On March 11, 2016, the Department of Homeland Security (www.dhs.gov) (“DHS”) published a final rule that significantly revises portions of the work authorization process for F-1 students.  The new rule, which will go into effect on May 10, 2016, addresses extensions of F-1 post-completion Optional Practical Training (“OPT”) for foreign students who have completed U.S. degree programs in the fields of Science, Technology, Engineering, or Mathematics (“STEM”).  The rule replaces the current STEM OPT regulations that were invalidated by a Federal court decision in August 2015 on procedural grounds. To mitigate potential harm to foreign students and their employers, the court stayed its judgment twice for a total of nine months, i.e. until May 2016, to give DHS time  to promulgate new regulations in accordance with the Administrative  Procedures Act.   The STEM OPT regulations impose additional administrative burdens on sponsoring US employers and F-1 students, but they also are potential lifeline for foreign nationals who have graduated from U.S. universities and have been unable to secure an H-1B working visa.

The new STEM OPT Extension rule stays within the spirit of the original STEM OPT Extension rule that has been in effect, with several significant changes and in some cases improvements.  The changes made by the new rule are as follows:

• The STEM OPT extension of work authorization is increased from 17 months to 24 months.
• A student who uses the 24-month STEM extended OPT and then graduates with another, higher level degree in STEM field will be entitled to a second 24-month extended OPT (after the regular 12-month OPT that comes with that degree).  A student will, however, only be entitled to two separate 24-month STEM extensions for two degrees.
• F-1 students who have graduated from a non-STEM degree field, but previously received a STEM degree in the U.S. within the past 10 years can qualify for a STEM OPT extension provided that that their job is directly related to that earlier degree field.
• To obtain a STEM OPT extension, as was the case with the prior STEM rules, the employer must be registered with the E-Verify system (https://www.uscis.gov/e-verify) and must agree to notify the STEM degree school in the event that the student’s employment ends for any reason.
• Unlike the prior STEM OPT rules, the new rules now require as a condition to an F-1 student receiving a STEM OPT extension, that the employer first adopt a Training Plan and provide it to the school. The Training Plan is completed on a Form I-983 – Training Plan for STEM OPT Students.  The student must submit the completed and signed Form I-983 to his or her school as a condition to being granted the STEM OPT extension.

The Form I-983 Training Plan contains attestations by the employer that (i) the employer has sufficient resources and personnel and is prepared to provide the training required in the Training Plan; (ii) the student will not replace a full- or part-time temporary or permanent U.S. worker; and (iii) the employment opportunity will assist the student in reaching the goals set forth in the Training Plan. The Training Plan must contain the following provisions:

