Federal immigration authorities recently published long-awaited revisions to the H-1B visa process intended to modernize the H-1B visa process and tighten the annual lottery system. The notice was published by U.S. Citizenship and Immigration Services, and the proposed rule will be available for public comment until December 22, 2023. We expect that the resulting regulations will be finalized and implemented in the coming months.

1. H-1B CAP Registration process: The H-1B selection process will be made employee-centric instead of position centric. The rule will change the cap registration process and allow no more than one lottery application per beneficiary to be counted — no matter how many companies register that beneficiary.

2. Extension of Cap-Gap Rules: Since the new H-1B cap registration was introduced a few years ago, there have been several annual runs of the selection lottery conducted by USCIS. This has resulted in many candidates receiving an H-1B cap approval and a related change of nonimmigrant status well beyond Oct. 1. However, current cap-gap rules technically only provide for renewed optional-practical-training work authorization until that date. The new rules will extend the cap-gap period for six months, from Oct. 1 of the fiscal year to April 1. Hopefully this will solve the problem that employers encounter with I-9 compliance, where USCIS delays adjudication of an H-1B cap petition until after Oct. 1.

3. Expansion of Cap-Exempt Organization Eligibility : The rule will expand eligibility for companies that support nonprofit research organizations and governmental research organizations, to allow for more H-1B cap-exempt filings.

4. Codification of Deference to Prior Approvals: The rule will codify of the concept of deference to prior approvals to confirm that USCIS should find a case approvable if the same candidate or employment was previously approved by the agency, and no material changes in employment have occurred. This specific change is important. The Trump administration had previously reversed this agency policy, which led to a heightened level of request-for-evidence issuance. The incoming Biden administration then restored the policy as one of its first USCIS agency actions in 2021.

5. Elimination of Itinerary of Services Requirements: USCIS may no longer require employer to provide an itinerary of services even while the employee is working at multiple location.

6. Clarification of Specialty Occupation Criteria: The rule will revise the definition of “specialty occupation” for H-1B purposes to allow for a position to require a range of academic degrees, provided these are related to the role in some explainable way. This could be helpful in few cases where more than one degree is listed as potentially qualifying for the underlying position. This could technically allow the employers to state the actual real-world requirements. But, there is a concern that the USCIS adjudicators may interpret this new language to increase the burden on petitioners. Also, in situations where an H-1B petition involves placement of the worker at a 3rd party worksite, USCIS is proposing to have the requirements for the role of the 3rd party company (end-client) rather than those of the petitioner. This could pose a major challenge since some of the end clients don’t mention the degree requirements. Even if they do, they keep it more generalized and hence may not qualify for specialty occupation.

8. Requiring MSA & POs: USCIS is seeking to codify the ability of USCIS to request statements of work and Master Services Agreements as well as other kinds of documentation to substantiate an H-1B petition proposing placement of the worker at a 3rd party locations.

9. USCIS to expand its role in assessing whether a Labor Condition Application corresponds to the supporting H-1B petition. This could pose a major challenge in case the supporting LCA does not state the correct SOC code or the Wage level. The proposed regulation seems to now invite the USCIS adjudicator to second-guess these decisions as well and could cause substantial unpredictability in outcomes of H-1B petitions.

9. USCIS to make compliance with FDNS visits Mandatory – During FDNS visits, if the Petitioner does not provide the information as requested by the FDNS Officer, the officer could deny or revoke the H-1B petition. This typically happens if the Officer is denied access to an interview with the employee.

10. Clarification on H-1B holders owing share in the company: The definition of a U.S. employer would be altered to make it easier for foreign nationals to be sponsored for H1B positions by a company he or she owns. For certain petitioners, the beneficiary could perform non-specialty occupation duties related to owning and directing a business.

DHS also proposes to clarify when an amended or new petition must be filed due to a change in an H–1B worker’s place of employment to be consistent with current policy guidance.