[Federal Register Volume 88, Number 203 (Monday, October 23, 2023)]
[Proposed Rules]
[Pages 72870-72963]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-23381]



[[Page 72869]]

Vol. 88

Monday,

No. 203

October 23, 2023

Part III





Department of Homeland Security





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8 CFR Part 214





Modernizing H-1B Requirements, Providing Flexibility in the F-1 
Program, and Program Improvements Affecting Other Nonimmigrant Workers; 
Proposed Rule

  Federal Register / Vol. 88 , No. 203 / Monday, October 23, 2023 / 
Proposed Rules  

[[Page 72870]]


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DEPARTMENT OF HOMELAND SECURITY

8 CFR Part 214

[CIS No. 2745-23; DHS Docket No. USCIS-2023-0005]
RIN 1615-AC70


Modernizing H-1B Requirements, Providing Flexibility in the F-1 
Program, and Program Improvements Affecting Other Nonimmigrant Workers

AGENCY: U.S. Citizenship and Immigration Services, DHS.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The U.S. Department of Homeland Security (DHS) proposes to 
amend its regulations governing H-1B specialty occupation workers to 
modernize and improve the efficiency of the H-1B program, add benefits 
and flexibilities, and improve integrity measures. Some of the proposed 
provisions would narrowly impact other nonimmigrant classifications, 
including: H-2, H-3, F-1, L-1, O, P, Q-1, R-1, E-3, and TN. DHS intends 
to finalize the proposals contained in this rulemaking through one or 
more final rules, depending on agency resources.

DATES: Written comments must be submitted on or before December 22, 
2023.

ADDRESSES: You may submit comments on the entirety of this proposed 
rulemaking package, identified by DHS Docket No. USCIS-2023-0005 
through the Federal eRulemaking Portal: https://www.regulations.gov. 
Follow the website instructions for submitting comments. The electronic 
Federal Docket Management System will accept comments before midnight 
Eastern time on December 22, 2023.
    Comments submitted in a manner other than the one listed above, 
including emails or letters sent to DHS or USCIS officials, will not be 
considered comments on the proposed rule and may not receive a response 
from DHS. Please note that DHS and USCIS cannot accept any comments 
that are hand-delivered or couriered. In addition, DHS and USCIS cannot 
accept comments contained on any form of digital media storage devices, 
such as CDs/DVDs and USB drives. USCIS is also not accepting mailed 
comments at this time. If you cannot submit your comment by using 
https://www.regulations.gov, please contact Samantha Deshommes, Chief, 
Regulatory Coordination Division, Office of Policy and Strategy, U.S. 
Citizenship and Immigration Services, U.S. Department of Homeland 
Security, by telephone at (240) 721-3000 for alternate instructions.

FOR FURTHER INFORMATION CONTACT: Charles L. Nimick, Chief, Business and 
Foreign Workers Division, Office of Policy and Strategy, U.S. 
Citizenship and Immigration Services, U.S. Department of Homeland 
Security, 5900 Capital Gateway Drive, Camp Springs, MD 20746; telephone 
(240) 721-3000.

SUPPLEMENTARY INFORMATION: 

Table of Contents

I. Public Participation
II. Executive Summary
    A. Purpose of the Regulatory Action
    B. Summary of the Major Provisions of the Regulatory Action
    1. Modernization and Efficiencies
    2. Benefits and Flexibilities
    3. Program Integrity
    C. Summary of Costs and Benefits
    D. Request for Preliminary Public Input
    E. Future Rulemaking Actions
III. Background and Purpose
    A. Legal Authority
    B. Background
    1. The H-1B Program
    2. The F-1 Program
IV. Discussion of the Proposed Rule
    A. Modernization and Efficiencies
    1. Amending the Definition of a ``Specialty Occupation''
    2. Amending the Criteria for Specialty Occupation Positions
    3. Amended Petitions
    4. Deference
    5. Evidence of Maintenance of Status
    6. Eliminating the Itinerary Requirement for H Programs
    7. Validity Expires Before Adjudication
    B. Benefits and Flexibilities
    1. H-1B Cap Exemptions
    2. Automatic Extension of Authorized Employment Under 8 CFR 
214.2(f)(5)(vi) (Cap-Gap)
    3. Start Date Flexibility for Certain H-1B Cap-Subject Petitions
    C. Program Integrity
    1. The H-1B Registration System
    2. Beneficiary Centric Selection
    3. Bar on Multiple Registrations Submitted by Related Entities
    4. Registrations With False Information or That Are Otherwise 
Invalid
    5. Alternatives Considered
    6. Provisions To Ensure Bona Fide Job Offer for a Specialty 
Occupation Position
    a. Contracts
    b. Non-Speculative Employment
    c. LCA Corresponds With the Petition
    d. Revising the Definition of U.S. Employer
    e. Employer-Employee Relationship
    f. Bona Fide Job Offer
    g. Legal Presence and Amenable to Service of Process
    7. Beneficiary-Owners
    8. Site Visits
    9. Third-Party Placement (Codifying Defensor)
    D. Request for Preliminary Public Input Related to Future 
Actions/Proposals
    1. Use or Lose
    2. Beneficiary Notification
    E. Potential Publication of One or More Final Rules
    F. Severability
V. Statutory and Regulatory Requirements
    A. Executive Order 12866 (Regulatory Planning and Review) and 
Executive Order 13563 (Improving Regulation and Regulatory Review)
    1. Summary
    2. Background
    3. Costs, Transfers, and Benefits of the Proposed Rule
    a. Amended Petitions
    b. Deference to Prior USCIS Determinations of Eligibility in 
Requests for Extensions of Petition Validity
    c. Evidence of Maintenance of Status
    d. Eliminating the Itinerary Requirement for H Programs
    e. Validity Period Expires Before Adjudication
    f. H-1B Cap Exemptions
    g. Automatic Extension of Authorized Employment ``Cap-Gap''
    h. Start Date Flexibility for Certain H-1B Cap-Subject Petitions
    i. The H-1B Registration System
    j. Beneficiary Centric Selection
    k. Bar on Multiple Registrations Submitted by Related Entities
    l. Registrations With False Information or That Are Otherwise 
Invalid
    m. Provisions To Ensure Bona Fide Job Offer for a Specialty 
Occupation Position
    (1) Contracts
    (2) Non-Speculative Employment
    (3) LCA Corresponds With the Petition
    (4) Revising the Definition of U.S. Employer
    (5) Employer-Employee Relationship
    n. Beneficiary-Owners
    o. Site Visits
    p. Third-Party Placement (Codifying Defensor)
    q. Additional Time Burden for Form I-129 H-1B
    r. Additional Time Burden for H Classification Supplement to 
Form I-129
    4. Alternatives Considered
    5. Total Quantified Net Costs of the Proposed Regulatory Changes
    B. Regulatory Flexibility Act (RFA)
    1. Initial Regulatory Flexibility Analysis
    a. A Description of the Reasons Why the Action by the Agency Is 
Being Considered
    b. A Statement of the Objectives of, and Legal Basis for, the 
Proposed Rule
    c. A Description and, Where Feasible, an Estimate of the Number 
of Small Entities to Which the Proposed Changes Would Apply
    d. A Description of the Projected Reporting, Recordkeeping, and 
Other Compliance Requirements of the Proposed Rule, Including an 
Estimate of the Classes of Small Entities That Will Be Subject to 
the Requirement and the Types of Professional Skills
    e. An Identification of All Relevant Federal Rules, to the 
Extent Practical, That May Duplicate, Overlap, or Conflict With the 
Proposed Rule
    f. A Description of Any Significant Alternatives to the Proposed 
Rule That Accomplish the Stated Objectives of

[[Page 72871]]

Applicable Statutes and That Minimize any Significant Economic 
Impact of the Proposed Rule on Small Entities
    C. Unfunded Mandates Reform Act of 1995 (UMRA)
    D. Congressional Review Act
    E. Executive Order 13132 (Federalism)
    F. Executive Order 12988: Civil Justice Reform
    G. Executive Order 13175 (Consultation and Coordination With 
Indian Tribal Governments)
    H. National Environmental Policy Act (NEPA)
    I. Paperwork Reduction Act

Table of Abbreviations

    AAO--Administrative Appeals Office
    AC21--American Competitiveness in the Twenty-first Century Act
    ACWIA--American Competitiveness and Workforce Improvement Act of 
1998
    BLS--Bureau of Labor Statistics
    CEQ--Council on Environmental Quality
    CFR--Code of Federal Regulations
    CMSA--Consolidated Metropolitan Statistical Area
    COS--Change of Status
    CPI-U--Consumer Price Index for All Urban Consumers
    D/S--Duration of status
    DHS--U.S. Department of Homeland Security
    DOL--U.S. Department of Labor
    DOS--U.S. Department of State
    FDNS--Fraud Detection and National Security
    FR--Federal Register
    FY--Fiscal Year
    HR--Human Resources
    HSA--Homeland Security Act of 2002
    ICE--Immigration and Customs Enforcement
    IMMACT 90--Immigration Act of 1990
    INA--Immigration and Nationality Act
    INS--legacy Immigration and Naturalization Service
    IRFA--Initial Regulatory Flexibility Analysis
    IRS--Internal Revenue Service
    LCA--Labor Condition Application
    MSA--Metropolitan Statistical Area
    NAICS--North American Industry Classification System
    NEPA--National Environmental Policy Act
    NOID--Notice of Intent to Deny
    NPRM--Notice of proposed rulemaking
    OIRA--Office of Information and Regulatory Affairs
    OMB--Office of Management and Budget
    OP&S--Office of Policy and Strategy
    OPT--Optional Practical Training
    PM--Policy Memorandum
    PMSA--Primary Metropolitan Statistical Area
    PRA--Paperwork Reduction Act PRD--Policy Research Division
    Pub. L.--Public Law
    RFA--Regulatory Flexibility Act of 1980
    RFE--Request for Evidence RIA--Regulatory Impact Analysis
    RIN--Regulation Identifier Number
    SBA--Small Business Administration
    SEVP--Student and Exchange Visitor Program
    SOC--Standard Occupational Classification
    Stat.--U.S. Statutes at Large
    TLC--Temporary Labor Certification
    UMRA--Unfunded Mandates Reform Act
    U.S.C.--United States Code
    USCIS--U.S. Citizenship and Immigration Services

I. Public Participation

    DHS invites all interested parties to participate in this 
rulemaking by submitting written data, views, comments, and arguments 
on all aspects of this proposed rule. DHS also invites comments that 
relate to the economic, environmental, or federalism effects that might 
result from this proposed rule. Comments must be submitted in English, 
or an English translation must be provided. Comments that will provide 
the most assistance to USCIS in implementing these changes will 
reference a specific portion of the proposed rule, explain the reason 
for any recommended change, and include data, information, or authority 
that support such recommended change. Comments submitted in a manner 
other than the one listed above, including emails or letters sent to 
DHS or USCIS officials, will not be considered comments on the proposed 
rule and may not receive a response from DHS.
    Instructions: If you submit a comment, you must include the agency 
name (U.S. Citizenship and Immigration Services) and the DHS Docket No. 
USCIS-2023-0005 for this rulemaking. Please note all submissions will 
be posted, without change, to the Federal eRulemaking Portal at https://www.regulations.gov, and will include any personal information you 
provide. Therefore, submitting this information makes it public. You 
may wish to consider limiting the amount of personal information that 
you provide in any voluntary public comment submission you make to DHS. 
DHS may withhold information provided in comments from public viewing 
that it determines may impact the privacy of an individual or is 
offensive. For additional information, please read the Privacy and 
Security Notice available at https://www.regulations.gov.
    Docket: For access to the docket and to read background documents 
or comments received, go to https://www.regulations.gov, referencing 
DHS Docket No. USCIS-2023-0005. You may also sign up for email alerts 
on the online docket to be notified when comments are posted or a final 
rule is published.

II. Executive Summary

A. Purpose of the Regulatory Action

    The purpose of this rulemaking is to modernize and improve the 
regulations relating to the H-1B program by: (1) streamlining the 
requirements of the H-1B program and improving program efficiency; (2) 
providing greater benefits and flexibilities for petitioners and 
beneficiaries; and (3) improving integrity measures. Some of the 
proposed provisions would narrowly impact other nonimmigrant 
classifications.

B. Summary of the Major Provisions of the Regulatory Action

1. Modernization and Efficiencies
    DHS proposes to streamline requirements for the H-1B program by: 
(1) revising the regulatory definition and criteria for a ``specialty 
occupation''; (2) clarifying that ``normally'' does not mean ``always'' 
within the criteria for a specialty occupation; and (3) clarifying that 
a position may allow a range of degrees, although there must be a 
direct relationship between the required degree field(s) and the duties 
of the position. As 21st century employers strive to generate better 
hiring outcomes, improving the match between required skills and job 
duties, employers have increasingly become more aware of a skills-first 
culture, led by the Federal Government's commitment to attract and hire 
individuals well-suited to available jobs.\1\ The flexibility inherent 
in H-1B adjudications to identify job duties and particular positions 
where a bachelor's or higher degree in a specific specialty, or its 
equivalent, is normally required, allows employers to explore where 
skills-based hiring is sensible.
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    \1\ See, e.g., U.S. Office of Personnel Management, Memorandum 
for Heads of Executive Departments and Agencies: ``Guidance 
Release--E.O. 13932; Modernizing and Reforming the Assessment and 
Hiring of Federal Job Candidates'' (May 19, 2022), https://chcoc.gov/content/guidance-release-eo-13932-modernizing-and-reforming-assessment-and-hiring-federal-job.
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    DHS also proposes to clarify when an amended or new petition must 
be filed due to a change in an H-1B worker's place of employment to be 
consistent with current policy guidance.
    Additionally, DHS proposes to codify and clarify its deference 
policy to state that, if there has been no material change in the 
underlying facts, adjudicators generally should defer to a prior 
determination involving the same parties and underlying facts. DHS also 
proposes to update the regulations to expressly require that evidence 
of maintenance of status must be included with the petition if a 
beneficiary is seeking an extension or amendment of stay. This policy 
would impact all employment-based nonimmigrant classifications that use 
Form I-129,

[[Page 72872]]

Petition for Nonimmigrant Worker. DHS further proposes to eliminate the 
itinerary requirement, which would apply to all H classifications, and 
allow petitioners to amend requested validity periods where the 
validity expires before adjudication.
2. Benefits and Flexibilities
    DHS proposes to modernize the definition of employers who are 
exempt from the annual statutory limit on H-1B visas to create more 
flexibility for nonprofit and governmental research organizations and 
beneficiaries who are not directly employed by a qualifying 
organization. Specifically, DHS proposes to change the definition of 
``nonprofit research organization'' and ``governmental research 
organization'' by replacing ``primarily engaged'' and ``primary 
mission'' with ``fundamental activity'' to permit a nonprofit entity or 
governmental research organization that conducts research as a 
fundamental activity, but is not primarily engaged in research or where 
research is not a primary mission, to meet the definition of a 
nonprofit research entity. Additionally, DHS proposes to revise the 
requirements for beneficiaries to qualify for H-1B cap exemption when 
they are not directly employed by a qualifying organization, but still 
provide essential work, even if their duties do not necessarily 
directly further the organization's essential purpose.
    DHS also proposes to provide flexibilities, such as automatically 
extending the duration of F-1 status, and any employment authorization 
granted under 8 CFR 274a.12(c)(3)(i)(B) or (C), until April 1 of the 
relevant fiscal year, rather than October 1 of the same fiscal year, to 
avoid disruptions in lawful status and employment authorization for F-1 
students changing their status to H-1B. Additionally, DHS is proposing 
to clarify the requirements regarding the requested employment start 
date on H-1B cap-subject petitions to permit filing with requested 
start dates that are after October 1 of the relevant fiscal year, 
consistent with current USCIS policy.
3. Program Integrity
    DHS proposes to address H-1B cap registration abuse by changing the 
way USCIS selects registrations. Instead of selecting by registration, 
USCIS would select registrations by unique beneficiary, thereby 
reducing the potential for gaming the process to increase chances for 
selection and helping ensure that each beneficiary would have the same 
chance of being selected, regardless of how many registrations are 
submitted on their behalf. DHS also proposes to clarify that related 
entities are prohibited from submitting multiple registrations for the 
same beneficiary, similar to the prohibition on related entities filing 
multiple cap-subject petitions for the same beneficiary for the same 
fiscal year's numerical allocations. Additionally, DHS proposes to 
codify USCIS's ability to deny H-1B petitions or revoke an approved H-
1B petition where the underlying registration contained a false 
attestation or was otherwise invalid.
    DHS further proposes to improve the integrity of the H-1B program 
by: (1) codifying its authority to request contracts; (2) requiring 
that the petitioner establish that it has an actual, non-speculative 
position in a specialty occupation available for the beneficiary as of 
the requested start date; (3) ensuring that the labor condition 
application (LCA) properly supports and corresponds with the petition; 
(4) revising the definition of ``United States employer'' by codifying 
the existing requirement that the petitioner has a bona fide job offer 
for the beneficiary to work within the United States as of the 
requested start date, consistent with current DHS policy; and (5) 
adding a requirement that the petitioner have a legal presence and be 
amenable to service of process in the United States.
    DHS additionally proposes to clarify that beneficiary-owners may be 
eligible for H-1B status, while setting reasonable conditions for when 
the beneficiary owns a controlling interest in the petitioning entity.
    DHS also proposes to codify USCIS's authority to conduct site 
visits and clarify that refusal to comply with site visits may result 
in denial or revocation of the petition. Additionally, DHS proposes to 
clarify that if an H-1B worker will be staffed to a third party, 
meaning they will be contracted to fill a position in the third party's 
organization, it is the requirements of that third party, and not the 
petitioner, that are most relevant when determining whether the 
position is a specialty occupation. Through these provisions, DHS aims 
to prevent fraud and abuse and maintain H-1B program integrity.

C. Summary of Costs and Benefits

    As discussed in the preamble, the purpose of this rulemaking is to 
modernize and improve the regulations relating to the H-1B program by: 
(1) streamlining H-1B program requirements and improving program 
efficiency; (2) providing greater benefits and flexibilities for 
petitioners and beneficiaries; and (3) improving integrity measures.
    For the 10-year period of analysis of the proposed rule, DHS 
estimates the annualized net costs of this rulemaking would be 
$6,339,779 annualized at 3 percent and 7 percent. Table 12 provides a 
more detailed summary of the proposed rule provisions and their 
impacts.

D. Request for Preliminary Public Input

    Finally, DHS is requesting preliminary public input on ideas that 
would curb or eliminate the possibility that petitioners may have 
speculative job opportunities as of the requested start date and delay 
admission of H-1B beneficiaries until the petitioner has secured work 
for the H-1B beneficiary, including two potential approaches DHS is 
considering for future action. DHS is also seeking preliminary public 
input on ways to provide H-1B and other Form I-129 beneficiaries with 
notice of USCIS actions taken on petitions filed on their behalf.

E. Future Rulemaking Actions

    After carefully considering any public comments received on the 
proposals in this NPRM, DHS may move to finalize the proposed 
provisions through one or more final rules, and may possibly do so in 
time for the fiscal year (FY) 2025 cap season, depending on agency 
resources.