• The Training Plan must identify goals for the STEM practical training opportunity including specific knowledge, skills or techniques that the student will learn from the program and explain how those goals will be achieved through the STEM training program with the employer.
• The Training Plan must describe the process by which the student will be evaluated and supervised during the course of the program.
• The Training Plan must explain how the training is directly related to the student’s STEM degree.
• The Training Plan must also describe (i) the duties, hours and compensation of the student and (ii) show they are commensurate with the terms and conditions of employment of similarly situated U.S. workers employed by the employer in the area of employment.
• A student seeking STEM OPT extension must file a Form I-765, Application for Employment Authorization with the appropriate filing fee and supporting documentation within 60 days of the date that the Designated School Official (DSO) recommends STEM Extension OPT on the Form I-20 Certificate of Eligibility and enters it into the SEVIS record.  Note:  The 60-day rule only applies to STEM Extension OPT.  F-1 students seeking a 12-month period of post-completion OPT must file their I-765 within 30 days of the DSO’s recommendation and entry into the SEVIS record.
• If a foreign student changes employers during the 24-month STEM extension period, then within 10 days of commencing the new employment, the student must submit a new Form I-983 with a new Training Plan signed by the new employer to their school in order to obtain the school’s approval of continued STEM extended OPT with the new employer.
• As noted in the introduction, the new STEM OPT rules become effective on May 10, 2016. If a foreign student applied for the 17-month STEM extension prior to May 10th and that extension is pending on May 10th, then the USCIS will issue an RFE in the pending application requesting a newly issued SEVIS Form I-20 from the school covering the full 24-month period (the issuance of which by the school will require the provision of a Training Plan on Form I-983). Upon  receipt of the requested documentation, USCIS will then be able to grant the full 24-month extension period.
• An F-1 student who received a 17-month STEM extension prior to May 10th may request an additional seven months of EAD validity provided that the F-1 student applies for the additional time between May 10th and August 8, 2016.  The F-1 student must have at least five months of validity remaining on their 17-month STEM extended EAD at the time of their application filing.  The application for the additional seven months must include a new SEVIS Form I-20 from the school (which can only be issued by providing the school with a completed Training plan on Form I-983).
• An F-1 Student whose EAD expires while an application for STEM OPT Extension is pending review by the USCIS will receive an automatic extension of employment authorization of up to 180 days beyond the date of the EAD’s expiration.
• F-1 students seeking a 24-month STEM OPT extension are allowed to have been unemployed for up to 90 days during their initial 12-month post-completion OPT and upon grant of STEM Extension OPT the unemployment limit is extended and additional 60 days for total not to exceed 150 days of unemployment during the entire (36 months) OPT period.
• F-1 students who were previously granted a 17-month STEM OPT extension and are seeking a 7- month extension of STEM OPT must not have accrued more than 120 days of unemployment in the aggregate.  Upon grant of the 7-month extension F-1 students may not accrue more than 150 days of unemployment during the entire (36 months) OPT period.
• The Student and Exchange Visitor Program (SEVP) revised its guidance on May 5th – Broadcast Message Number 1605-01 (Revised Guidance for SEVIS Workarounds and STEM OPT Transition) -to provide special filing instructions for those students who become eligible on May 10, 2016 for a STEM extension based on a prior degree or for a seven-month extension of approved STEM OPT and who must file their applications before May 23, 2016.  The new guidance instructs students in these categories to file a Form I-765 with USCIS no earlier than May 10, 2016 without the Form I-20 and to include one of the following statements:
  • For students whose filing deadline for a seven-month STEM OPT extension falls before May 23, 2016:
    “Due to new regulations, I must apply for the seven-month STEM extension of my OPT before SEVIS supports it. I am eligible based on my prior degree. I will provide a Form I-20 with the extension recommendation after USCIS requests it.”
  • For students eligible for a STEM extension based on a PRIOR degree and whose current post-completion OPT ends before May 23, 2016:
    “Due to new regulations, I must apply for the 24-month STEM extension of my OPT before SEVIS supports it. I am eligible based on my prior degree. I will provide a Form I-20 with the extension recommendation after USCIS requests it.”

A few additional notes about the final rule:

• The Cap-Gap provision survived and continues to apply.  This provision grants automatic extension of status and work authorization under the EAD to an F-1 student whose EAD will expire any time between April 1 and October 1 (when new H-1Bs become available) if the F-1 student has been sponsored for an H-1B petition under the H-1B cap with a request to change status, and the filing occurs before the EAD’s expiration. As the H-1B cap has repeatedly been reached in the first week of April, this assumes a filing will have been made in the first week.  Under the Cap-Gap provision, the automatic extension of work authorization will continue until October 1 unless any of the following occur: (i) the F-1 student is not selected in the H-1B lottery; (ii) the sponsoring employer withdraws the H-1B petition before it is approved; or (iii) the F-1 student travels abroad before the H-1B petition has been approved.
  An F-1 student may travel abroad and seek readmission during the Cap-Gap period to recommence employment under the Cap-Gap provision if the H-1B petition and change of status have been approved before the F-1 student departs the U.S.   However, F-1 students need to have a Form I-20 validly endorsed for reentry by the DSO within the last six months and should also have a valid multiple entry F-1 visa.
• An F-1 student is still not permitted have “dual intent” – i.e. seek permanent residence or otherwise have an intent to immigrate permanently to the U.S. without risking loss of F-1 status or readmission to the U.S.

These new STEM Extension OPT rules are complex. The USCIS has launched a very useful site – https://studyinthestates.dhs.gov – that provides guidance to employers, F-1 students and school officials to help them better understand these provisions and also tools to make navigating the intricacies of OPT and STEM OPT somewhat easier.  Nonetheless, USCIS will not hesitate to reject and return applications that are incomplete, untimely filed or improperly prepared.  With the H-1B cap selections now complete, Employers should carefully review all employees who are work authorized under F-1 post-completion OPT to determine what actions can and must be taken and by what given dates.  Parker Gallini LLP will be happy to assist employers who have questions about the new STEM rules and how they might apply to their foreign national employees.

Donald Parker (dparker@parkergallini.com)
John Gallini (jgallini@parkergallini.com)
Grant Godfrey (ggodfrey@parkergallini.com)

Given improving economic conditions and increased hiring, we anticipate that demand for the limited number of H-1B visas will again this year vastly exceed supply. Last April, over 234,000 cap-subject H-1B petitions were filed with the U.S. Citizenship & Immigration Services (“USCIS”) in the first week of April, and USCIS held a series of lotteries to determine which petitions would be accepted for processing. 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, 2016).

