The H-1B Cap Has Been Reached – What Are the Alternative Visa Options?

Many of our readers are aware that as of April 7, 2014, USCIS had received a sufficient number of H-1B cap-subject petitions to fill the annual H-1B quota. All cap-subject new H-1B petitions received by USCIS on or after April 7th have been or are currently in the process of being rejected and sent back and our office is starting to field a number of inquiries from candidates who were either not selected under the H-1B cap or were not able to file on time as to what are the alternatives to H-1B.     We are happy to provide an overview of the more common H-1B alternative visa options and our office is happy to provide a more individualized case analysis.

The H-1B Cap Season Numbers

This year there were 172,500 applications filed, for the 85,000 available H-1B cap visas, resulting in a simple calculation of about 50% chance that an application will be selected for processing under the H-1B cap.     This is in comparison to last year’s cap, fiscal year 2014 (FY2014), when there were 124,000 applications for the same number of H-1B cap visas.   This 40% increase in the H-1B cap demand this year compared to last year’s was evident early in the year and while our office had a great rate of H-1B cap acceptance, well exceeding the average of 50%, there are nonetheless H-1B candidates who were not accepted for processing under the H-1B cap.

As a result,  some employer and prospective employees who wanted to take advantage of the H-1B program this year are unable to do so — either because they were unable to file between April 1st and 7th or because their application was not picked by the H-1B lottery.     We seek to provide some alternatives which may be available.

Alternatives to H-1B Cap Petitions

Now that the H-1B quota has been reached, we are receiving an increasing number of inquiries by both cap-subject employers and prospective employees about the alternatives for work authorization between now and October 1, 2015, when the new fiscal year’s H-1B quota would begin (as a reminder, April 1, 2015 is the earliest a cap-subject H-1B application can be filed).  We describe some of the most common H-1B visa alternatives.  Note that the list is not intended to exhaust all possible visa types and scenarios pursuant to which an employee may be legally employed.  Our goal is to list some of the common options for the benefit of our clients and readers.  We are happy to discuss individual cases as part of our initial consultation.

Cap-Exempt H-1B

A number of employers may qualify to be cap-exempt and are allowed to file for H-1B petition at any time.   A cap-exempt employer is (1) an institution of higher education, (2) related or affiliated to a higher education institution nonprofit entity, or  (3) nonprofit research organization or a governmental research organization.  Please see our cap-exempt H-1B employer guide.   As a result, many educational institutions, non-profit and research organizations may qualify to file cap-exempt H-1Bs.   We are happy to help evaluate whether an employer can qualify to be cap-exempt.

O-1 or P-1 Extraordinary Ability Visas

O-1 and P-1 visas are generally reserved for individuals who have extraordinary ability in the sciences, arts (including the television and motion picture industry), education, business, or athletics.  By definition, not many individuals qualify for one or both of these visa types, but where possible, an application for O-1 and/or P-1 should be prepared in lieu of H-1B.   In addition to being able to obtain work authorization pursuant to these visa types, an O-1 and/or P-1 approval may establish the basis for the subsequent application for an EB-1 category permanent residency.  Please contact us if you would like our help in evaluating your O-1 and/or P-1 visa case.

L-1 Intracompany Transferee

The L-1 visa type allows multinational companies who have presence abroad to transfer their employees from their overseas offices to their U.S. office (or to establish a new U.S. office).  This visa type is a good option for foreign employers seeking to establish or boost their U.S. presence and for foreign nationals currently employed abroad.   Foreign nationals who are currently in the U.S. generally will not qualify for L-1 visa.  An added benefit to the L-1 visa is that family members are entitled to a work authorization pursuant to L-2 status.

TN for Canadian and Mexican Professional Workers

An option available to certain Canadian and Mexican nationals in certain occupations is the TN visa classification.   It is available to citizens of Canada and Mexico who would be employed in the U.S. in one of the designated occupations.  The TN visa is not subject to a cap and can be obtained fairly easily either by applying at the border (for Canadians) or by filing a petition with USCIS.    Please see more information on the TN visa classification.

E-1/E-2 Treaty Trader or Investor

The E-1/E-2 visas allow nationals of countries with which the U.S. has trade treaties to invest an amount in the U.S. and receive an E-1 (treaty trader) or E-2 (treaty investor) visa.  See a list of treaty countries.

The E-1 treaty trader visa is suitable if the foreign national has a multinational employer who is willing to transfer them, and the company has significant trade between the foreign country and the U.S.  The employee must also have skills which are essential to the operation of the company trade.   Dependents of E-1 visa holder are eligible for work in the U.S.

The E-2 treaty investor allows foreign nationals to invest (preferably) a substantial amount in the U.S. and obtain an E-2 visa to be able to manage and direct their investment.  The amount required for investment generally varies depending on the industry (the so called, proportionality test) with more capital-intensive industries requiring more significant investment for E-2 application.   Dependents of E-2 visa holders are eligible to apply for work authorization.

H-1B Program Changes by Congress Possible, Although Timing is Uncertain

It has become a pattern that after every H-1B cap season ends, resulting in a high number of disappointed employers and employees who did not make it under the lottery, there is increased talk about raising the H-1B cap limit.     There are proposals and much talk here in Washington, DC about this kind of a chance in the H-1B program; however, as of this time, there is no proposal or law which would become law any time soon.    As we have done in the past, our office would continue to monitor and report on any developments relating to relief to H-1B employers and workers, so stay tuned.

Wait and File on April 1, 2015 for the FY2016 Cap

For some of our clients, waiting until April 1, 2015 to file a new cap-subject H-1B petition may be the best (or only?) option.  The H-1B visa type, although subject to some requirements, is a fairly common visa type for which many qualified employees are eligible.    As of now, and assuming any proposed immigration reform is not enacted by then, the FY2016 H-1B cap is expected to be the same as it was for the FY2015 fiscal year – 65,000 H-1B visas (plus 20,000 for holders of U.S. master’s degrees).

Upcoming Webinar on H-1B Cap Alternatives

We would like to take this opportunity to invite you to our next webinar, scheduled for May 21, 2014 at 12:30 pm eastern time where our attorneys will have a more in-depth discussion of this year’s H-1B cap and, specifically,  these visa alternatives.   Registration and participation is free — please submit your free registration soon as there is a limit on the number of seats we can accommodate.

Conclusion

Our office will continue to monitor developments relating to the H-1B program, this and next year’s caps and the immigration proposals.   In the meantime, please feel free to subscribe to our free weekly newsletter to obtain developments on this and related topics. If our office can be of any help with any of the H-1B visa alternative options, please feel free to contact us.