H-1B Cap Lottery Lawsuit Allowed to Proceed
Many of our readers are aware of the way first-time H-1B work visas are allocated – via a random lottery conducted as part of each year’s H-1B cap filing season in early April. The way the lottery is conducted has been kept secret and a recent lawsuit seeks to uncover details of the lottery’s mechanics while also seeking to change the way H-1B work visas are allocated.
Background of the H-1B Cap Lottery
The H-1B visa category was created in 1990 through the Nationality and Immigration Act of 1990 (INA). Upon the creation of the H-1B visa type, INA imposed a numerical limitation (“cap”) on the number of H-1Bs that could be issued in each fiscal year. This “cap” (or quota) has varied over the past years but is set to 65,000 per year for FY2017 (fiscal year) starting on October 1, 2016. As a result, each year, by law, USCIS can approve up to new 65,000 H-1Bs.
There are certain exceptions to the congressionally-mandated maximum of 65,000 H-1B visas per fiscal year. The first 20,000 H-1B visas issued to alien workers who obtained their master’s degree or higher from a U.S. university are exempt from the 65,000 cap; H-1B visas issued to such U.S. master degree or higher holders subsequent to the first 20,000 are then counted against the overall 65,000 cap. Additionally, the cap does not apply to foreign nationals in the U.S. who are in lawful H-1B status and who are seeking to extend their visa or change employers.
All H-1B filings which are received over the first five business days in April are subject to a random lottery to determine which of these H-1B applications would be counted and included under the cap. Selected cases are issued a receipt notice while all other rejected cases are sent back in their entirety to their petitioner employers.
Historical Chances of Selection by the H-1B Cap Lottery
Over the last several years, the chances of selection of a new cap H-1B application under the H-1B cap have been decreasing.
This year (FY2017) there were 236,000 applications and the cap was reached over the first five days. This means that there was approximately 27% percent chance that an H-1B cap filing will be selected under the H-1B lottery. The chance for U.S. master’s degree or higher holders was slightly higher.
Last year (FY2016) there were 233,000 applications and the cap was also reached over the first five days. This means that there was approximately 28% percent chance that an H-1B cap filing will be selected under the H-1B lottery.
The Legal Challenge
The legal challenge, Tenrec, Inc. v. U.S. Citizenship & Immigration Servs. , seeks to have the random lottery struck down as it claims that the lottery is impermissible by the regulations which state that workers “shall be issued visas (or otherwise provided nonimmigrant status) in the order in which petitions are filed for such visas or status.” The plaintiffs argue that instead of a lottery, USCIS should implement a system which is based on a priority date similar to the priority date system currently used to process immigrant visas. In response USCIS sought to dismiss the lawsuit arguing that foreign workers do not have standing to sue and that the employers also are not eligible to challenge because they have not shown harm by the lottery.
In a recent opinion, District Court Judge Simon rejected USCIS’s motion to dismiss and held that foreign workers who are denied H-1B visas do have standing to sue in federal court similar to the recent decisions which allow (at least limited) options for foreign nationals to challenge denials of employment immigration-related benefits (see recent case). In addition, Judge Simon found that petitioners who miss the change to hire a particular foreign worker because of the H-1B lottery system do suffer harm.
What Happens Next?
It is too early to predict what will happen with this lawsuit. As part of the litigation, we may be able to get some details on the H-1B lottery mechanics -how exactly is the lottery run, is it truly random, etc. More important, however, is the question as to what kind of system replace the lottery, if it is struck down or if the government decides to abandon it.
The lawsuit claims that the system should revert to a priority date-based filing system determined by when an employer files a petition; however, as many Indian and Chinese immigrant visa applicants will attest, having a priority date system in an environment where the demand is very high will result in extremely long wait times. While the immigrant visa is a system which contemplates some future employment, the H-1B visa program is designed to address a specific need at the present time or in the near future. If an employer has to wait for a year or two (likely more) to fill an H-1B position, the business opportunity and the position itself may not exist by the time the H-1B priority date is reached.
Conclusion
So the future is uncertain. A victory in this legal challenge is likely to change the lottery but would its replacement system be better? We will monitor developments in this case and report here for the benefit of our clients and readers, so please stay tuned.
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.
About the Author: Dimo Michailov
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The Capitol Immigration Law Group has been serving the business community for over 15 years and is one of the most widely respected immigration law firms focused solely on U.S. employment-based immigration. Disclaimer: we make all efforts to provide timely and accurate information; however, the information in this article may become outdated or may not be applicable to a specific set of facts. It is not to be construed as legal advice.