Labor Immigration Law

United States Labor Immigration Law News and Analysis

Archive for January, 2008

Starting Own Company on H-1B Visa

Many H-1B visa holders are asking the question, “Can I start my own company while I am on H-1B visa?”  The short answer is “No, because the terms of the H-1B visa allow a foreign national to work only for the sponsoring employer.”

While there may be other ways in which a foreign national on H-1B visa can legally have a company and receive income from it, an H-1B visa holder should be careful not to engage in any unlawful employment because this may jeopardize his or her status.

Generally, a foreign national on H-1B visa may work only for the sponsoring employer.  This, unfortunately, precludes most types of activities that an H-1B individual may wish to engage – consulting, running small business, or even assisting a company for non-monetary gain.  While the Citizen and Immigration Services (USCIS) are unlikely to be going after an H-1B holder who spent a couple of hours helping his neighbor’s home based business by setting up a computer network in exchange for a dinner or a small gift card, anything that formally resembles like active employment for monetary gain is likely to be considered unauthorized employment.

One of the most obvious ideas is for the H-1B foreign national to start her own company and possibly have the new company issue a second H-1B visa for the owner.  However, this strategy may not work because running a company is not an occupation which requires a bachelor’s degree and therefore an H-1B visa approval is unlikely.

What is possible then? Anything that does not involve active participation by the H-1B holder is permissible.  For example, forming own company and hiring somebody else (who is legally authorized to work) to run it is fine even when the company makes profit and the H-1B individual receives it.  This is no different than investing $1,000 into stock of Microsoft which is considered passive investment.  The legal line is crossed, however, when the H-1B owner gets involved in the operation of the company.

Another option is to form a foreign (presumably in the home country) company and, after meeting all requirement, creating a US subsidiary of the foreign company and applying for an L-1 visa.

As always, a consultation by an immigration lawyer is extremely helpful especially considering the dangers of engaging in unauthorized employment and putting the H-1B status in danger.

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Immigration Applications at All-Time High, May Take Years to Clear

The USCIS Director Emilio Gonzalez appeared yesterday (01/17/2008) in front of the House Subcommittee on Immigration, Citizenship, Refugees, Border Security, and International Law and in written testimony he talked about the unprecedented volume of immigration applications filed with his agency.

uscis-receipts-1994-2007.jpgAs the chart illustrates, the number of visa applications following the July 2007 visa fees increased dramatically. This is ironic since the goal behind this July 2007 visa fee increase was to eliminate the processing backlog that plagued many visa applications. According to Gonzales, however, the USCIS did not anticipate the extremely high volume of applications, mainly resulting from the forward movement in many visa priority dates in the July 2007 Visa Bulletin. As a result of this forward movement in the employment-based visa numbers, the USCIS received in the summer months of 2007 approximately 300,000 adjustment of status applications, along with work authorization and travel (advance parole) documents, making a total of approximately 800,000 applications. From June through August 2007 the USCIS received over 3 million applications and petitions of all types (compared with 1.8 million for the same period in 2006).

In Fiscal Year 2007, the agency received almost 1.4 million citizenship applications which is almost twice the number received during the previous fiscal year. Gonzalez stated that his agency has responded to this surge in applications by increasing work hours, adding shifts and hiring contract workers to help meet the demand. However, the backlog remains and is not likely to decrease in the near future. The unfortunate news from Gonzalez is that, “[t]his surge will have a serious impact on application processing times for the next couple of years. As a result, based on our response plan, most customers will wait much longer to have their applications completed.”

The average processing times of citizenship applications are expected to increase from seven to 18 months and adjustment of status applications for family-based immigration applications would increase from six to 12 months. Although the increase in waiting times are expected to be temporary, this is expected to create a number of difficulties and challenges to foreign nationals. Gonzalez said that he expects a return to current processing times (which according to many are too long anyway) is expected in the second half of Fiscal Year 2010). He also said that his agency has taken tremendous efforts to be able to process employment authorization applications within the statutory period of 90 days in light of the large applications backlog.

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Laid Off H-1B Workers Do Not Have A Grace Period

An unfortunately common question which arises recently, especially with the U.S. economy about to go into a recession according to some economists, is what are my options if I get laid off by my employer?

