A Snitch in Time Saves How Many?  – Incentivizing Noncitizens to Report Employment Law Violations

“I generally avoid temptation unless I can’t resist it.”  ~ Mae West

The Biden Administration has long sought to incentivize noncitizens who suspect that an employer may be violating laws protecting worker rights to report perceived violations to federal authorities.  The Administration tried this early last year by including such incentives in the Senate and the House bills known as the “U.S. Citizenship Act of 2021.”  See, “Beware the Employer Risks Nesting in President Biden’s Comprehensive Immigration Reform Bill.”

Failing to muster sufficient votes for enactment, the Administration, through the Secretary of Homeland Security, Alejandro Mayorkas, issued on October 12, 2021 Policy Statement 065-06, “Worksite Enforcement: The Strategy to Protect the American Labor Market, the Conditions of the American Worksite, and the Dignity of the Individual,” to the three federal immigration agencies within DHS.  One “important interest” to be fostered under the new worksite enforcement strategy is to “[increase] the willingness of workers to report violations of law by exploitative employers and cooperate in employment and labor standards investigations.”

Policy Statement 065-06, by its terms, is motivated by the Feds’ desire that noncitizens, without fear of retaliation or personal endangerment, freely report “unlawful labor practices such as substandard wages, unsafe working conditions, and other forms of worker exploitation.”  It includes this element:

Develop agency plans . . .  [which] should, among other things, provide for the consideration of deferred action, continued presence, parole, and other available relief for noncitizens who are witnesses to, or victims of, abusive and exploitative labor practices. In addition, these plans should . . .  Ensure that noncitizen victims and witnesses generally are not placed in immigration proceedings during the pendency of an investigation or prosecution. (Emphasis added.)

To buttress this effort, Secretary Mayorkas included “Immediate Guidance” to the three immigration agencies within the Department to entertain requests by the Department of Labor (DOL) that “DHS consider whether to exercise prosecutorial discretion on a case-by-case basis for workers who are victims of, or witnesses to, workplace exploitation.”

This week, DOL seized upon the opportunity by issuing a July 6, 2022 FAQ outlining its “Process for Requesting Department of Labor Support for Requests to the Department of Homeland Security for Immigration-Related Prosecutorial Discretion During Labor Disputes.”  The new process invites “workers,” including “vulnerable workers who lack work authorization or sufficiently ‘portable’ immigration status,” to report “a labor dispute with my employer” and “request that DOL in the exercise of its discretion to submit a ‘Statement of DOL Interest’ in support of a request to DHS for immigration-related prosecutorial discretion.”

Among the forms of immigration relief cited by Secretary Mayorkas to tease out noncitizen reports of labor violations is “deferred action.”  DHS defines deferred action under 8 CFR §274a.12 (c)(14) as “an act of administrative convenience to the government which gives some cases lower priority.”  The carrot of deferred action is that it entitles a noncitizen to apply for and receive a work permit if s/he “establishes an economic necessity for employment.”  Another discretionary power highlighted in DHS Policy Statement 065-06 is parole (which would allow a noncitizen abroad to enter the U.S. , or if already here, to remain, and in both situations to obtain a work permit).  Still another instruction in Policy Statement 065-06 requires immigration officials to ensure “that noncitizen victims and witnesses generally are not placed in immigration proceedings during the pendency of an investigation or prosecution.”

The upshot of these developments is  a modern system of “bounty” hunting – the bounty being a work permit and a free pass to enter or remain in the U.S. and avoid deportation – privileges available to noncitizens who report to DOL, which then reports to DHS, perceived instances of “worker exploitation.”

The message to employers is clear: Behave and beware.  The message to noncitizens eyeing the bounty is equally clear: Don’t mess with the Feds unless you can put up or shut up.

My last blog post bewailed a notice in the Federal Register that seemed to give the immigration stakeholder community and the public only one day to comment on the practices and operations of U.S. Citizenship and Immigration Services (USCIS).  Well, lickety-split, USCIS has issued a correction. Now, comments are invited on 17 wide-ranging issues until May 19, 2021.  Don’t miss your chance to offer constructive criticism.

“Hell is paved with good intentions.” ~ Samuel Johnson

To its credit, United States Citizenship and Immigration Services (USCIS) – the beleaguered Department of Homeland Security (DHS) component charged with adjudicating requests for immigration benefits – is trying in earnest to improve. On April 18, 2021, the agency posted a notice (“Identifying Barriers Across [USCIS] Benefits and Services; Request for Public Input”). The notice set out 17 detailed questions on which members of the immigration stakeholder community and the general public might offer their insights.  This is welcome news. It demonstrates the sincerity of the agency in its desire to dig out from under the horrific degradation of our nation’s immigration programs wreaked by the 1,065 adverse actions of the Trump administration.

Unfortunately, the notice as published contained a glitch. The plan all along, as reflected in this early heads-up alert on soon-to-be-published notices in the Federal Register, was to allow public comment for a 30-day period.  Instead, the notice in final form provided only one day to comment.  It stated: “Written comments are requested on or before April 19, 2021. Late-filed comments will be considered to the extent practicable.”

This blogger is rooting for USCIS to succeed and believes the agency sincerely wants to improve. Great things are happening there. A talented, competent, non-partisan veteran, Tracy Renaud, is temporarily leading the agency. She has already set the tone by announcing that USCIS under the Biden Administration would welcome noncitizens with more inclusive appellations. Ms. Renaud is joined by the new USCIS Chief Counsel, Ashley Tabaddor, an inspiring leader and talented lawyer who most recently led the National Association of Immigration Judges in that union’s ongoing quest, with the ABA, AILA and many other organizations, to establish an Article I immigration court that would be independent of the Attorney General. They should soon be joined by Ur Jaddou, President Biden’s nominee to serve as the Director of USCIS.  She previously served as the agency’s Chief Counsel, Deputy Assistant Secretary in the State Department’s Bureau of Legislative Affairs, Chief Counsel to the House Subcommittee on Immigration and Border Security, Senior Counsel to Representative Zoe Lofgren, and most recently, as Director of DHS Watch for America’s Voice.  This impressive trio will no doubt be empowered and inspired by Alejandro Mayorkas, the former USCIS Director, who now serves as DHS Secretary.

With this auspicious assemblage of talent, USCIS can be forgiven for a misstep out of the gate.  Great things are set to happen.  But do re-open the comment period so that the public and immigration stakeholders have the full 30 days to offer their views.

[Blogger’s Note:  Many thanks to my talented co-author, Tieranny Cutler]

Beware the Employer Risks Nesting in President Biden’s Comprehensive Immigration Reform Bill

By Angelo A. Paparelli and Tieranny L. Cutler

At the urging of President Biden, two members of Congress – Senator Robert Menendez and Representative Linda Sanchez – introduced companion 353-page bills last month in the Senate and the House entitled the “U.S. Citizenship Act of 2021.”

Presented as a comprehensive modernization of our nation’s long outdated immigration laws, this proposed legislation – uniformly lauded by Democrats and opposed by Republicans – features many provisions that U.S. employers may welcome, including, as this White House Fact Sheet details, a path to legal status, employment authorization, and eventually, American citizenship, for some 11 million undocumented noncitizens; relief for Dreamers, persons in Temporary Protected Status, and immigrant farmworkers; and improvements to the legal, employment-based immigration system.

Although the media has widely reported on the proposal in broad strokes, little attention has been given to one significant part known as Title V (“Employment Authorization and Protecting Workers from Exploitation”).

As we shall show, employers should be wary of Title V because, if this title were passed as a standalone act, or tacked onto (even in pieces) must-pass legislation in the Democratic-controlled house and a (post-filibuster) Democratic-controlled Senate, it would dramatically expand potential employer liability, create new penalties, and increase compliance obligations involving I-9 and E-Verify employment eligibility verification.  It would also create a legal basis for noncitizens who are material witnesses or deemed likely to be “helpful” to the investigation of a workplace claim under a host of federal, state and local employment laws to be granted an array of immigration benefits under the legal immigration system (including U visa status, temporary relief from removal, employment authorization, and a path to lawful permanent resident status).

