New H-1B Rules Finalized
December 19, 2024The Department of Homeland Security (DHS) has finalized the remaining portions of its H-1B modernization regulation, which will go into effect on January 17, 2025. The final rule closely resembles the agency’s previously proposed rule, with a few revisions that are beneficial to employers. Here is an overview of the final changes:
“Specialty Occupation”
The rule revises the definition of an H-1B specialty occupation. Some of the revisions introduce greater flexibility to the definition, and some could narrow eligibility. The rule clarifies that an occupation “normally” requiring a bachelor’s degree doesn’t mean that it must “always” require a bachelor’s degree. It also clarifies that a position may qualify as a specialty occupation even if the employer accepts a range of qualifying degree fields, as long as each of those fields is “directly related” to the duties of the H-1B position. There must be a “logical connection” between the required degree and the H-1B position duties.
The rule speaks to third party placements by providing that when a beneficiary is “staffed” to a third party, the requirements of that third party, and not the petitioner, would be considered most relevant when determining whether the position is a qualifying specialty occupation. The final rule defines “staffing” to mean that the foreign national will be contracted to fill a position in the third party’s organization and become a part of that third party’s organizational hierarchy – not merely providing services to the third party.
Deference to Prior Adjudications
The rule makes permanent and slightly expands USCIS’s current policy of deference to its prior adjudications. During the first Trump administration, the USCIS revoked the rule providing deference, which led to confusion and unpredictability in filing petitions. The new rule provides that when adjudicating a Form I-129 involving the same parties and same underlying facts, USCIS should defer to its prior I-129 approval, unless there has been a material change in circumstances or eligibility requirements, a material error in the prior approval, or new material adverse information. Now that the rule is made permanent in the code, the policy is more difficult to revoke during the upcoming presidential administration.
Location Changes and Amendments
The rule makes permanent in the code the USCIS longstanding requirement that an employer must amend a nonimmigrant petition due to material changes in an H-1B worker’s place of employment, and requires the amendment to be filed before the change takes place. The rule also codifies the circumstances under which a location change would not require an amendment, including location changes within the area of intended employment listed in the DOL labor condition application (LCA) supporting the existing petition.
H-1B Eligibility for Business Owners
The rule notes that H-1B beneficiaries who have a controlling interest in the petitioning entity may be eligible for H-1B status, as long as the beneficiary will perform H-1B specialty occupation duties a majority of the time; however, the initial and first extension of such petitions will be limited to 18 months, rather than the typical three years.
Cap Gap
The new rule provides significant protection for Cap Gap students, who are F-1 students with CPT or OPT whose work authorization will expire while waiting for the H-1B petition to be approved. The Cap Gap protection period is extended from October 1 to potentially as late as April 1 of the following calendar year as long as the provisions of Cap Gap are met (such as a timely filed petition). This is good news for employers and foreign nationals as it means fewer employment gaps while waiting for the USCIS to process the H-1B petition.
Bona Fide Job Offer
The new rule codifies the government’s ability to request proof of contracts or similar evidence to show that the beneficiary does have a bona fide job offer. This may increase time and money for employers who will need to provide job contracts going forward.
In conclusion, the adroit timing of this rule is clearly meant to make it more difficult for the incoming administration to change these policies. Our firm will continue to closely monitor these changes, specifically with how they are carried out by the USCIS in practice. If your company has specific questions regarding how these policies are carried out, please contact our firm.