USCIS Clarifies Filing Requirements for H-1B Employers

​Employers of H-1B visa workers should prepare to include more documentation in petition filings if they intend to contract those workers out to third-party client worksites.

U.S. Citizenship and Immigration Services (USCIS) issued a new policy guidance, effective Feb. 22, clarifying what kinds of information will be required in petition filings involving third-party sites. The guidelines apply to H-1B cap petitions as well as extension requests and will increase petitioning employers' filing workload, legal costs and time to gain H-1B approvals, said Mareza "Rez" Estevez, a corporate global migration attorney based in the New York City area.

She explained that for these H-1B petitions to be approved, employers must show that:

• Workers will be employed in a specialty occupation. "That includes the job itself, the H-1B worker's qualifications to hold that job, and the employer's compliance to labor condition application requirements," she said.
  
• An employer-employee relationship with the worker will be maintained for the duration of the requested employment period. Expect a detailed focus on how the H-1B employer directly and exclusively supervises the H-1B worker, Estevez added.
  

Though USCIS routinely asks H-1B employers to provide information about third-party assignments, the new guidelines signal enhanced scrutiny of employers' relationships with subcontractors and end-clients to limit H-1B program abuses often cited by President Donald Trump's administration.

"Based on the agency's experience in administering the H-1B program, USCIS recognizes that significant employer violations, such as paying less-than-required wages, benching employees and/or having employees performing nonspecialty occupation jobs, may be more likely to occur when petitioners place employees at a third-party worksite," explained Joanne Talbot, a USCIS spokeswoman.

The enhanced focus will likely lead to more requests for evidence (RFEs), limited visa approval periods and petition denials for outsourcing firms. "Absolutely expect more RFEs, and more detailed RFEs and other notices," Estevez said. "In time, site visits are likely to reflect the agency's guidance."

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Client Letters as Corroborating Evidence

"The new policy memo largely formalizes existing USCIS policy on H-1B petitions involving third-party worksites, but also spells out new requirements regarding end-client letters and itineraries," said Rebecca Schechter, an attorney in the McLean, Va., office of Greenberg Traurig.

The employer must provide evidence demonstrating that there are specific work assignments in qualifying occupations for all H-1B employees placed at client worksites for the entire time requested on the petition and that an employment relationship will be maintained with the contracted workers. The following can be used for that purpose:

• Detailed documentation of work assignments, including technical and funding documents.
  
• Signed contracts with the end-client and all other companies involved in the H-1B worker's assignment.
  
• Copies of detailed statements of work or work orders or a letter signed by an authorized official of the client company where the work will be performed.
  

"While an end-client letter is not a new requirement, the memo specifies that the end-client letter should include a detailed description of the H-1B employee's job duties, the job requirements, the duration of the job, the salary, hours worked, benefits, and information about who will supervise the H-1B employee," Schechter said.

Submitting an end-client letter is an option to support a third-party placement, but end-client businesses should be extremely careful if and when they agree to provide such letters, noted Scott J. FitzGerald, a partner in the Boston office of global immigration law firm Fragomen.

"This is because the government has repeatedly stated its intention to try to prove co-employment of these H-1B workers by the consulting firms and their clients," he said. "In a nutshell, the government thinks that these H-1B workers are being supervised by the end clients. Although that is almost never the case, a poorly drafted or overly broad end-client letter could reinforce the misimpression that the end client is supervising the H-1B workers."

FitzGerald said Fragomen will continue to file H-1B petitions for third-party placements that include a valid and fully endorsed master service agreement and statement-of-work between the petitioner and the end client, but will rarely submit an end-client letter.

Changes to Third-Party Itineraries

USCIS often requests itineraries in RFEs for H-1B third-party placements, Schechter said. But the guidance clarified that the previous policy's allowance of general statements on itineraries instead of exact dates and locations of employment is superseded by the new memo. Itineraries must include specific information about H-1B assignments, including exact dates, names and addresses of intermediary vendors and end-clients, exact addresses and phone numbers of work locations, as well as corroborating evidence for these details.

The agency will use the information to determine whether the employer has qualifying assignments to cover the entire requested period of H-1B employment. If not, visa approval periods may be limited to less than the maximum three years.

H-1B Visa Extensions

The new guidelines will also heighten scrutiny of H-1B extensions for outsourced workers. Employers filing extension petitions will not only need to document future third-party assignments, they will need to confirm and provide corroborating evidence that the worker's past third-party placements met H-1B program requirements.

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