Expanded Employer Liability for Discrimination Based on National Origin or Citizenship Status

If enacted, Title V (§ 5105) would expand the population of potential claimants protected against citizenship status discrimination to include all noncitizens with employment authorization, including presumably employment-based nonimmigrants and holders of Employment Authorization Documents  (EADs).  Under current law, Immigration and Nationality Act (INA) § 274B(a), only “protected individuals” may claim citizenship status discrimination.  Protected individuals are currently defined as U.S. citizens, lawful permanent residents who are not yet eligible to apply for naturalization or who have applied within six months of eligibility, and persons granted asylum or refugee status.  Under § 5105, enforcement jurisdiction over such claims would remain with the Immigrant and Employee Rights (IER) Section of the Civil Rights Division within the Department of Justice (formerly, the Office of Special Counsel for Immigration-Related Unfair Employment Practices). This change would thus prevent employers from refusing to sponsor nonimmigrants for employment-based immigration benefits (such as STEM-based optional practical training, work visas, and green cards) for particular positions if the employer already has a practice of sponsoring foreign workers in these jobs.

Additionally, Title V (§ 5105) would extend protection against national origin and citizenship status discrimination beyond the acts of hiring and discharge from employment to also include “verification of the individual’s eligibility to work in the United States” or “verification of employment authorization,” and would transfer enforcement jurisdiction over this form of national origin discrimination from the Equal Employment Opportunity Commission (EEOC) to the IER.

Expanded Employer Liability for Unfair Documentary Practices and for I-9 and E-Verify violations

Title V (§ 5105) would expand liability for unfair documentary practices (i.e., where an employer requests more or different documents than minimally required to verify employment eligibility, or refuses to accept such documents).  It would also add the “disparate impact” standard of proof through statistical, pattern-based evidence, and extend such liability beyond citizenship status discrimination to include national origin discrimination as well. (Under current law, unfair documentary practices can only be established based on proof of an intention or purpose to discriminate, i.e., the “disparate treatment” standard, and such liability is now limited to citizenship status discrimination.)

Moreover, Title V (§ 5105) would create new forms of unfair immigration-related employment practices involving improper use of the “employment verification system” in INA § 274A (i.e., the I-9 process and the E-Verify system), referred to in § 5105 as the “System,” if an employer were to (A) “deny workers’ employment or post-employment benefits;” (B) misuse the System to discriminate based on national origin or citizenship status; (C) require an employee or prospective employee to use any “self-verification feature of the System as a condition of application or employment;” (D) use an immigration status verification system, service, or method other than the System; (E) grant unauthorized access to document verification or System data; or (F) fail to take reasonable safeguards against unauthorized loss, use, alteration, or destruction of System data.

Further, Title V (§ 5105) would prohibit withholding of employment records required to be maintained under federal, state, or local law, including dates or hours of work and wages received, and penalize the failure to provide such records to any employee, as to whom the records pertain, upon the employee’s request.  It would also require the EEOC to refer all matters alleging immigration-related unfair employment practices filed with the Employment Authorization Commission (established under § 5101 of Title V, described below) to the IER.

In addition, Title V (§ 5105) would increase existing civil fine amounts across the board for unlawful immigration-related discrimination or other unlawful practices committed against individuals, with fines levied on a per-person basis and adjusted according to the rate of inflation.  The new fine levels would take effect one year after the enactment of the statute and cover violations which occur during the intervening 12 months since enactment. Depending on the type of unlawful immigration-related discrimination or other unlawful practices found to have been committed, fines under this section would be pegged at $2,000 to $5,000 for each individual subjected to an unfair immigration-related employment practice, with penalties increasing to as much as $25,000 per person for employers who are repeat offenders.

Protecting Workers from “Exploitation”

Under Title V (§ 5102) a noncitizen with information provided in good faith about a labor or employment violation resulting in a workplace claim would be given U nonimmigrant visa status, as long as any government official involved in labor and employment law enforcement were to certify that the individual cooperated with the Department of Homeland Security (DHS), the Department of Labor (DOL), the EEOC, the National Labor Relations Board (NLRB), or certain other federal, state or local government agencies in the investigation and prosecution of the claim.  In the event DHS conducts an enforcement action at a facility where a workplace claim has been filed or based upon information an employer provided to DHS in retaliation against noncitizen employees, DHS will allow any arrested or detained noncitizens to remain in the U.S. until after DHS notifies law enforcement and allows the enforcing agency the opportunity to conduct interviews of these noncitizens.  In addition, individuals who have filed a workplace claim and are material witnesses or have filed a U visa application based upon this section will be entitled to a stay of removal and employment authorization until either the adjudication of the U visa application or resolution of the workplace claim.

Enhanced Penalties

Title V (§5103) would prescribe a new penalty of up to $5,000 to be added to INA § 274A (involving employment-eligibility verification) if an employer is found to have engaged in civil violations of labor laws related to wages and hours, labor relations, family and medical leave, occupational health and safety, civil rights, or discrimination as long as an enforcing agency has made a finding of a violation with respect to an unauthorized worker.

Preservation of Workplace Rights

The bill would preserve all rights, remedies, and relief provided under any federal, state, or local law relating to workplace rights, including reinstatement and back pay, notwithstanding an employee’s status as an unauthorized noncitizen during employment or during the back pay period, or the failure of the employer or employee to comply with the employment-eligibility verification requirements of INA § 274A or with any other provisions of federal law relating to the unlawful employment of noncitizens.  The bill would also allow such an employee to pursue other available causes of action in any civil proceeding.  In effect, Title V would reverse the U.S. Supreme Court decision in Hoffman Plastic Compounds, Inc. v. NLRB, 535 U.S. 137 (2002), which held that the NLRB had no discretion to award back pay to a noncitizen who was unauthorized for employment in the United States.

Employment Authorization Commission

Title V (§ 5101) would establish an Employment Authorization Commission (EAC) comprised of six members noted for their knowledge and experience in the field of employment verification, representing the employer, labor, and civil rights communities.  The EAC would (A) make recommendations to the President and Congress on policies to verify the eligibility of employment of noncitizens in the U.S.; (B) evaluate methods to verify employment that are free from discrimination and respect the rights of employment-authorized workers; (C) review error rates for E-Verify and its impact on various populations; and (D) issue a report within 180 days of the appointment of all members.  Designed to be temporary in nature, the EAC would terminate within two years of its inception.


While the U.S. Citizenship Act of 2021 is unlikely to be enacted in its present form, employers should remain vigilant about the possible inclusion of Title V in other legislation – whether or not related to immigration.  For if this title were enacted, its wide-ranging provisions would materially expand immigration-related worksite liabilities and penalties far beyond current law.

“America is back, the trans-Atlantic alliance is back.” – So declared President Biden on February 23, 2021.  Apparently, however, Antony J. Blinken, the newly installed U.S. Secretary of State (DOS), didn’t get the memo.  On March 2, 2021, he “rescinded the previous national interest determination regarding categories of travelers eligible for exceptions under Presidential Proclamation (PP) 10143 [relating] to the Schengen Area, United Kingdom, and Ireland.” As DOS’s announcement of the rescission noted, PP 10143, issued on January 25, 2021, restricted the issuance of visas and U.S. entry to “certain technical experts and specialists, senior-level managers and executives, treaty-traders and investors, professional athletes, and their dependents.”

NIEs for travelers from these Trans-Atlantic countries had been granted (at times with relative ease at some U.S. embassies and consular posts) based on previous State Department guidance. Under the prior guidance, executives, managers and specialists in the E-1 and E-2 (treaty traders and investors), H-1B (specialty occupation workers) and L-1 (intracompany transferees) visa categories, whose visit could be shown as likely to confer “substantial economic benefit” on the U.S., would often be approved. (For background, see this blog post (“Pursuing a National Interest Exception to the Presidential Entry Bans on Economic Grounds — Not A Fool’s Errand,” and slide deck, “Getting Your Key Employees Back to the U.S. under the National Interest Exceptions” to Presidential Proclamations ~ A Conversation about Eligibility and Process.”)

