I-140 Portability/EAD Draft Rule Released – Analysis and Overview of the Proposed Changes and System Fixes

On November 17, 2016, USCIS released the final version of this rule.

On December 31, 2015 USCIS released a draft of the proposed and long-awaited rule seeking to improve certain aspects of the employment-based immigration system. The proposed rule seeks to implement certain changes to the non-immigrant and immigrant visas in order to better allow US employers to retain foreign workers.   The proposed rule also provides increased flexibility to foreign workers, especially from India and China, during their U.S. employment-based immigration process.

It is important to note that this is the proposed rule which is subject to a public comment period and which is subject to significant changes and delays. Please also note that a significant portion of the proposed rule deals with codifying existing USCIS practices (based on agency guidance and memoranda) into the regulations. In other words, a good portion of the proposal does not bring much substantive changes. We focus our analysis below on what are the new or changed provisions.

Proposed Changes Driven by President Obama’s November 2014 Executive Action on Immigration

In his executive action on immigration announcement from November 2014, President Obama ordered certain changes to the immigration regulations in order to modernize and streamline the employment-based immigration system.   The last 12 months have been full of speculation and hope as to what the actual rules would look like. Prior to this announcement, we had been relying on bits and pieces of information from USCIS and other agencies involved in the immigration process. We now finally have a proposed rule which puts specific changes and regulations.

Executive Summary of the Proposed Rule

Portability of I-140s and Priority Dates.   I-140 petitions which have been approved for more than 180 days will be valid for H-1B extensions beyond the sixth-year limit and valid for portability (including retention and porting of the priority date) even in the event the sponsoring employer withdraws the approved I-140 or goes out of business.

I-140 EAD for “Compelling” Reasons. The proposed rule seeks to create a new category of EAD available to workers maintaining E-3, H-1B, H-1B1, L-1 or O-1 status, who have an approved I-140 in the EB1, EB2 or EB3 categories, and who are unable to adjust status because of retrogressed visa cutoff date. The I-140 EAD will be available only for “compelling” reasons and there are restrictions on status and renewals.

Introduction of Grace Period After H-1B Employment Termination. The proposed rule seeks to allow a one-time grace period of sixty (60) days after termination of H-1B employment (prior to expiration of authorized stay) to allow H-1B workers and their dependents time to seek H-1B transfer, change of status or departure from the U.S. This grace period would also apply to workers holding E-1, E-2, E-3, H-1B1, L-1 and TN status and their dependents.

Automatic Employment Authorization During EAD Extensions. The proposed rule seeks to allow for automatic and continued employment authorization for up to 180 days for certain types of employment authorization document (“EAD”) renewals when the EAD renewal application is timely-filed and remains pending after the current EAD term’s expiration.   Only certain types of EADs are included – I-485 EADs are included while H-4 EADs are not.

Below are more details and analysis of the significant new provisions of the proposed rule:

I-140 Petitions to Remain Valid Even After Employer Withdrawal and Retention of Priority Dates

The proposed rule seeks to clarify when an I-140 petition (and its priority date) can be retained. Currently, an I-140 petition is automatically withdrawn when a labor certification is invalidated, the petitioner dies/business is closed or the petitioning employer withdraws the petition (most common). Currently, based on USCIS practice, withdrawal of an I-140 by the employer generally does not affect the sponsored employee’s ability to retain their priority date but, currently, revocation of an I-140 impacts the ability of an H-1B worker to obtain H-1B extensions.

The proposed rule seeks to amend the regulations so that EB-1, EB-2 and EB-3 immigrant visa petitions that have been approved for 180 days or more would no longer be automatically revoked based only on withdrawal by the sponsoring employer or termination of the petitioner’s business. I-140s can still be revoked by the government based on fraud, material misrepresentation, invalidation or revocation of a labor certification or USCIS error. As a result, an eligible I-140 petition can be used to retain the priority date with a subsequent I-140 petition, obtain H-1B extensions with subsequent employer and obtain job portability.

The main benefit of this rule is to confirm the current practice of foreign workers being able to retain their priority date with a subsequent I-140 petition.   This rule would also remove the danger to foreign workers from running out of H-1B renewal options if the I-140 petitioner employer withdraws the I-140 petition (or goes out of business).

I-140 EAD in Compelling Circumstance

The proposed rule seeks to allow an EAD to be approved for a term of one year when the applicant (1) is in the U.S. on E-3, H-1B, H-1B1, O-1 or L-1 status, (2) is the beneficiary of an approved EB-1, EB-2 or EB-3 immigrant petition, (3) does not have a visa immediately available, and, notably, (4) can demonstrate that compelling circumstances justifying EAD approval.

