The US Department of Homeland Security (DHS) recently released a notice of proposed rulemaking (NPRM) with respect to the regulations governing the H-1B nonimmigrant visa classification. The proposed rule seeks to improve the H-1B program by streamlining eligibility requirements, enhancing program efficiency, providing greater benefits and flexibilities for employers and workers, and strengthening integrity measures.

DHS, through US Citizenship and Immigration Services (USCIS), published on October 23, 2023 an NPRM aimed at “modernizing H-1B requirements.” Upon publication of the NPRM in the Federal Register, a 60-day public comment period began, which will end on December 22, 2023. The finalized H-1B regulations will likely take effect in early to mid-2024.

BACKGROUND

The H-1B nonimmigrant visa classification is typically used for workers performing services in a specialty occupation. Due to its breadth, the H-1B classification is the most commonly sought classification for many employers petitioning to hire international talent.

With a congressionally mandated annual quota of 65,000 cap-subject H-1B visas and an additional 20,000 for foreign nationals holding a master’s or advanced degree, the overwhelming demand for H-1B visas created the need for an annual “lottery” system, which has continuously been in place in some form since fiscal year 2014.

After USCIS received a record-high 483,927 registrations during the fiscal year 2023 H-1B cap registration process, with 36.5% of beneficiaries receiving more than one registration, DHS, in its own words, was prompted to consider ways to “limit the potential for bad actors to game the system.” DHS seeks to “strengthen integrity” in the H-1B registration process through the proposed changes.

The proposed rule also seeks to amend certain areas of the H-1B regulations as well as clarify and codify existing rules that are currently established through case law and USCIS policy guidance.

DHS proposes to make the following changes:

MODERNIZATION

Amending the Definition of a ‘Specialty Occupation’

Revise the regulatory definition of “specialty occupation” and clarify that a position may allow a range of degrees; however, there must be a direct relationship between the required degree field(s) and the duties of the position.

Amending the Criteria for Specialty Occupation Position

Amend the criteria for a “specialty occupation” to clarify that an employer “normally” requiring a bachelor’s degree does not mean an employer “always” must require a bachelor’s degree within the criteria for a specialty occupation.

Amended Petitions

Clarify existing policy guidance that any change of work location that requires a new labor condition application (LCA) (i.e., a change in location outside of the area of intended employment) is itself considered a material change and therefore requires the petitioning employer to file an amended or new petition with USCIS before the H-1B worker may perform work under the changed conditions.

Deference

Codify and clarify the existing deference policy, which instructs officers to consider prior determinations involving the same parties and facts when there is no material error with the prior determination, no material change in circumstances or eligibility, and no new material information adversely impacting the petitioner’s, applicant’s, or beneficiary’s eligibility.

Evidence of Maintenance of Status

Require evidence of maintenance of status when filing an extension or amendment of stay.

Eliminating the Itinerary Requirement for H Programs

Eliminate the itinerary requirement for H petitions that require services to be performed or training to be received in more than one location.

Validity Expires Before Adjudication

Allow H-1B petitions to be approved or have their requested validity period dates extended if USCIS adjudicates and deems the petition approvable after the initially requested validity period end date, or the period for which eligibility has been established, has passed. This typically would happen if USCIS deemed the petition approvable upon a favorable motion to reopen, motion to reconsider, or appeal.

BENEFITS AND FLEXIBILITIES

H-1B Cap Exemptions

Broaden the definition of ‘‘nonprofit research organization’’ and ‘‘governmental research organization’’ by allowing nonprofit entities or governmental research organizations 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 definition of a nonprofit research entity.

Clarify that H-1B beneficiaries who are not directly employed by a qualifying cap-exempt institution, organization, or entity and who spend at least half of their work time performing job duties for a cap-exempt entity—as opposed to spending the majority of, or more than half, under current regulations—may be eligible for cap exemption.

Clarify that the requirement that the beneficiary spend at least half of their work time performing job duties ‘‘at’’ a qualifying institution should not be taken to mean the duties need to be physically performed onsite at the qualifying institution. DHS acknowledges that many positions can be performed remotely and seeks to emphasize the job duties rather than the location they are physically performed.

