On April 5, 2013, U.S. Citizenship and Immigration Services (USCIS) announced that it had received enough petitions to meet the statutory H-1B cap of 65,000 new H-1B visas to be issued each year.  The H-1B visa category is used by U.S. businesses to employ foreign workers in a “professional” or “specialty occupation” position. USCIS also announced that it received enough petitions to meet the 20,000 advanced degree exemption.  USCIS reported receiving approximately 124,000 H-1B petitions within the first week of the filing period. 

On April 7, 2013, USCIS selected the H-1B petitions to be processed using a computer generated random selection process, known as a lottery.  H-1B cap subject petitions received after April 5, 2013 or not selected for processing in the lottery will be rejected and returned to the petitioner along with the filing fees.  USCIS has started to issue receipt notices for premium processing cases selected for processing.  

H-1B petitions for extensions of stay or change of employer for workers who are currently in H-1B status do not count towards the H-1B cap and USCIS will continue to accept petitions for individuals in those categories.  USCIS will also continue to accept petitions for employers exempt from the H-1B cap, including institutions of higher education, nonprofit entities affiliated with an institution of higher education, and nonprofit research organizations. 

If you missed the H-1B filing window or your petition was not selected for processing, you should contact one of the lawyers in the Global Immigration Practice Group to discuss whether there are other options for employing your foreign national.

Give your company the gift of an immigration audit this year – it may just keep your company off the government’s naughty list.  Here are the top 12 immigration mistakes employers made in 2012:

1.  Failing To Properly Pay H-1B Workers

USDOL debarred a Washington information technology consulting services company from participating in the H-1B program for two years, assessed $405,175 in civil money penalties, and ordered payment of $983,039.12 in back wages for numerous H-1B violations, including willful failure to pay required wages by demanding workers pay H-1B government filing fees.

2.  Employing Unauthorized Workers

Two Houston companies each forfeited $2 million and agreed to adhere to revised immigration compliance programs for employing unauthorized workers.  Both companies received multiple "no-match letters" from the Social Security Administration (“SSA”), which indicated employee names and Social Security numbers did not match SSA records. ICE completed an I-9 audit of both companies in 2011, revealing that from 2005 to 2009 about 44 percent of the workforce of one company was undocumented, many individuals were employed with numerous "egregiously suspect" identification documents, including misspellings of agency names and/or containing the words "novelty item."  Similarly, an I-9 audit of the second company revealed that about 269 of its 451-person workforce consisted of undocumented aliens.

3.  Failing to Properly Notify USCIS of an H-1B Worker’s Termination

USDOL has repeatedly held that H-1B workers are entitled to back pay for the entire period of the H-1B approval where the company failed to promptly withdraw the H-1B with USCIS and pay for the reasonable cost of the H-1B worker's return transportation to his or her home country.

4.  Visa Fraud

The head of a Los Angeles law firm was sentenced to 10 months in prison for his role in orchestrating a lengthy employment visa fraud scheme where he and other members of the firm set up nearly a dozen shell companies in order to file at least 137 fraudulent employment-based visa petitions for nearly 100 foreign national clients in exchange for payments of $6,000 to $50,000.

5.  Citizenship Status Discrimination

USDOJ reached an agreement with a manufacturer of semiconductor structures and advanced solar cells based in Illinois to resolve allegations that the company violated the anti-discrimination provision of the Immigration and Nationality Act (“INA”), when it placed six online job postings that explicitly stated citizenship status preferences or requirements that excluded certain work-authorized non-citizens from consideration.  The company will pay $12,000 in civil penalties. 

6. I-9 Document Abuse

In October, USDOJ settled a lawsuit against a Las Vegas Casino for $49,000 in civil penalties and full back pay to a former employee for unfair documentary practices.  The complaint alleged the casino required non-citizen employees to provide more or different documents or information than it required from citizen employees during the initial employment eligibility verification process.  The company then allegedly used the information gathered to impose improper document requests on non-citizens during the reverification process as a condition of continued employment.  The complaint further alleged that the casino subjected non-citizen employees’ documents to a heightened review process by senior human resources representatives that was not applied to documents presented by U.S. citizens.   

