The H1B Visa program is one of the most sought-after work visa programs for anyone planning to build a career in the US. Due to significant demand, some bad actors try to leverage the loopholes in the system to their advantage, like submitting multiple H1B Registrations to increase their chances in the H1B visa Lottery.
The US Department of Homeland Security(DHS) & USCIS have had an agenda item to modernize the H1B Visa program and fix many of the loopholes in many regulatory agendas. Finally, they published a draft rule on modernizing the H1B visa program at the federal register today. We summarize the key areas of the proposed changes to the H1B Visa program and what remains the same, including some common FAQs.
Background of “Modernize the H1B Visa Program” Regulation, Structure
The original proposal to modernize the H1B Visa Program started back in June 2021 when the regulatory agenda was published for Spring 2021. This was the very first regulatory agenda for the Biden Administration. Since then, it has appeared in 5 regulatory agendas, and finally, they made it a point this time around to make it happen.
See the below screenshot that shows the history, as it appears at RegInfo.gov
Structure of the “Modernize H1B Visa Program” Proposed Regulation
The proposed regulation to modernize the H1B Visa program is a 227-page document and is mainly structured around three areas:
- Modernization of the H1B Visa Program: Change various H1B visa program-related aspects on how the adjudication happens, program-related definitions, focusing on increasing the H1B program’s overall efficiency.
- Add new benefits & flexibilities: Provide additional benefits and flexibilities for H1B visa applicants, and F1 visa holders to effectively use the program without impacting the business.
- Increase the Integrity of the H1B Program: Add more guardrails to the H1B Program to avoid fraud around H1B Lottery/registration system, employment offers, site visits, Employer-Employee Relationship, etc.
It is important to note that all the items that are discussed below in the proposed regulation are not final. They are in the draft stage and are now out for public comments under Notice of Proposed Rulemaking (NPRM). Some or many of these things may change in the final regulation based on public feedback.
The proposed regulation has many items that are already in practice by USCIS for adjudication but never codified(made part of the official rule book) in the regulation. So, they have added some existing rules/ practices in this proposed regulation as well to codify the same.
To make it easier for everyone, we have divided the overall topics in the proposed regulation into two broad categories:
- New Proposed Changes to the H1B Visa Program
- Existing H1B Program Practices or Rules that are Codified
Let’s look at topics under each of these broad categories.
New Proposed Changes to the H1B Visa Program
Below are the various new proposed changes to the H1B Visa Program. We have divided them into subsections for easy review.
H1B Visa Lottery – Multiple Offers as One Registration
H1B Registration process is subject to a lot of fraud, with a record number of 781K registrations received in FY 2024 season. DHS proposes introducing H1B Lottery selection based on a unique individual’s passport number. Even if the applicant has multiple offers from different companies, still the applicant would be treated as one entry for the lottery, and selection will be based on the unique passport number.
With the new approach, there is no advantage anyone gets by having multiple offers and there is less incentive to do fraud. If an applicant is selected, all the employers who registered for the same applicant would be notified and they can file H1B on behalf of that applicant. They plan to implement this change for the next fiscal year(FY) 2025 which starts in March 2024, if all goes well.
F1 Cap Gap to be extended until April 1st Next Year
Currently, for F1 Students who apply for an H1B petition as a change of status, the cap gap is given only until October 1st. Due to delays in adjudication, many students are not able to work beyond October 1st due to the current rule. DHS is proposing to change the end of cap gap from October 1st to April 1st of next year to avoid these issues.
For example, if you are filing for H1B Visa petition for FY 2025 season in June 2024 and availing cap gap, then you can continue to work until April 1st, 2025. Under the new provision you can continue to work beyond October 1st, 2024 until April 1st, 2025 while you wait for the decision on your petition from USCIS.
Company Majority Owners can sponsor their Own H1B Visa
USCIS is proposing to encourage entrepreneurship by enabling foreign nationality entrepreneurs to sponsor an H1B Visa for themselves by the company they own, if they meet some conditions as below:
- If a person owns more than 50% of a company, they must spend more than 50% of their time on specialty occupation-related duties. They are free to perform any non-speciality occupation activities in the remaining time, like administration, hiring, etc. Basically, it means that, if you are a Software Engineer Founder and own over 50% of the company, then you must spend over 50% of your time doing Software Engineering Tasks.
- USCIS would only issue 18 months of initial approval for applicants who fall into the above criteria, the first extension would be 18 months as well. After that, the subsequent extensions would be standard with 3-year extensions.
Change to Definition of Speciality Occupation
DHS proposes changing the definition of specialty occupation to be more specifically tied to the job duties and needing a specific degree rather than a general bachelor’s degree. For example, under the new definition, a requirement that says a general MBA or general Engineering degree will not be sufficient to qualify for an H1B specialty occupation.
