Risky to Rely on H1B Portability Based on H1B Filing
Posted 29.Jan.2010
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We at the Murthy Law Firm have received many questions recently regarding the potential impact of the January 8, 2010 H1B memo on employer-employee relationships. One area for consideration is the increased risk for those who attempt to utilize the H1B portability provisions of AC21 to start working for employers before obtaining their H1B approvals. The AC21 H1B portability provisions permit H1B employment in certain situations, based on a pending, unapproved H1B petition. The risk arises from the potential of a denial of the pending H1B petition. To the extent that this January 8th memo increases the potential for denial, especially for consulting companies, the risk of using H1B portability has increased.
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Conditions Required to Satisfy H1B Portability
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H1B portability refers to the authorization to accept H1B employment based upon a pending H1B petition for new employment. The basic requirements for eligibility to accept employment based on the pending H1B petition are that ALL of the following four conditions be met.

• The individual must have been lawfully admitted to the United States.

• The individual must have previously held H1B status or been issued an H1B visa.

• The individual must NOT have engaged in unauthorized employment.

• The H1B petition must be filed prior to expiration of the individual's authorized stay (I-94).

If ALL of these requirements are met, then it is permissible to start employment with the new H1B employer upon simply filing the H1B petition. Many employers wait until the U.S. Citizenship and Immigration Services (USCIS) issues a receipt notice as confirmation of the filing of a case.
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Risks of Using H1B Portability
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The risk in using H1B portability is that the H1B petition could be denied. This is especially so in a climate where the USCIS is scrutinizing H1B petitions closely, as well as changing their standards and expectations as to the proof needed to meet the legal requirements for an H1B petition. The employer-employee requirement, as interpreted by the January 8th memo is an example of the shift in adjudications standards. Our firm receives many calls and eMails from individuals and employers facing H1B denials in portability situations. If a foreign national has relied upon a pending H1B petition in order to stay in the United States and work, the denial of the H1B petition normally means that s/he is out of status. This creates significant problems for the individual. It is also disruptive to the employer's operations, as the individual's authorization to work was based solely upon the H1B filing. If the H1B petition is denied, the authorization to work ends.
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This risk has increased over the past year or two, with the more stringent review of H1B petitions, and higher denial rates. This is primarily a concern in the area of IT consulting, but applies to many other H1B employers, as well. The January 8, 2010 Neufeld memo on the employer-employee relationship potentially compounds this problem. The memo is described in our January 22, 2010 article, H1B Memo on Employer-Employee Relationships and 3rd Party Placements, available on MurthyDotCom.
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Suggestions to Avoid Risk
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The best way to avoid the risk of falling out of status due to reliance on H1B portability is to avoid using H1B portability. If at all possible, it is far better to remain in one's current status, usually H1B, and wait for approval of the new employer's H1B petition before making any changes in employment. That is, one should go from approval to approval, and not depend solely on the pending H1B petition. This is often possible when using the premium processing service to expedite the processing of the new employer's H1B petition.
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There are times when using portability is unavoidable; for example, when an individual is about to be laid off and must change her/his job quickly to avoid falling out of status. There are also situations in which an H1B employer may need the worker immediately, and cannot wait even a few weeks for the H1B approval. In an instance such as this, it is vital to be aware of the latest H1B adjudication trends, and to have a well-prepared H1B case. In a scenario involving a consulting company, it is necessary to have proof related to the project, such as end-client letters, as well as indicia of the employer-employee relationship.  
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Conclusion
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To summarize, it is safest to avoid relying upon a pending H1B petition for one's status and work authorization when changing to a new H1B employer. When this cannot be avoided, it is vital to prepare the H1B petition in a manner that has the best possible chance for approval. Obviously, no attorney can assure the approval of any case. In an era when adjudication standards are constantly changing, success requires detailed knowledge of current trends. The Murthy Law Firm remains up to date on all of the latest H1B information and USCIS trends. We share this valuable data with MurthyDotCom and MurthyBulletin readers and use it to provide our clients with the best chance for success in their immigration matters.