7.  Failure to Comply with State Immigration Laws

Employers are often unaware of the myriad of state immigration requirements.  A Survey of Immigration Laws is available on our website.

8.  Failing to Comply with the Deemed Export Rule

 The Export Administration Regulations (EAR) and the International Traffic in Arms Regulations (ITAR) impose licensing requirements on the export, reexport, and in-country transfer of a wide variety of items that are controlled for national security, foreign policy, and other reasons. The requirements include an obligation for U.S. persons, including corporate employers, to seek and receive a U.S. Government license before releasing in the U.S. to foreign persons, including foreign person employees from certain countries, various types of technology controlled by these regulations. This obligation is referred to by the Commerce Department as the “deemed export” rule because releases of controlled technology to foreign persons in the U.S. are “deemed” to be an export to the person’s country or countries of nationality.

9.  Failure to Properly Complete Form I-9s
 
A construction company with no history of previous I-9 violations was assessed fines in the amount of $17,200 for 103 I-9 violations, including failure to present I-9 forms for 10 employees, failure to list the proper List A document in Section 2 of the I-9, and twenty-seven I-9s with procedural or technical violations. 

10. Failing to Follow Proper E-verify Procedures

USDOJ reached a settlement with a provider of janitorial and facilities maintenance services based in Tampa to resolve allegations that the company violated the anti-discrimination provision of the INA when it failed to fully reinstate an employee in retaliation for asserting her right to work in the U.S.  The company has agreed to pay $6,800 in monetary relief to the charging party, which included back pay and interest, along with a $2,000 civil penalty.  The charging party alleged that the company failed to provide the employee with proper notice and instructions for contesting an initial data mismatch in E-Verify, resulting in E-Verify issuing an erroneous final response that she was not work authorized.    

11.  Taking Adverse Actions Against Employees Based Solely on SSA No-Match Letters

There is no clear guidance from the government on how an employer should respond to No-Match Letters received in 2012.  Employers should take the following steps upon receipt of a SSN No-Match letter:

• Check your records to make sure your Human Resources department accurately recorded the employee’s information.  If an error was made, provide the SSA with any corrections;
• If your records are correct, promptly notify the employee that you received a SSN No-Match letter and ask the employee to go to SSA to address any discrepancy;
• Do not take any adverse action against the employee based solely on the SSA No-Match letter;
• Apply any procedure developed to respond to the SSA No-Match letters in a non-discriminatory way; and
• Give the employee a reasonable amount of time to correct any discrepancy.  If the employee indicates that he visited SSA and the situation is resolved, please note the actions you and the employee took to resolve the discrepancy in the event of an audit. 

12. Not Preparing for an ICE Raid

In the chaos of an intrusive ICE raid, companies should ensure that their representatives are instructed not to volunteer statements to ICE agents or allow themselves to be interviewed or interrogated without an attorney present who represents the organization.
 
Last fiscal year, employers nationwide were ordered to pay nearly $10.5 million in civil fines for hiring violations. In addition, criminal charges were filed against a record-breaking 221 owners, employers, managers and/or supervisors – up from 196 in fiscal year 2010.  Once the final statistics for 2012 are tallied, 2012 is expected to be another record-breaking year for enforcement.  In order to avoid the above-listed costly errors, your company’s resolutions for 2013 should include ensuring immigration compliance programs are in place, up-to-date, and followed.

U.S. employers wishing to hire a foreign worker who is an Australian citizen should consider the E-3 visa category.  The E-3 visa category is only available for Australian citizens. The E-3 visa category permits Australian citizens to work in the U.S. in “specialty occupations” on a temporary basis. 

Specialty occupations are those which are professional in nature and require at least a bachelor’s degree in a specific field.  In order to qualify for the E-3 visa category, the Australian citizen must also possess the required bachelor’s degree or the equivalent in education or work experience. 

