Labor Immigration Law

Late spring and early summer are generally busy period for recent foreign college graduates as far as employment immigration is concerned.  On one hand, foreign college graduates are either applying for their initial term OPT, their 17-month STEM extensions (if they qualify) or their H-1B work visas.

Our office fields many questions from prospective or recent college graduates with respect to their OPT and H-1B options.   In this article we will focus on a number of questions relating to H-1B and the “cap-gap” provision allowing students with expiring OPT work permits to continue working subject to a timely-filed H-1B petition under the H-1B cap.

Background on the H-1B Cap

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 FY2011 starting on October 1, 2010.

H-1B is a nonimmigrant visa classification used by U.S. employers to hire a foreign national who will be employed temporarily in the U.S. in a specialty occupation (generally one which requires a bachelor’s degree or higher) or as a fashion model.  Each year, by law, USCIS can approve up to new 65,000 H-1Bs, thereby allowing many private and employers to hire temporary qualified workers.   H-1B non-immigrants who work at (but not necessarily for) universities and non-profit research facilities are excluded from the numerical cap (see below for discussion of cap-exempt employers).

There are certain exceptions to the congressionally-mandated maximum of 65,000 H-1B visas per fiscal year.  The first 20,000 H1B visas issued to alien workers who obtained their master’s degree from a U.S. university are exempt from the 65,000 cap;  H1B visas issued to such U.S. master degree 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 H1B status and who are seeking to extend their visa or change employers.

What Is “Cap-Gap”?

The current regulations allow certain students with pending or approved H-1B petitions to remain in F-1 status during the period of time when an F-1 student’s status and work authorization would otherwise expire, and up to the start of their approved H-1B employment period.  This is referred to as filling the “cap-gap,” meaning the regulations provide a way of filling the “gap” between F-1 and H-1B status that might otherwise occur if F-1 status was not extended for qualifying students.

How to Invoke the “Cap-Gap”?

Most importantly, H-1B petitions must be timely filed on behalf of an eligible F-1 student.  This means that the H-1B petition (indicating change of status rather than consular processing) was filed during the H-1B acceptance period, while the student’s authorized duration of status (D/S) admission was still in effect (including any period of time during the academic course of study, any authorized periods of post-completion OPT, and the 60-day departure preparation period, commonly known as the “grace period”).

Once a timely filing has been made, the automatic cap-gap extension will begin and will continue until the H-1B petition adjudication process has been completed.  If the student’s H-1B petition is selected and approved the student’s extension will continue through September 30th unless the petition is denied, withdrawn, or revoked.  If the student’s H-1B petition is not selected and approved, the student will have the standard 60-day grace period from the date of the rejection notice or their program or OPT end date, whichever is later, to prepare for and depart the United States.

Students are strongly encouraged to stay in close communication with their petitioning employer during the cap-gap extension period for status updates on the H-1B petition processing.

Is Proof of Cap-Gap Status Necessary?

A student will need to obtain an updated Form I-20 from his or her designated school official (DSO). The Form I-20 is the only document a student will have to show proof of continuing status and OPT, if applicable. The student should go to their DSO with evidence of a timely filed H-1B petition (indicating a request for change of status rather than for consular processing), such as a copy of the petition and a FedEx, UPS, or USPS Express/certified mail receipt.  The student’s DSO will issue an interim cap-gap I-20 showing an extension until June 1st.  Students whose approved period of OPT already extends beyond June 1st do not need an interim extension.

In some cases, a student’s SEVIS record will not be automatically updated with the cap-gap extension, in error. In this situation, the student’s DSO may need to add an interim cap-gap extension to the student’s SEVIS record or contact the SEVIS Help Desk to have the full cap-gap extension applied to the record. For additional information on the interim cap-gap extension, refer to SEVP’s Supplementary Cap-Gap Guidance.

Are Expired or Expiring OPT EAD Holders Eligible for Cap-Gap?

For a student to have employment authorization during the cap-gap extension, he or she must be in an approved period of post-completion OPT on the eligibility date which is generally the date of filing of the H-1B petition.

Can Students Travel While Under Cap-Gap Extension?

The regulations at 8 CFR 214.2(f)(13) state that a student who has an unexpired Employment Authorization Document (EAD) issued for post-completion OPT and who is otherwise admissible may return to the United States to resume employment after a temporary absence.  However, by definition, the EAD of an F-1 student covered under a cap-gap extension is necessarily expired.  Consequently, if a student granted a cap-gap extension elects to travel outside the United States during the cap-gap extension period, he or she will not be able to return in F-1 status.  The student will need to apply for an H-1B visa at a consular post abroad prior to returning.  As the H-1B petition is presumably for an October 1 or later start date, the student should be prepared to adjust his or her travel plans, accordingly.