III. Background and Purpose

A. Legal Authority

    The Secretary of Homeland Security's authority for these proposed 
regulatory amendments is found in various sections of the Immigration 
and Nationality Act (INA or the Act), 8 U.S.C. 1101 et seq., and the 
Homeland Security Act of 2002 (HSA), Public Law 107-296, 116 Stat. 
2135, 6 U.S.C. 101 et seq. General authority for issuing this proposed 
rule is found in section 103(a) of the INA, 8 U.S.C. 1103(a), which 
authorizes the Secretary to administer and enforce the immigration and 
nationality laws and establish such regulations as the Secretary deems 
necessary for carrying out such authority, as well as section 112 of 
the HSA, 6 U.S.C. 112, which vests all of the functions of DHS in the 
Secretary and authorizes the Secretary to issue regulations.\2\ Further 
authority for these regulatory amendments is found in:
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    \2\ Although several provisions of the INA discussed in this 
NPRM refer exclusively to the ``Attorney General,'' such provisions 
are now to be read as referring to the Secretary of Homeland 
Security by operation of the HSA. See 6 U.S.C. 202(3), 251, 271(b), 
542 note, 557; 8 U.S.C. 1103(a)(1), (g), 1551 note; Nielsen v. 
Preap, 139 S. Ct. 954, 959 n.2 (2019).
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     Section 101(a)(15) of the INA, 8 U.S.C. 1101(a)(15), which 
establishes

[[Page 72873]]

classifications for noncitizens who are coming temporarily to the 
United States as nonimmigrants, including the H-1B classification, see 
INA section 101(a)(15)(H)(i)(b), 8 U.S.C. 1101(a)(15)(H)(i)(b);
     Section 214(a)(1) of the INA, 8 U.S.C. 1184(a)(1), which 
authorizes the Secretary to prescribe, by regulation, the time and 
conditions of the admission of nonimmigrants;
     Section 214(c) of the INA, 8 U.S.C. 1184(c), which, inter 
alia, authorizes the Secretary to prescribe how an importing employer 
may petition for nonimmigrant workers, including certain nonimmigrants 
described at sections 101(a)(a)(15)(H), (L), (O), and (P), 8 U.S.C. 
1101(a)(15)(H), (L), (O), and (P); the information that an importing 
employer must provide in the petition; and certain fees that are 
required for certain nonimmigrant petitions;
     Section 214(e) of the INA, 8 U.S.C. 1184(e), which 
provides for the admission of citizens of Canada or Mexico as TN 
nonimmigrants;
     Section 214(g) of the INA, 8 U.S.C. 1184(g), which, inter 
alia, prescribes the H-1B numerical limitations, various exceptions to 
those limitations, and the period of authorized admission for H-1B 
nonimmigrants;
     Section 214(i) of the INA, 8 U.S.C. 1184(i), which sets 
forth the definition and requirements of a ``specialty occupation'';
     Section 235(d)(3) of the INA, 8 U.S.C. 1225(d)(3) (``any 
immigration officer shall have the power to administer oaths and to 
take and consider evidence of or from any person touching the privilege 
of any alien or person he believes or suspects to be an alien to enter, 
reenter, transit through, or reside in the United States or concerning 
any matter which is material and relevant to the enforcement of this 
chapter and the administration of the Service.'');
     Section 248 of the INA, 8 U.S.C. 1258, which authorizes a 
noncitizen to change from any nonimmigrant classification to any other 
nonimmigrant classification (subject to certain exceptions) if the 
noncitizen was lawfully admitted to the United States as a nonimmigrant 
and is continuing to maintain that status, and is not otherwise subject 
to the 3- or 10-year bar applicable to certain noncitizens who were 
unlawfully present in the United States;
     Section 274A of the INA, 8 U.S.C. 1324a, which recognizes 
the Secretary's authority to extend employment authorization to 
noncitizens in the United States;
     Section 287(b) of the INA, 8 U.S.C. 1357(b), which 
authorizes the taking and consideration of evidence concerning any 
matter that is material or relevant to the enforcement of the INA;
     Section 402 of the Homeland Security Act of 2002 (HSA), 
Public Law 107-296, 116 Stat. 2135, 6 U.S.C. 202, which charges the 
Secretary with ``[e]stablishing and administering rules . . . governing 
the granting of visas or other forms of permission . . . to enter the 
United States'' and ``[e]stablishing national immigration enforcement 
policies and priorities,'' id.; see also HSA sec. 428, 6 U.S.C. 236; 
and
     Section 451(a)(3) and (b) of the HSA, 6 U.S.C. 271(a)(3) 
and (b), transferring to USCIS the authority to adjudicate petitions 
for nonimmigrant status, establish policies for performing that 
function, and set national immigration services policies and 
priorities.

B. Background

1. The H-1B Program
    The H-1B nonimmigrant visa program allows U.S. employers to 
temporarily employ foreign workers in specialty occupations, defined by 
statute as occupations that require the theoretical and practical 
application of a body of highly specialized knowledge and a bachelor's 
or higher degree in the specific specialty, or its equivalent. See INA 
sections 101(a)(15)(H)(i)(b) and 214(i), 8 U.S.C 1101(a)(15)(H)(i)(b) 
and 1184(i).
    The Immigration Act of 1990 (Pub. L. 101-649) (IMMACT 90) 
significantly reformed the H-1B program. To protect U.S. workers, 
IMMACT 90 required a certified LCA by the Secretary of Labor as a 
prerequisite for classification as an H-1B nonimmigrant. The LCA 
requirement, and the associated obligations the employer must attest to 
and comply with, including the prevailing or actual wage requirement, 
were intended to safeguard the wages and working conditions of U.S. 
workers.\3\ Through IMMACT 90, Congress set the current annual cap for 
the H-1B visa category at 65,000,\4\ which limited the number of 
beneficiaries who may be issued an initial H-1B visa or otherwise 
provided initial H-1B status each fiscal year.\5\ Prior to IMMACT 90, 
no limit existed on the number of initial H-1B visas that could be 
granted each fiscal year. Congressional deliberations ahead of the 
enactment of the American Competitiveness and Workforce Improvement Act 
of 1998 (ACWIA) describe the H-1B program's purpose both as filling 
shortages and creating opportunities for innovation and expansion.\6\
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    \3\ See U.S. Gov't Accountability Off., GAO/PEMD-92-17, 
``Immigration and the Labor Market: Nonimmigrant Alien Workers in 
the United States,'' at 18 (1992).
    \4\ Up to 6,800 visas are set aside from the 65,000 each fiscal 
year for the H-1B1 visa program under terms of the legislation 
implementing the U.S.-Chile and U.S.-Singapore free trade 
agreements. See INA sections 101(a)(15)(H)(i)(b1), 214(g)(8), 8 
U.S.C. 1101(a)(15)(H)(i)(b1), 1184(g)(8).
    \5\ The 65,000 annual H-1B numerical limitation was increased 
for FYs 1999-2003. See INA section 214(g)(1)(A), 8 U.S.C. 
1184(g)(1)(A), as amended by section 411 of the ACWIA, Public Law 
105-277, div. C, tit. IV, 112 Stat. 2681, and the American 
Competitiveness in the Twenty-first Century Act of 2000 (AC21), 
Public Law 106-313, 114 Stat. 1251, as amended by the 21st Century 
Department of Justice Appropriations Authorization Act, Public Law 
107-273, 116 Stat. 1758 (2002). Subsequent to IMMACT 90, Congress 
also created several exemptions from the 65,000 numerical 
limitation. See INA section 214(g)(5), 8 U.S.C. 1184(g)(5).
    \6\ See 144 Cong. Rec. at S12749 (statement of Sen. Abraham) 
(``[T]his issue [of increasing H-1B visas] is not only about 
shortages, it is about opportunities for innovation and 
expansion.'').
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    Congress also set up several exemptions to the annual H-1B cap. For 
example, workers who will be employed at an institution of higher 
education (as defined in section 101(a) of the Higher Education Act of 
1965, as amended) or a related or affiliated nonprofit entity, and 
workers who will be employed at a nonprofit or governmental research 
organization, are exempt from the cap. These exemptions are not 
numerically capped. See INA section 214(g)(5)(A)-(B), 8 U.S.C. 
1184(g)(5)(A)-(B). Congress further provided an exemption from the 
numerical limits in INA section 214(g)(1)(A), 8 U.S.C. 1184(g)(1)(A), 
for 20,000 new H-1B visas, or grants of initial H-1B status, each 
fiscal year for foreign nationals who have earned a U.S. master's or 
higher degree (``advanced degree exemption'').\7\ Cap exemptions are 
discussed in more detail below.
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    \7\ See INA section 214(g)(5)(C), 8 U.S.C. 1184(g)(5)(C). This 
rule also may refer to the 20,000 exemptions under section 
214(g)(5)(C) from the H-1B regular cap as the ``advanced degree 
exemption allocation'' or ``advanced degree exemption numerical 
limitation.''
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    To manage the annual cap, USCIS used a random selection process in 
years of high demand to determine which petitions were selected toward 
the projected number of petitions needed to reach the annual H-1B 
numerical allocations.\8\ In order to better manage the selection 
process, DHS created a registration requirement for H-1B cap-subject 
petitions, which was first implemented in 2020 for the FY 2021

[[Page 72874]]

cap season.\9\ Under the registration requirement, prospective 
petitioners seeking to file H-1B cap-subject petitions (including 
petitions filed on behalf of beneficiaries eligible for the advanced 
degree exemption) must first electronically register and pay the 
associated H-1B registration fee for each prospective beneficiary. The 
random selection process is then conducted, selecting from the properly 
submitted registrations the number of registrations projected as needed 
to reach the numerical allocations.\10\ Only those prospective 
petitioners with selected registrations are eligible to file H-1B cap-
subject petitions for the beneficiary(ies) named in their selected 
registration(s). The electronic registration process has streamlined 
the H-1B cap selection process by reducing paperwork and simplifying 
data exchange, and has provided overall cost savings to employers 
seeking to file H-1B cap-subject petitions and to USCIS. Prior to the 
registration requirement, petitioners were required to prepare and file 
complete H-1B petitions in order to be considered for the random 
selection process.
---------------------------------------------------------------------------

    \8\ See ``Registration Requirement for Petitioners Seeking To 
File H-1B Petitions on Behalf of Cap-Subject Aliens,'' 84 FR 888 
(Jan. 31, 2019).
    \9\ Id.
    \10\ See 8 CFR 214.2(h)(8)(iii).
---------------------------------------------------------------------------

2. The F-1 Program
    Section 101(a)(15)(F)(i) of the INA, 8 U.S.C. 1101(a)(15)(F)(i), 
permits bona fide students to be temporarily admitted to the United 
States for the purpose of pursuing a full course of study at an 
established college, university, seminary, conservatory, academic high 
school, elementary school, or other academic institution or accredited 
language training program. Principal applicants are categorized as F-1 
nonimmigrants and their spouses and minor children may accompany or 
follow to join them as F-2 dependents.\11\
---------------------------------------------------------------------------

    \11\ See INA section 101(a)(15)(F)(i)-(ii), 8 U.S.C. 
1101(a)(15)(F)(i)-(ii); 8 CFR 214.2(f)(3).
---------------------------------------------------------------------------

    In 1992, legacy Immigration and Naturalization Services (INS) 
amended its longstanding regulations relating to an employment program 
for students called Optional Practical Training (OPT) such that 
students in F-1 nonimmigrant status who have been enrolled on a full-
time basis for at least one full academic year in a college, 
university, conservatory, or seminary (which now must be certified by 
U.S. Immigration and Customs Enforcement's (ICE's) Student and Exchange 
Visitor Program (SEVP)) are allowed up to 12 months of OPT to work for 
a U.S. employer in a job directly related to the student's major area 
of study.\12\ Employers of F-1 students already working for the 
employer under OPT, would often file petitions to change the students' 
status to H-1B so that these nonimmigrant students may continue working 
in their current or a similar job.\13\ Many times, however, an F-1 
student's OPT authorization would expire prior to the student being 
able to assume the employment specified in the approved H-1B petition, 
creating a gap in employment.\14\ In order to remedy this, in 2008, DHS 
created the cap-gap extension to temporarily extend the period of 
authorized stay, as well as work authorization, of certain F-1 students 
caught in a gap between the end of their program and the start date on 
their later-in-time approved, cap-subject H-1B petition.\15\ The cap-
gap extension provides a temporary bridge between F-1 and H-1B status, 
allowing students to remain in the United States between the end of 
their academic program and the beginning of the fiscal year, when the 
student's H-1B status commences.\16\ DHS subsequently amended cap-gap 
procedures by extending the authorized period of stay and work 
authorization of any F-1 student who is the beneficiary of a timely 
filed cap-subject H-1B petition that has been granted by, or remains 
pending with, USCIS, until October 1 of the fiscal year for which H-1B 
visa classification has been requested.\17\
---------------------------------------------------------------------------

    \12\ See 8 CFR 214.2(f)(10); ``Pre-Completion Interval Training; 
F-1 Student Work Authorization,'' 57 FR 31954 (July 20, 1992).
    \13\ See ``Extending Period of Optional Practical Training by 17 
Months for F-1 Nonimmigrant Students With STEM Degrees and Expanding 
Cap-Gap Relief for All F-1 Students With Pending H-1B Petitions,'' 
73 FR 18944, 18947 (Apr. 8, 2008), vacated, Wash. All. of Tech. 
Workers v. U.S. Dep't of Homeland Sec., 156 F. Supp. 3d 123 (D.D.C. 
2015), which amended the cap-gap extension. Through this interim 
final rule, DHS also made other amendments, such as eliminating the 
requirement that USCIS issue a Federal Register Notice in order to 
extend status for students with pending H-1B petitions. Although the 
2008 rule was vacated, the cap-gap extension was reinstated through 
``Improving and Expanding Training Opportunities for F-1 
Nonimmigrant Students With STEM Degrees and Cap-Gap Relief for All 
Eligible F-1 Students,'' 81 FR 13039 (Mar. 11, 2016).
    \14\ Id.
    \15\ Id.
    \16\ See ``Improving and Expanding Training Opportunities for F-
1 Nonimmigrant Students With STEM Degrees and Cap-Gap Relief for All 
Eligible F-1 Students,'' 81 FR 13039 (Mar. 11, 2016).
    \17\ See ``Extending Period of Optional Practical Training by 17 
Months for F-1 Nonimmigrant Students With STEM Degrees and Expanding 
Cap-Gap Relief for All F-1 Students With Pending H-1B Petitions,'' 
74 FR 26514 (June 3, 2009) (correction); ``Improving and Expanding 
Training Opportunities for F-1 Nonimmigrant Students With STEM 
Degrees and Cap-Gap Relief for All Eligible F-1 Students,'' 81 FR 
13039 (Mar. 11, 2016). Through this proposed rule, DHS amended the 
cap-gap procedures by no longer requiring USCIS to issue a Federal 
Register notice indicating that the H-1B cap must first be met (or 
would likely be met) for the current fiscal year.
---------------------------------------------------------------------------

IV. Discussion of the Proposed Rule

A. Modernization and Efficiencies

1. Amending the Definition of a ``Specialty Occupation''
    DHS proposes to revise the regulatory definition and standards for 
a ``specialty occupation'' to better align with the statutory 
definition of that term. Section 101(a)(15)(H)(i)(b) of the INA, 8 
U.S.C. 1101(a)(15)(H)(i)(b), describes nonimmigrants coming to the 
United States temporarily to perform services in a specialty 
occupation. Section 214(i)(1) of the INA, 8 U.S.C. 1184(i)(1) states 
that the term ``specialty occupation'' means: ``an occupation that 
requires--(A) theoretical and practical application of a body of highly 
specialized knowledge, and (B) attainment of a bachelor's or higher 
degree in the specific specialty (or its equivalent) as a minimum for 
entry into the occupation in the United States.''
    Currently, 8 CFR 214.2(h)(4)(ii) defines ``specialty occupation'' 
as an occupation which requires theoretical and practical application 
of a body of highly specialized knowledge in fields of human endeavor 
including, but not limited to, architecture, engineering, mathematics, 
physical sciences, social sciences, medicine and health, education, 
business specialties, accounting, law, theology, and the arts, and 
which requires the attainment of a bachelor's degree or higher in a 
specific specialty, or its equivalent, as a minimum for entry into the 
occupation in the United States.
    This proposed rule would add language to this definition to codify 
existing USCIS practice that there must be a direct relationship 
between the required degree field(s) and the duties of the position; 
there may be more than one acceptable degree field for a specialty 
occupation; and a general degree is insufficient.\18\ Specifically,

[[Page 72875]]

DHS proposes to add language to the definition of ``specialty 
occupation'' clarifying that the required specialized studies must be 
directly related to the position. DHS also proposes to add language 
stating that a position is not a specialty occupation if attainment of 
a general degree, such as business administration or liberal arts, 
without further specialization, is sufficient to qualify for the 
position, and that a position may allow a range of degrees or apply 
multiple bodies of highly specialized knowledge, provided that each of 
those qualifying degree fields or each body of highly specialized 
knowledge is directly related to the position.
---------------------------------------------------------------------------

    \18\ See, e.g., Madkudu Inc., et al., v. U.S. Citizenship and 
Immigration Services, et al. 5:20-cv-2653-SVK (N.D. Ca. Aug. 20, 
2021) Settlement Agreement at 4 (``if the record shows that the 
petitioner would consider someone as qualified for the position 
based on less than a bachelor's degree in a specialized field 
directly related to the position (e.g., an associate's degree, a 
bachelor's degree in a generalized field of study without a minor, 
major, concentration, or specialization in market research, 
marketing, or research methods (see Sections II.C.1.b and c), or a 
bachelor's degree in a field of study unrelated to the position), 
then the position would not meet the statutory and regulatory 
definitions of specialty occupation at 8 U.S.C. 1184(i)(1) and 8 CFR 
214.2(h)(4)(ii).''), https://www.uscis.gov/sites/default/files/document/legal-docs/Madkudu-settlement-agreement.pdf (last visited 
Sep. 5, 2023).
---------------------------------------------------------------------------

    A position for which a bachelor's degree in any field is sufficient 
to qualify for the position, or for which a bachelor's degree in a wide 
variety of fields unrelated to the position is sufficient to qualify, 
would not be considered a specialty occupation as it would not require 
the application of a body of highly specialized knowledge.\19\ 
Similarly, the amended definition clarifies that a position would not 
qualify as a specialty occupation if attainment of a general degree, 
without further specialization, is sufficient to qualify for the 
position.\20\ The burden of proof is on the petitioner to demonstrate 
that each qualifying degree field is directly related to the position. 
This is consistent with the statutory requirement that a degree be ``in 
the specific specialty'' and is USCIS' long-standing practice.
---------------------------------------------------------------------------

    \19\ See Caremax Inc v. Holder, 40 F. Supp. 3d 1182, 1187-88 
(N.D. Cal. 2014).
    \20\ Although a general-purpose bachelor's degree, such as a 
degree in business or business administration, may be a legitimate 
prerequisite for a particular position, requiring such a degree, 
without more, will not justify a conclusion that a particular 
position qualifies for classification as a specialty occupation. 
See, e.g., Royal Siam Corp., 484 F.3d 139, 147 (1st Cir. 2007) 
(``The courts and the agency consistently have stated that, although 
a general-purpose bachelor's degree, such as a business 
administration degree, may be a legitimate prerequisite for a 
particular position, requiring such a degree, without more, will not 
justify the granting of a petition for an H-1B specialty occupation 
visa.''); Shanti, Inc. v. Reno, 36 F. Supp. 2d 1151, 1162-1164 (D. 
Minn. 1999) (the former INS did not depart from established policy 
or precedent when concluding that a general degree, such as a 
business administration degree, without more, does not constitute a 
degree in a specialized field); Raj & Co. v. USCIS, 85 F. Supp. 3d 
1241, 1246 (W.D. Wash. 2015) (it is ``well-settled in the case law 
and USCIS's reasonable interpretations of the regulatory framework'' 
that ``a generalized bachelor['s] degree requirement is 
[in]sufficient to render a position sufficiently specialized to 
qualify for H-1B status.''); Vision Builders, LLC v. USCIS, No. 19-
CV-3159, 2020 WL 5891546, at *6 (D.D.C. Oct. 5, 2020) (citing Raj).
---------------------------------------------------------------------------

    Under this proposed addition to 8 CFR 214.2(h)(4)(ii), the 
petitioner would continue to have the burden of demonstrating that 
there is a direct relationship between the required degree in a 
specific specialty (in other words, the degree field(s) that would 
qualify someone for the position) and the duties of the position. In 
many cases, the relationship will be clear and relatively easy to 
establish. For example, it should not be difficult to establish that a 
required medical degree is directly related to the duties of a 
physician. Similarly, a direct relationship may readily be established 
between the duties of a lawyer and a required law degree and the duties 
of an architect and a required architecture degree. In other cases, the 
direct relationship may be less apparent, and the petitioner may have 
to explain and provide documentation to meet its burden of 
demonstrating the relationship. As in the past, to establish a direct 
relationship, the petitioner would need to provide information 
regarding the course(s) of study associated with the required degree, 
or its equivalent, and the duties of the proffered position, and 
demonstrate the connection between the course of study and the duties 
and responsibilities of the position.
    The requirement of a direct relationship between a degree in a 
specific specialty, or its equivalent, and the position, however, 
should not be construed as requiring a singular field of study.\21\ For 
example, for the position of electrical engineer, a degree in 
electrical engineering or electronics engineering may qualify a person 
for the position, and therefore a minimum of a bachelor's or higher 
degree, or its equivalent, in more than one field of study may be 
recognized as satisfying the ``degree in the specific specialty (or its 
equivalent)'' requirement of section 214(i)(1)(B) of the INA, 8 U.S.C. 
1184(i)(1)(B). In such a case, the ``body of highly specialized 
knowledge'' required by section 214(i)(1)(A) of the INA, 8 U.S.C. 
1184(i)(1)(A), would be afforded by either degree, and each field of 
study accordingly would be in a ``specific specialty'' directly related 
to the position consistent with section 214(i)(1)(B) of the INA, 8 
U.S.C. 1184(i)(1)(B).
---------------------------------------------------------------------------