Now, however, as explained by the U.S. Embassy (Rome) in this communique, “[senior] executives and managers traveling to observe operations, hold regular meetings with U.S. clients, and/or for routine operational travel will no longer be considered eligible for a National Interest Exception.”

Inexplicably, Secretary Blinken’s abrupt change in policy did not include Brazil or South Africa – two nations included in PP 10143 – even though these countries are hotspots for particularly contagious variants of COVID-19.  Nor does the new policy apply to travelers from China (PP 9984), or Iran (PP 9992) – countries typically considered U.S. adversaries.  Also unexplained in the DOS announcement, “[students] traveling from the Schengen Area, the UK, and Ireland with valid F-1 [academic] and M-1 [vocational] visas do not need to contact an embassy or consulate to seek an individual NIE to travel [and] students approved for F-1 or M-1 visas “will automatically be considered for an NIE to travel.”

Equally mystifying and anomalous, President Biden on February 24, 2021 issued PP 10149 which revoked a different Trump-era COVID-based proclamation, PP 10014, resting the decision to revoke, in part, because PP 10014 “harms industries in the United States that utilize talent from around the world.” Still more confounding, there has been no change to the COVID-19 Labor Market ban, PP 10052, and the different, more-easily-attainable NIE standards for H-1B, L-1 and J-1 (exchange visitor) visa categories, as DOS reaffirmed them as recently as February 24, 2021.

In rescinding the “substantial economic benefit” NIE criterion applicable to travelers from the Schengen Area, UK, and Ireland, Secretary Blinken now requires American consular officers to be satisfied that the applicant will provide “vital support of critical infrastructure sectors” as defined by the Department of Homeland Security (DHS), or critical infrastructure linked supply chain support.  According to DHS’s Cybersecurity and Infrastructure Security Agency (CISA), there are “16 critical infrastructure sectors whose assets, systems, and networks, whether physical or virtual, are considered so vital to the United States that their incapacitation or destruction would have a debilitating effect on security, national economic security, national public health or safety, or any combination thereof.”  They include chemical, commercial facilities, communications, critical manufacturing, dams, defense industrial base, emergency services, energy, financial services, food and agriculture, government facilities, healthcare and public health, information technology, nuclear reactors, transportation, and water/wastewater systems.

I understand that DOS has internally offered examples of NIEs that consular officers are allowed to approve on their own initiative under the new “vital support of critical infrastructure” standard.  These would include airline personnel conducting essential safety training or mechanics essential to the purchase of aircraft, food industry specialists, and specialized repair technicians for critical manufacturing.  Other examples would include multi-million dollar business transactions involving U.S.-based, contractually-required inspections as a condition to closing, or otherwise necessary to complete critical elements of the deal.

If, however, the preceding criteria cannot be satisfied, but an NIE applicant’s travel from the Schengen Area, UK, or Ireland would directly support the creation or retention of U.S. jobs, then the State Department’s Visa Office would need to pre-approve the NIE before it could be issued.  Under this directly-support test, the proposed activity must take place on American soil, and would be time-sensitive in that it could not be postponed or conducted remotely, e.g., where a U.S. manufacturing facility requires a noncitizen to repair an assembly-line malfunction that prevents American workers from performing their jobs, and would not merely involve a routine factory tour.

This flurry of ghoulish NIE standards – for pandemic-related proclamations issued, revoked, revised, rescinded, revived or resurrected – makes no sense from many policy perspectives.

  • Public health. If the pandemic is truly a danger to the populace, why are students visa holders allowed to enter en masse? And why are Brazil and South Africa exempted from the new, tougher vital support/critical infrastructure NIE standard when the coronavirus threat is as great or greater in those countries than from Trans-Atlantic sources?
  • Foreign policy. Why are travelers from adversaries such as Iran and China eligible for NIEs under a more lenient and explicit standard of proof while business executives, managers and essential personnel from our Trans-Atlantic allies are required to satisfy a more stringent, nebulous standard, and can be denied if traveling to observe operations, hold regular meetings with U.S. clients, and/or for routine operational travel?
  • Economic policy. Why is “harm [to] industries in the United States that utilize talent from around the world” a basis to rescind PP 10014 but not an equally compelling ground to eliminate visa and entry bans applicable to travelers from Trans-Atlantic ally nations?
  • Rule of law. Why is the State Department adjudicating and denying applications for “entry” to the U.S. when its consular officers only have authority to determine “visa ineligibilities” and not admissibility to enter the country? And why is U.S. Customs and Border Protection (CBP) directing NIE requestors to American embassies and consular posts when Immigration and Nationality Act § 212(f) – the asserted legal basis for all of these presidential proclamations – prescribes categories of individuals whose entry to the United States is suspended, given that CBP must determine an individual’s admissibility to enter the country?
  • Interdepartmental accountability. Why is State using appropriated funds unlawfully under 31 USC § 1301(a)(“appropriations shall be applied only to the objects for which the appropriations were made . . .”) by performing CBP-authorized functions?

Fortunately, we should know the answer to these questions no later than May 3, 2021.  This is when the Secretary of State, the Attorney General, and the Secretary of Homeland Security are “required to review existing regulations, orders, guidance documents, policies, and any other similar agency actions . . .  that may be inconsistent with the policy” enunciated by President Biden on February 2, 2021 in his “Executive Order on Restoring Faith in Our Legal Immigration Systems and Strengthening Integration and Inclusion Efforts for New Americans.”  By this deadline, these Cabinet officers must submit a plan to the President which will:

  • identify barriers that impede access to immigration benefits and fair, efficient adjudications of these benefits and make recommendations on how to remove these barriers, as appropriate and consistent with applicable law; and
  • identify any agency actions that fail to promote access to the legal immigration system . . . and recommend steps, as appropriate and consistent with applicable law, to revise or rescind those agency actions. Emphasis added.

This author, respectfully, offers the hope that one of the “barriers” “to remove” in the Secretaries’ plan will be the seemingly senseless and irreconcilable sets of confusing and ambiguous NIE criteria that harm U.S. businesses, American workers, and our economy, and close our doors to allies, while doing little in substance to protect us against the spread of COVID-19.

Big-Picture, Clean-Slate Immigration Reforms 

for the Biden-Harris Administration

By Angelo A. Paparelli and Stephen Yale-Loehr

As a new administration takes office on January 20, and the tantalizing prospect of enlightened immigration reforms looms on the horizon, an intriguing question has surfaced on Twitter:

“Is there a progressive version of Stephen Miller? Someone who has (1) put in the time to understand how the immigration system works in great detail, (2) relentlessly committed to changing the system, and (3) is actually politically effective?” Austin Kocher, PhD

As grizzled and tireless proponents of a just immigration system, we humbly nominate ourselves for (1) and (2), and for (3) propose the American Immigration Lawyers Association (AILA). To be sure, our audacity notwithstanding, others are more worthy. Many experts have suggested ways to restore America’s historic stature as a welcoming nation of immigrants. For example, consider recent proposals by Doris Meissner and Michelle Mittelstadt of the Migration Policy Institute, Alexander Aleinikoff, Donald Kerwin and other marquee immigration experts who collaborated with the Zolberg Institute on Migration and Mobility, David J. Bier at the Cato Institute, and the collective efforts of the National Immigration Forum, Immigration Hub and America’s Voice, and AILA.

