H1B Portability: A Change in USCIS Policy? Part 1 of 2

[Part 2 of this MurthyBulletin article discusses the consequence of this variation on individuals who previously engaged in employment under a broader reading of AC21.]

One significant change that had been brought about by the American Competitiveness in the Twenty-First Century Act (AC21) was the benefit referred to as H1B portability. This provision has allowed employees since October 2000 (when the law was passed), who desired to switch from one H1B employer to another H1B employer, to begin working for the new employer simply upon the filing of the H1B petition with USCIS (instead of waiting for the H1B approval). As explained here, while H1B portability is still in effect, the U.S. Citizenship and Immigration Services (USCIS) has articulated a policy that limits the use of H1B portability under AC21 to foreign nationals whose last status was H1B. This means that the USCIS requirement is now that an individual must have been in H1B status prior to the filing of an H1B petition by a new employer in order to enjoy H1B portability. In all other situations, the H1B candidate is required to obtain the H1B petition approval with a valid H1B I-94 before s/he is able to start working legally in the United States. This is troubling and contradicts the language of AC21.

USCIS Not Issued any AC21 Regulations

Although AC21 has been law since 2000, as regular readers of MurthyDotCom and the MurthyBulletin are aware, the USCIS has not issued regulations governing its application. Therefore, there remain significant questions as to many of the details of AC21. The USCIS has tried to clarify the application of the H1B portability provisions through memoranda and publications in question-and-answer format. However, this USCIS guidance has not fully addressed all of the possible situations, and policies are subject to change without notice. The resulting uncertainty has been highlighted in recent months by what appears to be a shift in USCIS policy with regard to H1B portability.

AC21 Requirements for H1B Portability

The AC21 H1B portability provisions state that a nonimmigrant, who was previously issued a visa or otherwise provided with nonimmigrant H1B status, is authorized to work upon the filing of an H1B petition by a new prospective employer if three requirements are met.

The three requirements are:

a) the foreign national has been lawfully admitted to the United States;

b) an employer has filed a petition for new employment for the individual prior to the expiration of his/her period of authorized stay; and

c) the individual has not been employed without authorization.

Previously Provided H1B Status: What Does This Mean?

The question that has arisen is whether the AC21 provisions require the H1B beneficiary to actually be in H1B status at the time of filing to use portability. Or is it enough to have previously held H1B status and be a nonimmigrant living in the United States a period of authorized stay?

Example:

Ravi entered the United States in F-1 (student) status. At the completion of his degree, he changed to H1B status and worked for two years. Thereafter, he changed back to F-1 status to complete an MBA. At the completion of his MBA, Ravi wants to change to H1B status again.

The question is: can Ravi use H1B portability and begin working when the new employer files an H1B petition on his behalf, or is an H1B petition with change of status approval required prior to starting the new job?

The same question would apply to one who previously held H1B status, but moved to H-4 status and now wishes to return to H1B.

Past Guidance: No Requirement to be in H1B Status

The USCIS guidance on this matter was interpreted by many, for almost a decade, to permit employment under AC21 in both examples provided above.

Legacy Immigration and Naturalization Service (INS, prior to 2003 restructuring) issued initial guidance in June 2001. In that guidance, as described in our June 25, 2001 article, INS Finally Issues its Initial Guidance on AC21 in June 2001, Legacy INS stated that it was not necessary to be working in H1B status to utilize these provisions.

The guidance pondered the idea that Congress did not intend to give the benefit to all foreign nationals who had ever held H1B status at any point in their lives. Thus, it proposed to limit of eligibility to those who had held H1B status within 60 days or less of the filing of a new employer’s H1B petition. However, no such limit was ever created due to the failure to implement regulations defining such details.

Later guidance, issued on May 12, 2005, was consistent. This guidance states, in part, that porting under the H1B portability provision does not require that the foreign national currently be in H1B status as long as he or she is in a period of stay authorized by the Attorney General.

The plain reading of this guidance led many employers and immigration attorneys to understand that an applicant who was no longer in H1B status could take advantage of the H1B portability provisions, provided the other requirements were met. The risks in utilizing these provisions are described in our news article, Risky to Rely on H1B Portability Based on H1B Filing (29.Jan.2010). However, the risks were related to the possibility of an H1B denial, not a change in interpretation of the scope of the provisions.

Hints of Trouble: E-Verify Could Not Confirm H1B Portability

Many foreign nationals and their employers have relied upon the more expansive interpretation contained in the 2001 Legacy INS memorandum for more than ten years. There was no inkling of any problem with this interpretation until the end of 2010. At that time, employers who utilize the USCIS E-Verify system to substantiate employment authorization began receiving “non-confirmations” for their employees working pursuant to H1B portability.

Initially, it was believed by many that these non-confirmations were a simple technical glitch in that part of the E-Verify system. E-Verify stated, however, that these were the result of internal policy guidance issued by the USCIS Office of the Chief Counsel. This guidance, which apparently concluded that H1B portability only applied to persons currently holding H1B status was not released to the public.

April 2011 USCIS Confirms (New) Interpretation

On April 7, 2011, in a question-and-answer session with the American Immigration Lawyers Association (AILA), the USCIS confirmed what is now the agency’s internal view regarding H1B portability: “H1B portability pursuant to AC21 . . . applies to nonimmigrants who are currently in H1B status or an authorized period of stay based on a timely-filed extension of an H1B status petition.”

Conclusion: Problems Likely in the Future

While the USCIS states that this is not a policy change, at a minimum, it is a much clearer, specific, and narrowly-defined policy statement. The wording used previously to articulate the policy allowed for different, broader interpretations. Many in the legal community, as well as employers, therefore, have been interpreting portability differently and, until recently, had no indication (such as RFEs or case denials) that the USCIS took a more narrow view of the provisions. Because many individuals worked under AC21 H1B portability in factual situations that are now being deemed unauthorized, this has the potential to create a variety of problems in the future.

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Disclaimer: The information provided here is of a general nature and may not apply to any specific or particular circumstance. It is not to be construed as legal advice nor presumed indefinitely up to date.