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Why Are H-1B Petition Denials Rising?

Ask Garry: Why Are H-1B Petition Denials Rising?

According to a report from the National Foundation for American Policy, October 2019, it is now four times more likely that an H-1B petition will be denied by USCIS. Of most concern is the fact that the law on H-1Bs has not changed. If the law is the same, what is it that accounts for the increase in denials? It can only be attributed to the administration’s aversion to all immigration, including legal immigration. See the report here:

 

 

There are several issues USCIS focuses on to deny H-1Bs. I will explain those typical issues raised by USCIS, and also suggest some best practices to avoid requests for evidence and denials.

 

To qualify for H-1B, an employer must prove that the job being offered to the foreign national candidate is one that is a specialty occupation. The way USCIS determines whether the position is a specialty occupation is by looking at whether the duties are ones that can only be successfully completed by someone with a specific bachelor’s degree. They do not look at it from an employer’s perspective. They look at it from an industry perspective. In other words, a specific restaurant may only hire people with bachelor’s degrees in Hospitality Management to manage the restaurant. But because most restaurant managers in the restaurant industry do not have degrees, it is not an industry requirement for successful completion of the job duties. Additional, USCIS looks at the size of the employer and the wage offered, as well as whether there is an employer/employee relationship between the employer and the H-1B candidate.

 

Specialty Occupation and the Occupational Outlook Handbook

 

 

USCIS is pushing back on what jobs it determines as ones requiring a specific bachelor’s or higher degree for successful completion of the job duties. I’ll provide some examples. Some registered nurses have bachelor’s degrees. Because most registered nurses are licensed and working with an Associate’s degree, a standard RN job is not a specialty occupation, even if the RN is working for a clinic that only hires people with bachelor’s degrees. Accountants are similar. There are many accountants that handle bookkeeping, basic tax filings and other duties that are often done by people without a college degree. Same goes for restaurant managers, analysts, marketing positions, and operations managers, among others.
USCIS references the Occupational Outlook Handbook (OOH) for input on whether the position offered is a specialty occupation. You can find this at the following link:

 

 

It is a resource maintained by the Bureau of Labor Statistics (BLS), part of the US Department of Labor, that provides information about jobs within the US. The BLS has insisted that USCIS’s use of the OOH in making determinations about specialty occupations is inappropriate. Regardless of that position from BLS, the fact is that USCIS is using it to make those determinations. If you are filing an H-1B petition, it would be wise to look up the job you are considering offering to an H-1B candidate in the OOH to make sure the duties of the position line up with the OOH job title you are using, and that the OOH confirms that a bachelor’s degree in a specific field is required for the job. If it says that a bachelor’s degree may be required, that is code to USCIS for not H-1B worthy.

 

Level 1 Wage

 

Part of the H-1B process involves filing an application with the U.S. Department of Labor to determine whether the wage offer to the H-1B is in line with the prevailing wage for the job in the geographic area in which the H-1B worker would be providing services to the employer. The point of this requirement is to ensure that U.S. workers are not displaced by H-1B workers who may be willing to work at a rate below the prevailing wage for those duties in the area. It removes the immigration incentive from the discussion between the H-1B worker and the employer. This application is called a Labor Condition Application.

 

To determine the prevailing wage for the job, you would go to the Occupational and Employment Statistics information found here.

 

 

Look for the location in which the person will work and the job title. Determine whether the duties actually are in line with the job title. Then notice two things: that there is some indication on the page for the job title whether a bachelor’s degree is typically required; and that there are 4 wage levels for that job.

 

If the employer opts to offer a Level 1 wage to the H-1B candidate, generally the Labor Department will be fine with that. USCIS may not be. The concern ties back into the specialty occupation analysis. If the job is entry-level, or Level 1, in terms of the wage, then some of the duties are likely not ones that require a specific bachelor’s degree for successful completion of the duties. Or they may find that there are many people doing entry-level versions of the job that do not have college degrees.

 

Our strong recommendation is that for jobs that are possibly not ones that require specific bachelor’s or higher degrees that Level 1 wages be avoided. If it truly is an entry-level position for an Engineer doing Engineering, a Doctor practicing medicine or Dentistry, a Lawyer, a Certified Public Accountant, or some other job that clearly requires at least a bachelor’s or in some cases a higher degree for entry into the job, then level 1 might work.

 

Employer/Employee Relationship

 

 
A legitimate employer/employee relationship must exist between the employer and the H-1B worker for an H-1B to be approved. The situations in which this is difficult to prove is when the employee will be working at a third-party worksite, when the employees are all employed by a Professional Employer Organization (PEO), and when the H-1B candidate is offered a position with a company in which he or she owns an interest.

 

On the third-party worksite front, if the employee is providing services and is being managed by a “client” at their workplace, rather than the actual employer, USCIS is likely to push back on this H-1B arrangement. The same goes with the PEO situation. The H-1B worker is not actually doing productive work for or being managed by the PEO, creating an issue on employer/employee relationship. H-1B cannot be used for self-employment. The employer/employee relationship must exist between the employing entity and the H-1B worker. If the H-1B worker is also an owner of the business, USCIS will be concerned that the owner cannot be terminated, and therefore is not an actual employee with a typical employer/employee relationship.

 

Small Employers

 

 

USCIS also pushes back on H-1Bs in the context of employers with few employees. There is no specific requirement that a company has a certain number of employees to qualify to file an H-1B sponsorship. It does not exist in the law. The way USCIS uses this issue is to require proof that the H-1B employee will not be responsible for duties that are outside the scope of the specific Bachelor’s or higher degree. If the company only has 3 employees, who is keeping up with the bookkeeping? Who is answering the phones? Who is opening and processing the mail? Who is taking client calls for sales? Someone has to perform these functions in every business. If there are only 3 people in the company including the H-1B worker, USCIS will have a hard time believing that the H-1B worker will never be involved in the administrative or other duties that do not require his or her degree, but that comes with running any business.

 

If you are considering sponsoring an H-1B or in taking an H-1B job, please consider these issues. The job must be a specialty occupation, and that must be provable objectively with government data. Consider the risks of filing an H-1B with a Level 1 wage. USCIS may push back on that. Make sure there is a solid employer/employee relationship between the employer and the H-1B worker. Being solid on these issues will drastically improve chances to have the H-1B approved.

 

Contact Davis & Associates with any questions about this article or the H-1B process.
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