Here then, with unbridled chutzpah, we offer four fresh ideas or tweaks of others’ already-suggested proposals. Some can be announced quickly by executive order or presidential proclamation. Others might require rulemaking. None would require congressional action:

  • Restore the customer-service ethos and recognition of our heritage as a nation of immigrants in the USCIS mission statement. The mission statement of U.S. Citizenship and Immigration Services (USCIS) should reflect our nation’s heritage and values. It should also inspire USCIS employees to recognize and foster the benefits of legal immigration in their work (family unity, refugee and labor protection, and promotion of economic prosperity). By changing the mission statement, the agency would send a message of inspiration to its personnel, immigration stakeholders, the nation and the world. In tandem, the new administration should instruct USCIS to: (1) restore its former deference policy on affirming previously approved grants of immigration benefits when extensions of status involve no material change in the facts; (2) stop rejecting properly filed forms that fail to put “not applicable” or “none” where such notations are unnecessary (e.g., requiring the “current location” of “deceased relatives”); (3) stop using instructions on immigration forms – which have the force and effect of a regulation under 8 C.F.R. § 103(a)(1) – as an end run around formal notice-and-comment rulemaking under the Administrative Procedure Act (APA); and (4) cease issuing boilerplate, kitchen-sink requests for evidence or notices of intent to deny or revoke immigration benefits unless the request or notice expressly articulates an examination of the relevant evidence presented, cites relevant legal authority (no more making stuff up), limits the “ask” to unresolved issues, acknowledges eligibility criteria that have been satisfactorily established, and offers a clear explanation for the agency’s action, including a rational connection between the facts found and the agency choice made. Moreover, USCIS adjudicators, just like immigration judges and members of the Board of Immigration Appeals, must be required to sign their name to their decisions (or a pen name, if necessary for security purposes). This way rogue adjudicators who do not comply with these new requirements could be re-educated or rooted out.
  • Take USCIS out of investigations and limit its role to adjudicating requests for immigration benefits. The Homeland Security Act of 2002 (HSA) states that USCIS should engage in only limited activities. As a recent amicus brief filed by the Alliance of Business Immigration Lawyers explained, the HSA allows USCIS to decide requests for immigration benefits (e.g., asylum, visa petitions, work permits, permanent residency and naturalization), but not to conduct investigations and intelligence-gathering activities. USCIS should therefore be ordered to shutter its Fraud Detection and National Security (FDNS) directorate, or limit that unit’s role to data collection and analysis. To the degree that immigration officials suspect crimes or fraud, Immigration and Customs Enforcement should conduct any investigation that may be warranted, as the HSA provides – subject to the new Administration’s enforcement priorities and under even-handed procedural due process protections, such as issuing advance notice of inspection in writing (except where imminent harm or solid evidence of crimes require dispensing with prior notice). USCIS should end unannounced FDNS site visits.
  • Authorize virtual or in-person attorney representation at U.S consular posts abroad and ports of entry, and allow legal representation of other parties with legitimate interests in USCIS benefits adjudications. In a 2017 petition for rulemaking under the APA, AILA urged the Departments of State and Homeland Security to allow in-person or electronic participation of legal counsel during consular visa interviews and in applications for admission to the United States. That effort proved fruitless, but the need for legal representation persists. Experience has shown that visa applicants at consular interviews and persons seeking entry to the United States have only a few minutes to persuade a federal immigration official of their eligibility. Routinely, these decisions are made without the safeguards that attorney representation would ensure. Also barred from attorney representation under USCIS procedures are stakeholders with a legitimate interest in a particular immigration proceeding. For example, employment-and family-based petitioners may be represented by counsel, but individual beneficiaries may not. Similarly, an EB-5 regional center or project developer may not be represented in an immigrant investor’s initial petition or a conditional permanent resident’s petition to remove conditions on residency. Lawyers safeguard fairness and due process in immigration proceedings. They should be expressly allowed to actively and directly protect their clients’ legal interests. (We also believe in the need to review consular visa denials, but that is a bridge too far for this post.)
  • Establish a single administrative tribunal that decides all immigration-related legal issues across all federal agencies. Many have espoused moving immigration judges and the Board of Immigration Appeals from the Justice Department to a freestanding Article I immigration court. That would require congressional action. In the meantime, the new administration already has authority to create an impartial administrative tribunal within the Department of Justice, but protected from political interference by executive order or regulation. Immigration and Nationality Act (INA) § 103(a) states that a “determination and ruling by the Attorney General with respect to all questions of law shall be controlling.” At present, an alphabet soup of agencies, departments, and subordinate components within the federal government make decisions interpreting the INA and agency regulations and practices. These decisions often conflict, leaving immigration stakeholders to infer, interpret, and sometimes just guess at what the law requires or permits. Of course, interagency cooperation and funding (perhaps with existing user-fee authority) will be necessary. These potential hurdles can be overcome. The existing legal disharmony is unsustainable. Immigration law must be reconciled and proclaimed consistently across federal immigration agencies so that the public will know how to plan their affairs and comply with the laws, and thus better protect reliance interests.

* * *

From our pens to the new Administration’s ears.


Copyright © 2020 Angelo A. Paparelli (@angelopaparelli; APaparelli@seyfarth.com) and Stephen Yale-Loehr (@syaleloehr; SWY1@cornell.edu). All rights reserved. An earlier version of this blog was published by the American Immigration Lawyers Association here.


The U.S. Department of Labor (DOL) and Department of Homeland Security (DHS) last week affirmed the truth of the Upton Sinclair maxim on just how hard it is get someone “to understand something, when his [or her] salary depends on . . . not understanding it.”

In this case, federal immigration bureaucrats have had three decades to comprehend the delicate legislative balance of business needs and labor protections that produced the H-1B visa category for workers in specialty occupations.  For most of the ensuing years they seemed to appreciate that balance.  Yet, now, with the fate of their Executive Branch leader and paymaster up for a plebiscite in three weeks, their comprehension has (unsurprisingly) failed.  As this blog post will explain, because the needs and best interests of employers and workers (citizen and noncitizen alike) are intertwined, changing the rules of play late in the game without fair notice in order to favor one team over others will only hurt everyone.

Four days ago, the two departments — with the gushing enthusiasm of its two leaders — together delivered a one-two punch, each posting a distinct interim final rule (IFR) dramatically restricting and making more costly and burdensome the H-1B nonimmigrant visa category for foreign workers in the H-1B and other specialty occupations.  The DOL rule, “Strengthening Wage Protections for the Temporary and Permanent Employment of Certain Aliens in the United States,” takes effect immediately on publication (October 8, 2020).  The DHS rule, “Strengthening the H–1B Nonimmigrant Visa Classification Program,” will be binding for new H-1B requests filed on or after December 7, 2020. Each rule consumes more than 40 pages of dense three-column, single-line text in the Federal Register.

The DOL rule instantaneously jacked up the prevailing wages that must be paid to H-1B workers if employers rely on the DOL as the source of prevailing wage data (this graphic, courtesy of  David Bier at the Cato Institute, shows how high the new DOL rates have jumped). These elevated rates, DOL has now ordered, must also be considered the going rate for cases involving the sponsorship of noncitizens for employment-based green cards under the PERM labor certification rules.

The DHS rule is a comprehensive overhaul, with a multitude of added burdens and restrictions, as explained here:

Specifically, DHS is: Revising the regulatory definition of and standards for a ‘‘specialty occupation’’ to better align with the statutory definition of the term; adding definitions for ‘‘worksite’’ and ‘‘third[-]party worksite’’; revising the definition of ‘‘United States employer’’; clarifying how U.S. Citizenship and Immigration Services (USCIS) will determine whether there is an ‘‘employer[-]employee relationship’’ between the petitioner and the beneficiary; requiring corroborating evidence of work in a specialty occupation; limiting the validity period for third-party placement petitions to a maximum of 1 year; providing a written explanation when the petition is approved with an earlier validity period end date than requested; amending the general itinerary provision to clarify it does not apply to H–1B petitions; and codifying USCIS’ H–1B site visit authority, including the potential consequences of refusing a site visit. (DHS rule, 85 Federal Register at 63918.)

