H-1B deportations: Concerns and clarification

The buzz about the deportation of H-1B visa-holders from Newark and JFK airports have created much anxiety in the community. But experts said much of the information about the 'rule change' that resulted in the deportations was not correct.

The deportation was effected following a memorandum by Donald Neufeld, associate director, Service Center Operations of USCIS, on January 8.

This memo clearly said that it was not a rule but 'is intended solely for the training and guidance of USCIS personnel in performing their duties relative to the adjudication of applications. It is not intended to, does not, and may not be relied upon to create any right or benefit, substantive or procedural, enforceable at law or by any individual or other party in removal proceedings, in litigation with the United States, or in any other form or manner.'

The memo underlines the requirement of an employer-employee relationship that would last the entire period of the foreign individual's H-1B stay in the United States.

In such a relationship the employer should have the 'actual' control or the 'right' to control the employee, to hire, fire, pay, and to decide when, where, and how the employee will be employed.

In situations where an individual works at a client's office, a location different from the petitioning employer's office, the question is whether such petitioner employer has the 'actual' control or the 'right' of control over the H-1B employee.

When the H-1B employee works at a client site, or a third party site, the H-1B petitioner may not always be able to exercise 'actual' control over the individual's employment. But to maintain the H-1B status and be in compliance with the regulations, the petitioner needs to prove the 'right' to control, if not the 'actual' control.

In an earlier news report it was mentioned that H-1B holders should 'arrive at the place of work,' which was also a mistake.

The memo aims to target unscrupulous body shops, which bring people on H-1B visas and supply to third parties without maintaining any further contacts.

What created the controversy was not the memo, but the alleged action of the CBP (Customs and Border Protection) officials at the airports. But attorneys say that with some foresight, many of the concerns expressed in the memo could be addressed with proper paper work.

At the same time, if the Green Card adjudicators too follow the guidelines in the memo it could create problems for the applicant, attorneys noted.

They point out that more than 80 per cent of the H-1B visa-holders are brought by the consulting firms and they in turn work at client sites. It is easy to term them as not maintaining a proper employer-employee relationship to deny their green card application.

Highlights of the memo:

• This memorandum is intended to provide guidance, in the context of H-1B-petitions, on the requirement that a petitioner establish that an employer-employee relationship exists and will continue to exist with the beneficiary throughout the duration of the requested H-1B validity period.
• United States employer means a person, firm, corporation, contractor, or other association, or organisation in the United States which 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.
• In support of an H-1B petition, a petitioner must not only establish that the beneficiary is coming to the United States temporarily to work in a specialty occupation but the petitioner must also satisfy the requirement of being a US employer by establishing that a valid employer-employee relationship exists between the US employer and the beneficiary throughout the requested H-IB validity period.
• While some third-party placement arrangements meet the employer-employee relationship criteria, there are instances where the employer and beneficiary do not maintain such a relationship. Petitioner control over the beneficiary must be established when the beneficiary is placed into another employer's business, and expected to become a part of that business's regular operations.
• Engaging a person to work in the United States is more than merely paying the wage or placing that person on the payroll. In considering whether or not there is a valid 'employer-employee relationship' for purposes of H-1B petition adjudication, USCIS must determine if the employer has a sufficient level of control over the employee. The petitioner must be able to establish that it has the right to control over when, where, and how the beneficiary performs the job.

Valid employer-employee relationship would exist in the following scenario:

Long-term placement at a third-party work site

The petitioner is a computer software development company which has contracted with another, unrelated company to develop an in-house computer program to track its merchandise, using the petitioner's proprietary software and expertise. In order to complete this project, petitioner has contracted to place software engineers at the client's main warehouse where they will develop a computer system for the client using the petitioner's software designs.

The beneficiary is a software engineer who has been offered employment to fulfill the needs of the contract in place between the petitioner and the client. The beneficiary performs his duties at the client company's facility.

While the beneficiary is at the client company's facility, the beneficiary reports weekly to a manager who is employed by the petitioner. The beneficiary is paid by the petitioner and receives employee benefits from the petitioner.

The following scenario would not present a valid employer-employee relationship:

Third-party placement/'job-shop'

The petitioner is a computer consulting company. The petitioner has contracts with numerous outside companies in which it supplies these companies with employees to fulfill specific staffing needs. The specific positions are not outlined in the contract between the petitioner and the third-party company but are staffed on an as-needed basis. The beneficiary is a computer analyst.

The beneficiary has been assigned to· work for the third-party company to fill a core position to maintain the third-party company's payroll. Once placed at the client company, the beneficiary reports to a manager who works for the third-party company.

The beneficiary does not report to the petitioner for work assignments, and all work assignments are determined by the third-party company. The petitioner does not control how the beneficiary will complete daily tasks, and no propriety information of the petitioner is used by the beneficiary to complete any work assignments.

The beneficiary's end-product, the payroll, is not in any way related to the petitioner's line of business, which is computer consulting. The beneficiary's progress reviews are completed by the client's company, not the petitioner.