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Innovative Strategies In Achieving H-1B Cap Exempt Status


As most employers who sponsor foreign nationals for H-1B status are aware, for the past three years it has been extremely difficult to file new H-1B cases (where the alien is not already in H-1B status) due to the unbelievably rapid rate at which the H-1B numerical cap of 65,000 visas (plus 20,000 for those with a US Master's Degree) has been depleted each April. Just as frustrating has been the fact that even after waiting a year to file (or re-file as the case may be) the new H-1B case, because the H-1B program each April 1st is being effectively administered as a lottery, both employer and alien alike live with the anxiety that their cases will not "be accepted" for processing.

This article will describe some alternative options for the "for profit" employer who seeks to sponsor professional foreign nationals for H-1B status.

Typically, H-1B "cap exempt" petitions include petitions filed by a) institutions of higher education; b) non-profit organizations or entities related to or affiliated with institutions of higher education; and c) nonprofit research organizations or governmental research organizations. These types of petitioners are normally referred to as "cap-exempt" because an H-1B alien employed by such an entity is not subject to the H-1B numerical limitations.

Employers not falling into any of these categories may, however, hire employees who are already working in H-1B status with a cap-exempt organization, as long as the employee works concurrently with both the cap-exempt employer and the cap-subject for-profit employer. Documentary evidence, such as a current letter of employment or a recent pay stub, would be needed to support a concurrent employment petition at the time that it is filed with USCIS to confirm that the H-1B alien beneficiary is still employed in a cap-exempt position.

As an example of how the concurrent employment option would work, let us take a cap-subject (i.e. for-profit) employer who decides in January to hire a Research Scientist. Because the employer is cap-subject, he normally could not file an H-1B petition until April 1 for the foreign national to start work on October 1. This represents a great burden to the employer. However, even if the employer could wait to petition until April 1st, and even if he could wait until October 1st for the employee to start, the petition filed may not even be accepted for processing due to the great number of applications filed on that date. To solve this problem, the employer decides to hire a Research Scientist currently working for a University in H-1B status. Because the worker is already working for a cap-exempt entity, he or she can also work concurrently for the new private entity employer without being subject to the cap. Therefore, by filing the H-1B petition for a current cap-exempt employee, the new employer does not have to wait until April 1 and does not have to take the risk that the case would not be adjudicated.

Another way an employer normally subject to the H-1B cap may become cap-exempt is by hiring an employee to work at a cap-exempt employer's worksite. The cap-subject employer (also known as a "third party petitioner") can claim the cap exemption if the petitioned-for employee will perform most of his or her job duties at a qualifying cap-exempt institution such as a higher education or nonprofit or government research institution. In addition, the work performed must directly and predominately further the normal, primary or essential purpose, mission, objective or function of the institution.

The burden of proof is on the cap-subject employer to establish a logical nexus between the work performed predominately by the employee, and the normal, primary or essential work performed by the qualifying institution. Essentially, the petitioned-for employee will be considered cap-exempt if he or she will be performing duties that would or could otherwise be performed by employees of the qualifying cap-exempt institution in furtherance of the qualifying institution's primary mission.

To illustrate this, we will use the same scenario as before. However, in this example, the employer will hire an employee who is not already in H-1B status with a cap-exempt entity. The employer has previously established or will establish a relationship with the local University in which the University's facilities are available in exchange for the University receiving the benefit of the for-profit employee's research. The new employee must also work at least half of his or her time at the University. If these conditions are met, the for-profit employer may be considered a third party petitioner, with the employee being cap-exempt.

These scenarios illustrate ways in which for-profit, cap-subject employers can still hire employees at any time during the year. Both are dependent on employers willing to compromise on either the number of hours an employee may be available to work, or on the number of hours the employee may work specifically at the employer's place of business, as well as on the scope of the employee's work with the company. Despite the restrictions, these options do allow for some relief from an H-1B program that is otherwise inflexible.

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