The answer, outlined by a CIS memo, is that there is no grace period and, at least in theory, a foreign national is not in status the day after they are laid off.  This does not mean that a foreign employee who is laid off has to pack and leave the country within 24 hours or less after they are laid off.  However, this means that an H-1B employee who is laid off must take immediate action, for example file a change of status, to avoid being out of status and jeopardize further immigration benefits.

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USCIS Receipts Update

The substantial forward movement in many visa categories from mid to late 2007 has resulted in a significant increase in petitions filed with the USCIS. Receipt by the foreign national of a receipt notice or deposit of the fee checks by the USCIS is connected with some sense of relief and a number of tangible benefits.

To address the concerns of all petitioners, the USCIS has released an update of the timing of the receipts and the data entry into the USCIS tracking system.

Dates
The USCIS has said that it will honor the actual date that an application was received by their mailroom. We recommend to all of our clients that all petitions be filed via courier such as FedEx which allows us to determine the actual receipt date. This provides the foreign national with some sense of what their receipt date will be once the USCIS processes the application and issues a Form I-797, Notice of Action. In addition, USCIS has said that it may take up to 12 weeks for adjustment of status applications and 15 weeks for naturalization applications to be entered into the USCIS system and I-797 issued.

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USCIS Initial Data Entry and Receipt Notices Status

As of January 4, 2008, the USCIS has completed initial data entry and issued receipt notices for applications and petitions received on or before the dates below.

California Service Center
- I-130 Forms            8/30/2007 (all subsequent forwarded to Chicago for data entry)
- All Other Forms      Current

Nebraska Service Center
- All Forms                Current

Texas Service Center
- All Forms                Current

Vermont Service Center
- I-130                          7/29/2007 (all subsequent sent to Chicago for data entry)
- All Other Forms        Current

Chicago Lockbox (as of 1/14/08)
- I-130 Forms             10/25/2007
- All Other Forms        Current

Los Angeles Lockbox
- All Forms                    Current

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EB2 India Developments from Department of State

We commented recently on the EB-2 India “unavailable” February 2008 Visa Bulletin.  As expected, this development created a reason for concern not only among Indian nationals but also from nationals of other countries that the EB-2 visa numbers may become unavailable.

The American Immigration Lawyers Association has approached Charlie Oppenheim, the Chief of Immigrant Visa Control and Reporting at the State Department, for comment on the EB-2 India unavailability.  In November 2007 the indications were that that demand for EB-2 India visa numbers would place significant pressure on the overall annual visa limitation, leading to rolling back the priority date for EB-2 India once for December 2007 Visa Bulletin to 01JAN02 and again for January 2008 Visa Bulletin to 01JAN00.  Even with those significant retrogressions, there was a demand for 300 EB-2 India visas in December.

It is possible that India EB-2 can become again available if it appears that demand for EB-1 India will not exceed the annual limit but this determination will not be possible until the second half of the fiscal year (April 08 or later).

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Importance of Address Change

Many non-U.S. Citizens residing in the U.S. consider the change of address obligations imposed by the USCIS as unimportant and of no significance.  This is a mistake.  In a recent meeting between the National Benefits Center (NBC) and the American Immigration Lawyers Association (AILA), the NBC reminded all immigration attorneys and their clients that a change of address is an important procedure and it must be done in two separate ways.

First, the foreign national must file form AR-11 with the USCIS in Washington, DC.  Under the current regulations, all foreign nationals, including permanent residents), and without regard to whether they have petitions or applications pending with the USCIS must file the AR-11 form within 10 days of change of address.  This is a separate requirement which is not related and does not automatically affect the USCIS address change (see below).  The AR-11 form can be filed on paper or online.  It is important to keep a proof of filing such change of address.

Second, if the foreign national has current pending immigration-related petitions or applications, they must notify the USCIS of their new address by calling USCIS (at 1-800-375-5283) or by using their online system.   USCIS recommends these two methods as the best ways to update an address with regard to pending applications and petitions. The requested change will be processed within three days of receipt.

As a conclusion, we would like to underscore the importance of timely filing address of change with the USCIS whether or not the foreign national has pending petitions with the USCIS.  Failure to do so may result in long delays in processing or even denial of immigration benefits.

