Court Invalidates USCIS H-1B Visa Policies that Adversely Impacted IT Consulting Companies

In the recently decided case, ITServe Alliance v. L. Francis Cissna, the U.S. District Court for the District of Columbia invalidated the USCIS policies that have caused skyrocketing H-1B denial rates and harsher treatment for IT services companies employing H-1B workers in the past few years. The Court’s ruling may significantly change how USCIS adjudicates H-1B cases from now on.

Please see below for the key aspects of the ruling:

Employer-Employee Relationship: Since 2018, USCIS has denied many H-1B petitions where the petitioner intended to place an H-1B professional at a third-party client site to perform work. In the denials, USCIS would claim the petitioner did not establish the required employer-employee relationship.

The Court noted that USCIS borrowed the definition of an employer from the Department of Labor and that a key part of the regulation states: “Has an employer-employee relationship with respect to employees under this part, as indicated by the fact that it may hire, pay, fire, supervise, or otherwise control the work of any such employee…” (emphasis added). The Court agreed with the Plaintiff that USCIS ignored the word “or” and instead silently replaced it with an “and” that required the petitioner to “otherwise control” the work of the H-1B employee in all instances, instead of recognizing that the necessary degree of “control” is fulfilled by each of the examples in the regulation. Thus, the Court found that the current USCIS interpretation is inconsistent with its regulation, was announced and applied without rulemaking and cannot be enforced. According to the Court’s ruling, the petitioner will only need to fulfill one of the examples listed in the regulation such as hire, pay, fire or otherwise control the employee, in order to establish the valid employer-employee relationship.

Specialty Occupation and Itinerary Requirement: For the past few years, USCIS has required that employers provide proof of non-speculative work assignments for the entire requested duration of the H-1B petition (normally 3 years), in order to qualify as a “specialty occupation.” USCIS has also denied H-1B petitions, or shortened the requested H-1B validity period to less than 3 years, because the accompanying itinerary and supporting contracts did not include non-speculative work assignments for the entire requested duration of the H-1B petition.

The Court found that the criteria for a “specialty occupation” in the regulations do not justify the requirement for non-speculative work assignments for the entire requested duration of the H-1B petition. Further, the Court agreed with the Plaintiff that the USCIS’s itinerary requirement was superseded by a later statute that permits employers to place H-1B visa holders in nonproductive status and is, therefore, no longer enforceable.

Finally, the Court added that the USCIS has the authority to grant H-1B visas for less than the requested three-year period, but must provide its reasoning for doing so.

The information contained in this news report should not be construed as legal advice.

Published by RongRong (Ron) Pan, Attorney at Bedi & Martinez, Esqs.