H-1B Modernization Final Rule Released: Key Updates
The Department of Homeland Security (DHS) has published a final rule to enhance the H-1B program, which will take effect on January 17, 2025. Here are the rule’s key updates:
Clarifying Requirements and Improving Program Efficiency
DHS is formalizing its current deference policy, allowing adjudicators to defer to prior USCIS decisions on the same facts and parties, unless material errors in the prior approval have been discovered. Such deference will reduce unnecessary delays for employers seeking extensions or amendments.
DHS is clarifying the definition of “specialty occupation” so that a range of qualifying degrees are acceptable for the H-1B position so long as the degree is directly related to the job duties of the position. USCIS has often pushed back on H-1B petitions where the degree is not in the exact field of the position, so this clarification should ease annoying Requests for Evidence, asking how the beneficiary’s degree is a match with the offered H-1B position.
Providing Greater Benefits and Flexibility
F-1 students who are on OPT or STEM OPT and who are selected in the annual H-1B lottery will have their work authorization and status extended automatically through April 1 of the following calendar year if they timely file an H-1B petition after being selected in the annual H-1B lottery. This will provide up to six additional months of status, minimizing the risk of gaps in maintenance of status and employment while awaiting an H-1B approval, and reduce the likelihood of having to pay for premium processing to avoid an interruption in employment authorization.
The final rule also expands the scope of cap-exempt status for nonprofit and governmental research organizations, as well as certain nonprofits affiliated with higher education institutions, which would allow these organizations to hire foreign nationals on H-1B visas without going through the annual lottery. Organizations can qualify for cap exempt status if research is one of their fundamental activities; research no longer has to be the primary activity.
Foreign nationals also can qualify for an H-1B visa without going through the annual lottery if they spend at least half of their time providing essential work for a cap-exempt organization.
Lastly, foreign nationals who are controlling shareholders of the petitioning entity can be sponsored for the H-1B visa, but will be given an initial period of 18-months instead of three years. They will still need to be able to show a bona fide business and ability to pay prevailing wage.
Strengthening H-1B Program Integrity
DHS will be able to use site-visits to monitor compliance with H-1B regulations at primary worksites, third-party worksites, and any locations where an employee will work. Refusal to comply with these visits may result in denials or revocations.
Furthermore, employers must establish that a bona fide specialty occupation is available for the H-1 petition at the requested start date. USCIS can review contracts or other documents to ensure legitimacy of the position.
These announcements are aimed to enhance flexibility, improve efficiency, and strengthen integrity of the H-1B program. While the incoming administration may seek to restrict adjudication of H-1B petitions (like during the last Trump administration), the formalization of these changes through regulations (instead of policy memos) will help reduce the risk of sudden changes to the program. By understanding these updates, businesses can continue to leverage the H-1B program, and obtain talented workers while complying with immigration regulations.
Please do not hesitate to contact us if you would like to discuss these developments further. Happy holidays!