Copland and Brenner

Table of Contents

1. Fat Lady Sings: It's Over - H-1B Cap Reached for FY2008
2. Update: Comprehensive Immigration Reform

1. Fat Lady Sings: It's Over - H-1B Cap Reached for FY2008

   As many are aware, the H-1B filing period for fiscal year 2008 (“FY2008”) began mere days ago, on April 2, 2007. Those who are aware of that fact are likely also aware that U.S. Citizenship and Immigration Services (“USCIS”) announced on April 3 that it had already received enough H-1B petitions to meet the congressionally mandated cap of 65,000. This means no additional filings for new H-1B visas may be made until April 1, 2008 since none will be available until the first day of FY2009 – that is, October 1, 2008. This, unless Congress comes to its senses and lifts or meaningfully (read: significantly) increases the cap.

   In the meantime, there are many questions about filing options and procedures for the April 2 filing date and agency provisions to deal with them. Among the problem areas are filing changes made shortly before FY2008 H-1B petitions could be filed, the cutoff date applicable when the cap has been reached, premium processing issues, and questions about the separate “Master’s cap.”

   H-1B Cap – the background: The uninitiated might wonder what all the fuss is about. For these readers, a bit of history concerning the H-1B category and the brouhaha surrounding it: an H-1B visa is available under the Immigration and Nationality Act to an alien “who is coming temporarily to the United States to perform services… in a specialty occupation… or as a fashion model… of distinguished merit and ability.” H-1B visas are also available for an alien to perform services of an exceptional nature requiring exceptional merit and ability relating to a Department of Defense (“DOD”) cooperative research and development project or co-production project. A “specialty occupation” is one that requires “theoretical and practical application of a body of highly specialized knowledge, and [ ] attainment of a bachelor's or higher degree in the specific specialty (or its equivalent) as a minimum for entry into the occupation in the United States.”

   The H-1B category was established pursuant to 1990 amendments to the Immigration and Nationality Act (“INA”), which made these provisions more complex than the earlier H-1 program, imposed a 65,000 limit on the number of aliens who could be newly sponsored in the category each fiscal year, and increased agency oversight. The 65,000 cap, set arbitrarily and without any statutory scheme for increases based on actual need, restricted the number of foreign professionals who may be sponsored annually as aliens in H-1B “specialty occupations.” The 1990 amendments also established a first-time role in the H-1B program for the Department of Labor (“DOL”), historically the protector of employee rights in the workplace.

   On August 28, 1996, the legacy Immigration and Naturalization Service announced that the annual limit on new H-1B petitions had been reached for the first time. The cap was likewise reached early for FY1997 and 1998. Despite the predicament this caused U.S. businesses, it was not until October 21, 1998 that Congress – in a massive (4,000 page) Omnibus Appropriations Bill - increased the arbitrary H-1B numeric limit, but only temporarily. And, despite an increase to 115,000 for FY1999, the cap was still reached early – on June 15, 1999. This was again the case for FY2000. Meanwhile, stories of agency miscounts abounded. On October 17, 2000, the American Competitiveness in the Twenty-First Century Act again – temporarily – increased the H-1B cap, for fiscal years 2001 – 2003. On October 1, 2003 the H-1B cap shrank to its 65,000 limit, under which U.S. businesses have since suffered.
   
   The 65,000 cap established by Congress in 1990 applied to all H-1B petitions until a statutory change enacted on December 8, 2004. At that time, a separate H-1B cap of 20,000 was established for beneficiaries holding at least a Master's degree from a U.S. institution of higher education - even if the job itself requires only a Bachelor's degree. Therefore, there is currently a cap of 65,000 H-1B visas for Bachelor's degree holders, with a separate cap of 20,000 for those holding a U.S. Master's degree. But the 65,000 cap is somewhat of a misnomer since 1,400 H-1B visas are set aside for nationals of Chile, and 5,400 for nationals of Singapore, under Free Trade Agreements with those countries. This sets the actual "worldwide" H-1B cap at 58,200.

   To further confuse (though favorably affect) H-1B matters, an additional, separate cap applies to any alien who is a national of the Commonwealth of Australia under yet another law (the REAL ID Act of 2005); they are not even classified as H-1B, but instead E-3, with an annual limit of 10,500 visas. Meanwhile, certain Canadian and Mexican "professionals" may be eligible for "TN" status under the North American Free Trade Agreement, to which no annual limit applies.

   Process problems: In its April 3 announcement, USCIS stated that it "will use a random selection process [ ] for all cap-subject filings received on April 2, 2007 and April 3, 2007 ." (emphasis in original) The agency "will reject and return along with filing fee(s) all petitions received on those days that are not randomly selected." (emphasis added) The announcement stated further that "[a]s of late Monday afternoon (April 2) [it] had received approximately 150,000 cap-subject H-1B petitions. USCIS must perform initial data entry for all filings received on April 2 and April 3 prior to conducting the random selection process. In light of the high volume of filings, USCIS will not be able to conduct the random selection for several weeks."

