Potential Government Shutdown: Immigration Consequences for Employers and their Foreign Employees

Seyfarth Shaw LLP

Seyfarth Synopsis: If Congress cannot resolve funding issues by 11:59 pm EST on September 30, 2023, resulting in a federal government shutdown, it will have a ripple effect on employers, both large and small, with an impact on several agencies involved in the processing of immigration-related petitions and applications.

U.S. Citizenship and Immigration Services (USCIS)

In the event of a shutdown, USCIS will be minimally impacted because it is largely a fee-funded service, which means USCIS will continue to process applications and petitions for immigration benefits, with some processing delays possible. However, petitions for which a Department of Labor (DOL) certification is required -- such as an H-1B, H-1B1, or E-3 petition that requires a Labor Condition Application (LCA) -- may be adversely affected, as discussed in more detail below. Following a previous government shutdown, when the government reopened, USCIS accepted certain filings late provided the petition was submitted with evidence that the primary reason for failing to timely file was the government shutdown. However, USCIS has not yet confirmed whether they would adopt a similar approach this time.

E-Verify, USCIS’ free, internet-based system that allows businesses to determine the eligibility of their employees to work in the United States, will be inaccessible during a shutdown. Employers must continue to complete I-9 forms in compliance with the law and create cases in E-Verify when E-Verify becomes available.

Other agencies of the Department of Homeland Security (DHS), notably Customs and Border Protection (CBP) and Immigration and Customs Enforcement (ICE), would likely retain most of their essential staff, so entry to the United States would not be impacted. However, processing of applications at the border – such as TN and L-1 applications for Canadian nationals – could be impacted if enough staff are not available to process these applications in addition to the normal flow of travelers to the U.S.

Department of Labor (DOL)

Office of Foreign Labor Certification (OFLC) employees, who fall under the umbrella of DOL, are considered non-essential and would be placed in furlough status during a government shutdown. OFLC would neither accept nor process any applications or related materials, including LCAs, applications for a prevailing wage determination, applications for temporary employment certification, applications for permanent employment certification (PERM applications), or PERM audit responses. OFLC recently confirmed that if the federal government shuts down, OFLC will disable the FLAG system – which processes prevailing wage determinations and PERM applications, among others -- and will not accept any applications during this period. In addition, users will be unable to access the FLAG system to print previously approved applications or otherwise take any actions in the system.

Given the potential for a shutdown and inaccessibility of FLAG, it is recommended to file PERM applications with impending deadlines no later than 11:59 pm EST on September 30. Similarly, if an employer will need an LCA in the coming weeks, it is recommended to file by the same deadline.

If a shutdown occurs, OFLC may issue guidance about flexibilities for employers with filing deadlines, but nothing has been confirmed at this time.

Department of State (DOS)

In the event of a shutdown, it is likely that visa issuance will continue, at least temporarily. It is expected that domestic and overseas Consular operations will remain fully operational as long as sufficient fees exist to support operations. Should there be a funding shortage, consular posts would focus on diplomatic visas and true emergency situations.

Seyfarth Shaw’s Business Immigration Group will continue to closely monitor this developing situation.

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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