The FY 2018 H-1B Cap to Open on April 1st

As has been the case in the past several years, with improving economic conditions and increased hiring, we anticipate that demand for the limited number of H-1B visas will again vastly exceed this year’s supply. Last April, the U.S. Citizenship & Immigration Services (“USCIS”) received approximately 233,000 cap subject H-1B petitions in the first week of April for selection under the Fiscal Year (FY 2017) quota. We are projecting that this year the cap will again be reached within the first week of April and that USCIS will hold another series of lotteries. As a result, we are advising all employers who expect to sponsor an employee for a new H-1B visa to file within the first five (5) days of April (i.e. so the petition is received no later than April 7, 2017).

The H-1B “specialty worker” visa is the standard working visa used by foreign nationals to work in the United States with a U.S. employer. The H-1B visa is available only to foreign nationals who have a job offer in a position that customarily requires someone with at least a Bachelor’s degree. A foreign degree that is deemed the equivalent of a U.S Bachelor’s degree will satisfy this requirement. Foreign nationals who cannot qualify based on their education alone may also qualify based on work experience, or a combination of work experience and education, that is determined to be equivalent to a Bachelor’s degree. Employers may request H-1B work authorized status for an initial period of up to three years. After this initial period, the Employer may thereafter request an additional period of up to three years. With a few exceptions that require the commencement by the U.S. employer of an application for U.S. permanent resident (or “Green Card”) status on their behalf, once a foreign national has completed six years of time in the United States in H-1B status, she will be required to leave the United States for at least a year before she may again be sponsored for an H-1B visa.

H-1B visas are available in a limited number (the “H-1B cap”) on October 1st of each year, the beginning of the fiscal year of the USCIS. Applications for the up-coming fiscal year can be filed starting April 1st.

H-1B visas are given out each year in two primary tranches – 20,000 visas for foreign nationals with a U.S. earned Master’s (or higher) degree and an additional 58,200 visas for foreign nationals who qualify generally for the H-1B (by having a U.S. or foreign Bachelor’s degree or a combination of education and experience that is equivalent to a Bachelor’s degree or higher). Note that there are additional H-1Bs (6,800 in total) that are specifically allocated to nationals of Singapore and Chile and that are available throughout the year. If USCIS receives more H-1B visa petitions than the two tranche limits in the first week of April, they will accept all cases received during the first 5 business days of the month, assign all of the received cases a number, and randomly select those that will be processed through two separate lotteries. USCIS will first run a lottery for the U.S. earned Master’s (or higher) degree tranche. Any cases not selected in that first tranche will then be added to the general tranche, and USCIS will run a second lottery. USCIS will cash the checks and issue receipts for all petitions selected in the lotteries. Petitions that are not selected will be rejected and returned together with the filing fee checks.

Employees who are subject to the H-1B cap are those who have not previously held H-1B status and who have not been counted against the H-1B cap within the past six years. Within this group typically are:

• individuals who hold F-1 student status and are either graduating this spring or summer, or who will be reaching the end of their OPT employment authorization in the next year;
• individuals in J-1 scholar or researcher status who are completing their programs this spring or summer;
• individuals who are currently outside of the U.S.; and
• individuals who have been employed in H-1B status but only with “exempt” institutions or organizations, such as universities, related or affiliated non-profit entities, nonprofit research organizations, and governmental research organizations.
• Note that the H-1B cap does not apply to a foreign national who is currently in the U.S. in H-1B status and has already been counted against the cap.

A few important points to note:

1. The CIS takes the position that the foreign national’s eligibility for H-1B status must be established at the time of filing. Thus, if the foreign national is hoping to apply in the U.S. Master’s degree tranche but has not received her U.S. Master’s degree on or before April 1st, then she is not qualified for the H-1B based on the U.S. Master’s degree. This person would have to file for an H-1B in the 58,200-visa general tranche based on a foreign or U.S. Bachelor’s degree.
2. Most commonly, F-1 students have a period of Optional Practical Training (“OPT”) granted as part of their F-1 student status that runs from their date of graduation (May or June) for one year. So, current F-1 student employees who are on OPT will commonly have their OPT expire in May or June of 2017. If the H-1B visa petition for such an F-1 student is accepted for processing before their OPT grant expires, then their OPT employment authorization can be extended until October 1st, when their H-1B status is activated, so long as the student informs the school that they have been selected in the H-1B cap.
3. F-1 students who are graduating in a program that is designated to be within the Sciences, Technology, Engineering or Mathematics (a “STEM”) Program and who will be working with a U.S. employer that is registered with the eVerify system, are eligible for a 24- month extension of their OPT after the initial 12-month period has run. Thus, F-1 students in STEM Programs will be able to take advantage of up to 36 months of employment authorization after graduation in OPT status and will have several opportunities to apply for an H-1B visa.
4. President Trump has clearly indicated his hostility towards the North American Free Trade Agreement (“NAFTA”) which created TN status for nationals of Canada and Mexico in the United States. Specifically, he has stated that he might invoke the clause in NAFTA that allows any of the countries to withdraw from the agreement based on six-month’s notice so that he can gain leverage in renegotiating the agreement. Because of the possibility of the termination or alteration of the TN program, U.S. employers with employees in TN status, should consider sponsoring those employees for a new H-1B status in the H-1B cap.

It is vital that employers determine which of their foreign employees or prospective employees to whom they have made offers will require an H-1B this year. The rules (as outlined briefly above) are complex and every case requires a different analysis. It is thus crucial that you collect the necessary data and begin a discussion with your immigration legal counsel as early as possible so that appropriate plans can be made to increase the chances of your foreign employees being able to maintain legal status and work authorization.

Please contact any of the members of the legal team at Parker Gallini LLP if you have any questions about the new H-1B visas that are becoming available.