The increasing unemployment rate inevitably affects foreign nationals living and working in the U.S. on a work visa.  We have been happy to help many clients over the past months who have either been laid off or have decided to seek a better opportunity to attend school by changing their status to F, J or M while they are in the U.S.

In light of the Form I-539, Application to Change of Status, processing timelines (~2-3 months),  a very frequent question which arises in such situations is “Can I start school while my I-539 application to change status is pending?”  The answer is that it depends on the status from which the applicant is changing.  Generally, if the person’s current status allows study then the person is allowed to start study while the change of status is pending.  Some of the most frequent cases are discussed below.

Changing From H-1B/H-4 (Or Another Status Which Allows Study) To F-1/M-1 Status

The regulations provide that  H-1B and H-4 holders are allowed to study while they maintain valid H-1B/H-4 status.  As a result an H-1B/H-4 holder who files timely I-539 Change of Status application to F-1 or M-1 is allowed to start school while the application is pending.  It is important to note that the regulations provide that starting school before filing an application to change status to F-1 or M-1 does not, by itself, make the applicant ineligible for the requested F-1 or M-1 status (this is not the case for B-1 or B-2 holders).

Changing From B-1/B-2 (Or Another Status Which Does Not Allow Study) to F-1/M-1 Status

Due to the fact that B-1/B-2 holders are not allowed to study, even if the file a timely application to change status to F-1 or M-1, such B-1/B-2 holders cannot start studying until the F-1 or M-1 application to change status is approved by USCIS.  Also, it is important to note that B status holders who do not have the “prospective student” notation on their I-94 card may be ineligible to apply to change status to F-1 or M-1 from within the U.S.

Holders of F (student), J (exchange visitor) or M (student) status in the U.S. are subject to certain requirements in order to maintain a valid status and be entitled to the benefits of their status (e.g. OPT, visa revalidation, etc.).  With the beginning of a new academic year, we have been advising a number of school officials and students with duties and responsibilities related to certain student or exchange visitor status.

F-1 Students

Students present in the U.S. on F-1 status (and their F-2 dependents) must:

• Maintain the requisite F-1 documentation: valid I-20, valid passport, and valid I-94 card marked “Duration of Status” or “D/S”;
• Pursue a full course of study (with limited exceptions) at an established college, university, seminary, conservatory, academic high school, elementary school, or other academic institution or in a language training program in the U.S. and make normal progress towards completing the course of study;
• Update by providing information to the designated school official (DSO) current address, legal name, or major field of study within 10 days of a change;
• Remain in the U.S. for no longer than 60 days after completing the full course of study (the so-called “60-day grace period”), unless prior to that time the student has followed procedures for applying for optional practical training (OPT), changing educational levels, transferring to another approved school, or changing status;
• Refrain from engaging in unauthorized employment (please see a related article on what constitutes “work”).

As a side note, F-2 dependents are prohibited from engaging in employment or a course of study, except that F-2 children may enroll in elementary or secondary school (K-12).

M-1 Students

Students present in the U.S. on M-1 (and their M-2 dependents) status must:

• Maintain required documentation: valid I-20, valid passport, and valid I-94 card. M-1 students are admitted for one year or for the period necessary to complete their course of study, whichever is less, plus 30 days thereafter to depart (the so called “30-day grace period.”);
• Pursue a full course of study (with certain exceptions) at an established vocational institution or other recognized nonacademic institution and make normal progress towards completing the course of study (full-time study may differ from school to school);
• Update by providing information to the designated school official (DSO) current address, legal name, or major field of study within 10 days of a change;
• Refrain from engaging in unauthorized employment.

Similarly to F-1, as a side note, M-2 dependents are prohibited from engaging in employment or a course of study, except that M-2 children may enroll in elementary or secondary school (K-12).

J-1 Exchange Visitors

Exchange visitors present in the U.S. on J-1 (and their dependents on J-2) status must:

• Maintain required documentation: valid DS-2019, valid passport, and valid I-94 card marked “Duration of Status” or “D/S”;
• Engage only in approved activities at the authorized location for which the DS-2019 was issued;
• Update by providing information to the responsible office (RO) current address, legal name, or major field of study within 10 days of a change;
• Maintain medical insurance required for J-1 visa holders;
• Remain in the United States for no longer than 30 days (the so called “30-day grace period”) after completing J-1 program; and
• Refrain from engaging in unauthorized employment.

Note that J-2 spouses and children are eligible to apply for an employment authorization document (EAD), but there is no regulation restricting J-2s from enrolling in a course of study.

In many areas around the U.S. driving is as essential as being able to read.  In our practice we face constantly foreign nationals who have been denied (correctly or incorrectly) a driver’s license due to their inability to show a certain document.