There is an annual limit of 10,500 new E-3 visas available to Australian citizens each year.  Under the E-3 visa category, an Australian citizen can obtain employment authorization in two-year increments and renew indefinitely.  Spouses and children of E-3 visa holders are also given E-3 visa status, but they are not counted against the annual cap.  Additionally, spouses of E-3 visa holders are eligible to apply work authorization in the United States.    

In order to apply for the E-3 visa category, an Australian citizen may apply directly at a U.S. Embassy or Consulate.  Alternately, an Australian citizen already in the U.S. may apply to U.S. Citizenship and Immigration Services to change his or her status to E-3 while in the U.S. 

An application for the E-3 visa category must include the following:

• Valid Australian passport as proof of citizenship;
• A Labor Condition Application (LCA);
• Offer letter of employment from a U.S. employer, detailing the professional position and applicant’s credentials; and
• Proof of the applicant’s qualifications, including degree, diploma, and/or experience letters.

While there is a limit on the number of E-3 visas available each year, the E-3 visa cap has not been reached this year.  Therefore, U. S. employers with immediate hiring needs should consider the E-3 visa as a viable option for hiring Australian citizens into professional positions.  Once employers have identified a potential candidate, they should contact an immigration attorney to evaluate whether the offered position and the candidate’s credentials meet the E-3 visa requirements.   

Since the H-1B visa cap was reached on June 11, 2012, U.S. employers wishing to hire a foreign worker who is a Canadian or Mexican citizen should consider the TN visa category.  The TN visa category is part of the North American Free Trade Agreement (NAFTA) and permits Canadian and Mexican citizens to enter the United States to participate in professional business activities on a temporary basis.

Under the TN visa category, Canadian and Mexican citizens are permitted to work in the U.S. in certain defined professional occupations, including, but not limited to, Accountant, Architect, Computer Systems Analyst, Engineer, Hotel Manager, Management Consultant, Mathematician, Scientific Technician/Technologist, and Scientist.  There are specific educational requirements and alternative credentials for each category and TN status is only available to individuals employed in the listed occupations who possess the required credentials. 

The TN visa category is available to an unlimited number of Mexican and Canadian citizens.  Unlike the H-1B visa category, the TN visa category does not have a numerical limit on how many visas are available each year.  Under the TN visa category, a Canadian or Mexican citizen can obtain employment authorization in three-year increments and renew indefinitely. 

In order to apply for a TN, Canadian citizens can simply apply for TN status at a U.S. port of entry.  Canadian citizens are not required to obtain a visa at a U.S. Consulate.   However, Mexican citizens are required to apply at a U.S. Consulate and obtain a TN visa stamp in their passport prior to entering the U.S.

Whether applying at a U.S. port of entry or at a U.S. Consulate, applicants for a TN must provide the following documentation:

• Valid Canadian or Mexican passport as proof of citizenship;
• Offer letter of employment from U.S. employer, detailing the professional position and applicant’s credentials;
• Proof of applicant’s qualifications, including degree, diploma, and/or experience letters; and
• Application fee.

Due to the availability of the TN visa for qualified applicants, the TN visa is an option for employers seeking to immediately hire a Canadian or Mexican citizen into a professional position.  Once employers have identified a potential candidate for TN status, they should contact an immigration attorney to evaluate whether the offered position and the candidate’s credentials fit within one of the defined TN occupations and will support a TN application.   

On Monday, April 2, 2012, U.S. Citizenship and Immigration Services (USCIS) will begin accepting FY 2013 H-1B cap-subject petitions for employment starting on October 1, 2012. 

U.S. businesses use the H-1B visa to employ foreign workers in “professional” or “specialty occupation” positions. The H-1B visa allows for 6 years of employment in the U.S., which is extendable if the company sponsors the individual for permanent residence.

Why Apply on April 2nd?

The law allows for 65,000 new H-1B visas to be issued each year, and an additional 20,000 visas are available to foreign workers with an advanced degree from a U.S. academic institution.  Because there is a cap on the number of available visas each year, employers should take advantage of the April 2 filing opportunity to ensure they obtain an H-1B for any foreign workers they wish to employ in H-1B status as of October 1, 2012.

