USCIS Proposes Rule to Change H-1B Cap Lottery System and US Master’s Degree Lottery

The U.S. Citizenship and Immigration Service (“USCIS”) has published a proposed rule which seeks to amend in substantial ways the way the annual H-1B “cap” work visa applications and lottery are being filed and how the U.S. master’s degree applications are being allocated under the H-1B cap lottery.

Please note that this is a proposed rule with comment period until January 2, 2019.  This proposed rule is subject to significant changes before it becomes effective.   It is also unclear if and when this rule will become effective.   Please stay tuned and sign up for our weekly newsletter to get updates on this topic.

H-1B Cap Filing Mechanics to Change Significantly

USCIS seeks to change the way H-1B cap cases are being filed.  Currently, all H-1B cap applications have to be filed within the first five working days in April and this is commonly referred to as the “H-1B cap season.”   Each case submitted is fully-prepared and in most cases, fully and extensively documented with application forms, filing fees, and supporting documents. After five days, and assuming the 85,000 annual H-1B work visa quota is reached, the government stops accepting new H-1B cap petitions and then they run a random lottery to allocate the available visa numbers.

Under the proposed rule, USCIS seeks to have a preliminary electronic registration system where petitioners would submit an electronic entry for each H-1B they wish to file.  This registration is proposed to happen in March of each year and is to be open for at least 14 days.   There will not be a fee associated with the submission of an electronic entry.   At the conclusion of the registration period, USCIS conduct the random lottery and notify the selected petitioners and only after such notification an H-1B petition can be prepared and filed with USCIS with all supporting documents.

Timing of the H-1B Cap Entry Submission.  USCIS proposed the registration period to be at least 14 calendar days and this registration window is anticipated to be open before the first day for filing (which is April 1^st).  USCIS intends to give the public at least 30 days advance notice of the opening of the registration window.

What Information Will be Required for Each Electronic Entry?   For each H-1B cap visa entry, USCIS will require (1) the employer’s name, employer identification number (FEIN), and address, (2) employer’s representative contact information; (3) the beneficiary’s full name, date of birth, country of birth, country of citizenship, gender, and passport number; (4)whether the beneficiary has obtained a master’s degree from a U.S. institution of higher education;  (5) employer’s attorney information; and (6) “any additional basic information requested by the registration system” (it is unclear what this may be).

What Will Selected H-1B Cap Entries Have to Do?   Once an employer receives a selection notice, the employer will then be given a period of 60 days to properly file a completed H-1B cap petition.  USCIS may specify different filing windows in an attempt to stagger the filings and to allow for most efficient petition processing.  The H-1B cap petition will need to include evidence of the random selection and will have to meet all other H-1B cap requirements, including LCA, proper filing fees and forms, and supporting documents.

How USCIS Intends to Prevent “Flooding” the System?  The proposed rule discusses USCIS’s efforts to prevent employers from “flooding” the system in an attempt to gain a higher likelihood of selection.  Since there is no filing fee to submit an entry and since this submission is simpler and has lower overall cost compared to a full H-1B filing, there are concerns that the demand for H-1B cap petitions may actually be dramatically higher compared to prior years. USCIS is explicit that one employer can submit only one entry for a particular beneficiary, which is the existing rule for H-1B cap petition.  Each entry will require an employer attestation that if selected, an H-1B petition will be filed although USCIS seems to admit other than fraud investigation referrals, they may not have very good enforcement mechanisms.  This also does not seems to prevent one candidate getting bona fide job offers from more than one employer and thus having more than one entry filed.

Will This Electronic Registration System be in Effect for April 2019?   We do not know yet.  This is only a proposed rule which is subject to a comment period until January 2, 2019 which will be followed by a review period, final rule publication and then effective date of the new rule.  Afterwards, USCIS will need to build a somewhat complex electronic registration system, test it, and implement it, all before March 1, 2019.   As a result,  we expect that even if this system is to become effective, it will not be for the April 2019 H-1B cap filing season.

H-1B U.S. Master’s Cap Lottery to Change to Increase Chances for U.S. Master’s Degree Holders

USCIS is also proposing changing the way it allocates the U.S. master’s degree visas by changing the sequence of the way the lottery is run.  Currently, all U.S. master’s cap cases are put together and the 20,000 visas allocated.  The non-selected U.S. master’s degree cap cases are then combined with the regular cap cases and the 65,000 remaining visas are allocated randomly.

Under the proposed rule, USCIS will combine all cap cases (U.S. master’s and regular cap) and allocate towards the 65,000 general cap and then, the remaining U.S. master’s degree applications will be allocated towards the 20,000 U.S. master’s cap.  According to USCIS, this switch will increase the likelihood of selection for a U.S. master’s degree petition.

Our Take

We applaud USCIS’s efforts to be more efficient in the way they process H-1B cap filings.   We also applaud USCIS’s efforts to improve the chances for U.S. master’s degree holders under the random lottery.   However, we have read the entire rule, and there are some very complex and unclear situations, including having to reopen the registration system if certain demand is low, putting certain cases in “reserve” and others.   This is likely to create a lot of complexity and confusion among employers and candidates.

We hope that USCIS will use the comments they receive in response to this rule to work on designing a system that is predictable, fair and efficient.   We hope USCIS does not rush changes to the system for April 2019 and instead takes a measured approach where feedback and suggestions are incorporated.

Conclusion

We will be submitting our comments to the proposed rule and we will monitor very closely any developments on this topic.  Please do not hesitate to contact us if we can be of any help in understanding or dealing with this change and please subscribe to our free weekly newsletter to obtain further news and developments on this topic.