The U.S. Immigration and Customs Enforcement (“ICE”) division has released a guide targeted to holders of F, M and J visas with respect to obtaining drivers licenses and answers to some of the most common questions.

Lead times.  It is important to note that some foreign nationals on F, M or J status who are recent arrivals into the U.S. must plan in advance their application for a drivers license as some states have requirements for social security numbers (which application can take a few days) or other documents which require some preparation time.

F-1 holders in cap-gap extension.  In addition, from our practice we have encountered some F-1 holders who are subject to the cap-gap automatic extension of status have run into difficulty extending their driver’s license beyond the expiration date of their employment authorization document (“EAD”).  The ICE guidance provides some specific instructions in such cases and instructs the Designated School Official (“DSO”) to issue an updated I-20 to the F-1 holder or to make certain notations on the I-20 form.

Problem resolution contact.  In cases where the DMV refuses or is unable to issue a driver’s license, ICE has encouraged the DSO to contact directly SEVP  for assistance at sevis.source@dhs.gov and provide certain information (please see the attached guidance sheet, p. 6).

The U.S. Customs and Immigration Enforcement (“ICE”) has released a supplemental guidance sheet with respect to gap-cap extensions available to holders of F-1 status who work pursuant to their optional practical training and who are beneficiaries of a cap-subject H-1B work visa petition.

The guidance sheet is helpful in not only describing in more detail what happens when an OPT F-1 holder is a beneficiary of an H-1B petition.  Normally, when USCIS receives an H-1B petition it enters the information into its mainframe called CLAIMS.  This update automatically updates the SEVIS system and which automatically should reflect the cap-gap extension for the F-1 holder.    If this process does not work (due to time constraints, mainly), SEVIS allows the Designated School Official (“DSO”) to enter manually that the student is in valid status pursuant to cap-gap into SEVIS.

This functionality also allows DSOs to enter gap-cap information in cases where the H-1B application has been filed but it has not yet been processed by USCIS.  The guidance notes, however, that the “manual” update of cap-gap status by the DSO should not be done unless in cases where the student’s OPT may expire before USCIS can receipt the H-1B petition (and therefore enter the H-1B petition in CLAIMS).

We have been receiving a number of inquiries from prospective clients who are interested in switching to F-1 student visa status using a Form I-20  issued by a English as Second Language (“ESL”) school or a community college.   In our experience, USCIS (if the change of status is requested from within the U.S.) or the Department of State (if the visa application is filed at a consulate abroad) have been very critical towards applicants admitted to attend ESL or a community college in the U.S.

We have seen USCIS deny change of status to F-1 applications on seemingly due to the lesser-known name of the college.  Similarly, U.S. consulates abroad have been denying F-1 visa applications where the foreign student wishes to study at a lesser-known college.  In a specific response to these situations, the Department of State has issued a note which is aimed to remind consular officers that “attendance at a lesser-known college, English language program, or a community college is not, in itself, a reason for refusing a student visa applicant. A student must establish that he/she has a plan for his/her education.”

What this means is that the F-1 visa or change of status applicant must show an educational plan which may include an ESL or a community college but which must, at some point, indicate that the student would transfer to a four-year college or another more advanced school.  According to the Department of State, “a plan that includes initial attendance at a community college or English language program, and then a transfer to a four-year college, certainly is acceptable. Which school a student chooses is not nearly as important as why he/she chose it.”

Considering this guidance, it becomes even more important for the F-1 applicant to be able to tell a story and present an educational plan as part of his or her F-1 visa application process.  This educational plan must be as detailed as possible and must present a clear picture of the applicant’s educational goals and where and how they would be achieved.  Please contact us if we can help you prepare your F-1 visa application.

The Optional Practical Training (OPT) program allows foreign students on F-1 visa to work for 12 (or up to 29 months, for holders of STEM degrees).  The 12 (or 29) month period allows many students to apply for an H-1B work visa.  Many employers (and OPT holders alike) are unaware of what happens when the OPT document expires while the H-1B application is pending.  This guide seeks to provide some answers.

The Cap Gap

If the employer employs an F-1 nonimmigrant student on post-completion (OPT) and that student is the beneficiary of a pending or approved H-1B petition, the student may be able to continue working beyond the expiration date on his or her employment authorization document (EAD).   In recent years, the number of H-1B petitions filed per year has exceeded the annual cap. Due to demand, the annual cap of 65,000 H-1B visas has been met during the initial filing period, beginning on April 1. All  cap-subject petitions filed during this initial filing period indicate a requested start date of October 1 (the start of the government fiscal year). In the past, F-1 students who were the beneficiaries of an H-1B petition often had their F-1 status expire before their H-1B status began on October 1 –- a period known as the cap gap. The most common situation occurred when a student’s OPT ended in the spring or early summer, and the student’s F-1 status expired 60 days after that, leaving a gap of several months before the individual’s H-1B status began on October 1.