    \21\ See, e.g., Relx, Inc. v. Baran, 397 F. Supp. 3d 41, 54 
(D.D.C. 2019) (``There is no requirement in the statute that only 
one type of degree be accepted for a position to be specialized.''); 
Residential Fin. Corp. v. U.S. Citizenship & Immigration Servs., 839 
F. Supp. 2d 985, 997 (S.D. Ohio 2012) (stating that when determining 
whether a position is a specialty occupation, ``knowledge and not 
the title of the degree is what is important'').
---------------------------------------------------------------------------

    In cases where the petitioner lists degrees in multiple disparate 
fields of study as the minimum entry requirement for a position, the 
petitioner has the burden of establishing how each field of study is in 
a specific specialty providing ``a body of highly specialized 
knowledge'' directly related to the duties and responsibilities of the 
particular position. The petitioner must show that its position meets 
the requirements of sections 214(i)(1)(A) and (B) of the INA, 8 U.S.C. 
1184(i)(1)(A) and (B), and the regulatory definition.\22\
---------------------------------------------------------------------------

    \22\ The petitioner must also establish that its position meets 
one of the four criteria at proposed 8 CFR 214.2(h)(4)(iii)(A), 
which is explained in detail below.
---------------------------------------------------------------------------

    As such, under this proposed rule, a minimum entry requirement of a 
bachelor's or higher degree, or its equivalent, in multiple disparate 
fields of study would not automatically disqualify a position from 
being a specialty occupation. For example, a petitioner may be able to 
establish that a bachelor's degree in the specific specialties of 
either education or chemistry, each of which provide a body of highly 
specialized knowledge, is directly related to the duties and 
responsibilities of a chemistry teacher. In such a scenario, the ``body 
of highly specialized knowledge'' requirement of section 214(i)(1)(A) 
of the INA, 8 U.S.C. 1184(i)(1)(A), and the ``degree in the specific 
specialty'' requirement of section 214(i)(1)(B) of the INA, 8 U.S.C. 
1184(i)(1)(B), would both be met by either degree and the chemistry 
teacher position listing multiple disparate fields of study would 
qualify as a specialty occupation.
    In determining whether a position involves a specialty occupation, 
USCIS currently interprets the ``specific specialty'' requirement in 
section 214(i)(1)(B) of the INA, 8 U.S.C. 1184(i)(1)(B), to relate back 
to the body of highly specialized knowledge requirement referenced in 
section 214(i)(1)(A) of the INA, 8 U.S.C. 1184(i)(1)(A), required by 
the specialty occupation in question. The ``specific specialty'' 
requirement is only met if the degree in a specific specialty or 
specialties, or its equivalent, provides a body of highly specialized 
knowledge directly related to the duties and responsibilities of the 
particular position as required by section 214(i)(1)(A) of the INA, 8 
U.S.C. 1184(i)(1)(A).
    If the minimum entry requirement for a position is a general degree 
without further specialization or an explanation of what type of degree 
is required, the ``degree in the specific specialty (or its 
equivalent)'' requirement of INA section 214(i)(1)(B), 8 U.S.C. 
1184(i)(1)(B),

[[Page 72876]]

would not be satisfied. For example, a requirement of a general 
business degree for a marketing position would not satisfy the specific 
specialty requirement. In this instance, the petitioner would not 
satisfactorily demonstrate how a required general business degree 
provides a body of highly specialized knowledge that is directly 
related to the duties and responsibilities of a marketing position.\23\
---------------------------------------------------------------------------

    \23\ See Royal Siam Corp., 484 F.3d at 147.
---------------------------------------------------------------------------

    Similarly, a petition with a requirement of any engineering degree 
in any field of engineering for a position of software developer would 
generally not satisfy the statutory requirement, as it is unlikely the 
petitioner could establish how the fields of study within any 
engineering degree provide a body of highly specialized knowledge 
directly relating to the duties and responsibilities of the software 
developer position.\24\ If an individual could qualify for a 
petitioner's software developer position based on having a seemingly 
unrelated engineering degree, then it cannot be concluded that the 
position requires the application of a body of highly specialized 
knowledge and a degree in a specific specialty, because someone with an 
entirely or largely unrelated degree may qualify to perform the 
job.\25\ In such a scenario, the requirements of INA sections 
214(i)(1)(A) and (B), 8 U.S.C. 1184(i)(1)(A) and (B), would not be 
satisfied.
---------------------------------------------------------------------------

    \24\ The requirement of any engineering degree could include, 
for example, a chemical engineering degree, marine engineering 
degree, mining engineering degree, or any other engineering degree 
in a multitude of seemingly unrelated fields.
    \25\ These examples refer to the educational credentials by the 
title of the degree for expediency. However, USCIS separately 
evaluates whether the beneficiary's actual course of study is 
directly related to the duties of the position, rather than merely 
the title of the degree. When applicable, USCIS also will consider 
whether the beneficiary has the education, specialized training, 
and/or progressively responsible experience that is equivalent to 
completion of a U.S. baccalaureate or higher degree in the specialty 
occupation. See 8 CFR 214.2(h)(4)(iii)(C)(4).
---------------------------------------------------------------------------

    Further, if a position requires a bachelor's degree in an 
unspecified ``quantitative field'' (which could include mathematics, 
statistics, economics, accounting, or physics) the petitioner must 
identify specific specialties, such as the majors or degree fields, 
within the wide variety of ``quantitative fields'' and establish how 
each identified degree in a specific specialty provides a body of 
highly specialized knowledge, consistent with INA section 214(i)(1)(A), 
8 U.S.C. 1184(i)(1)(A), that is directly related to the duties and 
responsibilities of the software developer position. While a position 
may allow a range of degrees, and apply multiple bodies of highly 
specialized knowledge, each of those qualifying degree fields or each 
body of highly specialized knowledge must be directly related to the 
proffered position.
2. Amending the Criteria for Specialty Occupation Positions
    Under INA section 214(i)(1), 8 U.S.C. 1184(i)(1), a ``specialty 
occupation'' requires attainment of a bachelor's or higher degree in 
the specific specialty (or its equivalent) as a minimum for entry into 
the occupation in the United States. The current regulatory criteria at 
8 CFR 214.2(h)(4)(iii)(A)(1) states that a bachelor's degree is 
``normally'' required. To provide additional guidance to adjudicators, 
attorneys, and the public, DHS is proposing to define the term 
``normally'' at proposed 8 CFR 214.2(h)(4)(iii)(A)(5) to state that, 
for purposes of the criteria in this provision, ``normally'' means 
``conforming to a type, standard, or regular pattern'' and is 
``characterized by that which is considered usual, typical, common, or 
routine.'' \26\ The proposed regulation also clarifies that 
``[n]ormally does not mean always.'' For these purposes, there is no 
significant difference between the synonyms ``normal,'' ``usual,'' 
``typical,'' ``common,'' or ``routine.'' \27\ These synonyms illustrate 
that a description of an occupation that uses a synonym for the word 
``normally'' in describing whether a bachelor's or higher degree is 
required for the occupation can support a finding that a degree is 
``normally'' required. By the same token, other synonyms for the word 
``normally'' that are not listed in proposed 8 CFR 
214.2(h)(4)(iii)(A)(5), such as ``mostly'' or ``frequently,'' also can 
support a finding that a degree is ``normally'' required. This proposed 
change clarifies that the petitioner does not have to establish that 
the bachelor's degree in a specific specialty or its equivalent is 
always a minimum requirement for entry into the occupation in the 
United States. This is consistent with both USCIS's current practice, 
as reflected by the statement on the USCIS website that ``normally,'' 
``common,'' and ``usually'' are not interpreted to mean ``always,'' 
\28\ and USCIS's rescission of a 2017 policy memorandum guiding 
officers on the interpretation of the Occupational Outlook Handbook's 
with respect to the computer programmer occupation.\29\ USCIS rescinded 
the 2017 policy memorandum following the decision of the U.S. Court of 
Appeals for the Ninth Circuit in Innova Solutions v. Baran, 983 F.3d 
428 (9th Cir. 2020).\30\ As the court stated in Innova, ``the fact that 
some computer programmers are hired without a bachelor's degree is 
entirely consistent with a bachelor's degree `normally [being] the 
minimum requirement for entry.' '' \31\ USCIS currently applies this 
same rationale to other occupations. By proposing to codify USCIS's 
current practice at proposed 8 CFR 214.2(h)(4)(iii)(A)(5), DHS seeks to 
provide H-1B petitioners with more certainty as to what adjudication 
standards apply to their petitions.
---------------------------------------------------------------------------

    \26\ See Merriam-Webster Dictionary at https://www.merriam-webster.com/dictionary/normal (last visited Aug. 24, 2023).
    \27\ See Innova, 983 F.3d at 432 (``There is no daylight between 
typically needed, per the OOH, and normally required, per the 
regulatory criteria. `Typically' and `normally' are synonyms.'').
    \28\ See USCIS, ``H-1B Specialty Occupations, DOD Cooperative 
Research and Development Project Workers, and Fashion Models,'' 
https://www.uscis.gov/working-in-the-united-states/h-1b-specialty-occupations (last updated Feb. 8, 2023).
    \29\ See USCIS, ``Rescission of 2017 Policy Memorandum PM-602-
0142,'' PM-602-0142.1, https://www.uscis.gov/sites/default/files/document/memos/PM-602-0142.1_RescissionOfPM-602-0142.pdf (Feb. 3, 
2021).
    \30\ The 2017 memorandum instructed officers not to ``generally 
consider the position of [computer] programmer to qualify as a 
specialty occupation,'' specifically where the proffered position 
did not have a minimum entry requirement of a U.S. bachelor's or 
higher and indicated that the petitioner must provide other evidence 
to establish that the particular position is one in a specialty 
occupation. See USCIS, Recission of the December 22, 2000 ``Guidance 
memo on H1B computer related positions'', PM-602-0142, https://www.uscis.gov/sites/default/files/document/memos/PM-6002-0142-H-1BComputerRelatedPositionsRecission.pdf (Mar. 31, 2017).
    \31\ See Innova, 983 F.3d at 432 (emphasis in original).
---------------------------------------------------------------------------

    In addition, DHS proposes to codify its current practices by 
revising the criteria for a specialty occupation at current 8 CFR 
214.2(h)(4)(iii)(A). First, DHS proposes to replace the phrase ``To 
qualify as a specialty occupation, the position must meet one of the 
following criteria'' with ``A position does not meet the definition of 
specialty occupation in paragraph (h)(4)(ii) of this section unless it 
also satisfies at least one of the following criteria at paragraphs 
(h)(4)(iii)(A)(1) through (4) of this section.'' This proposed change 
would clarify that meeting one of the regulatory criteria is a 
necessary part of--but not always sufficient for--demonstrating that a 
position qualifies as a specialty occupation. This is not new; the 
criteria at current 8 CFR 214.2(h)(4)(iii)(A) must be construed in 
harmony with and in addition to other controlling regulatory provisions 
and

[[Page 72877]]

with the statute as a whole.\32\ In 2000, the U.S. Court of Appeals for 
the Fifth Circuit highlighted the ambiguity of the regulatory 
provision's current wording, and petitioners have misinterpreted the 
criteria in 8 CFR 214.2(h)(4)(iii)(A) as setting forth both the 
necessary and sufficient conditions to qualify as a specialty 
occupation, a reading that resulted in some positions meeting one 
condition of 8 CFR 214.2(h)(4)(iii)(A), but not the definition as a 
whole.\33\ These proposed changes would eliminate this source of 
confusion.
---------------------------------------------------------------------------

    \32\ Numerous AAO non-precedent decisions spanning several 
decades have explained that the criteria at 8 CFR 
214.2(h)(4)(iii)(A) must logically be read together with section 
214(i)(1) of the Act and 8 CFR 214.2(h)(4)(ii), and that the 
regulatory criteria must be construed in harmony with the thrust of 
the related provisions and with the statute as a whole. See, e.g., 
In Re. ---, 2009 WL 4982420 (AAO Aug. 21, 2009); In Re. ---, 2009 WL 
4982607 (AAO Sept. 3, 2009); In Re. 15542, 2016 WL 929725 (AAO Feb. 
22, 2016); In Re. 17442092, 2021 WL 4708199 (AAO Aug. 11, 2021); In 
Re. 21900502, 2022 WL 3211254 (AAO July 7, 2022).
    \33\ See Defensor v. Meissner, 201 F.3d 384, 387 (5th Cir. 2000) 
(stating that current 8 CFR 214.2(h)(4)(iii)(A) ``appears to 
implement the statutory and regulatory definition of specialty 
occupation through a set of four different standards. However, this 
section might also be read as merely an additional requirement that 
a position must meet, in addition to the statutory and regulatory 
definition. The ambiguity stems from the regulation's use of the 
phrase `to qualify as.' In common usage, this phrase suggests that 
whatever conditions follow are both necessary and sufficient 
conditions. Strictly speaking, however, the language logically 
entails only that whatever conditions follow are necessary 
conditions. . . . If Sec.  214.2(h)(4)(iii)(A) is read to create a 
necessary and sufficient condition for being a specialty occupation, 
the regulation appears somewhat at odds with the statutory and 
regulatory definitions of `specialty occupation.' '').
---------------------------------------------------------------------------

    DHS is also proposing to amend 8 CFR 214.2(h)(4)(iii)(A)(1) by 
adding ``U.S.'' to ``baccalaureate,'' and replacing the word 
``position'' with ``occupation,'' so that it sets forth ``the minimum 
requirement for entry into the particular occupation in which the 
beneficiary will be employed.'' See proposed 8 CFR 
214.2(h)(4)(iii)(A)(1). Adding ``U.S.'' clarifies that a baccalaureate 
degree must be a U.S. degree (or its foreign equivalent), and that a 
foreign baccalaureate is not necessarily an equivalent. DHS is 
proposing this change to codify longstanding practice and to reflect a 
consistent standard that will align the regulation discussing the 
position requirement at 8 CFR 214.2(h)(4)(iii)(A)(1) with the statutory 
requirement of ``a bachelor's or higher degree in the specific 
specialty (or its equivalent) as a minimum for entry into the 
occupation in the United States'' at INA section 214(i)(1)(B), 8 U.S.C. 
1184(i)(1)(B), as well as the regulatory requirement that an H-1B 
beneficiary must have the equivalent of a U.S. baccalaureate degree at 
8 CFR 214.2(h)(4)(iii)(C)(1). Replacing ``position'' with 
``occupation'' would clarify that the first criterion can be satisfied 
if the petitioner can show that its position falls within an 
occupational category for which all positions within that category have 
a qualifying minimum degree requirement.\34\ This revision would 
provide added clarity to the regulatory criteria as the criteria would 
flow from general to specific (i.e., occupation level to industry to 
employer to position). If the occupation requires at least a bachelor's 
degree in a specific specialty (e.g., architect or aeronautical 
engineer) then it necessarily follows that a position in one of those 
occupations would require a degree and qualify as a specialty 
occupation. If the occupation does not require at least a bachelor's 
degree in a specific specialty, then the petitioner could submit 
evidence to show that at least a bachelor's degree in a specific 
specialty (or its equivalent) is required based on U.S. industry norms, 
the employer's particular requirement, or because of the particulars of 
the specific position. See proposed 8 CFR 214.2(h)(4)(iii)(A)(2) 
through (4). USCIS will continue its practice of consulting the U.S. 
Department of Labor's (DOL's) Occupational Outlook Handbook and other 
reliable and informative sources submitted by the petitioner, to assist 
in its determination regarding the minimum entry requirements for 
positions located within a given occupation.
---------------------------------------------------------------------------

    \34\ DHS generally determines a position's occupation or 
occupational category by looking at the standard occupational 
classification (SOC) code designated on the LCA.
---------------------------------------------------------------------------

    DHS further proposes to amend 8 CFR 214.2(h)(4)(iii)(A)(2) by 
consolidating this criterion's second prong into the fourth criterion. 
See proposed 8 CFR 214.2(h)(4)(iii)(A)(2). The second prong of current 
8 CFR 214.2(h)(4)(iii)(A)(2), which focuses on a position's complexity 
or uniqueness, is similar to current 8 CFR 214.2(h)(4)(iii)(A)(4), 
which focuses on a position's complexity and specialization. In 
practice, they are frequently consolidated into the same analysis. This 
amendment would streamline both criteria, as well as the explanation 
and analysis in written decisions issued by USCIS pertaining to 
specialty occupation determinations, as such decisions discuss all four 
criteria and are necessarily repetitive because of the existing overlap 
between 8 CFR 214.2(h)(4)(iii)(A)(2) and (4). This amendment would also 
simplify the analysis because petitioners may demonstrate eligibility 
under this criterion if the position is ``so specialized, complex, or 
unique'', as opposed to ``so complex or unique'' under current 8 CFR 
214.2(h)(4)(iii)(A)(2) and ``so specialized and complex'' under current 
8 CFR 214.2(h)(4)(iii)(A)(4) (emphasis added). Notwithstanding these 
amendments, the analytical framework of the first prong of proposed 8 
CFR 214.2(h)(4)(iii)(A)(2) generally would remain the same. Thus, a 
petitioner would satisfy proposed 8 CFR 214.2(h)(4)(iii)(A)(2) if it 
demonstrates that the specialty degree requirement is normally the 
minimum entry requirement for: (1) parallel positions; (2) at similar 
organizations; (3) within the employer's industry in the United States. 
This criterion is intended for the subset of positions with minimum 
entry requirements that are determined not necessarily by occupation, 
but by specific industry standards. For this criterion, DHS would 
continue its practice of consulting DOL's Occupational Outlook Handbook 
and other reliable and informative sources, such as information from 
the industry's professional association or licensing body, submitted by 
the petitioner.
    USCIS proposes to change the third criterion at proposed 8 CFR 
214.2(h)(4)(iii)(A)(3), in part, from stating that the employer 
normally requires a ``degree or its equivalent for the position'' to 
stating that the employer normally requires a ``U.S. baccalaureate or 
higher degree in a directly related specific specialty, or its 
equivalent, for the position.'' The additional phrase about a ``degree 
in a directly related specific specialty'' would reinforce the existing 
requirements for a specialty occupation, in other words, that the 
position itself must require a directly related specialty degree, or 
its equivalent, to perform its duties. See also proposed 8 CFR 
214.2(h)(4)(iii)(A)(3). Employers requiring degrees as a proxy for a 
generic set of skills would not meet this standard. Employers listing a 
specialized degree as a hiring preference would not meet this standard 
either. If USCIS were constrained to recognize a position as a 
specialty occupation merely because an employer has an established 
practice of demanding certain educational requirements for the offered 
position--without consideration of whether the position actually 
requires the application of a body of highly specialized knowledge 
consistent with the degree requirement--then any beneficiary with a 
bachelor's degree in a specific specialty could be brought

[[Page 72878]]

into the United States to perform work in a non-specialty occupation if 
the employer arbitrarily imposed such a degree requirement for the non-
specialty occupation position.\35\ With respect to an employer's normal 
employment practices, a petitioner could submit evidence of an 
established recruiting and hiring practice to establish its 
requirements for the position. Keeping the word ``normally'' in this 
criterion is intended to preserve flexibility for petitioners, although 
petitioners seeking to fill a position for the first time generally 
would not be able to demonstrate an established practice.\36\
---------------------------------------------------------------------------

    \35\ See Defensor, 201 F.3d at 388 (noting ``If only [the 
employer]'s requirements could be considered, then any alien with a 
bachelor's degree could be brought into the United States to perform 
a non-specialty occupation, so long as that person's employment was 
arranged through an employment agency which required all clients to 
have bachelor's degrees. Thus, aliens could obtain six year visas 
for any occupation, no matter how unskilled, through the subterfuge 
of an employment agency. This result is completely opposite the 
plain purpose of the statute and regulations, which is to limit H1-B 
[sic] visas to positions which require specialized experience and 
education to perform.'').
    \36\ First-time hirings are not precluded from qualifying under 
one of the other criteria.
---------------------------------------------------------------------------