Those who seek to take advantage of this provision and are able to actually obtain an approval of such EAD by showing compelling circumstances may find themselves unable to change status from within the US and may have to forego the option of filing I-485 adjustment of status from within the U.S. and may need to process their immigrant visa from the U.S. consulate. Dependents would be eligible to obtain EAD (initial and extensions) but only after the primary worker’s eligibility has been established.

Additionally, the ability to extend such EAD by showing continuing compelling circumstances will be limited only to those who have a priority date that is less than one (1) year from the current cutoff date for the applicable country and category.

What are Compelling Circumstances?

The proposed rule specifically refuses to define “compelling circumstances” and would prefer to grant discretion. However, the rule has identified four circumstances which may be considered compelling:

• Serious illness or disability – for example, requiring moving to a different area of requiring significant change in the employment circumstances.
• Employer retaliation – for example, as a result of the employee filing a complaint or similar grievance with appropriate agency.
• Substantial harm to the applicant – for example, as a result to sudden change in terms of employment and substantial difficulty in finding other employment.
• Significant disruption to the employer – for example, disruption due to inability to obtain visa petition approval due to corporate reorganization.

H-1B Extensions, Portability, and Cap-Exempt Definitions

H-1B Extensions Beyond Sixth-Year Limit.

The proposed rule makes a number of “tweaks” in the relevant H-1B guidelines regarding H-1B extensions beyond the sixth-year limit for individuals who are subject to retrogressed visa cutoff dates and who are beneficiaries of an I-140 petition which has been approved for 180 days or more even if the sponsoring employer has withdrawn the I-140 petition (as long as the petition has not been revoked for fraud, material misrepresentation, invalidation of the labor certification, or USCIS error). Similarly, extensions beyond the sixth-year limit will be available for beneficiaries of PERM labor certifications which are pending for more than 365 days.

• The availability of H-1B extensions beyond the sixth-year H-1B limit is proposed to be unlimited. This is not a new proposal – the current USCIS practice is to grant multiple H-1B extensions beyond reaching the sixth-year limit despite what the current (to be amended) regulations cite as “one-time” protection.
• Recapture of time spent abroad and request for H-1B time beyond the sixth-year limit can be combined in a single application asking for the combined available period of time. This has been USCIS’s current practice anyway and our office has been filing cases this way for eligible cases. USCIS now seeks to have this practice formally codified under the relevant regulations.   The maximum time which can be requested for any H-1B extension remains three years.
• H-1B extensions beyond the sixth-year limit can be filed by the sponsoring I-140 employer or by any other employer, as long as the I-140 petition meets the eligibility requirements noted above.
• Approved and eligible I-140 petition grants these benefits only to the principal H-1B worker and not to family members.   Therefore, a family member who has an independent H-1B petition cannot obtain H-1B extensions beyond the sixth-year limit unless they have are eligible for such extension based on their own employment-based immigrant process (PERM/I-140).
• One-year H-1B extensions beyond the sixth-year H-1B limit will be available if a PERM labor certification is pending for more than 365 days, including on appeal in the event of a denial. A PERM labor certification is not available for extension if the PERM has expired after its 180-day post-approval validity period has ended and no I-140 petition has been filed.
• To take advantage of these H-1B extension and portability provisions, a beneficiary must file an I-485 application for adjustment of status within one (1) year of an immigrant visa becoming immediately available (retrogressions in the visa dates would reset the clock).

H-1B Cap-Exempt: Employed “AT”

The proposed rule would amend current regulations regarding when an H-1B employment is considered to be cap-exempt.   Currently, a cap-subject employer may claim that an H-1B petition is cap-exempt for an H-1B worker if the worker will be employed at a cap-exempt organization and (1) the majority of the worker’s duties will be performed at a qualifying cap-exempt organization and (2) such job duties directly and predominantly further the essential purpose of the host organization. This is an amendment of current practice and this makes it relatively more difficult to justify H-1B employer at cap-exempt placement.

“Related or Affiliated Nonprofit Entity” Definition Clarification

The regulations seek to clarify, for both fee and cap-exemption purposes, the definition of affiliated nonprofit entity.   Currently, the definition includes situations where there is shared control of ownership or operation by or attachment to an institution of higher education. The proposed regulation seeks to expand the definition to include nonprofit entities that have entered into formal written affiliation agreements with institutions of higher education and can show both (1) active working relationship for purposes of research or education, and (2) that one of their primary purposes is to directly contribute to the research or education of the affiliated entity.

H-1B Licensing.

The proposed regulation would provide certain flexibility in H-1B cases for professions requiring a license. For H-1B petitions where a license is a requirement to practice the profession, USCIS would look to see if a license application has been filed (and not necessarily obtained because a state or locality requires a social security number or the issuance of an EAD before accepting or approving such licensing requests). Also, the licensing requirement will be considered to be met for H-1B purposes if an unlicensed H-1B worker will be working in a state that allows individuals to work under the supervision of a licensed senior or supervisory personnel.

