FY2012 H-1B Work Visa Cap Reached — Alternatives to H-1B

Many of our readers are aware that as of November 22, 2011, USCIS has 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 November 23rd will be rejected.   Throughout the entire H-1B cap season, our office was providing weekly updates to our readers and clients on the status of the H-1B cap and our predictions (based on analyzing the H-1B demand over time) that the H-1B cap would be reached by late November 2011 turned out to be pretty accurate.

Comparison of FY2011 and FY2012 H-1B Cap Seasons

This H-1B cap season lasted approximately two months shorter than last year’s.  Last year’s (fiscal year 2011, FY2011) H-1B cap season lasted until January 26, 2011, when the H-1B quota was reached.  This year, FY2012, the H-1B cap season was two months shorter.  This can be explained in a number of ways, most notably due to the gradual improvement in the U.S. economy and increase in the rate of hiring for the next 6-12 months.  As we saw the rate of H-1B filings over the past few weeks of this H-1B cap season to increase, we expect that as the economy continues to improves over the next couple of quarters, the H-1B demand should pick up and we expect that the new H-1B cap season, to open on April 2, 2012, to be busier than the last one.

Alternatives to H-1B Cap

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, 2012, when the new fiscal year’s H-1B quota would begin (as a reminder, April 2, 2012 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 FREE 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 Transferree

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.

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 Unlikely

While we do not expect Congress to raise the H-1B cap for FY2013, it is nonetheless possible.  There are a number of proposals currently circulating in Congress, some of which aim to increase the H-1B cap.  While none of these proposals have gained momentum at this time, we will be providing updates as soon as there is a likelihood that there will be development on this front.

Wait and File on April 2, 2012 for the FY2013 Cap

For some of our clients, waiting until April 2, 2012 to file a new cap-subject H-1B petition may be the best 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, the FY2013 H-1B cap is expected to be the same as it was for the FY2012 fiscal year – 65,000 H-1B visas (plus 20,000 for holders of U.S. master’s degrees).  However, as the economy starts to improve and employers increase hiring, we do not expect that next year’s H-1B numbers will remain available for as much as 8-9 months, as they did this year.   Accordingly, we urge employees and employers to prepare and file most or all of their H-1B petitions on or about April 2, 2012, to ensure that their petition has the greatest chance to be included in the quota.  Please contact us to start preparing for your FY2013 H-1B cap filing.