Uncertain Fate Of H-1B Modification Rule

Jackson Lewis P.C.
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Approximately 27,000 additional Cap H-1B cases were selected in a second-round lottery for fiscal year 2022. The selected petitions must be filed by November 3, 2021. In the meantime, litigation challenging the validity of the Modification of Registration Requirement for Petitioners Seeking to File Cap-Subject H-1B Petitions Rule (Modification Rule), for next year’s petitions, are moving forward.

The Modification Rule was published during the previous administration. It prioritizes H-1B Cap selection based on wage level. Instead of the current and historical process of random selection, USCIS would choose cases based on a hierarchy – starting with Level IV wages and working down. The Rule as written will increase the selection rate for Level III and Level IV cases. However, it would all but eliminate the likelihood that petitions with Level I entry-level wages will be selected. Concerns about this and the resulting effects on the economy have been raised since the Rule was first introduced, and business groups, institutions of higher education, and companies have been challenging the Modification Rule in court. Recently, though, a non-profit organization that represents technology workers, and that generally opposes the H-1B program, filed an amicus brief supporting the Modification Rule.

Unlike some other Trump Administration immigration rules, the Modification Rule was not withdrawn by the Biden Administration. Its implementation, however, was delayed due to technical challenges until the end of 2021. This means it could go into effect for next year’s Cap H-1B lottery if it is upheld.

In Chamber of Commerce of the United States et al. v. USCIS et al., opponents to the new rule argue that the proposed changes are unlawful in that the Rule conflicts with the Immigration and Nationality Act; is void because it was implemented by Chad Wolf who was unlawfully serving as Acting Secretary of Homeland Security; and is arbitrary and capricious because DHS failed to respond adequately to comments on the effects of the Rule. They argued that American employers have developed a “reliance interest” in the way the H-1B program historically has operated.  The plaintiffs particularly noted that the Modification Rule “is likely to exclude many of the bright, ambitious, early-career professional who often drive innovations” and that DHS itself has estimated that “zero percent” of wage Level I petitions will be selected.

We will continue to follow the litigations regarding the Modification Rule. 

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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