The societal costs of the two IFRs are substantial.  Just the initial cost to employers, with help from their outside counsel, to understand what the new rules require (the initial “familiarization costs”) amount to $1,954,336 for the DOL rule, and $11,941,471 for its DHS companion; but these sums pale in comparison to the whopping long-term cost projections:

For the 10-year implementation period of the rule (FY 2021 through FY 2030), DHS estimates the annual net societal costs to be $51,406,937 (undiscounted) in FY 2021, $416,212,496 (undiscounted) in FY 2022, $541,795,976 (undiscounted) from FY 2023 through FY 2027 each year, $388,592,536 (undiscounted) from FY 2028 through FY 2030 each year. DHS estimates the annualized net societal costs of the rule to be $430,797,915, annualized at 3-percent and $425,277,621, annualized at 7-percent discount rates.  (DHS rule, 85 Federal Register at 63921.)

[The DOL’s] IFR will have an annualized cost of $3.06 million and a total 10-year cost of $21.51 million at a discount rate of 7 percent in 2019 dollars. . . . The IFR will [also] result in annualized transfer payments of $23.5 billion and total 10-year transfer payments of $165.1 billion at a discount rate of 7 percent in 2019 dollars. . . . Transfer payments are the result of changes to the computation of prevailing wage rates for employment opportunities that U.S. employers seek to fill with foreign workers on a temporary basis through H–1B, H–1B1, and E–3 nonimmigrant visas. . . . [not including PERM transfer payments which DOL, without explanation, considered de minimus].  (DOL rule, 85 Federal Register at 63903-63903 (footnotes omitted)).

The new IFRs would upend complex rules in effect since 1991, regulations that — in a balanced way — considered the needs of employers to fill labor shortages by employing foreign workers, while also providing labor protections. See, H.R. REP. NO. 101-723, pt. 1, at 6721, 6723 (1990) (recognizing “the need of American business for highly skilled, specially trained personnel to fill increasingly sophisticated jobs for which domestic personnel cannot be found and the need for other workers to meet specific labor shortages.”), and DOL Administrator v. Volt Management, DOL Administrative Review Board, ARB CASE NO. 2018-0075, p. 15, fn. 62, Aug. 27, 2020.

Exhibiting virtually no sense of irony at almost three decades of bureaucratic inaction, DOL and DHS explained that it would not be right, nor is there time sufficient, to give the public advance notice or an opportunity to comment before the changes are final.  They cite two reasons for acting so hurriedly:  (1) President Trump issued his April 18, 2017 “Buy American and Hire American” (BAHA), Executive Order (E.O.) 13788, which required them to “propose new rules and issue new guidance, to supersede or revise previous rules and guidance if appropriate, to protect the interests of U.S. workers in the administration of our immigration system,” and (2) the nation is in the throes of an economic emergency as businesses and individuals are buffeted by the immediate harms and aftermath of COVID-19 (as DHS maintains, “[the] pandemic emergency’s economic impact is an ‘obvious and compelling fact’ that justifies good cause to forgo regular notice and comment”).

Given the pro-labor, oblivious-to-business slant of the two IFRs, it is no surprise that the DOL and DHS somehow neglected to discuss the President’s May 19, 2020 Executive Order 13924 on Regulatory Relief To Support Economic Recovery.  EO 13924 addressed several ways to promote an economic recovery in response to the pandemic, including by showing sensitivity to the challenges that U.S. businesses now face:

Agencies should address this economic emergency by rescinding, modifying, waiving, or providing exemptions from regulations and other requirements that may inhibit economic recovery, consistent with applicable law and with protection of the public health and safety, with national and homeland security, and with budgetary priorities and operational feasibility. They should also give businesses, especially small businesses, the confidence they need to re-open by providing guidance on what the law requires; by recognizing the efforts of businesses to comply with often-complex regulations in complicated and swiftly changing circumstances; and by committing to fairness in administrative enforcement and adjudication. (Emphasis added.)

Similarly ignored in the two IFRs are two other Trump Administration executive orders designed to relieve regulatory compliance burdens on businesses, discussed in my November 10, 2019 blog post. These orders — issued after BAHA — should have signaled to DHS and DOL that now is not the time to rock the boat on H-1B stakeholder reliance interests:

Also given little weight by DOL and DHS is the possibility that sharp increases in prevailing wage rates and added burdens and limits on the employment of H-1B workers might actually harm U.S. workers and endanger the economy, as this excerpt from the DOL IFR suggests (but nonetheless disregards in its rush to publication):

With the increases in prevailing wage levels under this IFR, some employers may decide not to hire a U.S. worker or a foreign worker on a temporary or permanent basis. The prevailing wage increase may mitigate labor arbitrage and induce some employers to train and provide more working hours to incumbent workers, resulting in no increase in employment. The Department is unable to quantify the extent to which these two factors will occur and therefore discusses them qualitatively.

The labor economics literature has a significant volume of research on the impact of wages on demand for labor. Of interest in the context of the H–1B program is the long-run own-wage elasticity of labor demand that describes how firms demand labor in response to marginal changes in wages. . . . It is likely that U.S. employers will pay higher wages to H–1B workers or replace them with U.S. workers to the extent that is possible. However, we can approximate that, if U.S. employers were limited in the ability to pay higher wages and did reduce demand, it would reduce the transfer payment [to workers in the form of higher wages] by approximately 7.74 percent. (DOL rule, 85 Federal Register at 63908; emphasis added.)

The DHS’s IFR does not address whether or not an increase in compliance costs and burdens, and restriction on H-1B eligibility and the maximum period of authorized stay, would result in quantitatively fewer H-1B workers hired.  Surprisingly, this omission comes notwithstanding that two federal courts in Northwest Immigrant Rights Center v. USCIS, and Immigrant Legal Resource Center v. Wolf, et al., have just wrapped USCIS’s knuckles and issued preliminary injunctions against filing-fee increases because the agency did not consider demand elasticity, i.e., that higher fees might result in lower total funding.  In other words, DHS has not learned the lesson (similarly discounted by DOL) that immigration demand goes down when costs go way up.

* * *

Ironically, the haste of DOL and DHS to make their ill-considered IFRs effective immediately have confirmed Upton Sinclair’s wisdom — but with a twist.  It is indeed hard to get someone “to understand something, when his [or her] salary depends on . . . not understanding it.”  It is harder still when the salary paymaster, who faces a vote of the populace in a few weeks, issues conflicting executive orders in the midst of a plague, and the wage recipients are partial to one group of stakeholders over others in a competition which Congress ordained should be fair and balanced.

We’ve seen this movie before.

Scene 1: The President issues a proclamation in reliance on his authority to restrict the entry of certain noncitizens under Immigration and Nationality Act (INA) § 212(f) so long as he asserts that allowing them in would be “detrimental to the interests of the United States.”

Scene 2: The proclamation creates exceptions to the entry bans based on  the national interests of the United States (among other grounds).

Scene 3:  Affected parties apply for exceptions; their requests are ignored or denied under opaque or nonexistent administrative procedures; and they sue in federal court.

This was the plot of the three travel-ban proclamations issued in 2017, the last of which the Supreme Court upheld in its 2018 decision, Trump v. Hawaii. After the Supreme Court’s  ruling, litigation ensued because plaintiffs in several suits alleged that the government’s actions (refusing visas under 22 CFR §§ 41.121 and 42.81) conflicted with the proclamation and the statutory authority of the Secretary of State in INA § 104. The litigation continues, having survived a government motion to dismiss, which a federal judge denied on June 5 in Emami v. Nielsen [and] Pars Equality Center v Pompeo (Pars Equality).

Sequels to Travel Ban–The Movie have since spewed forth, as the Congressional Research Service reports:

Issued between January and March 2020, these [Presidential] proclamations collectively suspend the entry of aliens who, within the prior 14 days, have been in mainland China, Iran, the European Schengen Area, Ireland, or the United Kingdom. . . . Also related to COVID-19, a proclamation that took effect on April 23, 2020 suspends the entry of many aliens on immigrant visas for 60 days, for the stated purposes of protecting Americans from job competition during the economic recovery and reducing strain on the domestic health care system.

