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Fiscal Year H-1Bs and H-1B Strategic Planning

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Fiscal Year H-1Bs and H-1B Strategic Planning

February 13, 2012

Beginning April 1, 2012, employers may file fiscal year (FY) 2013 H-1B visa petitions with requested start dates of October 1, 2012, when the government’s new fiscal year begins.  FY 2012 visas ran out right before Thanksgiving this past year — much earlier than anticipated.  For Chilean and Singaporean nationals, a number of FY 2012 H-1B visas remain available under a special set-aside program.

For employers who feel less burdened because they are seeking only extensions of H-1B status for their employees or are otherwise exempt from the FY cap, we nonetheless recommend filing H-1B visa petitions or extensions six months in advance if possible, because H-1B petitions are currently being processed at a snail’s pace of four to five months. 

Background on Fiscal Year H-1B Visas.  The government still allots only 65,000 H-1B visas per year, with an extra 20,000 set aside for employees with U.S. advanced degrees.  Exemptions apply for employees who have already obtained a FY H-1B visa with a previous employer, and for those whose employers are applying for H-1B extensions on their behalf.  Similarly, H-1B employees of nonprofit research or academic institutions are not subject to the H-1B cap.  Cap-exempt H-1B employees transferring to a private or cap-subject employer become subject to the FY cap.

Forecasts for 2012.  We expect increased demand for FY H-1B visas this year.  We do not anticipate that Congress will increase the number of H-1B visas available this year.  For the past two years, FY H-1B visas have run out earlier than the year before, with visas being exhausted in January 2011 for FY 2011 and in November 2011 for FY 2012.  As a result, it is most prudent to file visa petitions six months in advance and by late spring as feasible.  

Best Practices for Securing FY H-1B Visas.  Evaluate your current foreign national employee count.  Identify employees whose post-graduation practical training work authorization, or other nonimmigrant status that cannot be extended, expires before October 1, 2013.  Determine how best to plan for obtaining H-1B visas and avoid being faced with having to take employees off of payroll.  Communicate with your hiring managers and recruiters on upcoming hiring needs as the spring graduation season approaches.

Best Practices for H-1B Extensions or Cap-Exempt H-1B Visas — Long Adjudication Times.  File as early as possible to avoid having to reward the government for its five-month slow processing times with that $1,225 extra Premium Processing fee for the case to be adjudicated in 15 days, and to avoid other H-1B pitfalls.  Employers may file six months in advance of the requested start date or six months in advance of the expiration of the current H-1B visa. Driver’s license and travel issues also can play a role in strategic planning given the long processing times.  In many instances, the validity period of H-1B employees’ driver’s licenses is tied to the length of stay authorized under the H-1B approval.  In some states, DMVs will not renew driver’s licenses unless the foreign national presents the original H-1B Approval Notice.  Likewise, complications may arise if an employee travels internationally while an H-1B extension is pending.

Update on Proposed FY H-1B Pre-Registration Rule.  As many employers witnessed this past November, in the final weeks counting down for H-1B numbers each year, employers face much uncertainly and added expense as they prepare H-1B application packages which they hope will make it to the USCIS before the agency announces a final cutoff date.  To alleviate some of these issues, the USCIS in March 2011 proposed an “H-1B Registration Rule,” which would allow an employer to register online and wait for confirmation that it had received a FY H-1B number before having to file the full H-1B application package.  When the USCIS sought comment for its proposed rule, it said the advance registration process would result in savings of more than $23 million in employer resources over the next decade. The government has not yet announced when the proposed rule would become final and effective.  As a result, it is not clear whether employers will be able to benefit this year from a registration system for cap-subject petitions.

We look forward to working with our clients this winter and spring for smooth and uninterrupted work authorization.  As usual, we will keep our clients updated on FY H-1B number counts and H-1B planning.

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