Department Of State Proposes To End B-1 In Lieu Of H-1B Visa

Jackson Lewis P.C.
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The B-1 in lieu of H-1B visa has been used by international companies to bring employees who remain on payrolls abroad to the United States for short periods of time (generally fewer than six months) to do professional level work that benefits the company abroad. Through the rulemaking process, the Department of State is proposing to eliminate the B-1 in lieu of H-1B.

This is the government’s latest move under the authority of President Donald Trump’s Buy American, Hire American Executive Order. Others include the proclamation that was meant to block the entry of individuals in H-1B status on account of COVID-19 and new rules that would upend settled employment expectations by tightening H-1B regulations and raising H-1B wages – all of which are subjects of litigation.

According to DOS, only about 6,000 – 8,000 of these visas are issued annually. The Administration continues to rigorously enforce its mandate to protect economic interests in the United States and the B-1 in lieu of H-1B is the most recent casualty. The rationale is that these individuals enter the United States in B-1 in lieu of H-1B status without complying with the more rigorous prevailing wage requirements of an H-1B or filing petitions with USCIS, depriving USCIS of its filing fees. But in most instances, B-1 in lieu of H-1B status is used conscientiously and foreign workers do not replace U.S. workers – they are doing work for the benefit of a foreign entity for a very limited period. If the proposed rule goes in effect, only employees who qualify for “regular” B-1 status as business visitors will be allowed to use B-1 business visas. This would include, among other things, engaging in commercial transactions that do not involve gainful employment, taking orders, negotiating contracts, consulting with business associates, participating in litigation, attending conventions, conferences or seminars, and undertaking independent research.

Comments on the proposed rule may be submitted until December 21, 2020. If the new rule is enacted, those with valid B-1 in lieu of H-1B visas at that time will not have their statuses revoked. However, the proposed rule notes that individuals will be subject to independent reviews by the Department of Homeland Security upon entry into the United States. This may suggest that travelling in B-1 in lieu of H-1B status might become risky.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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