USCIS released this new Guidance Memorandum on Establishing the “Employee-Employer Relationship” for H-1B Petitions explaining clearly the description of Employee and Employer relationship and what USCIS would consider before they approve H1B visa petitions starting from 2011 Quota. They had to release this because of two supreme court cases related to H1B Employee Employer relation issues.
Below are some of the very key points of the Employer -Employee Relationship
IT Consulting Companies as H1B Employers:
One of the very common things we see in the IT Consulting business is a scenario as explained by USICS as below
“Third-Party Placement/ “Job-Shop” The petitioner is a computer consulting company. The petitioner has contracts with numerous outside companies in which it supplies these companies with employees to fulfill specific staffing needs. The specific positions are not outlined in the contract between the petitioner and the third-party company but are staffed on an as-needed basis. The beneficiary is a computer analyst. The beneficiary has been assigned to-work for the third-party company to fill a core position to maintain the third-party company’s payroll. Once placed at the client company, the beneficiary reports to a manager who works for the third-party company. The beneficiary does not report to the petitioner for work assignments, and all work assignments are determined by the third-party company. The petitioner does not control how the beneficiary will complete daily tasks, and no propriety information of the petitioner is used by the beneficiary to complete any work assignments. The beneficiary’s end-product, the payroll, is not in any way related to the petitioner’s line of business, which is computer consulting. The beneficiary’s progress reviews are completed by the client company, not the petitioner. [Petitioner Has No Right to Control; No Exercise of Control].”
If you look in the last line, USCIS consider this kind of scenario that the petitioner has No Right to Control or No Excerise of Control.
What does “No Right of Control” mean for filing H1B visa Petition ?
It is stated by USCIS that ‘USCIS will evaluate whether the petitioner has the “right to control” the beneficiary’s employment, such as when, where and how the beneficiary performs the job.’ Here the H1B sponsoring company is the employer is Petitioner and Beneficiary is the person who is seeking H1B and planning to work as consultant for the employer. USCIS mentions that the H1B petition filing company must clearly show that the employer-employee relationship exists between the H1B sponsoring company and the person they are sponsoring H1B visa and H1B sponsoring company has the right to control the beneficiary’s work including ability to hire, fire and supervise the beneficiary. The sponsoring company should submit proof for the duration of the H1-B validity period. There are a set of requirements they ask for. USICS determines the case approval based on the information submitted. They can deny if the submitted proof documents are not clear. For sake of clarity, details are posted in another article post. Check the detailed requirements article on Additional requirements for filing H1B visa petition .
What does it mean to all the Small IT Consulting Companies ?
It impacts a lot for all the small and mid-size IT companies that work on Job-shop concept by placing consultants at client locations and do not have any direct control over their employees. All these small and mid size IT companies, especially all the Desi Consulting Companies will have a hard time convincing USCIS and providing proof to indicate the right of control. Larger IT companies with on-site consultants doing development/support on behalf of the IT company are in good shape. If the consulting company does not have an implementation on site, then it is hard.
What should you look for when you seek employer for H1B visa petition ?
Piece of advice based on USCIS regulations, “make sure the IT consulting company you seek H1B visa employment have On site Client project implementations and the H1B sponsoring company will be controlling you, assigning work, giving you pay hikes, etc”. If that is not the case, there is a very high chance that your H1B visa petition will be denied. Because, as per the regulations, without the above condition, your application will not satisfy the employee and employer relationship and right to control.
Thanks to Joe for sending me the latest info. All the information is publicly available at USCIS website. You should visit USCIS website and read original memorandum for more information.
Here is the original document as released by USCIS H1B Employer-Employee Memorandum