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The H-1B Cap Has Been Reached - Now What?

Q: As an employer, I depend on the H-1B program to locate professional foreign nationals to work in positions for which I cannot locate qualified U.S. workers. Once the H-1B cap has been reached - or if the petitions I filed under the cap weren't selected in the H-1B lottery - how can I fill these positions or keep the employee?

A: There are several possible options for hiring foreign nationals if the H-1B cap has been reached and you as an employer are unable to locate qualified and available U.S. workers. We will present several options here - although this list is not intended to be exhaustive; there may be other possibilities unique to a given situation.

I. Non-Cap and Unused-Cap H-1Bs

First, we must look more closely at the H-1B category itself. Generally, when we talk of the H-1B cap being reached, we mean that the limit of H-1Bs has been reached in the general category which currently permits 65,000 new H-1Bs to be granted per fiscal year. However, not all H-1Bs are counted under this cap.

Amended or extended H-1Bs for foreign nationals who are already in H-1B status (or have had an H-1B approved as some point in the last six years) are only counted against the cap in the year that the original H-1B was approved. So, a foreign national with an H-1B for another company (or in a different position within your own company) can be hired with a simple employer-change amendment to his H-1B.

But, what about a situation where the employee had a cap-subject H-1B approved in the past, and is either abroad or in the US in a different non-immigrant status? Depending upon when the filing for the earlier H-1B was done, it may be possible to "elect" not to be counted again and simply use the remainder of the time allowed on that earlier case.

Next, it is highly likely that some of the 65,000 general allotment is still available, but only for certain specific groups. A subset of the 65,000 totaling more than 6,000 is reserved for citizens of Chile and Singapore due to unique trade treaties with those countries.

Generally, these special allotments do not become fully used as early as the rest of the 65,000 H-1Bs and often remain open through the end of the fiscal year, thus citizens of Chile and Singapore may often still be recruited and hired on H-1Bs. However, favoring nationals of specific countries over nationals of other countries may present equal opportunity issues, and a qualified employment lawyer should therefore be consulted before implementing any recruitment plan.

There are also rare situations where certain employers are entirely exempt from the H-1B cap. While nonprofit entities are not automatically exempt from the cap in seeking H-1Bs for their workers, they may be if they are a nonprofit affiliated with an institution of higher education (normally a university) or are a nonprofit research or governmental research organization. A university would itself be exempt from the H-1B cap. Often, there are ways in which some nonprofits are in fact affiliated with institutions of higher education that may not be readily apparent.

Further, sometimes an H-1B visa is needed for a foreign national physician previously on a J-1 non-immigrant visa, who has received a waiver of a J-1 two-year foreign residence requirement on the condition that he or she work in an area insufficiently served by physicians in that foreign national's practice area. An H-1B visa for such a foreign national physician is exempt from the H-1B cap where needed to work in that insufficiently served area.

In addition, 20,000 H-1Bs above the 65,000 limit are reserved for foreign nationals with Master's degrees from U.S. universities. The job need not be one which requires a Master's-level degree, though if it does not both the employer and foreign national should be aware that this has implications for a later permanent residence process.

In some years this additional allotment of 20,000 is sometimes still available even after the general cap has been reached (though this hasn't been the case in recent years - check with an immigration lawyer). If so, foreign nationals with Master's degrees from U.S. universities may often still be recruited with the intent of obtaining H-1B visas in the event qualified U.S. applicants cannot be located.

II. The H-3 Trainee Visa

While also within the overall H category, the H-3 Trainee visa is very different in character from the H-1B. The H-3 trainee must not be occupying a position which would ordinarily be filled by a U.S. employee.

The H-3 does permit some work for the U.S. employer, but only very limited work which is incidental to a formal training program rather than productive work primarily benefiting this U.S. employer - so its utility may be limited. However, if the employer is seeking to establish a training program to qualify new overseas recruits to handle productive work for the company overseas, the H-3 is an excellent option.

There must in fact be a formal training program in place, and the training must not be available in the home country of the foreign national(s) who will be participating. These foreign nationals must have the education and experience necessary to participate in the program (but must not already possess the knowledge which the program is designed to teach), and they will need to be able to show that the training will benefit their career in their home country.

The formal training program must be very specifically described - generally with a complete schedule and curriculum in the application materials. An H-3 may be obtained for up to two years, and additional H-3 time cannot be requested until the H-3 foreign national has spent at least six months abroad.

III. The O-1 Extraordinary Ability Visa

Certain foreign nationals may be eligible for an O-1 non-immigrant visa in the event that no H-1B visa is available. The O-1, while not limited to those with advanced degrees, does require a showing that the foreign national has attained a high level of achievement and recognition for excellence in his or her field - therefore the chances of success improve with the length of the individual's career (and resume or CV). More detailed information on the requirements for the O-1 may be found at our O-1 FAQ page.