The latest release, bearing the tongue-tiring title, “Proclamation Suspending Entry of Aliens Who Present a Risk to the U.S. Labor Market Following the Coronavirus Outbreak,” aired on June 22, and a bloodier Director’s Cut (thought to be the work of Stephen Miller) premiered on June 29.  Together, they extend the immigrant visa ban and bar the entry of foreign citizens requiring work visas in the H-1B, H-2B, L-1, and many J-1 categories along with their dependents (the June Bans) until the end of 2020.

The bans for the listed countries and regions (the Area Bans) created various carve outs, including a subjective one, i.e., if the entry of a noncitizen “would be in the national interest.”   The June Bans likewise included national-interest exceptions, but if based upon any job- or business-related claims of national interest, they set a very high bar. An economic-imperative exception to the work-visa bans would apparently not be allowed unless the entry of the applicant is shown to be “necessary to facilitate the immediate and continued economic recovery of the United States.”

As a practical matter, however, unless a national-interest (or other) exception is granted, neither the Area Bans nor the June Bans make much difference for the immediate future because most consular posts are closed and visa interview appointments are unavailable  — except on a showing of emergency (which one can assert if an appointment long into the future is snagged and then the chance to explain appears in the online DS-160 visa application, or the consular post’s email can be found or its fax number identified).

So does it make any sense to pursue a national-interest exception to any of the entry bans based on economic exigency?  I say, “yes,” and here’s why.

  • There Will Be Blood. As this is written, numerous organizations and individuals are identifying plaintiffs, and polishing off final drafts of soon-to-be-filed complaints and motions for emergency relief that seek to set aside the bans. Fiercely contested litigation often creates unforeseen beneficiaries.  The government may try to “moot out” plaintiffs and dismiss a case challenging its exercise of discretion by granting their requests for a national-interest exception. Also, a remedial order granting relief may apply to anyone who asked for a national-interest exception but was refused.  Litigation challenging the Area Bans and the June Bans may well succeed given the arbitrary and miserly grounds on which national-interest exemptions have been approved. Based on information reportedly from the U.S. Embassy in Paris, and independently confirmed by this blogger, the “bar is extremely high as to what constitutes national interest”:

So far, the only cases considered for a national interest exception are those of intended parents of children to be born through surrogacy in the United States and whose presence will relieve the hospital of the childcare burden during the current national health emergency; and researchers/healthcare workers or employees whose work is directly related to COVID-19 mitigation, treatment, or prevention.

Surely, competent litigators will make much of the exalted national interest in surrogate parenting (albeit important to the affected couples) that is seen by consular officials as trumping far more profound and broadly painful economic impacts.

  • The American President. The entry bans are not the only times President Trump has proclaimed on the economy. In a Presidential executive order (“EO”), entitled “Regulatory Relief To Support Economic Recovery,” EO 13924 (May 19, 2020), he called on all federal departments and agencies to combat the economic consequences of COVID-19 with “vigor and resourcefulness,” provide “exemptions from regulations and other requirements that may inhibit economic recovery [and] . . . use, to the fullest extent possible . . . any emergency authorities that I have previously invoked in response to the COVID-19 outbreak or that are otherwise available to them to support the economic response to the COVID-19 outbreak (emphasis added).” This is the third admonition of the President to urge the Administrative State to go easier on businesses and individuals (I blogged about the earlier two here). He has also trumpeted recent improvements in the unemployment numbers in May and June, noting that the economy is “roaring back.” Thus, by wrapping a national-interest/economic-imperative request in presidential garments, and citing government authorities such as, “Guidance on the Essential Critical Infrastructure Workforce: Ensuring Community and National Resilience in COVID-19 Response,” it may become easier to assert, with justification, that the grant of a national-interest exception to the bans will “facilitate the immediate and continued economic recovery of the United States.”
  • Local Hero. Perhaps the most promising visa category under which to consider requesting a national-interest exception based on economic urgency is the L-1 visa category for intracompany transferees.  These noncitizens must have at least one year of full time prior employment abroad in a multinational enterprise as a manager, executive or employee with specialized knowledge.  This is because U.S. workers’ employment prospects are likely not reality-based if they think they could possibly replace an L-1 intracompany transferee.  U.S. workers simply lack the requisite “insider” experience. I elaborated on the point in a June 23 interview with Immigration Law 360 Reporter, Suzanne Monyak:

‘It boggles the mind to think that the expertise and sophistication of executives and managers, who have been employed by [a multinational] organization, and the specialized knowledge of essential workers with that level of expertise, can be replaced by a U.S. worker,’ said Angelo Paparelli . . . . ‘No amount of education can substitute for that level of internal experience.’

To enhance the L-1 quest for a national-interest exception, applicants should note that the June Bans did not prohibit the entry of E-1 or E-2 visa holders even though they enter the U.S. in positions comparable to L-1s as executives, supervisors or essential-skills personnel, do not require one year of prior experience, and the entities that would employ them cannot even be owned by American citizens (who lack treaty-country nationality) or U.S. lawful permanent residents (with the same treaty-protected nationality [see 9 FAM 402.9-4(B)e]). Stated differently, E-1 and E-2 entrants presumably do not undermine the U.S. economy and they apparently “facilitate [America’s] immediate and continued economic recovery” (or they would have been included in the ban), but — counter-factually — L-1 visa holders somehow threaten our economic well-being, even though they are often owned and operated by Americans and employ U.S. workers.

  • Capitalism: A Love Story. H-1B nonimmigrants may also establish a factual basis for a national-interest exemption on economic grounds.  Their justifications of enhanced job creation and entrepreneurship would be based on abundant evidence (“Don’t Ban H-1B Workers: They Are Worth Their Weight in Innovation”).  J-1 nonimmigrants who come here as interns, trainees,  teachers, camp counselors, au pairs, or summer work travelers (and heretofore had not been banned) often liked what they saw, and – as immigration lawyers can attest – then returned as H-1B workers or budding entrepreneurs. Both the H-1B and J-1 categories can assert an economic claim of comparable merit to EB-5 immigrant investors who must directly or indirectly create jobs based on economic modeling (but are not subject to the June bans) or international entrepreneurial parolees who likewise are not banned, and whose legal eligibility remains on the books based on a federal court ruling against the Trump Administration in National Venture Capital Association v. Duke).  Similarly, U.S. employers of H-2B workers who fill temporary or seasonal needs should be able present a justifiable claim of entitlement to a national interest exception on economic grounds. A labor market test would have been required to qualify in this category (and no qualified U.S. worker would have been found, or else the H-2B visa petition would be denied).

In short, to the degree that economic imperatives must be established to gain a national-interest exception (the economy, after all, is the ostensible raison d’être for the bans), then the underlying economic justifications that caused Congress to create these work visa categories are surely relevant.

Moreover, the immigrant visa ban and the June bans squarely raise the issue of whether these proclamations conflict with the INA (an issue undecided in Trump v. Hawaii).  That conflict is litigation fodder, as is the asserted conflict acknowledged in Pars Equality between agency actions in administering the requests for exceptions to the bans and the requirements of the INA and immigration regulations.  These ripe and tasty “litigable” issues are reason enough to request national interest exceptions on economic grounds (over and above the chance that the exceptions will be approved).

* * *

In my interview with Suzanne Monyak, I predicted that the entry bans will be as ineffectual as medieval medicine:

[If] international companies decide the restrictions aren’t worth it and take their business outside the U.S., it could result in fewer, not more, jobs for Americans. Paparelli compared the proclamation to attempting to solve the U.S.’ current economic woes with the medieval practice of bloodletting. ‘While other countries are making their destinations more attractive, we’re basically pushing people out,’ he said. ‘And if that won’t affect U.S. workers adversely, I don’t know what will.’

As I reflect on it, however, the bans ultimately call to mind the Black Knight’s sword-fighting scene with King Arthur in Monty Python and the Holy Grail.  And, if national-interest exception requests based on economic grounds ultimately prevail, perhaps we can then say, with no sense of irony (but maybe just a smile), “’tis but a scratch.”