The OPT Interim Final Rule

On April 8, 2008, the Department of Homeland Security published an Interim Final Rule (IFR) titled, Extending Period of Optional Practical Training by 17 Months for F-1 Nonimmigrant Students With STEM Degrees and Expanding Cap-Gap Relief for All F-1 Students With Pending H-1B Petitions. The changes made by this rule became effective upon publication of the rule.

One provision of the rule applies to F-1 students who are the beneficiaries of a pending or approved H-1B petition that is subject to the annual cap. The IFR automatically extends the F-1 status and, for students in a period of approved post-completion OPT when the H-1B petition is filed, the OPT employment authorization.

The cap-gap extension of OPT is automatic for eligible students. A student does not file an application for the extension or receive a new EAD to cover the additional time. The only proof of continued employment authorization currently available to an affected student is an updated Form I-20 showing an extension of OPT, on page 3. This document serves as proof of continued employment authorization.  However, this automatic extension of an F-1 student’s duration of status and employment authorization is terminated upon the rejection, denial, or revocation of the H-1B petition filed on the F-1 student’s behalf.

Student’s Obligations

A student who is eligible for the cap-gap extension must work with a designated school official (DSO) at the student’s school to receive an updated Form I-20. If a student is eligible for the cap-gap extension of OPT, the student can continue to work while the update to his or her Form I-20 is being processed. Because the cap-gap extension is automatic, the updated Form I-20 is not required for a student to continue working; it merely serves as proof of the extension of OPT employment authorization.

Employer’s Obligations

To assist a student in obtaining an updated Form I-20, the employer may need to provide the student with an I-797 receipt or approval notice issued by USCIS for the H-1B petition filed on the student’s behalf.  This receipt notice serves as proof of filing the H-1B petition and may need to be submitted to SEVP in order to update a student’s Form I-20 to show eligibility for the cap-gap extension.

The California Service Center (CSC) has issued guidance on what kind of documentation is satisfactory to show that an H-1B beneficiary has completed his or her degree requirements.  It is important to note that an H-1B visa application must be filed only after all degree requirements are met, even if the diploma has not been awarded yet.  The H-1B filing window opens on April 1 and will likely remain open only for a few days, in effect making it impossible for most May graduates to apply for H-1B because of failure to complete all coursework and meet all requirements as of the H-1B filing date.

However, in cases where the requirements are met prior to filing but the diploma is not yet awarded, CSC has advised that it would accept the following:

• a final transcript; or
• a letter from the Registrar; or
• a letter executed by the person in charge of the records of the educational institution where the degree was or will be  awarded (with proper documentation that such person is in fact authorized to issue such letters).

USCIS has released some numbers about the student and exchange visitor visa programs.  As of December 31, 2008, there were 1,046,468 active nonimmigrant students, exchange visitors and their dependents.  Out of this number, there were a total of 722,272 active F or M students and 94,027 dependents.  There were 179,408 J-1 exchange visitors and 50,761 J-2 dependents.

Among the countries with the highest number of foreign students, South Korea leads the list with 110,083 students, India is second with slightly below 100,000 students and China is a close third with approximately 90,000.   The leading major continues to be Business with 145,873 international students, followed by Engineering.

Problem:  students on Curricular Practical Training (CPT) are always sent to secondary verification by E-Verify.

From our own practice and from statistics released by the government, it is clear that more and more employers are signing up for E-Verify, some in response to federal or state regulations, some on their own effort to maintain a compliant workforce.  However, as more and more foreign nationals are being screened through the system, we are starting to notice some of the less obvious quirks of the system.

One of those quirks is the fact that F-1 students who have are working under CPT, which is employment that is part of a student’s specified degree curriculum. The Designated School Official (DSO) authorizes CPT for students before they can begin wok by annotating their I-20 in accordance with the 8 CFR 214.2(f)(10)(i). Unlike Optional Practical Training (OPT), no employment authorization from USCIS is needed.

The problem has two parts.  First is the requirement that all E-Verify employers conduct checks on all of ther employees, including students on CPT. The second part is the fact that E-Verify is not connected to SEVIS, the system which maintains the foreign students’ records, including CPT authorizations.  As a result,  E-Verify always sends a CPT student to secondary verification.

The USCIS has responded that even though students on CPT are always sent to secondary verification, such secondary verification should occur within 24 hours, assuming the student’s record can be located in the SEVIS system.    Despite USCIS claims, we urge students on CPT and employers who employ such students to be aware of this quirk in E-Verify and allow extra time for E-Verify screening.