The H-1B visa is the standard working visa used by foreign nationals to work in the United States with a U.S. employer.  The H-1B “specialty worker” 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 3 years. After this initial period, the Employer may thereafter request an additional period of up to 3 years.  With a few exceptions, once a foreign national has completed 6 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.  Petitions 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 with the attached filing fees. It

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:

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.
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 1 year.   So, current F-1 student employees who are on OPT will commonly have their OPT expire in May or June of 2015.  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 is automatically extended until October 1st, when their H-1B status is activated.  The timing of the H-1B petition and the expiration of an employee’s OPT is therefore critical.
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 17 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 29 months of employment authorization after graduation in OPT status and will have several opportunities to apply for an H-1B visa.  Please Note: the USCIS has issued proposed regulations that significantly change the STEM extension rules in a number of favorable ways including increasing the extension period from 17 months to 24 months.  We expect that these regulations will be finalized before May and will provide you with information about them when they are finalized.
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 Donald Parker, John Gallini or Grant Godfrey if you have any questions about the new H-1B visas that are becoming available.

F-1 students whose OPT are due to expire before May 10, 2016 – and their employers – can breathe a temporary sigh of relief thanks to a recent ruling by the Federal District staying the vacatur of the U.S. Department of Homeland Security (“DHS”) STEM Extension and Cap Gap regulations previously promulgated in April of 2008.  The vacatur of the DHS’s regulations was to take effect on February 12, 2016.

Specifically, the April 2008 regulations provided the following relief:

• Extended the maximum period of OPT for F-1 students who had graduated from a U.S. university in designated STEM fields from 12 months to 29 months- through a 17 month STEM Extension OPT – provided the F-1 student had an offer of employment or actual employment with an E-Verify registered employer.
• Granted “CAP Gap” work authorization to F-1 students whose OPT expired any time on or after April 1 and before October 1, if the F-1 student had an H-1B petition selected for processing by the DHS U.S. Citizenship & Immigration Services (USCIS).

In March of 2014 Washington Alliance of Technology Workers, “a collective-bargaining organization that represents science, technology, engineering, and mathematics (“STEM”) workers”, sued the DHS over these rules and in August of 2015 won a judgment invalidating the 2008 regulations on procedural grounds. However, the Judge for the District Court stayed her judgment for six months, i.e. until February 2016, to give DHS time to promulgate new rules using the proper procedures.  On October 19, 2015, the Department of Homeland Security (“DHS”) published a proposed rule relating to the STEM OPT extension in the Federal Register. The rule if promulgated as drafted will replace the current STEM OPT regulations that were enacted in 2008.  The proposed rule stays within the spirit of the 2008 rules, with a few twists. Highlights include:

• The STEM OPT extension will be increased from 17 months to 24 months;
• F-1 students who have graduated from a non-STEM degree field, but previously received a STEM degree in the U.S., may be able to use the STEM OPT extension if they meet certain eligibility criteria;
• Any employer of an F-1 student seeking to continue work under STEM OPT must draft a formal mentoring and training program and submit it to the school before the F-1 student can apply for the STEM OPT extension. The program needs to include formal evaluations and those evaluations must be submitted to the school prior to the conclusion of the STEM OPT program;
• The employer of an F-1 student seeking to continue work under STEM OPT will need to attest that:
  • (1) the duties of the position, hours, and compensation paid to the student will be in line with similarly situated U.S. workers;
  • (2) the employer has sufficient resources and personnel to carry out the training program;
  • (3) no U.S. workers will be laid-off as a result of the program, and
  • (4) the job opportunity furthers the training that the student received in the degree program.

The proposed rule states that the DHS will have authority to visit the workplace to verify that the employers attestations are true.

As has been the case under the 2008 rules, only employers who are  registered with E-Verify may employ an F-1 student under STEM OPT.

Importantly, students who are currently on a 17 month STEM OPT extension will be allowed to apply for the extra seven (7) months of employment authorization if they otherwise meet the requirements under the new program.

For F-1 students whose current 12 month OPT is set to expire before May 10, 2016, and who are graduates with degrees in a STEM designated field, it makes sense to file an application for 17 month STEM Extension OPT provided they are employed with or have a job offer from an E-Verify registered employer. Employers who are not registered with E-Verify, but currently employ a qualifying F-1 student with a degree in a STEM designated field and an OPT that will expire before May 10, 2016, should look into E-Verify. With the H-1B cap season opening quickly approaching employers should also recognize that H-1B sponsorship may be a necessity if they hope to hold on to a valued employee currently in F-1 OPT.

Please contact Donald Parker, John Gallini or Grant Godfrey if you have any questions about the current F-1 OPT rules, the potential implications of the Court’s order and temporary stay, and options that are and may be available for maintaining status and/ work authorization.