On November 30, 2018, the United States Citizenship and Immigration Services (USCIS) and the Department of Homeland Security (DHS) announced a notice of proposed rulemaking in the Federal Register entitled “Registration Requirement for Petitioners Seeking to File H-1B Petitions on Behalf of Cap-Subject Aliens.” The proposed rule would implement significant changes to the current H-1B lottery process.

The proposed rule is open now for public comment until January 2, 2019, and provides for fundamental changes in the H-1B lottery system, creating a “pre-selection” system for H-1B cap-subject petitions.

H-1B regulations currently allow for an annual allotment of 65,000 H-1B petitions along with an additional 20,000 for professionals with a U.S. Master’s degree or higher.  Each year, employers file H-1B petitions for potential employees on April 1 (the normal filing period includes the first five business days of April).  Historically, USCIS has received well over the allotted numbers of petitions, forcing a “lottery” of the received cases.  The proposed rule is an effort to streamline the way H-1B petitions are received by USCIS through the creation of an electronic “pre-selection” system.  The rule also proposes to change the selection process for “regular cap” subject and “advanced degree cap” subject petitions.

Highlights of the Proposed Pre-Registration System

• DHS will designate a registration period prior to opening of cap, during which employers can “pre-register” an employee for an H-1B cap number.
• From the initial registration period, DHS will randomly select a sufficient number of electronic registrations to fill the available visa numbers. 
• Information needed to complete pre-registration for an individual employee will likely include biographic data such as Name, Date of Birth, and Country of Birth.
• Selected registrations will be notified with a “window” of filing time.  A selected registration will be given a 60-day window to complete and file the H-1B petition.  In order to stagger volume of applications received and in effort to increase adjudication efficiency, the 60-day window will vary.
• In an effort to curb H-1B abuse, each beneficiary will be allotted only one opportunity at pre-registration per company. 
• USCIS will maintain a “wait list” of reserve registrations to ensure the applicant pool is sufficient to fill H-1B quota regulations.
• Should USCIS receive too few pre-registrations, the registration process can be re-opened by USCIS to secure more H-1B registrations. 

Changes to Master’s Cap Selection Process

Under current protocol, the lottery for petitions filed for the “Master’s cap” are selected first and any unselected petitions are included in the lottery for the “Regular cap.”  Under the proposed rule, USCIS would include all petitions received in the first lottery and then move any remaining Master’s cap eligible filings to the 2nd lottery, with the expectation that this will increase the overall percentage of  
H-1B cap cases selected for advanced degree professionals. DHS indicates that this rule is consistent with the administration’s stated goals in the Executive Order 13788, “Buy American Hire American,” to ensure that “H-1B visas are awarded to the most-skilled or highest paid petition beneficiaries.”

Implementation and Timing for Pre-registration System

DHS has published the notice, today, December 3, and the rule will be open for public comment until January 2, 2019. In the proposed rule-making, USCIS has indicated they have the option of delaying implementation of the pre-registration system for next year’s H-1B cap filing season if technical issues exist, though the initial intent is to have the pre-registration system in place.  The decision to delay implementation of the pre-registration system would not affect implementation of the changes to the Master’s cap selection process, as USCIS has imbedded a severability clause in the rulemaking.
Due to the uncertainty of the proposed rule and its implementation, employers should continue to plan for filing for H-1B quota cases, as they have in the past, until a final regulation is issued.

We encourage employers to begin planning for H-1B season early by determining who in your organization will require H-1B sponsorship.