Overview of Final Rule Modifying H1B Lottery System

The U.S. Department of Homeland Security (DHS) issued the final rule on January 30, 2018 for H1B cap-subject petitions. The new regulation makes a procedural change for the USCIS, which should result in an increase in the percentage of foreign nationals selected in the lottery who have advanced degrees from qualifying U.S. universities. The rule also calls for the creation of a registration system for employers planning to file cap-subject H1B petitions. However, the registration system will not be implemented for the upcoming fiscal year 2020 (FY20) H1B lottery, which begins on April 1, 2019.

Statistical Edge for Certain U.S. Advanced Degree Holders

The one major change going into effect for the FY20 H1B lottery is that the lottery for the advanced-degree exemption (i.e., the “master’s cap”) now will be held after the lottery for the standard cap-subject H1B petitions. As discussed in the MurthyDotCom NewsBrief, DHS Proposes Pre-Registration for Cap-Subject H1B Petitions (06.Dec.2018), statistically, this change should make it more likely for the selection of more U.S. advanced-degree holders in the H1B lottery. The USCIS estimates that reversing the order that the lottery takes place should result in approximately 16 percent more lottery numbers going to eligible candidates with the U.S. master’s degree.

Registration System May Start Next Fiscal Year (FY21)

Per the new regulation, the USCIS intends to create a mandatory electronic registration program for any employer who plans to file cap-subject H1B petitions with the USCIS. As mentioned above, this registration system will not go into effect for the FY20 H1B lottery, but may be implemented for the FY21 lottery.

Overview of the Registration Process

Once the new registration system is effective, the registration period will start at least 30 calendar days before the first day of H1B cap filings for the following fiscal year, and then will remain open for at least 14 calendar days. During that period, prospective employers will need to submit a separate registration for each foreign national subject to the cap-subject H1B position.

For each registration, the petitioning employer will need to provide certain basic information on both the employer and the sponsored foreign national, including whether the individual qualifies for the master’s cap. Details to be provided on the beneficiary are:

• Beneficiary’s full name
• Date of birth
• Country of birth
• Country of citizenship
• Gender
• Passport number

Once the registration period is closed, assuming the number of registrations exceeds the H1B cap, the USCIS will conduct a random lottery. The USCIS then will notify all the petitioners with selected registrations. Any employer with a registration that is selected then will have 90 days to file an H1B petition on behalf of the selected individual. If the 90-day filing period passes and the anticipated number of H1B petitions has not been received, the USCIS then will select additional registrations and notify those selected employers. The newly selected employers then will have 90 days to file their respective cap-subject H1B petitions.

Employer’s Attestation Requirements and USCIS Fraud Monitoring

As part of the registration process, an attestation will have to be signed by the employer, stating that the employer has an actual job for the prospective H1B employee. The USCIS will monitor the registration system for fraud and abuse, and take “… appropriate action against those who do file non-meritorious registrations.”

New Rule Only Applies to H1B Cap Filings

The new rule only applies to new cap-subject H1B petitions. It has no impact on non-cap cases, such as H1B extensions and amendments.

Conclusion

The new method for conducting the H1B lottery process should benefit those H1B beneficiaries who qualify for the U.S. master’s cap, by making it statistically more likely that their H1B petitions will be selected. As for the registration system, it will not be implemented for at least another year. Once it does go into effect, it has the potential of making the H1B lottery process more streamlined and cost effective for the USCIS and for H1B employers.

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