In the wake of recent losses in the federal courts, U.S. Citizenship and Immigration Services (USCIS) — on June 17, 2020 — issued a memorandum that rescinds two agency policies which, for more than ten years, had forced employers of H-1B (Specialty Occupation) workers stationed at customer worksites to submit voluminous and burdensome evidence.  Thankfully, under the new interpretation such evidence will no longer be required.

The June 17 memorandum also provides partial guidance on possible petition denials and revocations, as well as potential status violations, when employees are placed in nonproductive status, whether in response to COVID-19, or otherwise.  Yet it leaves many questions unanswered.

Easier Proof of Employer-Employee Relationship

For more than a decade, USCIS had required employers intending to place H-1B employees at third-party worksites to submit proof of client contracts, purchase orders, statements of work, letters from customers, and similar evidence to establish that the H-1B petitioner (and not the customer) was and would remain the actual employer of the sponsored worker. See, “Determining Employer-Employee Relationship for Adjudication of H-1B Petitions, Including Third-Party Site Placements,” HQ 70/6.2.8 (AD 10-24), issued January 8, 2010. These documents often contained confidential business information; thus, procuring them for each employee often entailed needless delay and inconvenience, requiring outreach to, and delicate negotiation with, the corporate customer.

Employers petitioning for H-1B noncitizens for offsite work no longer need to file evidence obtained from customers. The January 8, 2010 policy is now rescinded and can no longer be applied to “any pending or new requests for H-1B classification, including motions on and appeals of revocations and denials of H-1B classification.”

USCIS’s latest memorandum makes clear that its adjudicators should not request evidence derived from the petitioner’s customers, but may consider such proof if the employer submits it.  An H-1B employer, however, must still prove the existence of a bona fide job offer when the petition is filed by satisfying only “ONE” (capitalization courtesy of USCIS) of the following criteria, namely, the authority to (1) hire, (2) pay, (3) fire, (4) supervise, or (5) otherwise control the work of the sponsored H-1B employee.

Contracts and Itineraries No Longer Required

Also rescinded by the recent USCIS policy memorandum is a February 22, 2018 interpretation, “Contracts and Itineraries Requirements for H-1B Petitions Involving Third-Party Worksites,” PM-602-0157, which the agency describes as having been “intended to be read together with the 2010 memorandum and as a complement to that policy.”  The professed purpose of the 2018 memorandum was to allow USCIS adjudicators the opportunity to confirm that the H-1B employee would be employed, on a “non-speculative” bases, in a job classifiable as a specialty occupation.  In practice, USCIS had required proof of day-to-day assignments to establish the availability of specialty occupation work, and too often approved H-1B petitions only for the duration of the customer contract rather than for the otherwise-applicable statutory maximum period of H-1B petition validity. With USCIS’s issuance of its June 17 memorandum, contracts, itineraries and proof of day-to-day assignments are no longer required, but “the petitioner may choose to provide such evidence.”

Given that USCIS adjudicators are no longer allowed to ask for evidence that is burdensome and time-consuming to produce, and may not deny the petition or shorten the period of H-1B petition validity and status solely because such evidence is not filed, there seems no advantage in providing it. Or, as one wag has suggested, “[stress] is unnecessary and unnecessary stress is very unnecessary.”

New USCIS Guidance on Benching

The June 17, 2020 policy memorandum also clarified USCIS guidance on the possible immigration consequences arising in situations when an H-1B worker is not performing services as described in the employer’s petition.  The memorandum is especially relevant given the varying responses of H-1B employers and employees to the COVID-19 pandemic that has triggered a wave of repercussions ranging from reductions in hours, leaves of absence, furloughs, and terminations of employment, some of which have been couched as extended severance periods that purport to prolong employment status.

The new memorandum states:

The failure to work according to the terms and conditions of the petition approval may support, among other enforcement actions, revocation of the petition approval, a finding that the beneficiary failed to maintain status, or both. . . .

Lack of work may be a material change in the terms and conditions of employment that could affect eligibility for H-1B nonimmigrant classification and could require the filing of an amended petition. . . .

In assessing whether a beneficiary’s non-productive status constitutes a violation of the beneficiary’s H-1B nonimmigrant classification, the officer must assess the circumstances and time spent in non-productive status.

As the memorandum notes, the Immigration and Nationality Act (INA) and regulations of the U.S. Department of Labor (DOL) require that the employer continue to pay H-1B nonimmigrants the “required wage” reported to DOL if the employee “is not performing work and is in a nonproductive status due to a decision by the employer.” (This obligation, sometimes described as the duty to pay during periods of “benching,” applies as well to H-1B1 employees from Chile and Singapore and to E-3 workers from Australia.) The required wage need not be paid, however, if an employee “experiences a period of nonproductive status due to conditions” which “render the nonimmigrant unable to work.” See INA § 212(n)(2)(C)(vii)(listing exceptions to the prohibition on unpaid benching) and 20 CFR § 655.731(c)(7)(i) and (ii)(listing, respectively, circumstances where required wages “must” or “need not” be paid).

USCIS acknowledges in the new memorandum that “neither statutes nor regulations state the maximum allowable time of non-productive status.”  Thus, it authorizes agency officers to exercise discretion in issuing a notice of intent to deny (NOID) a pending petition, or a notice of intent to revoke (NOIR) a previously approved petition, and grant of status.  Issuance of a NOID or NOIR would give the petitioner (but not the worker) a chance to explain why adverse action should not be taken.

The memorandum also includes an exception (citing the DOL regulation, 20 CFR § 655.731(c)(7)(ii), noted above):

However, it would not be a violation of H-1B nonimmigrant status for a beneficiary to be in non-productive status during a period that is 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 Disabilities Act. (Emphasis added.)

The quoted statement is unhelpful for two reasons.  First, it is confusing because it contains a triple negative.  Second, it conflates the employer’s duty to pay the required wage with the employee’s distinct obligation to maintain lawful status.

Presumably, a USCIS adjudicator in reliance on the quotation might find, for example, that a medical disability would still allow the individual to be classified as having maintained lawful status if the employee on medical leave is not paid under the benefits plan, the FMLA or the ADA or some other law requiring payment. Regrettably, however, the USCIS Memorandum does not address the opposite situation, i.e., where the employer pays the required wage to an H-1B worker who is on an approved medical leave, even though payment is not required by the benefits plan or by statute. (Readers should note that USCIS in the past has often approved an otherwise approvable H-1B petition, and found no violation of status, as a result of a leave of absence that is medically justified and reasonable in duration – whether or not the employer has paid the required wage in the interim.)

Also disappointing is the omission in the new memorandum of any guidance on recurrent fact patterns involving nonproductive status that have arisen in response to the COVID-19 pandemic.  Numerous questions remain unanswered in the new memorandum, including these:

  • What happens if an employee’s hours were reduced even though s/he was willing and able to work full time and the employer never filed an amended petition to allow reduced hours? Will that be treated as a status violation when the employee invokes H-1B portability and seeks to transfer status to another employer? Note that the INA and the DOL regulations cited above are intended to protect the employee from unlawful benching by the employer, including a reduction of hours. Consider also relevant precedent decisions. See, e.g., Matter of Lee, 11 I&N Dec. 601 (Comm. 1966)(“[b]y ceasing his temporary employment . . . the applicant terminated his lawful nonimmigrant status”) and compare Matter of Siffre, 14 I&N Dec. 444 (Comm. 1973)(“[in the case of a nonimmigrant who] has been admitted for a fixed period, within that period his stay is not unlawful unless by his own conduct he violates one of the conditions of his admission [emphasis added]).
  • What if an employer who intends to terminate the employment of an H-1B worker offers the employee a period of extended paid or unpaid “garden leave” to graciously allow the individual to find another career opportunity but requires no services or labor in return and affords the individual no access to employer IT or facilities? Note that USCIS regulations governing the Form I-9 (Employment Eligibility Verification) process allow employer-authorized paid or unpaid leaves of absence to be treated in certain situations as “continuing employment.” Note also that, although USCIS regulations allow a terminated H-1B employee up to a 60-day grace period to find and be sponsored for another job, the agency can shorten or eliminate the grace period in the exercise of discretion based on all of the facts involved in the “cessation of employment.”
  • What if an H-1B employee files an aggrieved-party complaint with the DOL for having been benched without pay and terminated in retaliation for objecting to the pay cut? Note that INA 212(n)(2)(C)(v) requires the “Secretary of Labor and the Attorney General [now the Secretary of Homeland Security]” to “devise a process under which an H-1B nonimmigrant who files a complaint regarding [retaliation] and is otherwise eligible to remain and work in the United States may be allowed to seek other appropriate employment in the United States for a period not to exceed the maximum period of stay authorized for such nonimmigrant classification.” However, no such “process” has ever been “devise[d].” Is that a status violation by the employee?

