Following litigation USCIS entered a settlement agreement on May 20, 2020 with the IT serve Alliance (an association of IT services, staffing and Consulting organizations.) In accordance with the settlement agreement, on June 17th, 2020 USCIS rescinded these policy memorandums:

  • Determining Employer-Employee Relationship for Adjudication of H-1B Petitions, Including Third-Party Site Placements (Reference AFM Chapter 31.3(g)(16)), HQ 70/6.2.8 (AD 10-24), issued January 8, 2010;1 and
  • Contracts and Itineraries Requirements for H-1B Petitions Involving Third-Party Worksites, PM-602-0157, issued February 22, 2018

In place of the rescinded memorandums USCIS has provided a guidance memorandum that covers these key points:

Employer-Employee Relationship

  • Officers should consider whether petitioners meet at least one of the “hire, pay, fire, supervise, or otherwise control the work of” factors with respect to the beneficiary. 
  • If the petitioner’s attestations and supporting documentation establish that employment exists at the time of filing and it will employ the beneficiary in a specialty occupation, then the officer should not request additional evidence and should approve the petition.
  • If the officer finds that a petitioner has not established, by a preponderance of the evidence, statutory or regulatory eligibility for the classification as of the time of filing, the officer should articulate that basis in denying the H-1B petition. 

Contracts

  • Petitioners are not required by existing regulation to submit contracts or legal agreements between the petitioner and third parties.
  • In assessing whether an employer and a beneficiary have or will have an employer-employee relationship, the officer may consider any evidence provided by the petitioner, including chain of contracts or legal agreements between the petitioner and third parties. Further, if a petitioner provides contracts or legal agreements, the officer is not precluded from evaluating that evidence in the adjudication of other eligibility criteria.  

Non-speculative Specialty Occupation Work

  • The officer should review the position as described by the H-1B petitioner to determine if the petitioner has met its burden of proof to establish that the beneficiary will be employed in a specialty occupation. Evidence of specific day-to-day assignments is not required to establish that the position is in a specialty occupation.
  • Except in certain limited circumstances, “benching” is prohibited by law. The officer may issue a Notice of Intent to Deny (NOID) for failure to maintain status or a Notice of Intent to Revoke (NOIR), if evidence in the record indicates there has been a material change in the terms and conditions of employment that could affect eligibility for H-1B, and require an amended petition.
  • The regulations state being “no longer employed in the capacity specified in the petition” is a basis for revocation on notice. Being placed in non-productive status or training for an extended time period, even if paid, may qualify as being “no longer employed in the capacity specified in the petition.”
  • If a beneficiary is in non-productive status because of a lack of work, that could indicate that the beneficiary no longer is in a specialty occupation and there has been a material change in the terms and conditions of employment that may affect eligibility. 
  • It would not violate H-1B nonimmigrant status for a beneficiary to be in non-productive status during a period not subject to payment under the petitioner’s benefit plan or other statutes such as the Family and Medical Leave Act or the Americans with.
  • In assessing whether a beneficiary’s non-productive status violates the beneficiary’s H-1B nonimmigrant classification, the officer must assess the circumstances and time spent in non-productive status. While neither statutes nor regulations state the maximum allowable time of non-productive status, the officer may exercise his or her discretion to issue a NOID or a NOIR to allow the petitioner to respond, if the period of non- productive status is more than that required for a reasonable transition between assignments. 
  • If the officer encounters a novel issue, the officer should elevate that issue to local service center management or Service Center Operations.
  • If a petitioner files an amended or new petition for H-1B classification reflecting the changed terms and conditions of employment, the officer should not revoke the approval of the original petition unless the record establishes a pattern or practice of failure to file an amended or new petition when required to do so. Instead, the officer should adjudicate the amended or new petition and may find, if warranted, that the beneficiary did not maintain status and issue a denial of the H-1B extension or change of status request, if appropriate. Ultimately, the officer’s adjudication requires consideration of the time period in non-productive status, the circumstance of the non-productive status (including, but not limited to, medical or personal leave), and whether the petitioner filed an amended or new petition.

Itinerary


  • USCIS will abstain from applying the itinerary requirement at 8 CFR 214.2(h)(2)(i) in the limited instance of applicable H-1B adjudications until the Department of Homeland Security or USCIS issues new adjudicative and/or regulatory guidance on this requirement. The officer also should not apply the rescinded guidance. 
  • Officers should continue to apply the itinerary requirement at 8 CFR 214.2(h)(2)(i)(F) for H-1B petitions filed by agents.

Limiting Validity Periods

  • If USCIS issues approvals for H-1B petitions with validity periods shorter than the period requested by the H-1B petitioner, the decision must come with a brief explanation as to why the validity period has been limited.

One has to wait and see for how long this memorandum provides IT consulting companies, a break from the laborious requirements imposed on them over the last decade. There are a lot of good elements to this memorandum, employer-employee relationship established by the simple act of hiring, no requirement to detail day to day assignments, no longer a requirement to provide contracts with end-clients, no longer a requirement for an itinerary. There are no new requirements imposed by this memorandum, besides stating that beneficiaries can be considered out of status if they are placed in non-productive status, even if they are paid during such time. The memorandum for the most part just states the obvious and sometimes seems to potentially confuse officer’s by stating for example:

“May an officer deny a petition for H-1B nonimmigrant classification on the basis that the petitioner, while having identified and described the nature of the specialty occupation, has not specified the beneficiary’s day-to-day assignments in that role?

An officer should deny a petition when the petitioner has not established that the beneficiary will work in a specialty occupation. While a petitioner is not required to identify and document the beneficiary’s specific day-to-day assignments, the petitioner must meet all statutory and regulatory requirements,…”.

The straightforward answer to the above would have been. “No.” For now, USCIS seems to be at a loss for words. But we have to wait and see if the Administration has the time, and/or will to implement new regulations to impose more constraints on the IT consulting industry.