    Furthermore, DHS proposes to add ``or third party if the 
beneficiary will be staffed to that third party'' to proposed 8 CFR 
214.2(h)(4)(iii)(A)(3) \37\ to clarify that it is the third party's 
requirements, not the petitioning employer's, that are most relevant if 
the beneficiary would be staffed to a third party. This change would be 
consistent with proposed 8 CFR 214.2(h)(4)(i)(B)(3), which clarifies 
that when a beneficiary is staffed to a third party, it is the 
requirements of that third party, and not the petitioner, that are most 
relevant when determining whether the position is a specialty 
occupation. This proposed revision would define ``staffed'' in the same 
way to mean that the beneficiary would be contracted to fill a position 
in the third party's organization. The criterion at proposed 8 CFR 
214.2(h)(4)(iii)(A)(4) incorporates the second prong of current 8 CFR 
214.2(h)(4)(iii)(A)(2). See proposed 8 CFR 214.2(h)(4)(iii)(A)(4). DHS 
proposes no other substantive changes to this criterion. Thus, the 
fourth criterion could be satisfied if the petitioner demonstrates that 
the proffered position's job duties are so specialized, complex, or 
unique that they necessitate the attainment of a U.S. bachelor's degree 
in a directly related specific specialty, or its equivalent.
---------------------------------------------------------------------------

    \37\ The full proposed regulation would read: ``The employer, or 
third party if the beneficiary will be staffed to that third party, 
normally requires a U.S. baccalaureate or higher degree in a 
directly related specific specialty, or its equivalent, for the 
position.''
---------------------------------------------------------------------------

3. Amended Petitions
    DHS proposes to clarify when an amended or new H-1B petition must 
be filed due to a change in an H-1B worker's place of employment. 
Specifically, this rule proposes to clarify that any change of work 
location that requires a new LCA is itself considered a material change 
and therefore requires the petitioning employer to file an amended or 
new petition with USCIS before the H-1B worker may perform work under 
the changed conditions. Further, DHS proposes to consolidate and 
clarify guidance on when an amended or new petition is required for 
short-term placement of H-1B workers at a worksite not listed on the 
approved petition or corresponding LCA.\38\ These proposed changes are 
not intended to depart from existing regulations and guidance, but 
rather, seek to consolidate existing requirements and make clear when a 
petitioner must submit an amended or new petition. DHS regulations 
already require that petitioning employers file an amended or new H-1B 
petition for all situations involving a material change to the 
conditions of H-1B employment. Specifically, 8 CFR 214.2(h)(2)(i)(E) 
states that a ``petitioner shall file an amended or new petition, with 
fee, with the Service Center where the original petition was filed to 
reflect any material changes in the terms and conditions of employment 
or training or the alien's eligibility as specified in the original 
approved petition.'' That regulation goes on to add that if the amended 
or new petition is an H-1B petition, a new LCA must accompany the 
petition. Additionally, 8 CFR 214.2(h)(11)(i)(A) requires a petitioner 
to ``immediately notify'' USCIS of a change in the terms and conditions 
of employment of a beneficiary which may affect eligibility for H-1B 
status. However, USCIS seeks to clarify when an amended or new petition 
must be filed or when a petitioner need not file an amended petition. 
To find relevant requirements, H-1B petitioners and USCIS officers 
currently must look to various sources, including USCIS policy 
guidance, DOL regulations, and DOL guidance. DHS seeks to make its 
regulations relating to amended or new H-1B petitions more 
comprehensive and useful by incorporating relevant requirements into 
proposed 8 CFR 214.2(h)(2)(i)(E)(2).
---------------------------------------------------------------------------

    \38\ See USCIS, ``USCIS Final Guidance on When to File an 
Amended or New H-1B Petition After Matter of Simeio Solutions, 
LLC,'' PM-602-0120 (July 21, 2015), https://www.uscis.gov/sites/default/files/document/memos/2015-0721_Simeio_Solutions_Transition_Guidance_Memo_Format_7_21_15.pdf.
---------------------------------------------------------------------------

    Under 8 CFR 214.2(h)(4)(i)(B), an H-1B petition for a specialty 
occupation worker must include a certified LCA from DOL. DOL regulation 
at 20 CFR 655.731 provides details on the LCA requirements, including 
that an employer seeking to employ an H-1B worker in a specialty 
occupation must attest on the LCA that it will pay the H-1B worker the 
required wage rate. The required wage rate is the higher of either the 
prevailing wage \39\ for the occupational classification, or the actual 
wage paid by the employer to similarly situated employees, in the 
geographic area of intended employment.\40\ The LCA seeks to protect 
U.S. workers and their wages by disincentivizing hiring foreign workers 
at lower wages. A key component to filing an LCA is determining the 
appropriate wage to list on the application. Generally, a petitioning 
employer is not required to use any specific methodology to determine 
the prevailing wage and may utilize a wage obtained from the Office of 
Foreign Labor Certification, an independent authoritative source, or 
other legitimate sources of wage data.\41\ While there are many factors 
that may be considered when determining the prevailing wage, one of the 
most significant is the geographic area where the H-1B worker will 
perform their duties. Because prevailing wages differ, often 
significantly, from location to location, a change in geographic area 
of intended employment that goes beyond the current metropolitan 
statistical area

[[Page 72879]]

(MSA) often will have an impact on the prevailing wage, requiring a new 
LCA.
---------------------------------------------------------------------------

    \39\ 20 CFR 655.731(a)(2)(ii) states that, if the job 
opportunity is not covered by a collective bargaining agreement, the 
prevailing wage shall be the arithmetic mean of the wages of workers 
similarly employed, except that the prevailing wage shall be the 
median when provided by paragraphs (a)(2)(ii)(A), (b)(3)(iii)(B)(2), 
and (b)(3)(iii)(C)(2) of 20 CFR 655.731. An employer is not 
permitted to pay a wage that is lower than a wage required under any 
other applicable Federal, State or local law.
    \40\ Pursuant to 20 CFR 655.715, ``Area of intended employment'' 
means the area within normal commuting distance of the place 
(address) of employment where the H-1B nonimmigrant is or will be 
employed. There is no rigid measure of distance which constitutes a 
normal commuting distance or normal commuting area, because there 
may be widely varying factual circumstances among different areas 
(e.g., normal commuting distances might be 20, 30, or 50 miles). If 
the place of employment is within a Metropolitan Statistical Area 
(MSA) or a Primary Metropolitan Statistical Area (PMSA), any place 
within the MSA or PMSA is deemed to be within normal commuting 
distance of the place of employment; however, all locations within a 
Consolidated Metropolitan Statistical Area (CMSA) will not 
automatically be deemed to be within normal commuting distance. The 
borders of MSAs and PMSAs are not controlling with regard to the 
identification of the normal commuting area; a location outside of 
an MSA or PMSA (or a CMSA) may be within normal commuting distance 
of a location that is inside (e.g., near the border of) the MSA or 
PMSA (or CMSA).
    \41\ See 20 CFR 655.731(a)(2).
---------------------------------------------------------------------------

    In its precedent decision Matter of Simeio Solutions, LLC, 26 I&N 
Dec. 542 (AAO 2015), USCIS's Administrative Appeals Office (AAO) held 
that a change in geographic area of employment that would require a new 
LCA is considered a material change for purposes of 8 CFR 
214.2(h)(2)(i)(E) and (h)(11)(i)(A) because the new LCA may impact 
eligibility under 8 CFR 214.2(h)(4)(i)(B)(1). For example, a change in 
location may impact eligibility if the new location is in an MSA with a 
higher wage. USCIS provided additional guidance implementing Matter of 
Simeio Solutions in July 2015 in its policy memorandum ``USCIS Final 
Guidance on When to File an Amended or New H-1B Petition After Matter 
of Simeio Solutions, LLC.'' \42\
---------------------------------------------------------------------------

    \42\ See USCIS, ``USCIS Final Guidance on When to File an 
Amended or New H-1B Petition After Matter of Simeio Solutions, 
LLC,'' PM-602-0120 (July 21, 2015), https://www.uscis.gov/sites/default/files/document/memos/2015-0721_Simeio_Solutions_Transition_Guidance_Memo_Format_7_21_15.pdf.
---------------------------------------------------------------------------

    In proposed 8 CFR 214.2(h)(2)(i)(E)(2), DHS proposes to specify 
that ``Any change in the place of employment to a geographical area 
that requires a corresponding labor condition application to be 
certified to USCIS is considered a material change and requires an 
amended or new petition to be filed with USCIS before the H-1B worker 
may begin work at the new place of employment.'' Further, DHS proposes 
to specify in proposed 8 CFR 214.2(h)(2)(i)(E)(2) that ``[t]he amended 
or new petition must be properly filed before the material change(s) 
takes place''. This would codify current USCIS practice as articulated 
in its policy memorandum ``USCIS Final Guidance on When to File an 
Amended or New H-1B Petition After Matter of Simeio Solutions, LLC,'' 
which discusses the ``USCIS position that H-1B petitioners are required 
to file an amended or new petition before placing an H-1B employee at a 
new place of employment not covered by an existing, approved H-1B 
petition.'' As with current USCIS practice, proposed 8 CFR 
214.2(h)(2)(i)(E)(2) would allow the worker to begin working under the 
materially changed terms and conditions of employment upon the filing 
of the amended or new petition, assuming all other requirements and 
terms of eligibility are met. They would not need to wait for a final 
decision on the amended or new petition in order to begin working if 
eligible in accordance with existing portability provisions at 8 CFR 
214.2(h)(2)(i)(H). If while the amended or new petition is pending 
adjudication another material change occurs, an employer must file 
another amended or new petition to account for the new changes.\43\ If 
that amended or new petition is denied, the H-1B worker generally may 
return to the position and worksite listed on the most recently 
approved petition as long as that petition and corresponding LCA are 
still valid.\44\
---------------------------------------------------------------------------

    \43\ See id. at 7.
    \44\ See id.
---------------------------------------------------------------------------

    Proposed 8 CFR 214.2(h)(2)(i)(E)(2) would also set forth limited 
circumstances in which a change to the beneficiary's place of 
employment would not require the petitioner to file an amended 
petition. Proposed 8 CFR 214.2(h)(2)(i)(E)(2)(i) states that moving a 
beneficiary to a new job location within the same area of intended 
employment as listed on the LCA would not require an amended petition, 
assuming there are no other material changes. This would be consistent 
with INA section 212(n)(4), which provides that a change in the 
worksite location within the same MSA of the existing LCA would 
generally be deemed to be within the area of employment.\45\ Note that 
proposed 8 CFR 214.2(h)(2)(i)(E)(2)(i) does not purport to set forth 
all relevant DOL requirements, such as the requirement that the 
petitioning employer post notice of the LCA, either electronically or 
in hard-copy, in the new work location on or before the date that the 
H-1B worker performs any work at the new location.\46\
---------------------------------------------------------------------------

    \45\ See also 20 CFR 655.734; DOL, Wage and Hour Division, 
``Fact Sheet #62J: What does `place of employment' mean?'' (July 
2008), https://www.dol.gov/agencies/whd/fact-sheets/62j-h1b-worksite 
(``The employer need not obtain a new LCA for another worksite 
within the geographic area of intended employment where the employer 
already has an existing LCA for that area.'').
    \46\ See 20 CFR 655.734(a)(2).
---------------------------------------------------------------------------

    Additionally, proposed 8 CFR 214.2(h)(2)(i)(E)(2)(ii) would set 
forth the specific durations for short-term placements that would not 
require an amended or new petition, assuming there are no other 
material changes. This would be consistent with DOL regulations at 20 
CFR 655.735 in which short-term placements of less than 30 days, or in 
some cases 60 days, do not require a new LCA or an amended or new 
petition, provided there are no material changes.
    Proposed 8 CFR 214.2(h)(2)(i)(E)(2)(iii) would clarify that an 
amended or new petition would not be required when a beneficiary is 
going to a non-worksite location to participate in employee 
development, will be spending little time at any one location, or will 
perform a peripatetic job. Proposed 8 CFR 214.2(h)(2)(i)(E)(2)(iii) 
provides examples of ``peripatetic jobs'' including situations where 
the job is primarily at one location, but the beneficiary occasionally 
travels for short periods to other locations on a casual, short-term 
basis, which can be recurring but not excessive (i.e., not exceeding 5 
consecutive workdays for any one visit by a peripatetic worker, or 10 
consecutive workdays for any one visit by a worker who spends most work 
time at one location and travels occasionally to other locations). 
Proposed 8 CFR 214.2(h)(2)(i)(E)(2)(iii) would be consistent with DOL 
regulations at 20 CFR 655.715, which sets forth several criteria for 
what would not constitute a ``place of employment'' or ``worksite,'' as 
well as what would constitute an ``employee developmental activity,'' 
for purposes of requiring a new LCA.
    Note that proposed 8 CFR 214.2(h)(2)(i)(E)(2) would not codify all 
relevant considerations related to when to file an amended petition. 
Stakeholders should still consult DOL regulations and policy guidance 
when considering if an amended petition is necessary. Nevertheless, DHS 
believes its proposed changes to 8 CFR 214.2(h)(2)(i)(E)(2) would still 
be beneficial by providing additional clarity about when a change in an 
H-1B worker's place of employment constitutes a material change 
requiring an amended or new petition.
    DHS proposes to revise and redesignate current 8 CFR 
214.2(h)(2)(i)(E) as proposed 8 CFR 214.2(h)(2)(i)(E)(1) so that this 
provision would be applicable to all H classifications, while proposed 
8 CFR 214.2(h)(2)(i)(E)(2) would be specific to H-1B nonimmigrants. In 
proposed 8 CFR 214.2(h)(2)(i)(E)(1), DHS proposes minor changes to 
clarify that an amended or new H-1B petition requires a current or new 
certified labor condition application.

[[Page 72880]]

4. Deference
    DHS seeks to codify and clarify its existing deference policy at 
proposed 8 CFR 214.1(c)(5). Deference helps promote consistency and 
efficiency for both USCIS and its stakeholders. The deference policy 
instructs officers to consider prior determinations involving the same 
parties and facts, when there is no material error with the prior 
determination, no material change in circumstances or in eligibility, 
and no new material information adversely impacting the petitioner's, 
applicant's, or beneficiary's eligibility. Through this proposed 
regulation, DHS seeks to clarify when petitioners may expect 
adjudicators to exercise deference in reviewing their petitions, so 
petitioners will be more likely to submit necessary, relevant 
supporting evidence. This creates predictability for petitioners and 
beneficiaries and leads to fairer and more reliable outcomes. Codifying 
and clarifying when USCIS gives deference would also better ensure 
consistent adjudications.
    In 2004, USCIS issued a memorandum discussing the significance of 
prior USCIS adjudications.\47\ The memorandum acknowledged that USCIS 
is not bound to approve subsequent petitions or applications where 
eligibility has not been demonstrated merely because of a prior 
approval, which may have been erroneous. Nevertheless, where there has 
been no material change in the underlying facts, the memorandum 
specified that adjudicators should defer to a prior determination 
involving the same parties and underlying facts unless there was a 
material error, a substantial change in circumstances, or new material 
information that adversely impacts eligibility. On October 23, 2017, 
USCIS rescinded that guidance, expressing concern that the 2004 
memorandum shifted the burden from a petitioner to USCIS.\48\ Rather 
than attempt to address any perceived concerns, the 2017 memorandum 
rescinded the 2004 policy entirely. On April 27, 2021, USCIS 
incorporated its deference policy into the USCIS Policy Manual, 
acknowledging that adjudicators are not required to approve subsequent 
petitions or applications where eligibility has not been demonstrated 
strictly because of a prior approval (which may have been erroneous), 
but stressing that they should defer to prior determinations involving 
the same parties and underlying facts.\49\ As stated in the USCIS 
Policy Manual, deviation from a previous approval carries important 
consequences and implicates predictability and consistency 
concerns.\50\
---------------------------------------------------------------------------

    \47\ See USCIS, ``The Significance of a Prior CIS Approval of a 
Nonimmigrant Petition in the Context of a Subsequent Determination 
Regarding Eligibility for Extension of Petition Validity,'' HQPRD 
72/11.3 (Apr. 23, 2004).
    \48\ See USCIS, ``Rescission of Guidance Regarding Deference to 
Prior Determinations of Eligibility in the Adjudication of Petitions 
for Extension of Nonimmigrant Status,'' PM-602-0151 (Oct. 23, 2017).
    \49\ See USCIS, ``Deference to Prior Determinations of 
Eligibility in Requests for Extensions of Petition Validity, Policy 
Alert,'' PA-2021-05 (April 27, 2021), https://www.uscis.gov/sites/default/files/document/policy-manual-updates/20210427-Deference.pdf 
(last visited on Mar. 23, 2023).
    \50\ See USCIS Policy Manual, Volume 2, ``Nonimmigrants,'' Part 
A, ``Nonimmigrant Policies and Procedures'', Chapter 4, ``Extension 
of Stay, Change of Status, and Extension of Petition Validity,'' 
Section B, ``Extension of Petition Validity,'' https://www.uscis.gov/policy-manual/volume-2-part-a-chapter-4.
---------------------------------------------------------------------------

    Consistent with current guidance in the USCIS Policy Manual, 
proposed 8 CFR 214.1(c)(5) would provide that when adjudicating a 
request filed on Form I-129 involving the same parties and the same 
underlying facts, USCIS gives deference to its prior determination of 
the petitioner's, applicant's, or beneficiary's eligibility. However, 
USCIS need not give deference to a prior approval if: there was a 
material error involved with a prior approval; there has been a 
material change in circumstances or eligibility requirements; or there 
is new, material information that adversely impacts the petitioner's, 
applicant's, or beneficiary's eligibility.
    Proposed 8 CFR 214.1(c)(5) would apply to all nonimmigrants using 
Form I-129, Petition for a Nonimmigrant Worker, and would include a 
request on Form I-129 involving the same parties and same material 
facts. Currently, the USCIS Policy Manual frames its deference policy 
as applying to requests for an ``extension of petition validity.'' \51\ 
The phrase ``extension of petition validity'' may be misread as 
limiting USCIS's deference policy to petition extensions and excluding 
other types of requests that could involve the same parties and same 
material facts. Thus, DHS proposes to more broadly frame proposed 8 CFR 
214.1(c)(5) as applying to ``a request filed on Form I-129'' and would 
not use the term ``extension of petition validity'' as found in the 
current USCIS Policy Manual.
---------------------------------------------------------------------------

    \51\ See id.
---------------------------------------------------------------------------

5. Evidence of Maintenance of Status
    DHS seeks to clarify current requirements and codify current 
practices concerning evidence of maintenance of status at proposed 8 
CFR 214.1(c)(1) through (7). Maintenance of status in this context 
generally refers to the applicant or beneficiary abiding by the terms 
and conditions of admission or extension of stay, as applicable (for 
example, if admitted as an H-1B nonimmigrant, the individual worked 
according to the terms and conditions of the H-1B petition approval on 
which their status was granted and did not engage in activities that 
would constitute a violation of status, such as by working without 
authorization). Primarily, DHS seeks to clarify that evidence of 
maintenance of status is required for petitions where there is a 
request to extend or amend the beneficiary's stay. These changes would 
impact the population of nonimmigrants named in 8 CFR 214.1(c)(1): E-1, 
E-2, E-3, H-1B, H-1B1, H-2A, H-2B, H-3, L-1, O-1, O-2, P-1, P-2, P-3, 
Q-1, R-1, and TN nonimmigrants.
    First, DHS would add a new provision at proposed 8 CFR 214.1(c)(6), 
which would provide, in part, that an applicant or petitioner seeking 
an extension of stay must submit supporting evidence to establish that 
the applicant or beneficiary maintained the previously accorded 
nonimmigrant status before the extension request was filed.\52\ 
Proposed 8 CFR 214.1(c)(6) would further provide that evidence of such 
maintenance of status may include, but is not limited to: copies of 
paystubs, W-2 forms, quarterly wage reports, tax returns, contracts, 
and work orders. This is consistent with the nonimmigrant petition form 
instructions, which state that for all classifications, if a 
beneficiary is seeking a change of status (COS) or extension of stay, 
evidence of maintenance of status must be included with the new 
petition.\53\ The form instructions further state that if the 
beneficiary is employed in the United States, the petitioner may submit 
copies of the beneficiary's last two pay stubs, Form W-2, and other 
relevant evidence, as well as a copy of the beneficiary's Form I-94, 
passport, travel document, or Form I-797.\54\ By proposing to codify 
these instructions, DHS hopes to clarify that petitioners should 
demonstrate such eligibility by submitting supporting documentation 
upfront with the extension of stay request, rather than waiting for 
USCIS to issue a request for additional

[[Page 72881]]

information such as a request for evidence (RFE) or notice of intent to 
deny (NOID). Under proposed 8 CFR 214.1(c)(6) DHS further proposes to 
include additional examples of evidence to demonstrate maintenance of 
status, which include, but are not limited to: quarterly wage reports, 
tax returns, contracts, and work orders. By clearly stating what types 
of supporting documentation will help USCIS in adjudicating extension 
petitions, DHS hopes to further reduce the need for RFEs and NOIDs, 
which can be burdensome to both USCIS and petitioners.
---------------------------------------------------------------------------