Automatic Extension of Authorized Employment Under Cap Gap

Provide an automatic extension of duration of status and post-completion optional practical training (OPT) or 24-month extension of post-completion OPT, as applicable, until April 1 of the relevant fiscal year for which the H-1B petition is requested. Currently, the automatic extension is valid only until October 1 of the fiscal year for which H-1B status is being requested. This change aims to provide flexibility and help avoid disruption to US employers that lawfully employ F-1 students while a qualifying H-1B cap-subject petition is pending.

Start Date Flexibility for Certain H-1B Cap-Subject Petitions

Clarify the current policy of permitting a requested H-1B cap-subject petition start date of October 1 or later as long as the requested petition start date does not exceed six months beyond the filing date of the petition, even during the initial registration period.

PROGRAM INTEGRITY

The H-1B Registration System

Beneficiary-Centric Selection

Modify H-1B selection process so that selection would be based on each unique beneficiary identified in the registration pool as opposed to each registration. Each beneficiary would be entered in the selection process once, regardless of how many registrations were submitted on their behalf.

If a beneficiary is selected, each registrant that submitted a registration on that beneficiary’s behalf would be notified of selection and would be eligible to file a petition on that beneficiary’s behalf. By selecting by a unique beneficiary, DHS aims to ensure that beneficiaries have the same chance of being selected regardless of how many registrations were submitted on their behalf.

Bar on Multiple Registrations Submitted by Related Entities

Extend the existing prohibition on related entities filing multiple petitions by also prohibiting related entities from submitting multiple registrations for the same individual.

Registrations with False Information or That Are Otherwise Invalid

Codify USCIS’s ability to deny an H-1B petition or revoke an H-1B petition’s approval when the petition is based on a registration where the statement of facts (including the attestations) was not true and correct, inaccurate, or fraudulent, or misrepresented a material fact.

Provisions to Ensure Bona Fide Job Offer for a Specialty Occupation Position

Contracts

Codify USCIS’s authority to request contracts, work orders, or similar evidence.

Nonspeculative Employment

Codify that a petitioner must establish at the time of filing that it has a nonspeculative position in a specialty occupation available for the beneficiary as of the start date of the validity period as requested on the petition.

LCA Corresponds with the Petition

Update the regulations to expressly include DHS’s existing authority to ensure that the LCA properly supports and corresponds with the accompanying H-1B petition.

Revising the Definition of ‘US Employer’

Codify the existing requirement that the petitioner has a bona fide job offer for the beneficiary to work within the United States. Replace the requirement that the petitioner ‘‘[e]ngages a person to work within the United States’’ with the requirement that the petitioner have a legal presence and is amenable to service of process in the United States.

Employer-Employee Relationship

Remove the employer-employee requirement from the definition of an H-1B employer with the aim of removing barriers for beneficiary-owned petitioners.

Bona Fide Job Offer

Codify the existing requirement that the petitioner have a bona fide job offer for the beneficiary to work within the United States. Clarify that the bona fide job offer may include ‘‘telework, remote work, or other off-site work within the United States.”

Legal Presence and Amenable to Service of Process

Add a new requirement that the petitioner has a legal presence in the United States and is amenable to service of process in the United States. Legal presence, in this context, means that the petitioner is legally formed and authorized to conduct business in the United States.

ADDITIONAL CHANGES

Beneficiary-Owners

Codify a petitioner’s ability to qualify as a US employer even when the beneficiary possesses a controlling interest in that petitioner.

Site Visits

Codify DHS’s existing authority to perform site visits and clarify the scope of inspections and the consequences of a petitioner’s or third party’s refusal or failure to fully cooperate with these inspections.

Third-Party Placement

Codify that where an H-1B worker provides services for a third party, USCIS would look to that third party’s requirements for the beneficiary’s position, rather than the petitioner’s stated requirements, in assessing whether the proffered position qualifies as a specialty occupation.

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