What changed?

Today the USCIS published for comment a proposed final rule that, if implemented, will dramatically change the H-1B Cap Process for US Employers. Here are the two main changes included in the proposed rule:

  • Submission of online preregistration requests. Employers would first submit an online preregistration request to the USCIS for each beneficiary for whom it will file an H-1B Petition. If more registrations are submitted than H-1B visas available (85,000 per fiscal year), the USCIS will run a randomized lottery to determine which registrations are selected to file an H-1B Petition. Petitioners will then be provided a 60-day filing window to submit the H-1B Petition; the timing of the window may vary as the USCIS seeks to stagger its review of H-1B Cap Petitions. Note that the online request does not require the filing of the Labor Condition Application but does require basic information about the position (employer name, EIN and mailing address, information regarding employer’s authorized representative and the beneficiary, and Form G-28).
  • Change in order of review. 20,000 H-1B visas are allocated annually to those holding a US Master’s Degree (or higher), while 65,000 H-1B visas are allocated for all qualified beneficiaries. Under current procedure, the Advanced Degree lottery is run first and the 65,000 visa lottery second. The proposed rule seeks to reverse this order such that the Advanced Degree lottery would occur second.

The public now has 30 days to comment on the proposed role, followed by a review and response period from the USCIS. It is possible that the USCIS will complete the notice and comment period prior to the FY 2020 H-1B cap period (i.e., petitions filed in 2019). The proposed rule includes a severance provision that would allow the change in the order of review of petitions to be finalized without the inclusion of the preregistration system.

Key Takeaways for Employers

The proposed rule would dramatically change the way that companies consider how and when to file H-1B Cap Petitions, and how potential beneficiaries are selected. Here are the key takeaways employers should be aware of:

  • Employers would be required to submit an online request for each beneficiary; only one request can be made per beneficiary by an employer.
  • The USCIS will notify petitioners of the opening and closing of the preregistration window; it is likely the window will occur during the two weeks leading up to April 1 of each year.
  • Once the lottery is run, petitioners will be notified of whether any of its registrations have been selected and include a 60-day window during which the H-1B Petition must be submitted.
  • The filing window will likely be staggered, e.g., some employers may receive April 1 to May 31, while other registrations could be provided a filing window of May 1 to June 30.
  • Employers cannot substitute beneficiaries once a registration has been selected.
  • Employers must attest, within the registration system, that the petitioner intends to employ the beneficiary consistent with the registration. While the employer is not required to submit the H-1B Petition on behalf of the selected beneficiary, the USCIS will closely monitor potential abuse of the preregistration program (i.e., flooding of registrations by petitioners) and potentially coordinate with other government agencies to seek action against employers they deem to have abused the system.
  • Unselected registrations will be kept as backups in the event petitions are not submitted for selected registrations. The USCIS may also reopen the preregistration period if required.
  • The USCIS will run the Advanced Degree lottery second in an attempt to maximize the number of selected registrations for beneficiary’s with advanced degrees.
       

Actions to Take

Given the uncertainty regarding the change in process and the possibility that the final rule will differ from the proposed rule (as a result of notice and comment), it is critical that employers prepare for the FY 2020 H-1B cap season as soon as possible. As a first step employers should immediately begin to identify potential candidates for submission. Given the potential attestation requirement, employers must carefully consider which individuals it intends to employ under the H-1B program.

Employers should be aware that if instituted, the proposed rule may spread out the submission and adjudication of H-1B cap petitions. As a result, employers should prepare to make strategic decisions regarding (i) when to notify beneficiaries that an H-1B cap preregistration will be submitted on their behalf, (ii) when to gather documentation from beneficiaries, and (iii) when to confirm relevant job details for potential H-1B cap beneficiaries.

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