    \52\ This is subject to the exception in 8 CFR 214.1(c)(4).
    \53\ See USCIS, Form I-129 Instructions, ``Instructions for 
Petition for Nonimmigrant Worker,'' at 6, https://www.uscis.gov/sites/default/files/document/forms/i-129instr.pdf (last visited Aug. 
23, 2023).
    \54\ See id.
---------------------------------------------------------------------------

    Requiring petitioners (or applicants, in the case of E 
nonimmigrants) to submit supporting evidence to establish that the 
beneficiary (or applicant) maintained the previously accorded 
nonimmigrant status before the extension of stay request was filed 
would not conflict with USCIS's current and proposed deference policy. 
Although USCIS defers to prior USCIS determinations of eligibility in 
extension requests, USCIS would not be able to defer to a prior 
determination of maintenance of status during the preceding stay 
because it would not have made such a determination until adjudicating 
the extension of stay request. Even if there was a prior determination, 
USCIS need not give deference when there was a material error involved 
with a prior approval; a material change in circumstances or 
eligibility requirements; or new, material information that adversely 
impacts the petitioner's, applicant's, or beneficiary's eligibility. 
Without supporting evidence to demonstrate maintenance of status, it is 
unclear how USCIS would determine if there was a material error, 
material change, or other new material information. For example, 
evidence pertaining to the beneficiary's continued employment (e.g., 
paystubs) may help USCIS to determine whether the beneficiary was being 
employed consistent with the prior petition approval or whether there 
might have been material changes in the beneficiary's employment (e.g., 
a material change in the place of employment).
    Thus, proposed 8 CFR 214.1(c)(6) would make clear that it is the 
filers' burden to demonstrate that status was maintained before the 
extension of stay request was filed. This would be consistent with 
current 8 CFR 214.1(c)(4), which states that, ``An extension of stay 
may not be approved for an applicant who failed to maintain the 
previously accorded status . . ., '' as well as proposed 8 CFR 
214.1(c)(4)(i), which would state that, ``An extension or amendment of 
stay may not be approved for an applicant or beneficiary who failed to 
maintain the previously accorded status . . .''
    In line with proposed 8 CFR 214.1(c)(6), DHS is proposing to amend 
8 CFR 214.2(h)(14) by removing the sentence ``Supporting evidence is 
not required unless requested by the director.'' This sentence causes 
confusion because it implies that supporting evidence is not required, 
contrary to current 8 CFR 214.1(c)(1) (a request for an extension of 
stay must be filed ``on the form designated by USCIS, . . . with the 
initial evidence specified in Sec.  214.2, and in accordance with the 
form instructions'') and the form instructions (``[f]or all 
classifications, if a beneficiary is seeking a [COS] or extension of 
stay, evidence of maintenance of status must be included with the new 
petition'').\55\ Removing this sentence from proposed 8 CFR 
214.2(h)(14) should further reduce the need for RFEs or NOIDs.
---------------------------------------------------------------------------

    \55\ See USCIS, Form I-129 Instructions, ``Instructions for 
Petition for Nonimmigrant Worker,'' at 6, https://www.uscis.gov/sites/default/files/document/forms/i-129instr.pdf (last visited Aug. 
23, 2023).
---------------------------------------------------------------------------

    For the same reasons, DHS is also proposing to remove the same or 
similar sentence found in the regulations for the L, O, and P 
nonimmigrant classifications. Specifically, DHS proposes to amend 8 CFR 
214.2(l)(14)(i) by removing the sentence ``Except in those petitions 
involving new offices, supporting documentation is not required, unless 
requested by the director.'' DHS proposes to amend 8 CFR 214.2(o)(11) 
and (p)(13) by removing the sentence ``Supporting documents are not 
required unless requested by the Director.'' DHS is proposing technical 
changes to add the word ``generally'' to 8 CFR 214.2(l)(14)(i), 
(o)(11), and (p)(13), to account for untimely filed extensions that are 
excused consistent with 8 CFR 214.1(c)(4). As stated above, removing 
this sentence should reduce the need for RFEs or NOIDs. Further, it 
would not add an additional burden on the petitioner or applicant.
    In addition, DHS proposes to codify its longstanding practice of 
requiring evidence of maintenance of status for petitions requesting to 
amend a beneficiary's stay in the United States. The proposed rule 
would add language to clarify that the petitioner must submit initial 
evidence that the beneficiary maintained the previously accorded status 
before the amendment of stay petition was filed. Failure to establish 
maintenance of status would result in a denial of the request to amend 
the beneficiary's stay in the United States, unless USCIS determines 
that the failure to timely file the amendment of stay was due to 
extraordinary circumstances. See proposed 8 CFR 214.1(c)(1), (4), (6), 
and (7). DHS would also update the Form I-129, Petition for a 
Nonimmigrant Worker, as well as the form filing instructions to 
coincide with and support these changes, as well as provide clarity 
about when an amended petition is appropriate, including the 
requirement of establishing maintenance of status for amendment of stay 
requests.
    Current 8 CFR 214.1(c)(1) generally requires evidence of 
maintenance of status with an extension of stay request, and 8 CFR 
214.1(c)(4) generally states that an extension of stay may not be 
approved where a beneficiary failed to maintain the previously accorded 
status. DHS proposes to add specific references to requests to ``amend 
the terms and conditions of the nonimmigrant's stay without a request 
for additional time'' or for an ``amendment of stay'' to proposed 8 CFR 
214.1(c)(1), (4), (6), and (7), so that these regulations clearly 
convey that evidence of maintenance of status is also required for 
petitions requesting to amend a beneficiary's stay in the United 
States, even when the petition is not requesting additional time beyond 
the period previously granted. For example, a petitioner may request to 
amend the stay of the beneficiary when filing an amended petition but 
not seek additional time for the beneficiary's stay because the 
beneficiary may have an unexpired I-94 that has been granted until the 
end of the 6-year period of admission and is not yet eligible for an 
exemption from the 6-year period of admission limitation. In that 
example, the petitioner may seek authorization for the beneficiary to 
remain in the United States, but under different terms and conditions 
than previously granted, without requesting additional time. A 
petitioner filing an amended petition with a request to amend the terms 
and conditions of the beneficiary's stay, but without a request for 
additional time, would not specifically request an ``extension of 
stay'' on the Form I-129 petition. Nevertheless, DHS considers a 
petition requesting to amend the terms and conditions of the 
beneficiary's stay to be substantively equivalent to an extension of 
stay request for purposes of establishing maintenance of status and 
will exercise discretion when granting such requests. In other words, 
DHS considers an amendment of stay request as a request to continue to 
allow the beneficiary to remain in the United States based upon the 
amended

[[Page 72882]]

conditions for a period of stay that has already been granted. 
Therefore, DHS believes that it is reasonable to require evidence that 
maintenance of status has been satisfied, before USCIS may favorably 
exercise its discretion to grant an amendment of stay request. Further, 
including amendments of stay under 8 CFR 214.1(c) would close a 
potential loophole of using an amended petition for a beneficiary who 
has not maintained status, yet wishes to remain in the United States, 
without having to depart and be readmitted in that status.
    Currently, most petitioners filing to amend a beneficiary's stay 
already submit evidence of maintenance of status; however, if an 
amended petition does not contain evidence of maintenance of status, 
USCIS typically issues a request for such evidence. By proposing to 
codify current practice in 8 CFR 214.1(c), DHS hopes to clarify that 
petitioners should demonstrate eligibility by submitting evidence of 
maintenance of status with the amendment of stay request (just like 
with an extension of stay request), rather than waiting for USCIS to 
request this information. By clearly stating what types of supporting 
documentation will help USCIS in adjudicating requests to amend a 
beneficiary's stay, DHS hopes to further reduce the need for RFEs and 
NOIDs, which can be burdensome for petitioners and USCIS, and generally 
extends the time needed to complete the adjudication of the petition.
    Specifically, DHS proposes to revise 8 CFR 214.1(c)(4), to add a 
reference to an ``amendment'' of stay. Aside from clarifying that 
evidence of maintenance of status would be required in an amendment of 
stay request, this change would also clarify that USCIS can excuse the 
late filing of an amendment of stay request under the circumstances 
described at proposed 8 CFR 214.1(c)(4)(i)(A) through (D). ``Late 
filing'' in this context would include certain extension of stay 
requests filed after the expiration date on the Form I-94. A ``late 
filing'' would also encompass, for example, a request for an amendment 
of stay that was filed after the beneficiary temporarily stopped 
working due to extraordinary circumstances beyond their control. DHS 
would clarify in proposed 8 CFR 214.1(c)(4)(ii) that, if USCIS excuses 
the late filing of an amendment of stay request, it would do so without 
requiring the filing of a separate application or petition and would 
grant the amendment of stay, if otherwise eligible, from the date the 
petition was filed.\56\
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    \56\ Proposed 8 CFR 214.1(c)(4)(ii) would continue to state, 
with minor revisions, that if USCIS excuses the late filing of an 
extension of stay request, it will do so without requiring the 
filing of a separate application or petition and will grant the 
extension of stay from the date the previously authorized stay 
expired or the amendment of stay from the date the petition was 
filed.
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    DHS proposes nonsubstantive edits to improve readability to 8 CFR 
214.1(c)(4). DHS also proposes nonsubstantive edits in proposed 8 CFR 
214.1(c)(1) and (4) to add references to a ``beneficiary,'' 
``petition,'' or ``Form I-129,'' to account for the extension or 
amendment of stay being requested on the Form I-129 petition, and to 
replace ``alien'' with ``beneficiary'' and ``Service'' with ``USCIS.'' 
With respect to proposed 8 CFR 214.1(c)(7), this provision would 
contain the same language as current 8 CFR 214.1(c)(5), except that DHS 
would add references to an ``amendment'' of stay and make other 
nonsubstantive edits similar to the ones described above.
6. Eliminating the Itinerary Requirement for H Programs
    DHS is proposing to eliminate the H programs' itinerary 
requirement. See proposed 8 CFR 214.2(h)(2)(i)(B) and (F). Current 8 
CFR 214.2(h)(2)(i)(B) states that ``A petition that requires services 
to be performed or training to be received in more than one location 
must include an itinerary with the dates and locations of the services 
or training and must be filed with USCIS as provided in the form 
instructions.'' In addition, current 8 CFR 214.2(h)(2)(i)(F), for 
agents as petitioners, contains itinerary requirement language.
    The information provided in an itinerary is largely duplicative of 
information already provided in the LCA for H-1B petitions and the 
temporary labor certification (TLC) for H-2 petitions. The LCA and TLC 
require the petitioner to the list the name and address where work will 
be performed, as well as the name and address of any secondary entity 
where work will be performed. It is also largely duplicative of 
information already provided on the Form I-129, which requires the 
petitioner to provide the address where the beneficiary will work if 
different from the petitioner's address listed on the form.\57\ 
Therefore, eliminating the itinerary requirement would reduce 
duplication that increases petitioner burden and promote more efficient 
adjudications, without compromising program integrity. Furthermore, 
USCIS no longer applies the itinerary requirement to H-1B petitions 
governed by 8 CFR 214.2(h)(2)(i)(B), as memorialized in USCIS Policy 
Memorandum PM-602-0114, ``Rescission of Policy Memoranda'' (June 17, 
2020) (rescinding USCIS Policy Memorandum PM-602-0157, ``Contracts and 
Itineraries Requirements for H-1B Petitions Involving Third-Party 
Worksites'' (Feb. 22, 2018)).\58\
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    \57\ See USCIS, Form I-129, ``Petition for a Nonimmigrant 
Worker,'' https://www.uscis.gov/sites/default/files/document/forms/i-129.pdf (last visited Mar. 14, 2023).
    \58\ USCIS issued policy memorandum PM-602-0114 following the 
decision of the U.S. District Court for the District of Columbia in 
ITServe Alliance, Inc. v. Cissna, 443 F. Supp. 3d 14, 42 (D.D.C. 
2020) (``the itinerary requirement in the INS 1991 Regulation 
[codified at 8 CFR 214.2(h)(2)(i)(B)] . . has been superseded by 
statute and may not be applied to H-1B visa applicants''). See also 
Serenity Info Tech, Inc. v. Cuccinelli, 461 F. Supp. 3d 1271, 1285 
(N.D. Ga. 2020) (citing ITServe).
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    To eliminate the unnecessary duplication of work, DHS also proposes 
to eliminate the itinerary requirement for agents acting as petitioners 
at current 8 CFR 214.2(h)(2)(i)(F). In proposing to eliminate the 
itinerary requirement for agents at paragraph (h)(2)(i)(F), DHS also 
proposes to incorporate technical changes to this provision by moving 
language currently found in paragraph (h)(2)(i)(F)(2) to paragraph 
(h)(2)(i)(F)(1); removing paragraph (h)(2)(i)(F)(2); and redesignating 
current paragraph (h)(2)(i)(F)(3) as proposed paragraph 
(h)(2)(i)(F)(2). Proposed 8 CFR 214.2(h)(2)(i)(F)(1) would incorporate 
the following language currently found in paragraph (h)(2)(i)(F)(2): 
``The burden is on the agent to explain the terms and conditions of the 
employment and to provide any required documentation. In questionable 
cases, a contract between the employers and the beneficiary or 
beneficiaries may be required.'' This proposed restructuring at 8 CFR 
214.2(h)(2)(i)(F) is intended to simplify and consolidate the guidance 
for agents as petitioners following the removal of the itinerary 
requirement language.
7. Validity Expires Before Adjudication
    DHS proposes to allow H-1B petitions to be approved or have their 
requested validity period dates extended if USCIS adjudicates and deems 
the petition approvable after the initially requested validity period 
end-date, or the period for which eligibility has been established, has 
passed. This typically would happen if USCIS deemed the petition 
approvable upon a favorable motion to reopen, motion to reconsider, or 
appeal. Specifically, under proposed 8 CFR 214.2(h)(9)(ii)(D)(1), if 
USCIS adjudicates an H-1B petition and deems it otherwise approvable 
after the initially requested validity period end-

[[Page 72883]]

date, or the last day for which eligibility has been established, USCIS 
may issue an RFE asking whether the petitioner wants to update the 
dates of intended employment.
    If in response to the RFE the petitioner confirms that it wants to 
update the dates of intended employment and submits a different LCA 
that corresponds to the new requested validity dates, even if that LCA 
was certified after the date the H-1B petition was filed, and assuming 
all other eligibility criteria are met, USCIS would approve the H-1B 
petition for the new requested period or the period for which 
eligibility has been established, as appropriate, rather than require 
the petitioner to file a new or amended petition. The petitioner's 
request for new dates of employment and submission of an LCA with a new 
validity period that properly corresponds to the revised requested 
validity period on the petition and an updated prevailing or proffered 
wage, if applicable, would not be considered a material change, except 
that the petitioner may not reduce the proffered wage from that 
originally indicated in their petition. See proposed 8 CFR 
214.2(h)(9)(ii)(D)(1). However, the total petition validity period 
would still not be able to exceed 3 years.
    Currently, if USCIS adjudicates and deems these types of petitions 
approvable after the initially requested validity period, or the last 
day for which eligibility has been established, has elapsed, the 
petition must be denied. The petitioner is also not able to change the 
requested validity period using the same petition. Instead, the 
petitioner must file an amended or new petition requesting a new 
validity period if they seek to employ or continue to employ the 
beneficiary. See 8 CFR 214.2(h)(2)(i)(E) and (h)(11)(i)(A). The 
requirement to file an amended or new petition in this circumstance 
results in additional filing costs and burden for the petitioner. It 
also results in unnecessary expenditures of USCIS resources to intake 
and adjudicate another petition, even though the only change generally 
is a new requested validity period due to the passage of time. This is 
not an efficient use of USCIS or the petitioner's resources. In certain 
circumstances this requirement may also result in the H-1B beneficiary 
losing their cap number, which generally would be an unequitable result 
for a petition that was otherwise approvable.
    Aside from changing the requested validity period, the petitioner 
would also be able to increase the proffered wage to conform with a new 
prevailing wage if the prevailing wage has increased due to the passage 
of time. The petitioner would also be able to increase the proffered 
wage for other reasons, such as to account for other market wage 
adjustments. An increase to the proffered wage would not be considered 
a material change, so long as there are no other material changes to 
the position. However, a petitioner would not be allowed to reduce the 
proffered wage, even if the prevailing wage decreased due to the 
passage of time. If the petitioner intends to reduce the proffered wage 
or make any other material change to the proposed employment, it would 
have to file an amended or new petition in accordance with existing 
provisions at 8 CFR 214.2(h)(2)(i)(E) and (h)(11)(i)(A).
    Under proposed 8 CFR 214.2(h)(9)(ii)(D), USCIS would not be 
required to issue an RFE, as it could instead proceed to approve the 
petition for the originally requested period or until the last day for 
which eligibility has been established, as appropriate. For example, 
USCIS would not be required to issue an RFE when the beneficiary has 
already been granted H-1B status through another employer, changed 
nonimmigrant status, adjusted status, or has reached their 6-year 
limitation on stay, such that an RFE asking the petitioner if they want 
to update the requested dates of H-1B employment would serve little or 
no purpose. Consistent with these examples, DHS would consider 
potential factors that could inform whether USCIS issues an RFE as 
including, but not limited to, additional petitions filed or approved 
on the beneficiary's behalf, or the beneficiary's eligibility for 
additional time in H-1B status. See proposed 8 CFR 
214.2(h)(9)(ii)(D)(1) and (2).
    Proposed 8 CFR 214.2(h)(9)(ii)(D)(2) provides that if no RFE is 
issued concerning the requested dates of employment, or if the 
petitioner does not respond, or the response to the RFE does not 
support new dates of employment, the petition would be approved, if 
otherwise approvable, for the originally requested period or until the 
last day for which eligibility has been established, as appropriate. 
The last day for which eligibility has been established could, for 
example, be the date the beneficiary reached their six-year maximum 
limitation on stay, or the end date of the supporting LCA, or one year 
from approval in case of temporary licensure. If the petition is 
approved for the originally requested period or the last day for which 
eligibility has been established, the petition would not be forwarded 
to the U.S. Department of State (DOS) nor would any accompanying 
request for a COS, extension of stay, or amendment of stay, be granted 
because the validity period would have already expired and would 
therefore not support issuance of a visa or a grant of status.

