This Year’s H-1B Cap Has Been Reached – What Are the Alternative Visa Options?

Many of our readers are aware that as of April 7, 2015, USCIS had received a sufficient number of H-1B cap-subject petitions to fill the annual H-1B quota.  This year’s number of filings (233,000) is at an all-time high, meaning that about 1 in 3 H-1B cap applications will be selected for review.    As USCIS is starting to issue receipt notices for the H-1B cap cases which are being selected for processing (we even are starting to see H-1B cap premium processing approvals), we wanted to provide an overview of the alternative visa options for those H-1B employers and employees whose H-1Bs did not get selected under the H-1B cap lottery.

The H-1B Cap Season Numbers

This year there were 233,000 applications filed for the 85,000 available H-1B cap visas, resulting in a simple calculation of about 36% average chance than an application will be selected for processing under the H-1B cap.    U.S. master’s degree holders have higher change, while the rest of the applicants have slightly lower chance due to the way U.S. master’s degree holders’ H-1B cap cases are given priority at the lottery.   This 36% chance is significantly lower than last H-1B cap year’s 50% average chance of H-1B cap selection.     As a comparison, there were 172,500 H-1B applications filed last year (which translates to 35% more H-1B cap applications filed this year compared to last year’s H-1B cap season).

As a result,  many employers 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 describe some alternative visa options.

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, 2016 is the earliest a cap-subject H-1B application can be filed under next year’s cap).  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.  A cap-exemption case may be made even if the actual H-1B employer does not meet these requirements but the placement of the H-1B worker will be at the location of a cap-exempt employer.    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.

F-1 Optional Practical Training (OPT) Extension or F-1 Curricular Practical Training  (CPT)

Many of the H-1B cap candidates are F-1 student visa holders who are already in the U.S. and for them there may be ways to continue to stay on F-1 status while having work authorization.    OPT holders who have completed a STEM degree (See Which Degrees are on the STEM List?) are eligible to apply for a 17-month STEM OPT extension.    There are certain requirements to qualify for the 17-month STEM OPT extension (employer must be E-Verified company, extension must be filed before the current OPT expires, and others) but this is a great way for F-1 students to continue to be able to work in the U.S.

Additionally, certain schools and F-1 degree programs allow an F-1 student to engage in employment related to their field of study under the Curricular Practical Training, CPT, program.    Availability and eligibility varies by school and program; but when available, the F-1 CPT option may allow continued employment authorization.

File for a Permanent Residency/Green Card Directly

For some employers and their foreign workers filing for an employment-based green card may be  viable option.   Normally, employers seek to hire a foreign worker on H-1B status and then the employer does a green card sponsorship.    However, it is also possible to do a green card directly, without going through the H-1B visa option.      This option may work best for foreign workers who have a master’s degree OR a bachelor’s degree and five years of experience and are nationals of a country other than China or India.   This option may work well even for holders of a bachelor’s degree from a country other than China or India.     Unfortunately, this direct green card filing option may not work so well for India or China nationals because of the significant waiting time for a visa number to become available (4-5+ years).

For example, it may be possible to secure a PERM Labor Certification approval in 9-12 months.   For many EB-2 (and even for some EB-3) candidates, the way the Visa Bulletin cutoff dates have advanced means that the second and third stages of the green card process (which also grants permission to stay in the U.S. and EAD permission to work) can be filed within a year (or possibly even less) after starting the green card process.    While the foreign national will need to be able to maintain valid status in the U.S. during this time, the direct filing of a green card may be a good alternative to simply skip the H-1B work visa filing process.     Obviously, the suitability of this option depends on a number of factors, including education, experience, country of nationality and the ability to maintain status in the U.S.     We are happy to provide a more personalized overview of this option – please contact one of our attorneys for more information.

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, 2016 for the FY2017 Cap

For some of our clients, waiting until April 1, 2016 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 FY2017 H-1B cap is expected to be the same as it was for the FY2016 fiscal year – 65,000 H-1B visas (plus 20,000 for holders of U.S. master’s degrees).

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.