Given that the June 17, 2020 memorandum does not fully address these and other foreseeable situations arising in response to the pandemic, H-1B employers and employees have little choice but to consult with their immigration counsel and await case-by-case adjudication outcomes – unless of course USCIS is again required to recant the latest guidance through federal court litigation.

Much like patient vintners, federal immigration agencies often take time to offer up a grand cru.  One such agency, U.S. Citizenship and Immigration Services (USCIS), the Homeland Security component that administers the legal immigration system, just produced a long-awaited, delectable quaff. On May 5, it issued a policy memorandum that anointed as binding precedent an administrative appellate decision which at long last blesses modern practices in business transformations.

USCIS will now allow eligibility for employment-based immigration benefits previously secured by one company to be preserved by a successor entity even if the predecessor goes out of business. The decision,  Matter of F-M- Co., Adopted Decision 2020-01, issued by the USCIS’s Administrative Appeals Office (AAO), recognized the principle of immigration “successorship in interest” in mergers, acquisitions and other forms of corporate restructuring.

USCIS’s actions are significant and historic.

The agency has now provided a predictable path to preserving precious employment-based immigration benefits for many foreign managers and executives transferring from abroad who might otherwise have lost eligibility because of a corporate restructuring over which they had no control.  These noncitizens, so-called “intracompany transferees,” qualify for an “L-1A” work visa (for up to seven years) and an “EB-1C” employment-based green card as a “priority worker” if the manager or executive sponsored by an employer to work in the U.S. had been employed abroad for at least one of the last three years by a “qualifying organization” or “multinational” enterprise.  (To meet this entity-relationship test, both the foreign employer and U.S.-based petitioning entity must be a parent, branch office, affiliate or subsidiary within a group of entities under common ownership and control.)

Before the recent USCIS actions, the path to immigration eligibility for these managers or executives has long been beclouded.  The problem has persisted since at least 1989 (as I described in “Life After Mergers and Acquisitions: The Immigration Impact on U.S. Employers and Alien workers,” my first of several co-authored articles on the topic), and later made worse by a gratuitous comment in an August 6, 2009 USCIS policy memorandum.

This memo, Memorandum of Donald Neufeld, Acting Associate Director, Domestic Operations, USCIS, ‘Successor-in-Interest Determinations in Adjudication of Form I-140 Petitions; Adjudicators Field Manual (AFM) Update to Chapter 22.2(b)(5), without explanation or analysis, purported to deprive intracompany managers and executives (as well as “outstanding professors and researchers”) of employment-based green-card eligibility following a corporate restructuring, even though longstanding agency practice had been to recognize their entitlement based on immigration successor-in-interest principles.

To be fair, Mr. Neufeld’s memorandum was still quite helpful.  It recognized that immigration successor-in-interest determinations in major corporate restructurings should no longer be guided by Matter of Dial Auto Repair Shop, Inc., 19 I&N Dec. 481 (Comm. 1981), a case involving the transfer of an automotive technician from one car repair shop to another.  Dial Auto Repair created an inflexible test for immigration successorship (requiring the assumption by a corporate successor entity of all assets and all liabilities of the predecessor) in green card cases involving “labor certification,” i.e., where an employer must first prove that U.S. workers are unavailable.

Fortunately, however, the 2009 memorandum acknowledged that the predecessor immigration agency, the Immigration and Naturalization Service (INS), had long applied a “very restrictive reading” of Dial Auto Repair and its test for successorship. The 2009 memorandum therefore noted:

USCIS recognizes that business practices change over time, particularly in the areas of acquisitions, mergers, and transfers of assets and liabilities between entities . . . [Corporate] entities do not always wholly assume the assets and liabilities of entities they acquire or merge with and that businesses may choose not to assume certain assets or liabilities in connection with a perfectly legitimate transaction.

Writing in Business Law Today, I welcomed the newly relaxed standard for successorship in “Bothersome immigration buzz spells trouble for M&A deals: New homeland security memo complicates employee transfers,”  but whined over the agency’s elimination of inherited immigration benefits for intracompany managers and executives, stating:

USCIS has not explained why it views immigration successorship “principally” through the lens of the labor certification procedure. The agency and its predecessor, the Immigration and Naturalization Service, have long accorded successor-in-interest designation to a host of nonimmigrant work visa categories that are exempt from the labor certification requirement. Similarly, both agencies have historically granted the designation to the EB1 Multi-National Executive or Manager immigrant visa classification, a kissing cousin of the L-1 nonimmigrant visa . . . .

USCIS is wrong to proclaim in a memorandum drafted without stakeholder consultation that only certain foreign workers whose employers are involved in new business combinations (those holding labor certifications) are allowed to continue their pursuit of permanent residence in the United States while other noncitizen employees (likewise affected by corporate restructurings, but in different immigrant visa categories) are precluded.

USCIS should not limit eligibility by a wooden view of immigration successorship while proclaiming an intention to adjust to changing business practices. The memorandum speaks a good game, but the agency’s newfound flexibility is difficult to discern.

Happily for this class of aspiring citizens, USCIS’s recent actions on May 5 have at last softened its “wooden view of immigration successorship.” Thus, the AAO in Matter of F-M- Co., has finally ruled:

The Neufeld Memorandum, which recognized changes in business practices in the areas of acquisitions and mergers, was issued “to allow flexibility for the adjudication of I-140 petitions that present novel yet substantiated and legitimate successor in interest scenarios.” . . .

In the event a corporate restructuring affecting the foreign entity occurs prior to the filing of a first preference multinational executive or manager petition, a petitioner may establish that the beneficiary’s qualifying foreign employer continues to exist and do business through a valid successor entity. If these conditions are met, USCIS will consider the successor-in-interest to be the same entity that employed the beneficiary abroad.

Matter of F-M- Co. involved a merger and absorption of one foreign company into another. What remains to be decided is what test for immigration successorship will be applied outside of the merger context.  Far more common is the assumption of assets but not necessarily liabilities.

Legacy INS had informally relaxed the Dial Auto Repair requirement and determined that the assumption of only a portion of the liabilities of a division of a target company would be sufficient for immigration successorship to be recognized. (See, e.g., the Bednarz-Bravin correspondence published in 70 Interpreter Releases 1568 [Nov. 22, 1993].) Over time, in practice, INS and USCIS have often approved immigration successorship deals where the assumption involved only immigration-related liabilities. This trend seems to have benefited by the enactment of Immigration and Nationality Act § 214(c)(10) which allows H-1B employers to dispense with the filing of a new or amended petition following a corporate restructuring if a “new corporate entity succeeds to the interests and obligations of the original petitioning employer . . .” However, Mr. Neufeld’s memorandum, again in the context of a labor certification, phrased the test differently, stating:

[A] valid successor-in-interest relationship may still be established in certain instances where liabilities unrelated to the original job opportunity are not assumed by the successor, e.g., where the successor does not assume the liability of a pending or potential sexual harassment litigation, or other tort obligations unrelated to the job opportunity in the labor certification.

Still, USCIS’s actions are welcome.  They essentially stand for the proposition that a cousin, however distant, remains part of the extended family even though her parent has died or disappeared.

Depending on your calculation, it only took 32 years (by my count) or 11 (since the 2009 USCIS memorandum).  Better late than never.