B. Benefits and Flexibilities

1. H-1B Cap Exemptions
    DHS proposes to revise the requirements to qualify for H-1B cap 
exemption under 8 CFR 214.2(h)(8)(iii)(F)(4) when a beneficiary is not 
directly employed by a qualifying institution, organization, or entity. 
DHS also proposes to revise the definition of ``nonprofit research 
organization'' and ``governmental research organization'' under 8 CFR 
214.2(h)(19)(iii)(C). These proposed changes are intended to clarify, 
simplify, and modernize eligibility for cap-exempt H-1B employment, so 
that they are less restrictive and better reflect modern employment 
relationships. The proposed changes are also intended to provide 
additional flexibility to petitioners to better implement Congress's 
intent to exempt from the annual H-1B cap certain H-1B beneficiaries 
who are employed at a qualifying institution, organization, or entity.
    Congress set the current annual regular cap for the H-1B visa 
category at 65,000. See INA section 214(g)(1)(A), 8 U.S.C. 
1184(g)(1)(A). Not all H-1B nonimmigrant visas (or grants of H-1B 
status) are subject to this annual cap. INA section 214(g)(5) allows 
certain employers to employ H-1B nonimmigrant workers without being 
subject to the annual numerical cap. See INA section 214(g)(5), 8 
U.S.C. 1184(g)(5). For example, INA section 214(g)(5)(A) and (B) 
exempts those workers who are employed at an institution of higher 
education or a related or affiliated nonprofit entity, a nonprofit 
research organization or a governmental research organization. See INA 
section 214(g)(5)(A)-(B), 8 U.S.C. 1184(g)(5)(A)-(B).
    Currently, DHS regulations state that an H-1B nonimmigrant worker 
is exempt from the cap if employed by: (1) an institution of higher 
education; (2) a nonprofit entity related to or affiliated with such an 
institution; (3) a nonprofit research organization; or (4) a 
governmental research organization. See 8 CFR 214.2(h)(8)(iii)(F)(1) 
through (3). DHS regulations also state that an H-1B nonimmigrant 
worker may be exempt from the cap when they are not ``directly 
employed'' by a qualifying institution, organization, or entity, if 
they are employed at a qualifying

[[Page 72884]]

institution, organization, or entity so long as: (1) the majority of 
the worker's work time will be spent performing job duties at a 
qualifying institution, organization, or entity; and (2) the worker's 
job duties will directly and predominately further the essential 
purpose, mission, objectives or functions of the qualifying 
institution, organization or entity. See 8 CFR 214.2(h)(8)(iii)(F)(4). 
When relying on this exemption, the H-1B petitioner must also establish 
that there is a nexus between the work to be performed and the 
essential purpose, mission, objectives, or functions of the qualifying 
institution, organization, or entity. Id.
    The H-1B cap exemption regulations define ``nonprofit entity,'' 
``nonprofit research organization,'' and ``governmental research 
organization'' at 8 CFR 214.2(h)(8)(iii)(F)(3). For the definition of 
``nonprofit entity,'' the regulation adopts the definition at 8 CFR 
214.2(h)(19)(iv).\59\ For the definition of ``nonprofit research 
organization'' and ``governmental research organization,'' the 
regulation adopts the definition at 8 CFR 214.2(h)(19)(iii)(C). The 
regulation at 8 CFR 214.2(h)(19)(iii)(C) states that a nonprofit 
research organization is ``primarily engaged in basic research and/or 
applied research,'' while a governmental research organization is a 
Federal, State, or local entity ``whose primary mission is the 
performance or promotion of basic research and/or applied research.'' 
Id.
---------------------------------------------------------------------------

    \59\ 8 CFR 214.2(h)(19)(iii) and (iv) pertains to organizations 
that are exempt from the ACWIA fee for H-1B petitions.
---------------------------------------------------------------------------

    Specifically, DHS proposes to change the phrase ``the majority of'' 
at 8 CFR 214.2(h)(8)(iii)(F)(4) to ``at least half'' to clarify that H-
1B beneficiaries who are not directly employed by a qualifying 
institution, organization, or entity identified in section 214(g)(5)(A) 
or (B) of the Act, who equally split their work time between a cap-
exempt entity and a non-cap-exempt entity, may be eligible for cap 
exemption. See proposed 8 CFR 214.2(h)(8)(iii)(F)(4). The purpose and 
intended effect of the proposed change is to update the standard to 
qualify for this cap exemption, as USCIS has historically interpreted 
``the majority of'' as meaning more than half.\60\ For example, under 
proposed 8 CFR 214.2(h)(8)(iii)(F)(4), a beneficiary who works at a 
for-profit hospital and research center that would not otherwise be a 
qualifying institution would qualify for this cap exemption if the 
beneficiary will spend exactly 50 percent of their time performing job 
duties at a qualifying research organization (and those job duties 
would further an activity that supports or advances one of the 
fundamental purposes, missions, objectives, or functions of the 
qualifying research organization). Under the current regulations, the 
same beneficiary would not qualify because 50 percent would not meet 
the ``majority of'' standard. The application of 8 CFR 
214.2(h)(8)(iii)(F)(4) to a beneficiary who is not directly employed by 
a qualifying institution, organization, or entity identified in section 
214(g)(5)(A) or (B) of the Act would remain unchanged.
---------------------------------------------------------------------------

    \60\ See USCIS, Adjudicator's Field Manual (AFM), Chapter 
31.3(g)(13), ``Cap Exemptions Pursuant to 214(g)(5) of the Act,'' 
https://www.uscis.gov/sites/default/files/document/policy-manual-afm/afm31-external.pdf, at 36 (providing an example of a qualifying 
H-1B cap-exempt petition where the beneficiary ``will spend more 
than half of her time'' working at the qualifying entity). While 
USCIS retired the AFM in May 2020, this example nevertheless 
illustrates the agency's historical interpretation since at least 
June 2006, when chapter 31.3(g)(13) was added. See also USCIS, 
Interoffice Memorandum HQPRD 70/23.12, ``Guidance Regarding 
Eligibility for Exemption from the H-1B Cap Based on Sec.  103 of 
the American Competitiveness in the Twenty-First Century Act of 2000 
(AC21) (Pub. L. 106-313)'' (Jun. 6, 2006), https://www.uscis.gov/sites/default/files/document/memos/ac21c060606.pdf.
---------------------------------------------------------------------------

    DHS also proposes to revise 8 CFR 214.2(h)(8)(iii)(F)(4) to remove 
the requirement that a beneficiary's duties ``directly and 
predominately further the essential purpose, mission, objectives or 
functions'' of the qualifying institution, organization, or entity and 
replace it with the requirement that the beneficiary's duties 
``directly further an activity that supports or advances one of the 
fundamental purposes, missions, objectives, or functions'' of the 
qualifying institution, organization, or entity. See proposed 8 CFR 
214.2(h)(8)(iii)(F)(4).\61\ This proposed change is intended to update 
the availability of cap exemptions to include beneficiaries whose work 
directly contributes to, but does not necessarily predominantly 
further, the qualifying organization's fundamental purpose, mission, 
objectives, or functions. Further, this proposed change, by revising 
``the'' to ``an'', acknowledges that a qualifying organization may have 
more than one fundamental purpose, mission, objective, or function, and 
this fact should not preclude an H-1B beneficiary from being exempt 
from the H-1B cap.
---------------------------------------------------------------------------

    \61\ Although DHS would replace the word ``essential'' with 
``fundamental'' in proposed 8 CFR 214.2(h)(8)(iii)(F)(4), these two 
words are synonymous for purposes of cap exemptions. DHS proposes to 
use ``fundamental'' in proposed 8 CFR 214.2(h)(8)(iii)(F)(4) in 
order to be consistent with current and proposed 8 CFR 
214.2(h)(19)(iii).
---------------------------------------------------------------------------

    Proposed 8 CFR 214.2(h)(8)(iii)(F)(4) would also eliminate the 
sentence stating that the H-1B petitioner has the burden to establish 
that there is a nexus between the beneficiary's duties and the 
essential purpose, mission, objectives or functions of the qualifying 
institution, organization, or entity. Since the petitioner is already 
required to establish that the beneficiary's duties further an activity 
that supports one of the fundamental purposes, missions, objectives, or 
functions of the qualifying entity, it is inherently required to show a 
nexus between the duties and the entity's purpose, mission, objections, 
or functions, and therefore, the ``nexus'' requirement is redundant. 
These proposed changes to 8 CFR 214.2(h)(8)(iii)(F)(4) would provide 
more clarity and flexibility for H-1B beneficiaries who will not be 
directly employed by a qualifying institution, organization, or entity.
    DHS also proposes to clarify that the requirement that the 
beneficiary spend at least half of their work time performing job 
duties ``at'' a qualifying institution should not be taken to mean the 
duties need to be physically performed onsite at the qualifying 
institution. DHS is aware that many positions can be performed 
remotely. When considering whether such a position is cap-exempt, the 
proper focus is on the job duties, rather than where the duties are 
performed physically.
    DHS also proposes to revise 8 CFR 214.2(h)(19)(iii)(C), which 
states that a nonprofit research organization is an entity that is 
``primarily engaged in basic research and/or applied research,'' and a 
governmental research organization is a Federal, State, or local entity 
``whose primary mission is the performance or promotion of basic 
research and/or applied research.'' DHS proposes to replace ``primarily 
engaged'' and ``primary mission'' with ``a fundamental activity of'' to 
permit a nonprofit entity or governmental research organization that 
conducts research as a fundamental activity, but is not primarily 
engaged in research, or where research is not the primary mission, to 
meet the definition of a nonprofit research entity or governmental 
research organization. See proposed 8 CFR 214.2(h)(19)(iii)(C). 
Reorienting the cap exemptions for nonprofit research organizations and 
governmental research organizations to the ``fundamental activity'' 
construct would align these standards with the current ``fundamental 
activity'' standard found for formal written affiliation agreements 
under 8 CFR

[[Page 72885]]

214.2(h)(8)(iii)(F)(2)(iv) and (h)(19)(iii)(B)(4), and would bring more 
clarity and predictability to decision-making, for both adjudicators 
and the regulated community.
    DHS acknowledges that the ``primarily'' and ``primary'' 
requirements at current 8 CFR 214.2(h)(19)(iii)(C) have been in effect 
for over a decade for purposes of cap exemptions, and that DHS declined 
to make the same changes it is currently proposing in response to 
commenters' suggestions when codifying this regulation in 2016.\62\ At 
that time, DHS stated ``that maintaining these longstanding 
interpretations, which include the `primarily' and `primary' 
requirements, will serve to protect the integrity of the cap and fee 
exemptions as well as clarify for stakeholders and adjudicators what 
must be proven to successfully receive such exemptions.'' \63\ However, 
rather than providing clarity, the ``primarily'' and ``primary'' 
requirements have resulted in inconsistency and confusion surrounding 
eligibility for such cap exemptions.\64\
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    \62\ As DHS explained in the final rule, the ``primarily'' and 
``primary'' requirements ``have been in place since 1998 with regard 
to fee exemptions and have been in effect for more than a decade for 
purposes of the cap exemptions.'' See ``Retention of EB-1, EB-2, and 
EB-3 Immigrant Workers and Program Improvements Affecting High-
Skilled Nonimmigrant Workers,'' 81 FR 82398, 82446 (Nov. 18, 2016).
    \63\ Id.
    \64\ See, e.g., Open Society Inst. v. USCIS, 2021 WL 4243403, at 
*1 (D.D.C. 2021) (``Open Society maintains that on over a dozen 
prior occasions USCIS found that Open Society satisfied this 
standard but that in 2020 the agency reversed course without 
sufficient explanation or sound reason.'').
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    In 2015, DHS proposed using the phrase ``primary purpose'' at 8 CFR 
214.2(h)(8)(iii)(F)(2)(iv) and (h)(19)(iii)(B)(4) (addressing cap 
exemption and ACWIA fee exemption, respectively, for a nonprofit entity 
that is related to or affiliated with an institution of higher 
education based on a formal written affiliation agreement).\65\ In the 
2016 final rule, however, DHS explained that it was not pursuing the 
proposed phrase ``primary purpose'' and instead chose to replace it 
with ``fundamental activity'' at 8 CFR 214.2(h)(8)(iii)(F)(2)(iv) and 
(h)(19)(iii)(B)(4) ``to avoid potential confusion'' and to make it 
``clearer that nonprofit entities may qualify for the cap and fee 
exemptions even if they are engaged in more than one fundamental 
activity, any one of which may directly contribute to the research or 
education mission of a qualifying college or university.'' \66\ Even 
though DHS declined to concurrently change the ``primarily'' and 
``primary'' language at current 8 CFR 214.2(h)(19)(iii)(C), DHS 
acknowledges that the ``fundamental activity'' text in current 8 CFR 
214.2(h)(8)(iii)(F)(2)(iv) and (h)(19)(iii)(B)(4) did enhance clarity 
in the intended manner and believes that current 8 CFR 
214.2(h)(19)(iii)(C) would similarly benefit from this proposed change.
---------------------------------------------------------------------------

    \65\ See ``Retention of EB-1, EB-2, and EB-3 Immigrant Workers 
and Program Improvements Affecting High-Skilled Nonimmigrant 
Workers,'' 80 FR 81900 (Dec. 31, 2015) (proposed rule).
    \66\ See ``Retention of EB-1, EB-2, and EB-3 Immigrant Workers 
and Program Improvements Affecting High-Skilled Nonimmigrant 
Workers,'' 81 FR 82398, 82444 (Nov. 18, 2016).
---------------------------------------------------------------------------

    In addition, DHS believes that the proposed ``fundamental 
activity'' standard would still protect the integrity of the cap. While 
changing this terminology may somewhat expand who is eligible for the 
cap exemption, it would still require that an employer demonstrate that 
research is a ``fundamental activity,'' which is a meaningful limiting 
standard. Not every activity an organization engages in would be 
considered a ``fundamental activity.'' A fundamental activity would 
still have to be an important and substantial activity, although it 
need not be the organization's principal or foremost activity as 
required under the current ``primary'' construct.\67\ Further, the 
organization would still need to meet all the other requirements to 
qualify as a nonprofit research organization or governmental research 
organization, including engaging in qualifying research as defined in 
proposed 8 CFR 214.2(h)(19)(iii)(C), and documenting its tax exempt 
status pursuant to proposed 8 CFR 214.2(h)(19)(iv).
---------------------------------------------------------------------------

    \67\ See Open Society Inst. v. USCIS, 2021 WL 4243403, at *5 
(D.D.C. 2021) (``the ordinary meaning of `primarily' as it is used 
in 8 CFR 214.2(h)(19)(iii)(C) is `principally and as distinguished 
from incidentally or secondarily.''').
---------------------------------------------------------------------------

    DHS believes that the ``primarily'' and ``primary'' requirements at 
current 8 CFR 214.2(h)(19)(iii)(C) are too restrictive.\68\ As 
explained above, the current ``primarily'' and ``primary'' construct 
requires a petitioner to demonstrate that research is its principal 
activity, i.e., that research is the main or primary activity.\69\ One 
key difference between the current and proposed standard is that an 
employer could have more than one ``fundamental activity,'' whereas the 
``primary'' or ``primarily'' standard requires that research is the 
employer's foremost and main activity. This proposed change 
acknowledges the reality that nonprofit organizations may engage in 
several important activities. The proposed change modernizes the 
definition of ``nonprofit research organization'' and ``governmental 
research organization'' to include entities that may assist with 
aspects of research throughout the research cycle despite not being 
primarily engaged in performing the research. For example, a nonprofit 
organization with a mission to eradicate malaria that engages in 
lobbying, public awareness, funding medical research, and performing 
its own research on the efficacy of various preventative measures, may 
qualify for H-1B cap exemption even if it was not primarily engaged in 
research. In this example, the organization would still qualify for the 
cap exemption if research were one of several ``fundamental 
activities'' of the organization, as opposed to its primary mission. 
Similarly, a governmental research organization that engages in 
semiconductor manufacturing research and development could qualify for 
H-1B cap exemption if research is a fundamental activity of the 
organization. Under the proposed rule, the organization may be eligible 
for cap exemptions if research is one of its fundamental activities as 
opposed to its primary activity.
---------------------------------------------------------------------------

    \68\ Multiple comments leading to the 2016 final rule also 
expressed concern that the ``primary purpose'' requirement was too 
restrictive, although in the context of 8 CFR 
214.2(h)(8)(ii)(F)(2)(iv) and (h)(19)(iii)(B)(4). 81 FR at 82403.
    \69\ See Open Society Institute v. USCIS, 2021 WL 4243403, at 
*4-5 (D.D.C. 2021) (The court examined AAO's analysis of the term 
``primarily engaged'' and the AAO's conclusion that ``a nonprofit 
organization is ``primarily engaged'' in research if, and only if, 
it is ```directly and principally' engaged in research'': ``. . . 
[While] [Open Society] is `focused on research--researching problems 
in the world, researching possible solutions for those problems, and 
researching how to implement those solutions,' the regulation at 8 
CFR 214.2(h)(19)(iii)(C) defines a nonprofit research organization 
as one that is `primarily engaged' in research, which we interpret 
to mean directly and principally engaged in research. Based on the 
totality of evidence in the record, and considering its research 
activities in proportion to its other activities, we conclude that 
the record does not demonstrate that [Open Society] is directly and 
principally engaged in research. The research conducted by [Open 
Society] is incidental, or, at best, secondary to its principal 
activities: making grants to promote social, legal and economic 
reforms.' '') (changes in original).
---------------------------------------------------------------------------

    DHS also proposes to revise 8 CFR 214.2(h)(19)(iii)(C) to state 
that a ``nonprofit research organization or governmental research 
organization may perform or promote more than one fundamental 
activity.'' See proposed 8 CFR 214.2(h)(19)(iii)(C). This proposed 
change would align with DHS's position that a nonprofit entity may 
engage in more than one fundamental activity under current 8 CFR

[[Page 72886]]

214.2(h)(8)(iii)(F)(2)(iv),\70\ which DHS seeks to codify at proposed 8 
CFR 214.2(h)(8)(iii)(F)(2)(iv) and (h)(19)(iii)(B)(4) as well. DHS 
believes it should apply the same standard that an entity may engage in 
more than one fundamental activity, regardless of whether that entity 
is requesting cap exemption as an ``affiliated or related nonprofit 
entity'' or a ``nonprofit research organization or governmental 
research organization.''
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    \70\ Id. at 82445 (``DHS emphasizes that a nonprofit entity may 
meet this definition even if it is engaged in more than one 
fundamental activity, so long as at least one of those fundamental 
activities is to directly contribute to the research or education 
mission of a qualifying college or university.'').
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    Finally, DHS proposes to add language that both basic and applied 
research may also include ``designing, analyzing, and directing the 
research of others if on an ongoing basis and throughout the research 
cycle.'' See proposed 8 CFR 214.2(h)(19)(iii)(C).
    Taken together, these proposed changes clarify, simplify, and 
modernize eligibility for cap-exempt H-1B employment.\71\ DHS's 
proposed changes to 8 CFR 214.2(h)(8)(iii)(F)(4) and (h)(19)(iii)(C) 
provide additional flexibility to exempt from the H-1B cap certain H-1B 
beneficiaries who are employed at a qualifying institution, 
organization, or entity. These changes are consistent with the language 
of the statute at INA section 214(g)(5)(A) through (B) and would 
further the INA's goals of improving economic growth and job creation 
by facilitating U.S. employers' access to high-skilled workers, 
particularly at these institutions, organizations, and entities.\72\
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    \71\ These proposed changes would also impact eligibility for 
exemption from the ACWIA fees applicable to initial cap-subject 
petitions. The definitions of ``nonprofit research organization'' 
and ``governmental research organization'' at 8 CFR 
214.2(h)(19)(iii)(C), and ``nonprofit entity'' at 8 CFR 
214.2(h)(19)(iv), would continue to apply to which entities are 
exempt from the H-1B- cap as well as which entities are exempt from 
the additional ACWIA fee.
    \72\ See S. Rep. No. 260, 106th Cong., 2nd Sess. (Apr. 11, 
2000), at 10 (AC21 sought to help the American economy by, in part, 
exempting from the H-1B cap ``visas obtained by universities, 
research facilities, and those obtained on behalf of graduate degree 
recipients to help keep top graduates and educators in the 
country.'' See also ``Retention of EB-1, EB-2, and EB-3 Immigrant 
Workers and Program Improvements Affecting High-Skilled Nonimmigrant 
Workers,'' 81 FR 82398, 82447 (Nov. 18, 2016) (``DHS believes that 
its policy extending the cap exemption to individuals employed `at' 
and not simply employed `by' a qualifying institution, organization 
or entity is consistent with the language of the statute and 
furthers the goals of AC21 to improve economic growth and job 
creation by immediately increasing U.S. access to high-skilled 
workers, and particularly at these institutions, organizations, and 
entities.'').
---------------------------------------------------------------------------

    DHS further proposes to amend the definition of ``nonprofit or tax 
exempt organizations'' by eliminating 8 CFR 214.2(h)(19)(iv)(B), which 
currently requires that the petitioner provide evidence that it ``[h]as 
been approved as a tax exempt organization for research or educational 
purposes by the Internal Revenue Service.'' In its experience, USCIS 
has found that Internal Revenue Service (IRS) letters generally do not 
identify the reasons why an entity received approval as a tax exempt 
organization, so current 8 CFR 214.2(h)(19)(iv)(B) imposes an 
evidentiary requirement that is unduly difficult to meet. Proposed 8 
CFR 214.2(h)(19)(iv) would more simply state that a nonprofit 
organization or entity ``must be determined by the Internal Revenue 
Service as a tax exempt organization under the Internal Revenue Code of 
1986, section 501(c)(3) (c)(4), or (c)(6), 26 U.S.C. 501(c)(3), (c)(4), 
or (c)(6).'' While this change would remove the requirement that the 
IRS letter itself state that the petitioner's approval as a tax exempt 
organization was ``for research or educational purposes,'' DHS is not 
proposing to eliminate or otherwise change the overarching requirement 
that a qualifying nonprofit or tax exempt petitioner be an institution 
of higher education or a related or affiliated nonprofit entity, or a 
nonprofit research organization or a governmental research organization 
institution, as required by the regulations and INA section 214(g)(5). 
The petitioner would still need to submit documentation to demonstrate 
that it meets such a requirement, except that the submitted 
documentation would not need to be in the form of an IRS letter.
2. Automatic Extension of Authorized Employment Under 8 CFR 
214.2(f)(5)(vi) (Cap-Gap)
    DHS proposes to revise 8 CFR 214.2(f)(5)(vi) to provide an 
automatic extension of duration of status and post-completion OPT or 
24-month extension of post-completion OPT, as applicable, until April 1 
of the relevant fiscal year for which the H-1B petition is requested. 
See proposed 8 CFR 214.2(f)(5)(vi). Currently, the automatic extension 
is valid only until October 1 of the fiscal year for which H-1B status 
is being requested. This change would result in more flexibility for 
both students and USCIS and would help to avoid disruption to U.S. 
employers that are lawfully employing F-1 students while a qualifying 
H-1B cap-subject petition is pending. As an added integrity measure, 
DHS proposes to specify that the H-1B petition must be ``nonfrivolous'' 
in order for the student to benefit from the cap-gap extension. See 
proposed 8 CFR 214.2(f)(5)(vi)(A)(3).
    Each year, a number of U.S. employers seek to employ F-1 students 
via the H-1B program by requesting a COS and filing an H-1B cap 
petition with USCIS. Because petitioners may not file H-1B petitions 
more than six months before the date of actual need for the 
employee,\73\ the earliest date an H-1B cap-subject petition may be 
filed for a given fiscal year is April 1, six months prior to the start 
of the applicable fiscal year for which initial H-1B classification is 
sought. Many F-1 students complete a program of study or post-
completion OPT in mid-spring or early summer. Per current regulations, 
after completing their program or post-completion OPT, F-1 students 
have 60 days to depart the United States or take other appropriate 
steps to maintain a lawful status. See 8 CFR 214.2(f)(5)(iv). However, 
because the change to H-1B status cannot occur earlier than October 1, 
an F-1 student whose program or post-completion OPT expires in mid-
spring has two or more months following the 60-day period before the 
authorized period of H-1B status can begin. To address this situation, 
commonly known as the ``cap-gap,'' DHS established regulations that 
automatically extended F-1 Duration of Status (D/S) and, if applicable, 
post-completion OPT employment authorization to October 1 for eligible 
F-1 students. See 8 CFR 214.2(f)(5)(vi). The extension of F-1 D/S and 
OPT employment authorization is commonly known as the ``cap-gap 
extension.''
---------------------------------------------------------------------------