   The agency also stated that, with respect to the Master's degree cap: "USCIS does not yet know how many of these petitions it has received as those petitions are mixed with the cap-subject cases received on April 2 and 3. USCIS will make a future announcement regarding the 'final receipt date' for these petitions."

   As explained below, a petitioner could literally be a day late and $1,000 short, and - under the USCIS random selection process - still gain an advantage over a petitioner that filed under premium processing guidelines with a receipt date of April 2.

   Random selection: The random selection process is set forth in regulations written, of course, by the agency. Those regulations, found at 8 CFR 214.2(h)(8)(ii)(B) state:

   "When calculating the numerical limitations for a given fiscal year, USCIS will make numbers available to petitions in the order in which the petitions are filed . USCIS will make projections of the number of petitions necessary to achieve the numerical limit of approvals, taking into account historical data related to approvals, denials, revocations, and other relevant factors. USCIS will monitor the number of petitions (including the number of beneficiaries requested when necessary) received and will notify the public of the date that USCIS has received the necessary number of petitions (the 'final receipt date'). The date of publication will not control the final receipt date. When necessary to ensure the fair and orderly allocation of numbers in a particular classification subject to numerical limits, USCIS may randomly select from among the petitions received on the final receipt date the remaining number of petitions deemed necessary to generate the numerical limit of approvals. This random selection will be made via computer-generated selection as validated by the Office of Immigration Statistics. Petitions not randomly selected, and petitions received after the final receipt date , will be rejected. If the final receipt date is the same as the first date on which petitions subject to the applicable cap may be filed (i.e., if the cap is reached on the first day filings can be made), USCIS will randomly apply all of the numbers among the petitions filed on the final receipt date and the following day." (emphasis added)

   It is unclear why - if the cap is reached on the first day filings can be made - USCIS makes its random selection among petitions filed on that day and the following day. For those who filed a prima facie approvable H-1B case subject to the Bachelor's degree cap, which was received at the USCIS Service Center on April 2, it seems inappropriate that a petition received a day later should be included among those randomly selected for FY2008 processing. It is unclear why the American Immigration Lawyers Association ("AILA") and other affected entities have not specifically objected to the agency's regulatory approach.

   Premium processing: Some might also oppose the USCIS random selection process in the context of the premium processing filing option. Premium processing is authorized by Section 286 of the Immigration and Nationality Act, which states that USCIS "is authorized to establish and collect a premium fee for employment-based petitions and applications. This fee shall be used to provide certain premium-processing services to business customers, and to make infrastructure improvements in the adjudications and customer-service processes. For approval of the benefit applied for, the petitioner/applicant must meet the legal criteria for such benefit. This fee shall be set at $1,000, [and] shall be paid in addition to any normal petition/application fee that may be applicable.." H-1B petitions are among those eligible for premium processing, and many employers are willing to pay the additional $1,000 fee to obtain an agency decision more quickly.

   USCIS regulations at 8 CFR 103.2(f) allow for temporary termination of premium processing, but state that: "[1]n order to ensure equitable access to these limited visa programs, the Service may temporarily terminate the availability of Premium Processing Service for certain petitions or applications. The Service will announce a temporary termination by publication of a notice in the Federal Register." (emphasis added) To date, there has been no such announcement in the Federal Register.

   On this front, also, it is unclear as to why AILA and other entities are largely silent. We note, though, that AILA did post a notice to members on April 4, stating that "[m]any AILA members report having received receipts on their premium processing H-1B filings, and have raised the question of how USCIS will handle premium processing filings in light of the length of time it is likely to take USCIS to conduct its random selection for the cap cases. It is highly unlikely that the selection will be completed before the 15 days for premium processing has run, and USCIS appears to understand that a premium processing filing cannot receive an advantage over a regular filing by virtue of having been filed premium. It should be noted that getting a receipt does not mean that the case has been accepted for processing. It only means that the case will be in the 'lottery'. [sic] AILA has raised this with USCIS, which is reviewing the issue."

   Under the circumstances, it is critical that H-1B beneficiaries within the U.S.A. understand the obligation to maintain their nonimmigrant status pending the outcome of the random selection process. Even then, of course, any change of status for the fortunate 65,000 can be effective only on October 1, 2007.

   Unless Congress changes the law to increase the cap, nearly two thirds of the intended beneficiaries will have no alternative but to seek an alternative to H-1B nonimmigrant status or depart the U.S.A. The U.S. businesses seeking their talents, unfortunately, appear to have fewer options.

2. Update: Comprehensive Immigration Reform

   A recent editorial in the Washington Post (www.washingtonpost.com, April 2, 2007) sums things up well: “[a] week after sensible, bipartisan legislation to reform immigration policy was introduced in the House, the administration circulated a collection of talking points last week. The document, the product of meetings between senior administration officials and Republican senators, is a step backward – not only from legislation passed by the Senate last year but also from the general proposition that any genuine reform must be workable….At its heart, the White House plan is a political document, not a workable program destined for success in the real world…It may appease some immigration hawks, but it will not address a problem that Americans overwhelmingly say they want fixed.” Stay tuned.