer has had lay-offs in the preceding six months, notification to laid-off workers.
  3. The employer will not submit recruitment documentation with the application:  The application will consist principally of a DOL form on which the employer attests to having complied with all of the recruitment requirements and to not having located a qualified, available, U.S. worker.
  4. The application will be processed electronically by an automated system and may result in a labor certification in as few as 21 days:   Unless an application is flagged for an audit, the processing will be entirely electronic, without human intervention.  The automated system will read the application forms and will detect responses that would flag a case for an audit.  In addition, any case may be subject to random auditing. If a filing is not flagged for an audit, the labor certification may be granted in as few as 21 days.
  5. DOL may audit the employer’s recruitment documentation before rendering a decision on the application:  If a case is flagged for an audit, the employer will be given 21 days within which to produce documentation that its attestations regarding the recruitment were truthful.  Depending on what the employer provides, DOL will approve the labor certification, deny the labor certification, or order government-supervised recruitment.
  6. Labor certifications may be revoked for cause within a year of issuance:  Even after a labor certification is issued, the proposed regulation would allow DOL to revoke its approval within a year, provided the employee has not yet obtained permanent residence in the U.S. or received a U.S. immigrant visa from a consulate abroad.  The proposed rule is not specific about what would be just cause for such a revocation.

The following is a summary of the procedural steps that most successful labor certification cases will follow if the PERM proposal is adopted as-is:

  • Step 1:  Submit prevailing wage request (Form ETA 9088) to the State Workforce Agency and obtain a prevailing wage determination.
  • Step 2:  Post internal notice of labor certification via all in-house media, including electronic media.
  • Step 3:  Undertake recruitment program consisting of: (a) placing a job order with the State Workforce Agency; (b) print advertising, e.g., depending on the occupation, two Sunday newspaper ads or one national journal ad; (c) three additional forms of recruitment from among a list of acceptable forms (the list includes Internet job sites, the employer’s own web site, on-campus recruiting, job fairs, and headhunters); and (d) notice to potentially qualified workers whom the employer laid off in the preceding six months.
  • Step 4:  Submit to DOL the labor certification application (Form ETA 9089), on which the employer has checked responses attesting to its recruitment efforts.
  • Step 5:  Either automatically, or after a DOL audit, receive approved labor certification and proceed with the rest of the employee’s immigration process (I-140 immigrant petition; then, final application for permanent residence through I-485 adjustment-of-status or through consular processing).

© Jewell & Associates 2004

USCIS Releases H-1B Cap usage for the first quarter of FY04

News Release from Jewell & Associates - January 22, 2004

In a brief statement issued January 21, 2004, U.S. Citizenship and Immigration Services (USCIS) announced that, based upon tabulations for the first quarter of fiscal year 2004 (October 1, 2004 through December 31, 2004), 43,500 H-1B cases that could count against the 65,000 cap on new H-1B approvals for FY 2004 either have been approved or are in the queue for adjudication.  Based on these numbers, we believe that the annual limit on new H-1B approvals may be reached with petitions filed only through mid-February 2004, and that later-filed petitions may be rejected.  The new fiscal year, which will bring another allotment of 65,000 new H-1Bs, will not begin until October 1, 2004.  During the interval between the exhaustion of the H-1B cap and October 1, 2004, new H-1Bs will not be approved.

It is important to note that only “new” H-1B petitions are subject to the annual cap.  H-1B petitions for an amendment, an extension-of-stay or a change-of-employer are not subject to the cap.  Employers planning to file “new” H-1B petitions should consult with their immigration counsel as soon as possible on the appropriate strategy for such cases.

© Jewell & Associates 2004