Certain employers are exempt from the H-1B cap, and can apply for an H-1B visa year-round. These include institutions of higher education such as universities, non-profit entities related to an institution of higher education, and non-profit or government-affiliated research organizations.  In addition, foreign workers who have already been counted against the H-1B cap are not subject to the H-1B cap.

What Type of Position and Foreign Worker Qualifies for an H-1B?

Any position that requires at least a bachelor's degree as a minimum qualification may qualify for an H-1B visa.  In other words, if in the general labor market a candidate would usually need a bachelor's degree to be hired for a given position, that position may be filled by an H-1B worker.  Similarly, the H-1B worker must possess a degree in a field related to the position being filled.  If the H-1B worker does not have a formal educational degree, then 12 years of progressive experience in the field may be used instead to obtain the equivalent of a bachelor’s degree.

How Do I Prepare?

Although the FY 2012 H-1B cap was not reached until November 22, 2011, we can not predict whether the cap will be reached quickly this year.  Therefore, employers should immediately evaluate their hiring needs for this year and identify any current employees or potential hires who will need H-1B sponsorship.  Possible candidates for an H-1B visa include potential new hires or current employees working on another type of work visa, such as student (F-1/OPT), exchange visitor (J-1), intra-company transferee (L-1), or NAFTA professional (TN).  Once employers have identified candidates for H-1B status, they should contact an immigration attorney to evaluate whether the offered position and the candidate’s credentials will support an H-1B petition and start preparing to file the H-1B case on April 2, 2012. 

     Although the Presidential candidates will not be delving into all the volatile details of immigration in an election year, employers should tackle immigration issues to avoid monetary penalties and criminal sanctions.  Here are twelve steps all employers should take in 2012 to comply with the myriad of immigration laws:

1.    Conduct An Annual I-9 Audit

• The I-9 audit should be conducted by someone other than the person responsible for completing I-9s because the individual completing I-9s often repeats the same error.
• Correctable errors on the I-9 should be fixed, the change should be initialed and dated, and the words “Per Self Audit” should be placed beside the correction.
• Some I-9 errors cannot be corrected.  For example, if the employer completed Section 2 of the I-9 later than three business days from the employee’s first date of work for pay, the date cannot now be changed to show a timely completion.  

2.    Incorporate Immigration Policies in Handbooks

• Ensure immigration policies are in place, up-to-date, and followed.
• Develop and disseminate an immigration-related notification and response policy so all employees know how to handle unannounced government visits, including site visits from the H-1B Fraud Investigation Unit.

3.    Audit H-1B Public Access Files

     H-1B employers are required to maintain a public access file for each H-1B worker and must make the file available for public examination within one working day after the Labor Condition Application (“LCA”) is filed with U.S. Department of Labor (“USDOL”).  The public access files for most employers must contain:

• A copy of the certified LCA;
• Documentation of the wage rate to be paid to the H-1B worker;
• An explanation of how the actual wage was calculated (e.g. copy of the pay scale); 
• Documentation used to established the prevailing wage for the position;
• A copy of the internal notice of posting given to the union/employees; and
• A summary of the benefits offered to U.S. workers in the same occupation as the H-1B worker and an explanation of any differentiation in benefits.   

     Employers must retain all records one year beyond the end date on the LCA or, if a complaint is filed, until the complaint is resolved. 

4.    Properly Withdraw H-1Bs

• If an Employer terminates an H-1B worker or the worker resigns before the end of the three-year period of authorized admission, the employer should notify the U.S. Citizenship and Immigration Service (“USCIS”) in writing of the end of the employment and withdraw the underlying LCA with USDOL to avoid accrual of front pay and back pay damages. 
• The employer is also required by law to pay for the reasonable cost of the terminated H-1B worker’s return transportation to his or her home country.

5.    Implement Hiring/Application Practices that Avoid Discrimination Claims

     An employer can lawfully ask whether an applicant has unrestricted authorization to work in the U.S.  An employer cannot, however, request specific details about an applicant’s citizenship status or adopt an across-the-board policy of only hiring U.S. citizens.