    \73\ See 8 CFR 214.2(h)(2)(i)(I).
---------------------------------------------------------------------------

    DHS proposes to further extend F-1 status and post-completion OPT, 
including STEM OPT, in this context.\74\ Under current regulations, the 
automatic cap-gap extension is valid only until October 1 of the fiscal 
year for which H-1B status is being requested. See 8 CFR 
214.2(f)(5)(vi). When the October 1 extension was initially promulgated 
through an interim final rule in 2008, DHS considered it an 
administrative solution to bridge the gap between the end of the 
academic year and the beginning of the fiscal year, when the student's 
H-1B status typically would begin.\75\ When this

[[Page 72887]]

provision was finalized in 2016, DHS responded to commenters requesting 
that DHS revise the cap-gap provision so as to automatically extend 
status and employment authorization ``until adjudication of such H-1B 
petition is complete.'' \76\ Commenters stated that an extension until 
October 1 might have been appropriate in the past, when H-1B petitions 
were adjudicated well before that date, but USCIS workload issues at 
the time the rule was promulgated and the need to respond to RFEs 
delayed such adjudications beyond October 1.\77\ DHS responded that it 
recognized that some cap-subject H-1B petitions remain pending on or 
after October 1 of the relevant fiscal year, but that USCIS prioritizes 
petitions seeking a COS from F-1 to H-1B, which normally results in the 
timely adjudication of these requests, so the vast majority of F-1 
students changing status to H-1B do not experience any gap in 
status.\78\ DHS also explained that it was concerned that extending 
cap-gap employment authorization beyond October 1 would reward 
potentially frivolous filings that would enable students who may 
ultimately be found not to qualify for H-1B status to continue to 
benefit from the cap-gap extension and that the October 1 cut-off 
serves to prevent possible abuse of the cap-gap extension.\79\
---------------------------------------------------------------------------

    \74\ DHS previously proposed extending the cap-gap period, but 
the proposed rule was never finalized and was subsequently 
withdrawn. See ``Establishing a Fixed Time Period of Admission and 
an Extension of Stay Procedure for Nonimmigrant Academic Students, 
Exchange Visitors, and Representatives of Foreign Information 
Media,'' 85 FR 60526 (Sept. 25, 2020) (withdrawn by 86 FR 35410 
(July 6, 2021)).
    \75\ See ``Extending Period of Optional Practical Training by 17 
Months for F-1 Nonimmigrant Students With STEM Degrees and Expanding 
Cap-Gap Relief for All F-1 Students With Pending H-1B Petitions,'' 
73 FR 18944 (Apr. 8, 2008).
    \76\ See ``Improving and Expanding Training Opportunities for F-
1 Nonimmigrant Students With STEM Degrees and Cap-Gap Relief for All 
Eligible F-1 Students,'' 81 FR 13039, 13100 (Mar. 11, 2016).
    \77\ See 81 FR 13040, 13101 (Mar. 11, 2016).
    \78\ Id.
    \79\ Id.
---------------------------------------------------------------------------

    DHS has reconsidered its position in light of recent adjudication 
delays and to avoid potential disruptions in employment authorization. 
With the consistently high volume of cap-subject H-1B petitions filed 
within a short period of time each year and the long timeframes 
afforded to respond to RFEs, USCIS has, in some years, been unable to 
complete the adjudication of all H-1B cap-subject petitions by October 
1. This has resulted in situations where some individuals must stop 
working on October 1 because the employment authorization provided 
under 8 CFR 214.2(f)(5)(vi) ends on that date, although these 
individuals generally have been allowed to remain in the United States 
in an authorized period of stay while the H-1B petition and COS 
application is pending.
    To account for this operational issue, DHS is proposing to revise 8 
CFR 214.2(f)(5)(vi) to provide an automatic extension of F-1 status and 
post-completion OPT, or 24-month extension of post-completion OPT, as 
applicable, until April 1 of the fiscal year for which the H-1B 
petition is filed, or until the validity start date of the approved H-
1B petition, whichever is earlier. This provision would extend the 
student's F-1 status and employment authorization, as applicable, 
automatically if a nonfrivolous H-1B petition requesting a COS is 
timely filed on behalf of the F-1 student. See proposed 8 CFR 
214.2(f)(5)(vi)(A). However, if the F-1 student's COS request is still 
pending at the end of the cap-gap period, then their employment 
authorization would terminate on March 31, and the F-1 student would no 
longer be authorized for employment on this basis as of April 1 of the 
fiscal year for which H-1B classification is sought. If the H-1B 
petition underlying the cap-gap extension is denied before April 1, 
then, consistent with existing USCIS practice, the F-1 beneficiary of 
the petition, as well as any F-2 dependents, would generally receive 
the standard F-1 grace period of 60 days to depart the United States or 
take other appropriate steps to maintain a lawful status.\80\ If the H-
1B petition is still pending on April 1, then the beneficiary of the 
petition is no longer authorized for OPT and the 60-day grace period 
begins on April 1. The F-1 beneficiary may not work during the 60-day 
grace period.
---------------------------------------------------------------------------

    \80\ See 8 CFR 214.2(f)(5)(iv).
---------------------------------------------------------------------------

    Changing the automatic extension end date from October 1 to April 1 
of the relevant fiscal year would prevent the disruptions in employment 
authorization that some F-1 nonimmigrants seeking cap-gap extensions 
have experienced over the past several years. DHS recognizes the 
hardships that a disruption in employment authorization could cause to 
both the affected individual and their employer and seeks to prevent 
potential future disruptions by extending cap-gap relief. According to 
USCIS data for FY 2016-22, USCIS has adjudicated approximately 99 
percent of H-1B cap-subject petitions requesting a COS from F-1 to H-1B 
by April 1 of the relevant fiscal year.\81\ As a result of this 
proposed cap-gap extension, DHS expects USCIS would be able to 
adjudicate nearly all H-1B cap-subject petitions requesting a COS from 
F-1 to H-1B by the April 1 deadline.
---------------------------------------------------------------------------

    \81\ USCIS, OP&S Policy Research Division (PRD), Computer-Linked 
Application Information Management System 3 (C3) database, Oct. 27, 
2022. PRD187.
---------------------------------------------------------------------------

    In addition to avoiding employment disruptions, the lengthier 
extension of F-1 status and post-completion OPT or 24-month extension 
of post-completion OPT employment authorization for students with 
pending H-1B petitions until April 1, which is one year from the 
typical initial cap filing start date, accounts for USCIS' competing 
operational considerations and would enable the agency to balance 
workloads more appropriately for different types of petitions.
    Although DHS previously expressed the concern that extending cap-
gap employment authorization could potentially enable students who 
ultimately may be found not to qualify for H-1B status to continue to 
benefit from the cap-gap extension,\82\ and thus encourage frivolous 
filings, DHS has reconsidered its position. It is now DHS's position 
that extending the cap-gap period would not significantly increase the 
risk of frivolous filings. Because there is no way of knowing whether 
USCIS would complete adjudication of a petition before October 1 or 
April 1 of the fiscal year, there should be little incentive to submit 
a frivolous filing solely to obtain the longer cap-gap extension 
period. The H-1B petition would still have to be filed with all 
appropriate fees, which can be substantial for an initial cap filing. 
Moreover, if the petition is denied, the beneficiary's cap-gap 
eligibility ends immediately. Accordingly, frivolous petitions or 
petitions filed solely to obtain cap-gap protections would run the risk 
of simply being denied prior to October 1. This would result in no 
additional benefit from the expanded timeframe. Any risk of fraud is 
already inherent in providing cap-gap relief itself, and DHS is unaware 
of any additional risk presented by extending the cap-gap period. DHS 
proposes to explicitly state that the H-1B petition must be 
nonfrivolous at proposed 8 CFR 214.2(f)(5)(vi)(A)(3) to further deter 
frivolous filings. This would bolster integrity because if USCIS 
determines the filing to be frivolous, then the beneficiary would not 
have qualified for the cap-gap protection and may be deemed to have 
failed to maintain status and, if applicable, worked without 
authorization. Given the importance of ensuring that the United States 
attracts and retains top talent from around the globe, DHS believes 
that the benefits of this proposed cap-gap extension far outweigh the 
risk of abuse.
---------------------------------------------------------------------------

    \82\ See 81 FR 13039, 13101 (Mar. 11, 2016).
---------------------------------------------------------------------------

3. Start Date Flexibility for Certain H-1B Cap-Subject Petitions
    DHS proposes to eliminate all the text currently at 8 CFR 
214.2(h)(8)(iii)(A)(4), which relates to a limitation on the

[[Page 72888]]

requested start date, because the current regulatory language is 
ambiguous.\83\ DHS's proposal to eliminate the current language at 8 
CFR 214.2(h)(8)(iii)(A)(4) would provide clarity and flexibility to 
employers with regard to the start date listed on H-1B cap-subject 
petitions. This proposal also would align the regulations related to H-
1B cap-subject petitions with current USCIS practice, which is to 
permit a requested petition start date of October 1 or later, as long 
as the requested petition start date does not exceed six months beyond 
the filing date of the petition, even during the initial registration 
period.\84\ Other restrictions on the petition start date would remain 
in place, such as the requirement that a petition may not be filed 
earlier than six months before the date of actual need. See 8 CFR 
214.2(h)(2)(i)(I). Additionally, a petitioner may file an H-1B cap-
subject petition on behalf of a registered beneficiary for a particular 
fiscal year only after the petitioner's registration for that 
beneficiary has been selected for that fiscal year. See 8 CFR 
214.2(h)(8)(iii)(A)(1).
---------------------------------------------------------------------------

    \83\ DHS is proposing new language at 8 CFR 
214.2(h)(8)(iii)(A)(4) about selecting registrations based on unique 
beneficiaries. DHS discusses this proposal in detail in the preamble 
section describing the proposed changes to the H-1B registration 
system.
    \84\ See USCIS, ``H-1B Electronic Registration Process,'' 
https://www.uscis.gov/working-in-the-united-states/temporary-workers/h-1b-specialty-occupations-and-fashion-models/h-1b-electronic-registration-process (petitioners with a selected 
registration ``must indicate a start date of Oct. 1 . . . . or 
later'') (last visited Nov. 10, 2022).
---------------------------------------------------------------------------

    The current regulation at 8 CFR 214.2(h)(8)(iii)(A)(4) states, ``A 
petitioner may submit a registration during the initial registration 
period only if the requested start date for the beneficiary is the 
first day for the applicable fiscal year.'' This language is ambiguous 
as to whether the ``requested start date'' is the start date of the 
registration or the petition. This has led to confusion as the H-1B cap 
registration system currently does not ask for the requested start date 
for the beneficiary. The start date would only be relevant upon the 
filing of the petition, but the regulation refers to submitting ``a 
registration with a requested start date.'' Further, current 8 CFR 
214.2(h)(8)(iii)(A)(4) states that, ``If USCIS keeps the registration 
period open beyond the initial registration period, or determines that 
it is necessary to re-open the registration period, a petitioner may 
submit a registration with a requested start date after the first 
business day for the applicable fiscal year.'' Given the potential for 
multiple registration periods, however, the current regulation is 
potentially confusing regarding the intended start date and what start 
date a petitioner is permitted to request on a cap-subject petition.
    As stated above, DHS's proposal to eliminate the current language 
at 8 CFR 214.2(h)(8)(iii)(A)(4) would provide clarity and flexibility 
to employers. The need to eliminate potential confusion regarding 
permissible requested start dates on cap-subject petitions emerged 
during the FY 2021 registration and filing season, the first year of 
the electronic registration process. The electronic registration period 
for FY 2021 ran from March 1, 2020, to March 20, 2020. First, USCIS 
selected registrations submitted on behalf of all beneficiaries, 
including those eligible for the advanced degree exemption. USCIS then 
selected from the remaining registrations a sufficient number projected 
to reach the advanced degree exemption. The selection process was 
completed on March 27, 2020, and USCIS began to notify employers of 
selection results. The initial petition filing period began on April 1, 
2020, and lasted 90 days. Due to multiple factors occurring during the 
FY 2021 registration and initial filing period (most notably that it 
was the first year that the electronic registration system was in place 
as well as it being the early months of the COVID-19 pandemic with its 
unforeseen consequences), USCIS received fewer petitions than projected 
as needed to reach the numerical allocations under the statutory cap 
and advanced degree exemption. In August 2020, USCIS selected 
additional registrations and permitted those prospective petitioners 
with a selected registration or registrations to file petitions before 
November 16, 2020. Due to the additional selection period, the filing 
window went beyond October 1, leading some petitioners to indicate a 
start date after October 1, 2020.
    Although USCIS permitted employers to file petitions after October 
1, 2020, USCIS rejected or administratively closed many petitions that 
did not list a start date of October 1, 2020, pursuant to current 8 CFR 
214.2(h)(8)(iii)(A)(4). As a result, many petitioners had to backdate 
the requested start date on the petition, even though the start date 
listed on the petition consequently may have been before the start date 
identified on the accompanying LCA. On June 23, 2021, USCIS announced 
its reconsideration of those rejected or administratively closed 
petitions.\85\ The agency announced that it would permit petitioners to 
resubmit any FY 2021 H-1B cap-subject petitions that were rejected or 
administratively closed solely because the petition requested a start 
date after October 1, 2020.
---------------------------------------------------------------------------

    \85\ See USCIS, ``USCIS Will Allow Resubmission of Certain FY 
2021 H-1B Petitions Rejected or Closed Due to Start Date,'' https://www.uscis.gov/news/alerts/uscis-will-allow-resubmission-of-certain-fy-2021-h-1b-petitions-rejected-or-closed-due-to-start-date (last 
visited Jan. 26, 2023).
---------------------------------------------------------------------------

    The proposed changes would eliminate the language at current 8 CFR 
214.2(h)(8)(iii)(A)(4), which would clarify for petitioners that they 
may file H-1B cap-subject petitions with requested start dates that are 
after October 1 of the relevant fiscal year. This is consistent with 
current USCIS policy and would eliminate the potential confusion 
resulting from the current regulation with regard to permissible start 
dates for employers submitting H-1B cap-subject petitions.\86\ While 
the requested start date may be later than October 1, it must be six 
months or less from the date the petition is filed.\87\ If the 
requested start date is more than six months after the petition is 
filed, the petition will be denied or rejected.\88\
---------------------------------------------------------------------------

    \86\ See USCIS, ``H-1B Electronic Registration Process'' (last 
reviewed/updated Apr. 25, 2022), https://www.uscis.gov/working-in-the-united-states/temporary-workers/h-1b-specialty-occupations-and-fashion-models/h-1b-electronic-registration-process (Q4: ``If we 
selected your registration, you must indicate a start date of Oct. 1 
. . . or later.'').
    \87\ See 8 CFR 214.2(h)(2)(i)(I).
    \88\ See id.
---------------------------------------------------------------------------

    DHS's proposal to eliminate the current language at 8 CFR 
214.2(h)(8)(iii)(A)(4) would not affect the requirement that an H--1B 
cap-subject petition must be based on a valid registration for the same 
beneficiary and the same fiscal year. This requirement is reflected in 
existing USCIS guidance \89\ and the current regulation at 8 CFR 
214.2(h)(8)(iii)(A)(1), which states that ``A petitioner may file an H-
1B cap-subject petition on behalf of a registered beneficiary only 
after the petitioner's registration for that beneficiary has been 
selected for that fiscal year.'' While DHS intends to remove this 
particular sentence at proposed 8 CFR 214.2(h)(8)(iii)(A)(1) to reflect 
changes resulting from the beneficiary-centric selection process, DHS 
proposes to add the same requirement that the registration and petition 
be for the same fiscal year by adding ``for the same fiscal

[[Page 72889]]

year'' to the immediately preceding sentence discussing the eligibility 
requirements to file an H--1B cap-subject petition based on the 
registration. Thus, proposed 8 CFR 214.2(h)(8)(iii)(A)(1) would state, 
``To be eligible to file a petition for a beneficiary who may be 
counted against the H-1B regular cap or the H-1B advanced degree 
exemption for a particular fiscal year, a registration must be properly 
submitted in accordance with 8 CFR 103.2(a)(1), paragraph (h)(8)(iii) 
of this section, and the form instructions, for the same fiscal year.''
---------------------------------------------------------------------------

    \89\ See USCIS, ``H-1B Specialty Occupations, DOD Cooperative 
Research and Development Project Workers, and Fashion Models,'' 
https://www.uscis.gov/working-in-the-united-states/h-1b-specialty-occupations (``A cap-subject H-1B petition will not be considered to 
be properly filed unless it is based on a valid, selected 
registration for the same beneficiary and the appropriate fiscal 
year''.).
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C. Program Integrity

1. The H-1B Registration System
    Through issuance of a final rule in 2019, Registration Requirement 
for Petitioners Seeking To File H-1B Petitions on Behalf of Cap-Subject 
Aliens, DHS developed a new way to administer the H-1B cap selection 
process to streamline processing and provide overall cost savings to 
employers seeking to file H-1B cap-subject petitions.\90\ In 2020, 
USCIS implemented the first electronic registration process for the FY 
2021 H-1B cap. In that year, prospective petitioners seeking to file H-
1B cap-subject petitions (including for beneficiaries eligible for the 
advanced degree exemption) were required to first electronically 
register and pay the associated H-1B registration fee for each 
prospective beneficiary.
---------------------------------------------------------------------------

    \90\ See ``Registration Requirement for Petitioners Seeking To 
File H-1B Petitions on Behalf of Cap-Subject Aliens,'' 84 FR 888 
(Jan. 31, 2019).
---------------------------------------------------------------------------

    Under this process, prospective petitioners (also known as 
registrants) that seek to employ H-1B cap-subject workers must complete 
a registration process that requires only basic information about the 
prospective petitioner and each requested worker. The H-1B selection 
process is then run on properly submitted electronic registrations. 
Only those with valid selected registrations are eligible to file H-1B 
cap-subject petitions.
    Per regulation, USCIS takes into account historical data related to 
approvals, denials, revocations, and other relevant factors to 
calculate the number of petitions needed to meet the H-1B cap for a 
given fiscal year.\91\ In making this calculation, USCIS considers the 
number of registrations that need to be selected to receive the 
projected number of petitions required to meet the numerical 
limitations.
---------------------------------------------------------------------------

    \91\ See 8 CFR 214.2(h)(8)(iii)(E).
---------------------------------------------------------------------------

    As stated in the proposed rule for the registration requirement, 
DHS proposed this new process, ``to reduce costs for petitioners who 
currently spend significant time and resources preparing petitions and 
supporting documentation for each intended beneficiary without knowing 
whether such petitions will be accepted for processing by USCIS due to 
the statutory allocations.'' \92\ DHS also explained that the 
registration process, ``would help to alleviate administrative burdens 
on USCIS service centers that process H-1B petitions since USCIS would 
no longer need to physically receive and handle hundreds of thousands 
of H-1B petitions (and the accompanying supporting documentation) 
before conducting the random selection process.'' \93\ Several 
stakeholders commented favorably on this proposal, noting that the 
registration requirement would ``reduce waste and increase 
efficiency,'' as well as ``relieve uncertainty for employers and 
employees, and mitigate burdens on USCIS.'' \94\ The H-1B electronic 
registration process continues to be well-received by users, who 
provided a high satisfaction score with the system for FY 2023 (4.84 
out of 5) \95\ and FY 2022 (4.87 out of 5).\96\
---------------------------------------------------------------------------