Grace Periods Available to Nonimmigrant Visa Holders After Termination of Employment

By way of background, currently, H-1B workers have a grace period of 10 days before AND after the validity of an H-1B petition during which period they can be in the US in valid H-1B status but not work.   Also, currently, H-1B does not have any grace period in the event the H-1B employment is terminated (by either party) before the expiration of the H-1B petition.   The grace periods will be available only to E-1, E-2, L-1, TN and H-1B status holders, as described below, and their dependents.

10-day Grace Periods Before and After Employment Validity Terms

The proposed regulation seeks to expand the availability of the 10-day grace period of authorized stay (but not work) in the US before and after the petition validity period, to workers on E-1, E-2, L-1 and TN status. While employment is not authorized during these 10-day grace periods, eligible workers are authorized to stay in the U.S.

One-time 60-day Grace Period Following Termination of Employment

The proposed rule would introduce a one-time grace period of 60 days or until the existing validity period ends, whichever is shorter, in the event employment is terminated. This one-time grace period is intended to allow affected workers time to evaluate their options and seek transfer of their employment, change of status or departure from the US. Employment is not authorized during this grace period even if a transfer petition (for example, H-1B) is filed by another employer during the grace period (in this case, the employee will need to wait for approval).

Automatic Interim Employment Authorization for Certain Pending EAD Renewals

The proposed rule seeks to introduce some relief and changes to the way EADs are being adjudicated.   Currently, the regulations do not allow for employment authorization (with the extension of STEM OPT extensions) after the current EAD has expired and while a timely-filed EAD renewal is pending.   This creates significant difficulty (and stress) to EAD applicants who must file renewals months in advance and who rely on USCIS timely adjudicating such EAD renewal applications.

The proposed rule seeks to authorize employment while the EAD renewal is pending for up to 180 days after the expiration of the existing EAD when the following criteria are met: (1) the applicant files the EAD renewal prior to the current EAD’s expiration date – timely filing; (2) the applicant is applying under the same EAD category; (3) the applicant is filing under a category which does not first require adjudication of an underlying application.

USCIS is restricting the availability of this provision only to certain types of EAD applications. Notably, I-485 EADs are included under this automatic employment authorization provision but H-4, L-2 and similar EADs are not eligible.

Specifically, the available classes are as follows:   refugees – (a)(3), asylees – (a)(5), parents or dependent children of people who got permanent residency under INA 101(a)(27)(I) – (a)(7), citizens of Micronesia or the Marshall Islands – (a)(8), applicants granted withholding of deportation or removal – (a)(10), TPS (a)(12) and (c)(19), applicants with pending asylum or withholding of deportation or removal – (c)(8), pending adjustment of status applicants – (c)(9), applicants with pending suspension of deportation and cancellation of removal – (c)(10), applicants for creation of a record of lawful admission for permanent residence – (c)(16), legalization applicants – (c)(20) and (c)(22), LIFE Act adjustment applicants – (c)(24), VAWA cases – (c)(31).

At the same time, USCIS is removing the current provisions requiring them to adjudicate EADs in 90 days. The stated reason is “to address national security and fraud concerns.” Interim EADs are also eliminated. While USCIS intends to continue to adhere to 90-day EAD processing timelines, there are no mechanisms for relief in cases where the EAD remains pending for more than 180 days OR for EAD applicants who are not eligible to take advantage of this new automatic employment authorization extension provision.

Timeline for Next Steps and Rulemaking Process – When Would This Rule Become Effective?

Please note that at this time this is only the proposed rule.   As part of the rulemaking process, this rule draft is subject to a public comment period. This comment period is scheduled to end on February 29, 2016 (see the rule text for information on how you can submit comments to this proposed rule – anyone can do so).   Once the comment period closes, DHS would review the comments and either revise the rule in response to concerns or seek to publish a final rule.     The final rule, once published, will have a future effective date which. Please note that USCIS may (and is likely to) take months after the public comment period ends to publish the final rule, with a future effective date to allow for staff training and transition. Also, the proposed rule provisions may undergo changes, some of them significant.

Please stay tuned to our website or newsletter for more updates on the timeline and the effective date for this rule over the next several months.

Conclusion

We welcome DHS’s publication of the proposed rule and we believe that many foreign workers will benefits from the many provisions included in the rule. At the same time, we recognize that the actual provisions stop short of providing relief in a number of areas. We hope that USCIS will continue to identify and address areas where the employment-based needs further improvements.

We also caution that this is a proposed rule and we do not know if this rule will become final in its current form.   We also do not know when the rule will become effective.   Our office will monitor this process over the next months and provide additional updates, including estimates and actual dates of implementation of this new rule.

Please do not hesitate to contact us if we can review your case, answer any questions or schedule a consultation.   We also invite you to subscribe to our free weekly immigration newsletter to receive timely updates on this and related topics.