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Documents Required for Arrival and Departure from the United States by Air

The U.S. Customs and Border Protection (CBP) has released a convenient chart outlining the documentary requirements for arrival to and departure from the United States by air passengers.  The requirements are as follows:

For Arrival to the United States by Air

  • United States Citizens must present one of the following:
    • US Passpor,
    • Military ID Card,
    • US Merchant Mariner Card,
    • NEXUS Card (at Nexus kiosk only), or
    • Transportation Letter.
  • Canadian and Bermudan Citizens must present one of the following:
    • Passport,
    • NEXUS Card (at Nexus kiosk only), or
    • Parole Letter.
  • Mexican Citizens must present one of the following:
    • Passport and visa,
    • Passport and Border Crossing Card,  or
    • Parole Letter.
  • Lawful Permanent Residents must present one of the following:
    • Permanent Resident Card,
    • Immigrant Visa,
    • DHS Travel Document,
    • Parole Letter,
    • Transportation Letter, or
    • ADIT Stamp.
  • Visa Waiver Program (VWP) Eligible Travelers must present all of the following:
    • VWP Eligible Passport,
    • Machine Readable Zone,
    • Digital Photo if issued after October 25, 2005, and
    • E-Passport if issued after October 25, 2005.
  • All others must present one of the following:
    • Passport and Visa, or
    • Parole Letter.

For Departure From the United States

  • United States Citizens must present one of the following:
    • Passport,
    • NEXUS Card,
    • Military ID Card,or
    • U.S. Merchant Mariner Card.
  • Lawful Permanent Residents must present one of the following:
    • Passport,
    • DHS Travel Document,
    • Permanent Resident Card, or
    • ADIT Stamp.

    Canadian Citizens must present one of the following:

    • NEXUS Card, or
    • Passport.
  • All others must present one of the following:
    • Passport,
    • Emergency Travel Document, or
    • Removal Order.

The full chart in color and with pictures of sample documents can be found here.

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February 2008 Visa Bulletin – EB2 India is “Unavailable”

The United States Department of State issued its February 2008 monthly visa bulletin on January 9. The February bulletin reflects that visa numbers for EB2 India (employment-based second preference category for Indian nationals) are “unavailable.” According to the Bulletin, the annual limit has been reached in this category for India meaning that there are no more EB2 visa numbers for Indian nationals for the remainder of Fiscal Year 2008 which runs until September 30, 2008.

This visa “unavailability” was anticipated as a result of the surge in demand in this visa category. Many foreign workers who had previously applied as EB3 (employment-based third preference) were caught in the labor certification backlog which lasted, for some, people several years. Many of these employees were able to refile their applications under the more attractive EB3 category due to experience they gained while waiting for labor certification approval. As a result, the number of EB3 petitions rose sharply over the past months and quickly exhausted the number of available EB3 visas.

The October 2008 Visa Bulletin, due to be released in September 2008 should “open” again EB3 visas for Indian nationals. Note that EB2 visa numbers are “current” for all other nationalities except China which is as of January 1, 2003.

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DOL Perm and H-2A/B Processing Statistics

The Department of Labor has released an interesting report regarding the number of PERM and H-2A/H-2B labor certifications.

For the period between October and December 2007, DOL received almost 20,000 PERM on-line submissions and slightly over 1,000 mail-in submissions. DOL completed work on 16,200 cases, of which 12,500 were certified (78% certification rate), 2,800 were denied (17%) and 800 were withdrawn (5%).

It is interesting to compare the approval rates for the Oct-Dec 2007 period with the historical certification rate since PERM started in March 2005. The historical overall certification rate is slightly above 78% which seems to indicate that the Oct-Dec 2007 certification rate was in line with historical averages.

Among other interesting findings in the report are the top five states of intended employment – California (23%), New York (10%), New Jersey (7%), Texas (7%) and Florida (6%). Few would be surprised that Indian nationals were the top nationality with 28% of all certified applications and computer software engineers were the top occupation with 17%.

In the H-2A/H-2B section of the report, it is worth noting that there was a significant increase in both the number of requested and certified labor certifications for both the agricultural and non-agricultural programs in FY07 compared to FY06. This seems to suggest that more employers are resorting to H-2 visas to obtain temporary labor. [See our recent post on H-2B cap.]

The relevant portion of the DOL report can be read here (PDF).

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