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H-1B visa petitions have been receiving increased denials from the US Citizenship & Immigration Services (USCIS) following the President’s Buy American and Hire American Executive Order of 2017.  For example, according to the National Foundation for American Policy analysis of US Citizenship & Immigration Services data, IBM had a denial rate of 1% for H-1B visa petitions filed in 2015, yet a 35% denial rate in 2019.

More generally, USCIS have denied 33% of initial H-1B petitions in the first two quarters of FY 2019, and last quarter, 24% were denied.  Even H-1B visa renewals have also experienced a 12% denial rate so far this year.

The reason for increased denials frequently seem to rest on what USCIS considers to be a so-called “specialty occupation”, normally construed in the past as requiring a US Bachelor’s Degree or experiential or foreign equivalent.  Experience must be related to the position in question and increase in responsibility and complexity to be taken into consideration by the USCIS.  Reputable educational equivalency services can review proofs of foreign formal education or on-the-job experience and provide an opinion as to its formal US education equivalent for submission to the USCIS.  Usually, a three to one ratio is applied: three years of on-the job experience often being equal to one year of US college.

The candidate must not only possess the required credentials to be qualified for the “specialty occupation”, the position’s job description, not just the job title, must also point to the fact that a Bachelor’s Degree or equivalent is required.  USCIS seems to view a number of IT-related positions as not requiring a Bachelor’s Degree and hence not appropriate for an H-1B visa.  A good rule of thumb to get started in determining if the position qualifies as a “specialty occupation” requiring a Bachelor’s Degree or equivalent, is to look at the educational background required for the positon in the Bureau of Labor Statistics’ Occupational Outlook Handbook.  Another resource is O*NET Online sponsored by the US Department of Labor’s Employment & Training Administration.  That website actually lists the education normally required by respondents, and is also helpful in providing the prospective employer with an idea of the median wage for the position in question in the state where the employer is located.

Another reason for increased denials is that the USCIS finds that the wage level, of which there are four, is too low for the position in question.  This wage level must be correctly assigned when completing the Form ETA 9035E, an electronic labor condition application filed with the US Department of Labor, and once certified, forming part of the H-1B visa petition.

Denial rates appear to be especially high for consulting and business-services firms, now averaging over 30%. One reason is the perceived lack of employer-employee relationship when the H-1B candidate would be working remotely from the employer’s location and lacking close supervision, causing USCIS to question a bona fide employer-employee relationship.  Another reason for such denials is the employer’s failure to establish ongoing, specific work in a specialty occupation for the entire duration of employment requested.  Assignments cannot be speculative or capable of disappearing if the prospective employer is not selected for a project on which it wants the H-1B visa holder to work.

Carefully prepared H-1B petitions and extensions are certainly approvable by thoroughly addressing these areas of concern in the petition.

On a positive note, the USCIS is adding another layer to the application process come spring, 2020 which, in some ways, will benefit the employer.  USCIS has published a final rule requiring petitioners seeking to file H1B cap-subject* petitions (meaning subject to the lottery), to first electronically register with USCIS during a designated registration period.  In some ways, the new pre-registration is salutary since, by pre-registering, the employer need not prepare a full-blown petition only to find it was not selected through the H-1B lottery.  Thus, payment of a $10 filing fee through the https://www.pay.gov portal, the employer can apply to enter the H-1B lottery, and if selected, then files the H-1B visa petition.

USCIS has advised that it will monitor the new registration system for potential fraud and abuse to determine if employers are submitting many registrations but only filing petitions based on selected registrations at a significantly lower rate, which could reflect “gaming” the system to improve their odds of being selected.  USICS will require all registrants to attest that they intend to file an H-1B petition.

Finally, the 2020 H-1B lottery will reverse the order of selecting H-1B petitioners by first considering cases filed on behalf of applicants holding an advanced degree from US institutions.  The total number of specialty occupation cap-subject H-1B visas is 85,000, with 65,000 going to bachelor’s degree or higher, and 20,000 to advanced degree holders from a US institution of higher education.  According to USCIS, this reverse selection order will result in an estimated increase of up to 16% (or 5,430 workers) in the number of selected petitions for H-1B beneficiaries with Master’s Degrees or higher from a US institution of higher education.  The negative will be Bachelor Degree holders, or those holding graduate degrees from foreign academic institutions, will have less chance of success in this new cap-subject H-1B lottery.

*Some H-1B petitions are exempt from the H-1B lottery, known as being cap-exempt, if they are filed by institutions of higher education, a federal research organization like the NIH, or if the H-1B visa holder is changing employers.

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