6.    Abide by E-verify

     Employers cannot terminate or take any other adverse action against an employee who contests a tentative non-confirmation (“TNC”) of an E-Verify query while the TNC is in process. The employee is allowed eight federal government work days to contact the appropriate federal agency to correct the data.

7.    Do Not Ignore SSN No Match Letters

     There is no clear guidance from the government on how an employer should respond to No-Match Letters received in 2012.  Employers should check their records and give the employee a reasonable amount of time to correct any discrepancy.  If the employee indicates that s/he visited the U.S. Social Security Administration (“SSA”) or the USCIS and the situation is resolved, the employer should note the actions taken to resolve the discrepancy in the event of an audit.

8.    Implement Export Control Practices

     Under the Export Administration Regulations (“EAR”) and the International Traffic in Arms Regulations (“ITAR”), releases of controlled technology to foreign persons in the U.S. are “deemed” to be an export to the person’s country of nationality.  Thus, employers need to determine if export control licenses are required for foreign national employees.   

9.    Avoid Taking a Hands-off Approach to Immigration

     As the petitioner, the employer signs immigration petitions under the penalty of perjury.  Therefore, the employer should consult its own immigration attorney who will fully inform the employer about its legal obligations - rather than relying on an attorney retained by the employee.                    

10.  Avoid Passing Immigration Fees onto Employees in Violation of the Law

     For instance, USDOL regulations require the employer to pay for all fees and costs associated with applying for the first step of the three-step permanent residence process for foreign national employees.  Thus, such fees and costs cannot be passed onto the employee or deducted from their pay.  

11.  Utilize Contract Employees Properly

     Although employers are not required to complete I-9s for independent contractors, the USDOL and U.S. Department of Justice take the position that employers are obligated to do so if the contractors should be classified as employees.  Similarly, if an employer uses H-1B contractors, USCIS will scrutinize the end-user to determine which employer truly exercises control over the contractor to determine which employer should be filing the H-1B work visa petition.  
 

12.  Budget Time and Expenditures for Immigration

     Although many countries, such as the U.S. and Canada, allow for expedited immigration processing for intra-company transferees, employers need to allow sufficient lead time and budget for receiving the proper immigration approvals prior to sending an employee on a work assignment abroad.  The time to consult your immigration attorney is when a candidate is in consideration for a transfer, not when the candidate is already working in another country without authorization.  

Does your company rely on H-1B workers to fill critical positions?  Do you anticipate hiring foreign nationals in the upcoming months?   Fiscal Year 2012 H-1B visas are going fast and expected to be exhausted by the end of December 2011.  Act quickly to lock in one of the remaining FY 2012 H-1B visas.              

Each year, there are 65,000 regular cap (from which up to 6,800 visas are reserved for citizens of Chile and Singapore) and 20,000 U.S. Master’s or higher degree H-1B visas available for foreign nationals to work in the United States on a temporary basis in professional or specialty jobs.  On November 2, 2011, the U.S. Citizenship and Immigration Services (USCIS) announced that it had received 50,800 regular cap petitions and that the U.S. Master’s and higher degree cap had been reached for fiscal year 2012 (October 1, 2011 to September 30, 2012). The USCIS will continue to accept H-1B petitions covered under the annual quota until the cap has been reached.  For the last two years, the annual cap was reached on January 26, 2011 for FY 2011 and December 21, 2009 for FY2010.  With less than 8,000 visas remaining under the FY 2012 quota, the annual cap could be reached within the next month. 

The following petitions are exempt from the H-1B annual quota count:
• petitions for extensions of stay or change of employer for workers who are currently in H-1B status; and
• petitions by institutions of higher education, nonprofit entities affiliated with an institution of higher education, and nonprofit research organizations.

Employers who anticipate hiring a foreign national on a new H-1B visa should take immediate steps to ensure that the petition is received by the USCIS before the annual cap is reached.  Once the FY 2012 cap is reached, the USCIS will not accept FY 2013 H-1B petitions again until April 1, 2012 (for an October 1, 2012 employment start date).