On March 10, 2016, the Department of Homeland Security published the new STEM Optional Practical Training (“OPT”) final rule in the Federal Register. The effective date of this new final rule is May 10, 2016, the date that the existing STEM OPT rule expires due to a federal court injunction. This rule applies to F-1 status foreign national students who are completing degree programs in certain designated Science, Technology, Engineering, and Mathematics (STEM) fields at a DOE-accredited and SEVP-certified U.S. educational institution. The rule governs the employment authorization these students can receive at the conclusion of their educational program and extends the employment authorization period beyond the initial 12-months that all F-1 students who complete a degree program in the United States receive.

As we describe below, this new rule makes far-reaching changes to the existing program and contains both opportunities and responsibilities for U.S. employers that employ recent foreign national graduates.

For updates on litigation over the STEM OPT rule and the proposed rule, please review our prior alerts here.

Summary of the new STEM OPT Rule

Most significantly, the STEM OPT extension will now allow for 24 months of employment authorization as opposed to the current 17 months.

Another very significant change is the creation of a new “Mentoring and Training Plan” obligation imposed on employers and employees, coupled with DHS’s enhanced ability to verify the employer’s compliance with OPT program requirements . We describe these changes in greater detail below:

• Training and Mentoring Plan (Form I-983): Employers and foreign workers must create a Training and Mentoring Plan identifying learning objectives and a plan to achieve these objectives within the 24 month STEM OPT period. This training plan must address the following key points:
  • The employer has sufficient resources and trained personnel available to provide appropriate training in connection with the specified opportunity;
  • The student will not replace a full or part-time, temporary or permanent U.S. worker; AND
  • The opportunity will help the student achieve his or her training objectives;
• Site visits: DHS has extended its authority to conduct site visits to verify the employment of OPT workers and the employer’s compliance with the training and mentoring plan requirements as represented by the employer in Form I-983. While DHS will normally provide 48-hour notice before conducting a site visit, the agency reserves the right to conduct a visit without notice if “a complaint or other evidence of noncompliance with the STEM OPT extension regulations triggers the visit”. This is an ominous sign for employers, who must treat their obligations as described in their Form I-983 with the utmost seriousness.
• Reporting Requirements: The student and employer must report annually on their compliance with the training plan. Additionally, a mid-point evaluation must also be provided during the first 12-month interval, and a final evaluation must be completed prior to the conclusion of the STEM OPT extension. This results in a total of four (4) evaluations that must be provided during the 24-month period, including the initial Form I-983.

However, some OPT practices remain unchanged from the existing rule:

• A U.S. employer must be registered with E-Verify to employ a foreign worker with a STEM OPT extension;
• The “cap-gap” will continue to provide an automatic extension of employment authorization and/or “duration of status” (D/S) through October 1 to a student if he/she is the beneficiary of a timely filed H-1B petition and change of status request that is pending with or approved by USCIS. The practical impact is that employers can continue to employ, through October 1 of any given year, a student whose OPT authorization expires between April 1 and October 1. 

Analysis and Employer Insights:

On one hand, the new OPT STEM rule provides great opportunities to employers seeking to hire international STEM workers who have been educated at accredited and SEVP-certified U.S. educational institutions. On the other hand, the new rule significantly increases the regulation of employers hiring OPT STEM trainees. Due to the scope and significance of these regulations, and the upcoming May 10, 2016 deadline, we recommend that employers hiring international STEM workers quickly determine and develop a process for creating and maintaining the Mentoring and Training Program (Form I-983) and how to comply with new reporting requirements. Much like I-9 responsibilities, it is essential that individuals designated with the Form I-983 responsibility familiarize themselves with the form and the various reporting requirements. We expect the DHS to publish Form I-983 and clearly establish the process for reporting in the near future. The new final rule also provides a compelling reason for employers, who may have a need for international talent in STEM fields, to consider enrolling in E-Verify to benefit from this program.