IV. F-1 Students on Practical Training

Foreign nationals in the U.S. on F-1 student visas are generally prohibited from accepting employment except in certain circumstances. However, where circumstances permitting employment do apply, the F-1 student can be a promising subject for recruitment in the absence of qualified and available U.S. workers.

F-1 students who are still pursuing their academic degree program in valid F-1 status may work under certain circumstances. Students still pursuing a degree program may be authorized to work as part of a co-op or similar program for which they receive academic credit for work performed at a company or organization. Normally called "Curricular Practical Training," this path provides an excellent opportunity for companies to recruit potential entry-level hires who may later be hired upon graduation and possibly sponsored for an H-1B when they later become available.

Students may also seek authorization to work on the basis of economic hardship, although this is rare since F-1 students must demonstrate adequate means of support as a prerequisite to admission to the U.S. These situations are normally a result of a sudden and drastic change in family or home-country circumstances.

Finally, once an F-1 student has graduated from his or her academic program, the student is eligible for up to one year of "Optional Practical Training" - blanket authorization to work for one year in the field of academic study. This, as well is a valuable evaluation tool for entry-level employees, allowing both parties to ensure a good fit before either invests time and money in an H-1B visa.

Optional Practical Training can in many circumstances run longer than the initial one year: in those instances where an H-1B has been submitted for the next fiscal year for someone on an F-1 with Optional Practical Training and actually accepted for processing, the period of authorized stay and employment authorization is extended for an additional period of months until the following October 1 - thus eliminating the "cap gap" problem.

Further and of much greater benefit, for individuals working in "STEM" fields: Sciences, Technology, Engineering and Mathematics (a complete list is available here), can get an extension of Optional Practical Training for 24 additional months (with the initial 12-month grant, a total of 36 months of OPT).
However, this is only available where the individual has a position offered for at least 20 hours a week with an employer which is a registered user of the E-Verify system, and where a formal training plan is submitted. Not all employers are registered users of the E-Verify system, which provides online verification of documents presented as evidence of identity and employment eligibility - or wish to be.

V. J-1 Exchange Visitors

The J-1 exchange visitor program allows a foreign national to come to the U.S. for limited periods of time to take part in certain specific types of activities. A J-1 can be, among other things, an intern (someone still in a degree- or certificate-granting program at a school outside the U.S. or who has graduated from such a program within the last 12 months), a trainee (someone who has graduated from degree- or certificate-granting program at a school outside the U.S. and has at least one year of experience in the same field or someone without such a degree but who has five years of experience outside the U.S. and is entering to obtain training in the same field).

Among the allowable activities for which a J-1 might come to the U.S. are: student, professor or research scholar, short-term scholar, non-academic specialist (a common use for those seeking J-1s where no H-1B is available), foreign physician (often one seeking clinical training), international visitor, teacher, government visitor, camp counselor, au pair, and summer students in a travel/employment program. The maximum length of time permitted on J-1 status depends upon which type of activity is involved.

The J-1 program is procedurally unusual in that it requires a program sponsor, which need not be the sponsoring employer (in fact, it usually will not be the sponsoring employer, known as the "Host" for J-1 purposes). The program sponsor is an entity, often one founded to further an educational purpose of some sort, which has applied for approval from the U.S. State Department to administer a J-1 program.

This program sponsor reviews information provided by the Host/employer about the proposed activity which the foreign national would pursue if he or she were to be granted a J-1, and if found to be consistent in purpose and guidelines with requirements of the program sponsor's approved program, the program sponsor will then issue a DS-2019 form to the foreign national. This form permits application for a J-1 visa stamp at a U.S. consulate abroad and entry into the U.S. as a J-1 Exchange Visitor.

There are possible drawbacks to the J-1 visa: in some circumstances, a J-1 can be subject to a two-year foreign residency requirement. In other words, absent a waiver of this requirement (available only in certain circumstances), the J-1 exchange visitor would at the end of the allowable J-1 period of stay need to return to the country where they last resided abroad for two full years before they would be eligible to come to the U.S. in any other non-immigrant status or to receive permanent residence.

The J-1 is normally not recommended where this requirement would be present, unless the desire of all parties is definitively and genuinely for the foreign national to remain in the U.S. for only a brief period before for training before returning home.



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The above is presented for informational purposes only, and does not constitute legal advice or create an attorney-client relationship with our firm. The information provided should not be used as guidance in pursuing an immigration matter absent consultation with a qualified immigration attorney.