Site Visits No longer Voluntary
Currently, participating in USCIS FDNS site visits for H1B holders is not mandatory. It is up to the employee to voluntarily participate or choose not to cooperate, there was no impact of not participating or cooperating during the site visit.
DHS is proposing to change the current voluntary participation to mandatory. Under the new changes, USCIS could conduct site visits on-site, at you home, at client location, interview the managers, verify records, etc. Failure to cooperate or provide all the details as requested by the USCIS officer could result in consequences such as denial or revoke of your H1B petition.
Approval with Submitted Expired Documents, Extend Validity Period
Currently, in situations such as RFE or Motion to re-open or reconsider, during the decision time due to delays, the approval requested dates would have passed. DHS is proposing to approve such petitions or have their validity period dates extended as needed. Also, request relevant updated documents like updated LCA, and wage documents, as needed, if the petition is eligible for approval.
H1B Cap Exemption Flexibility
DHS wants to give more flexibility for anyone leveraging the H1B cap exemption petition under universities, non-profit research or Govt. research institutions. Under the proposed changes, an applicant of H1B cap exempt petition needs to work only at least half of the time under the cap-exempt category sponsored entity. Also, they are revising some terms on the definition of the non-profit to give more flexibility.
For example, if someone has filed for H1B under cap exempt under a non-profit research organization, then they only need to work for up to 50% of their time for that non-profit research organization. For the rest 50% of their time they can work in a for-profit company such as Hospital, or any other company.
H1B Start Date anytime during Fiscal Year
Under the proposed regulation, employers can request any date within the particular fiscal year for the new H1B cap-subject petitions. They are not forced to indicate October 1st as the start date for the new H1B petitions filed under that fiscal year.
Existing H1B Program Practices or Rules that are Codified
Below are various H1B Program-related adjudication practices that are currently used by USCIS that are either codified (made part of the official rule) or modified minorly and codified. These are not new per se, but rather made part of the official rulebook.
- Amendments of H1B Petitions: Codifying the changes on when amendment needs to be filed, LCA requirements for amendments, etc. This is based on Matter of Simeio Solutions decision
- Deference for H1B approvals: Codify deference policy for H1B approval for extensions where the same parties are involved and the facts related to the petition remain same.
- Maintenance of Status Documents: All petitions needs to submit evidence proving the maintenance of status of the applicant in the form of pay slips, tax returns, contracts, etc. to prove the same.
- Removal of the need for Itinerary requirements: Codify that there is no need to submit a detailed itinerary related to the H1B-related work as it is already captured on H1B LCA
- Multiple Registrations by related entities: Codify that related entities cannot file multiple H1B registrations for the same applicant. The current rule is tied to multiple H1B petitions from related entities.
- False Information, Attestation during H1B Registration Submission: Codify that the information that employers cannot enter false information or do false attestation during H1B registration submission. It will lead to revocation or denial, if done so.
- Bona Fide Job Offers, Contracts, Non-speculative Employment: DHS is codifying the requirements that the job offers have to be bona fide for H1B petition. Also, the evidence, such as contracts, work orders, MSAs, etc. needs to be submitted to show the proper relationship and the work. The employment must be for a real position and cannot be speculative in nature.
- H1B LCA, Remove Employer-Employee Relationship: DHS is codifying that the H1B LCA should correspond to the actual position and they will adjudicated based on the DOL SOC Code, wage level, etc.. They are also removing the old employer-employee relationship definition based on Neufeld memo.
- Third-party placements: DHS is adding additional text to clarify that the work done at third party location has to be speciality occupation in nature and cannot be some random work.
We have covered most of the important aspects in the 227-page proposed regulation by DHS.
Next Steps on H1B Rule Changes Regulation
Starting from today, October 23rd, 2023, DHS is giving 60 days for public comments under the NPRM process of 9 Step Federal Rule Making Process. The last date for submission of the comments is December 22nd, 2023.
Public ( individuals, organizations, law firms, nonprofits, etc) can submit their feedback on the proposed changes until December 22nd, 2023. DHS would review all the comments and then do relevant changes to the proposed rule and then publish a final rule.
Until final rule is published, nothing listed above is implemented. So, please do not assume anything and confuse yourself.
We do not have a date yet from DHS. They are still in NPRM stage and not final. We will know a date once final rule is published.
We do not know at this point. DHS wants to implement it for FY 2025 season, but we do not know at this point as there is no final rule released yet for the same.
No, there are no specific rules tied to the H4 visa holders in the proposed regulation. Most of these are related to the primary H1B Holders.
The main intent of the proposed rules is to reduce fraud. Some of the proposed rules around H1B Lottery are mainly to prevent fraud. We need to see how it will pan out in course of time.
What do you think of the New H1B proposed regulatory changes? Add your thoughts in the comments section below.