    \92\ See ``Registration Requirement for Petitioners Seeking To 
File H-1B Petitions on Behalf of Cap-Subject Aliens,'' 83 FR 62406, 
62407 (Dec. 3, 2018).
    \93\ Id. at 62407-08.
    \94\ See ``Registration Requirement for Petitioners Seeking To 
File H-1B Petitions on Behalf of Cap-Subject Aliens,'' 84 FR 888, 
897 (Jan. 31, 2019).
    \95\ See USCIS, ``H-1B Electronic Registration Process'' (last 
updated Apr. 25, 2022), https://www.uscis.gov/working-in-the-united-states/temporary-workers/h-1b-specialty-occupations-and-fashion-models/h-1b-electronic-registration-process.
    \96\ See American Immigration Lawyers Association, ``USCIS 
Provides FY2022 H-1B Cap Registration Process Update,'' https://www.aila.org/infonet/fy2022-h-1b-cap-registration-process-update.
---------------------------------------------------------------------------

    As DHS noted in the final rule implementing the registration 
system, USCIS has authority to collect sufficient information for each 
registration to mitigate the risk that the registration system will be 
flooded with frivolous registrations.\97\ For example, USCIS requires 
each registrant to complete an attestation and noted in the final rule 
that ``individuals or entities who falsely attest to the bona fides of 
the registration and submitted frivolous registrations may be referred 
to appropriate Federal law enforcement agencies for investigation and 
further action as appropriate.'' \98\ DHS revised this attestation 
prior to the FY 2023 cap season, by adding a certification (to which 
the registrant must attest before submission) that the registration 
reflects a legitimate job offer, and that the registrant has ``not 
worked with, or agreed to work with, another registrant, petitioner, 
agent, or other individual or entity to submit a registration to 
unfairly increase chances of selection for the beneficiary or 
beneficiaries in this submission.'' \99\ DHS continues to take steps 
against potential abuse and is in the process of investigating 
potential malfeasance and possible referrals to law enforcement 
agencies. However, the time needed to pursue potential bad actors 
supports an alternative solution. As a result, DHS has determined that 
a more effective way to ensure that the registration system continues 
to serve its purpose of fair and orderly administration of the annual 
H-1B numerical allocations would be to structurally limit the potential 
for bad actors to game the system by changing the selection process so 
that it selects by unique beneficiary rather than by registration.
---------------------------------------------------------------------------

    \97\ See ``Registration Requirement for Petitioners Seeking To 
File H-1B Petitions on Behalf of Cap-Subject Aliens,'' 84 FR 888, 
900, 904 (Jan. 31, 2019).
    \98\ See id. at 900.
    \99\ See Office of Management and Budget (OMB) Control Number 
1615-0144, Information Collection Request Reference Number 202202-
1615-005, supplementary document ``H-1B Registration Tool Copy 
Deck,'' https://www.reginfo.gov/public/do/PRAViewDocument?ref_nbr=202202-1615-005 (received by OMB's Office of 
Information and Regulatory Affairs (OIRA) Feb. 28, 2022, and 
approved without change Aug. 8, 2022).
---------------------------------------------------------------------------

    As detailed in the table below, DHS has seen an increase in the 
number of beneficiaries with multiple registrations submitted on their 
behalf, an increase in the number and percentage of registrations 
submitted for beneficiaries with multiple registrations, an increase in 
the number of beneficiaries having five or more registrations submitted 
on their behalf, and a substantial increase in the total number of 
registrations submitted for a unique individual.
BILLING CODE 9111-97-P

[[Page 72890]]

[GRAPHIC] [TIFF OMITTED] TP23OC23.007

    While DHS recognizes that simply being the beneficiary of multiple 
registrations is not necessarily indicative of fraud or misuse, as 
beneficiaries may legitimately have multiple job offers by different 
employers that are not working together to game the system, it is still 
worth noting the significant increase in individuals with multiple 
registrations for FY22 and FY23. For instance, while DHS is aware that 
multiple petitioners may submit registrations for a highly qualified 
beneficiary, it raises red flags if one beneficiary has 41 or 83 
registrations submitted on their behalf, which occurred in FY22 and 
FY23, respectively.
    Under current regulations, there is no limit on the number of 
registrations that may be submitted on behalf of one unique individual 
by different registrants. DHS is not proposing to limit the number of 
registrations that may be submitted on behalf of a unique individual by 
different registrants, provided that the registrants are not working 
with (or have not agreed to work with) another registrant, petitioner, 
agent, or other individual or entity to submit a registration to 
unfairly increase the chances of selection for a beneficiary. However, 
the data show that multiple registrations on behalf of the same 
individual are increasing. DHS is concerned that this increase in 
multiple registrations may indicate strategic behavior by registrants 
(and beneficiaries working with registrants) to submit increasing 
numbers of registrations, which may be frivolous, to greatly increase a 
beneficiary's chance of selection. This negatively affects the 
integrity of the registration system and selection process.
    DHS is concerned that individuals with large numbers of 
registrations submitted on their behalf are potentially misusing the 
registration system to increase their chances of selection and that the 
registrations submitted may not represent legitimate job offers. The 
possible effect of this increase in multiple registrations, which 
potentially do not represent legitimate job offers, is to skew the 
selection process. Beneficiaries who have multiple registrations 
submitted on their behalf have a significantly higher chance of 
selection. At the same time, an individual's chance of selection with a 
single registration is greatly reduced, as the number of beneficiaries 
with multiple registrations increases.

[[Page 72891]]

[GRAPHIC] [TIFF OMITTED] TP23OC23.008


[[Page 72892]]


[GRAPHIC] [TIFF OMITTED] TP23OC23.009


[[Page 72893]]


[GRAPHIC] [TIFF OMITTED] TP23OC23.010

    Registration data also show patterns of groups of companies 
submitting registrations for the same groups of beneficiaries. When 
selected, these companies then go on to file a minimal number of 
petitions compared to the number of registrations they submitted for 
those beneficiaries. The following tables exemplify how one group of 
companies has submitted large numbers of registrations for a smaller 
number of common beneficiaries over three fiscal years, with the vast 
majority of their total registrations made up of beneficiaries for whom 
other companies in the group also submitted registrations.

[[Page 72894]]

[GRAPHIC] [TIFF OMITTED] TP23OC23.011


[[Page 72895]]


[GRAPHIC] [TIFF OMITTED] TP23OC23.012


[[Page 72896]]


[GRAPHIC] [TIFF OMITTED] TP23OC23.013

    The degree of duplication between the companies raises concern that 
the companies are working with each other to increase their chances of 
selection. This coupled with the fact that the companies routinely have 
over 150 registrations selected each year, but only file between 1 and 
19 petitions, suggests that the registrations submitted by the 
companies for the duplicate beneficiaries may not have represented 
legitimate, bona fide offers of employment. This practice creates a 
disadvantage for companies that are adhering to the requirements of the 
registration and selection process.
    Although there may have been legitimate reasons why a company did 
not file a petition for a beneficiary whose registration was selected, 
the non-filing rates for beneficiaries with multiple registrations is 
significantly higher than that of beneficiaries with single 
registrations. The non-filing rates for beneficiaries with multiple 
registrations raises the question of whether these companies actually 
intended to file an H-1B petition on behalf of the beneficiary when 
they submitted their registrations and did not work with others to 
unfairly improve their chance of selection, as they attested to on the 
Registration Tool when each registration was submitted.

[[Page 72897]]

[GRAPHIC] [TIFF OMITTED] TP23OC23.014

BILLING CODE 9111-97-C
    The registration data also show that the companies with the highest 
rates of non-filing submitted a high percentage of registrations for 
beneficiaries with multiple registrations. In FY23, 97 companies with 
10 or more selections had a non-filing rate of 90 percent or greater. 
Of those 97, the average rate of common beneficiaries among them was 
90.72 percent. Eighteen of the 97 companies had a common beneficiary 
rate of 100 percent. Amongst these 97 companies, the average number of 
registrations per beneficiary was 8.03. In contrast, the companies with 
10 or more selections and a non-filing rate of 10 percent or less, of 
which there were 667, had an average rate of common beneficiaries of 
8.01 percent and submitted registrations for beneficiaries who had an 
average of 1.40 registrations per beneficiary.
    Stakeholders have also identified opportunities for improving the 
registration system in response to a DHS Request for Public Input.\100\ 
For instance, several commenters suggested running the selection 
process based on unique beneficiaries instead of registrations to give 
all beneficiaries an equal playing field, which is what DHS is 
proposing with the beneficiary-centric option described below. 
Commenters also made general suggestions to strengthen the consequences 
of submitting frivolous registrations, which DHS agrees with and has 
expanded upon in its proposals.
---------------------------------------------------------------------------

    \100\ See ``Identifying Barriers Across U.S. Citizenship and 
Immigration Services (USCIS) Benefits and Services; Request for 
Public Input,'' 86 FR 20398 (Apr. 19, 2021).
---------------------------------------------------------------------------

    DHS has a strong interest in ensuring that the annual numerical 
allocations are going to petitioners that truly intend to employ an H-
1B worker, rather than prospective petitioners using the registration 
system as a relatively cheap placeholder for the possibility that they 
may want to employ an H-1B worker or as a way to game the selection 
process. The current registration and selection process would benefit 
from additional guardrails to better ensure the fair allocation of the 
limited H-1B cap numbers to employers and individuals that are 
complying with the regulations and have bona fide, legitimate 
employment in which they intend to employ qualified beneficiaries. 
Accordingly, this rule proposes to further limit the potential for 
abuse of the registration process in three ways.\101\
---------------------------------------------------------------------------

    \101\ In U.S. Citizenship and Immigration Services Fee Schedule 
and Changes to Certain Other Immigration Benefit Request 
Requirements, 88 FR 402, 527 (Jan. 4, 2023) (proposed rule), DHS 
proposed to increase the H-1B registration fee from $10 to $215 per 
registration submitted. While the underlying purpose of the proposed 
fee increase is to ensure full cost recovery for USCIS adjudication 
and naturalization services, DHS recognizes the possibility that the 
increase in the H-1B registration fee may have an impact on the 
number of H-1B registrations submitted, including those submitted to 
improperly increase the chance of selection. However, any potential 
impact of that separate regulatory proposal is purely speculative.
---------------------------------------------------------------------------

    First, if USCIS determines that a random selection process should 
be conducted, DHS proposes to shift from selecting by registration, to 
selecting by unique beneficiary. Under the new proposal, each unique 
individual who has a registration submitted on their behalf would be 
entered into the selection process once, regardless of the number of 
registrations filed on their behalf. By selecting by a unique 
beneficiary, DHS would better ensure that each individual has the same 
chance of being selected, regardless of how many registrations were 
submitted on their behalf.
    Second, DHS proposes to extend the existing prohibition on related 
entities filing multiple petitions \102\ by also prohibiting related 
entities from submitting multiple registrations for the same 
individual. Prohibiting related employers from submitting multiple 
registrations, absent a legitimate business need, would prevent 
employers from submitting registrations when they would not in fact be 
eligible to file a petition based on that registration, if selected.
---------------------------------------------------------------------------

    \102\ See 8 CFR 214.2(h)(2)(i)(G).
---------------------------------------------------------------------------

    Third, DHS proposes to codify USCIS's ability to deny an H-1B 
petition or revoke an H-1B petition's approval when the petition is 
based on a registration where the statement of facts (including the 
attestations) was not true and correct, inaccurate, fraudulent, or 
misrepresented a material fact.
2. Beneficiary Centric Selection
    Under the proposed update to the random selection process, 
registrants

[[Page 72898]]

would continue to submit registrations on behalf of beneficiaries and 
beneficiaries would continue to be able to have more than one 
registration submitted on their behalf, as allowed by applicable 
regulations. If a random selection were necessary, then the selection 
would be based on each unique beneficiary identified in the 
registration pool, rather than each registration. Each unique 
beneficiary would be entered in the selection process once, regardless 
of how many registrations were submitted on their behalf. If a 
beneficiary were selected, each registrant that submitted a 
registration on that beneficiary's behalf would be notified of 
selection and would be eligible to file a petition on that 
beneficiary's behalf. See proposed 8 CFR 214.2(h)(8)(iii)(A)(1) and 
(4). Changing how USCIS conducts the selection process to select by 
unique beneficiaries instead of registrations would significantly 
reduce or eliminate the advantage of submitting multiple registrations 
for the same beneficiary solely to increase the chances of selection 
and should give all beneficiaries an equal chance at selection. It 
could also result in other benefits, such as giving beneficiaries 
greater autonomy regarding their H-1B employment and improving the 
chances of selection for legitimate registrations.
    To ensure that USCIS can accurately identify each potential 
beneficiary, registrants will continue to be required to submit 
identifying information about the beneficiaries as part of the 
registration process. Currently, each registration includes, in 
addition to other basic information, fields for the registrant to 
provide the beneficiary's full name, date of birth, country of birth, 
country of citizenship, gender, and passport number if the beneficiary 
has a passport. Although the Registration Final Rule said the passport 
number would be required and it is requested during registration, 
registrants have been able to effectively bypass the passport 
requirement by affirmatively indicating that the beneficiary does not 
have a passport.\103\
---------------------------------------------------------------------------

    \103\ In response to a comment in the final rule, DHS responded, 
``This final rule requires that each registration include, in 
addition to other basic information, the beneficiary's full name, 
date of birth, country of birth, country of citizenship, gender, and 
passport number.'' ``Registration Requirement for Petitioners 
Seeking To File H-1B Petitions on Behalf of Cap-Subject Aliens,'' 84 
FR 888, 900 (Jan. 31, 2019).
---------------------------------------------------------------------------

    Because the integrity of the new selection process would rely on 
USCIS's ability to accurately identify each individual beneficiary, DHS 
proposes to require the submission of valid passport information, 
including the passport number, country of issuance, and expiration 
date, in addition to the currently required information. See proposed 8 
CFR 214.2(h)(8)(iii)(A)(4)(ii). Registrants would no longer be allowed 
to select an option indicating that the beneficiary does not have a 
passport. Combined with the other collected biographical information, 
the passport number would allow USCIS to identify unique individuals 
more reliably, increasing the likelihood that each individual would 
have the same opportunity to be selected, if random selection were 
required. Beneficiaries would be required to supply the same 
identifying information and passport information to all registrants 
submitting registrations on their behalf. Each beneficiary would only 
be able to be registered under one passport, and the registrant would 
be required to submit the information from the valid passport that the 
beneficiary intends to use for travel to the United States if issued an 
H-1B visa. If the beneficiary were already in the United States and 
were seeking a COS, the registrant would be required to list a valid 
passport. See proposed 8 CFR 214.2(h)(8)(iii)(A)(4)(ii). Even if a 
beneficiary had more than one valid passport, such as a beneficiary 
with dual citizenship, a beneficiary would only be able to be 
registered under one of those passports. If USCIS determined that 
registrations were submitted by either the same or different 
prospective petitioners for the same beneficiary, but using different 
identifying information, USCIS could find all of those registrations 
invalid and could deny or revoke the approval of any petition filed 
based on those registrations. See proposed 8 CFR 
214.2(h)(8)(iii)(A)(2). Petitioners would be given notice and the 
opportunity to respond before USCIS denied or revoked the approval of a 
petition. Petitioners would be asked to explain and document the 
identifying information used in the registration process. Petitioners 
would be encouraged to retain documentation provided by the beneficiary 
prior to registration, including a copy of the passport.
    Any H-1B cap-subject petition must contain and be supported by the 
same identifying information about the beneficiary as provided in the 
selected registration for the beneficiary named in the petition, and 
DHS proposes to require that petitioners submit evidence of the 
passport used at the time of registration to identify the beneficiary. 
See proposed 8 CFR 214.2(h)(8)(iii)(D)(1). USCIS could deny or revoke 
the approval of an H-1B petition that does not meet this proposed 
requirement. USCIS would typically afford the petitioner the 
opportunity to respond when identifying information provided on the 
registration does not match the information provided on the petition, 
and petitioners would need to be prepared to explain and document the 
reason for any change in identifying information. In its discretion, 
USCIS could find that a change in identifying information is 
permissible. Such circumstances could include, but would not be limited 
to, a legal name change due to marriage, change in gender identity, or 
a change in passport number or expiration date due to passport renewal, 
or replacement of a stolen passport, in between the time of 
registration and filing the petition. See proposed 8 CFR 
214.2(h)(8)(iii)(D)(1).
    DHS recognizes that some individuals may not possess a valid 
passport, and therefore the proposed passport requirement would require 
these individuals to obtain a valid passport, at some cost, by the time 
of registration or even preclude individuals from being registered if 
they were unable to obtain a valid passport by the time of 
registration. However, DHS has a strong interest in requiring passport 
information for each beneficiary, regardless of nationality, to better 
identify unique beneficiaries and enhance the integrity of the H-1B 
registration system. Further, DHS believes that requiring passport 
information is reasonable because each registration should represent a 
legitimate job offer. Except in limited situations where the Department 
of State issued a beneficiary a visa on Form DS-232, Unrecognized 
Passport or Waiver Cases, in the absence of a passport, it is not clear 
how most beneficiaries could enter the United States in H-1B status 
pursuant to that job offer. Therefore, the proposed rule, if finalized, 
would only accelerate the time by which the beneficiary needed to 
obtain a passport if the beneficiary did not already have a passport.
    DHS recognizes that stateless individuals may be unable to obtain a 
valid passport and that this passport requirement could preclude some 
stateless individuals from being registered. DHS considered proposing 
an exception to the passport requirement limited solely to stateless 
individuals, but providing an exception would leave open the risk of 
registrants submitting a registration for an individual claiming to be 
stateless and having no passport number and submitting another 
registration for the

[[Page 72899]]

same individual while listing a passport number. At the registration 
stage, USCIS would not be able to determine whether those two 
individuals are the same person or whether the individual is truly 
stateless. Such a determination would require an adjudication of the 
claim of statelessness, but USCIS does not adjudicate the registration. 
Submission of the registration is merely an antecedent procedural 
requirement to file the petition properly and is not intended to 
replace the petition adjudication process or assess the eligibility of 
the beneficiary for the offered position.\104\ DHS also considered the 
possibility of generating a unique identifier for stateless 
individuals, so that registrants could use this number in place of the 
valid passport number on the registration, but believed this option 
would run into the same problems of USCIS not being able to verify a 
claim of statelessness at the registration stage.
---------------------------------------------------------------------------

    \104\ See ``Registration Requirement for Petitioners Seeking To 
File H-1B Petitions on Behalf of Cap-Subject Aliens,'' 84 FR 888, 
900 (Jan. 31, 2019).
---------------------------------------------------------------------------

    Furthermore, DHS considered available data for individuals issued 
H-1B visas or otherwise granted H-1B status from FYs 2010-23. While the 
data are imperfect, the data nevertheless suggest that the proposed 
passport requirement would likely impact a small population of 
stateless individuals. For instance, available data for FYs 2022 and 
2023 show that USCIS received H-1B petitions for nine and four 
individuals, out of a total of 370,110 and 94,649 H-1B petitions, 
respectively, whose country of citizenship were listed as 
``stateless.'' \105\ This represents just 0.0024 percent and 0.0042 
percent, respectively, of all H-1B petitions received those fiscal 
years. These data do not show whether the stateless individuals had a 
valid passport upon their admission into the United States in H-1B 
status; these data also do not show whether any of the four individuals 
for FY 2023 were the same as some of the nine individuals reported for 
FY 2022. Further, the DOS data show that, between FYs 2010-22, a total 
of 89 H-1B visas out of a total of 1,988,856 H-1B visas were issued to 
individuals whose nationalities were listed as ``no nationality.'' 
\106\ This total represents just 0.0045 percent of all H-1B visas 
issued during those years. These data do not show how many of the 89 
total H-1B visas were issued to unique individuals, as individuals 
could have been issued more than one visa during this twelve-year 
timeframe. Again, while acknowledging that the above data are 
imperfect, DHS recognizes that not providing an exception or 
alternative to the passport requirement would potentially impact 
stateless individuals who might be approved for H-1B visas but would be 
ineligible because they are unable to obtain a passport. DHS continues 
to consider options and alternatives to the passport requirement for 
stateless individuals and welcomes public comment on this issue as well 
as the costs and benefits for both petitioners and beneficiaries of 
requiring a passport number at registration.
---------------------------------------------------------------------------

    \105\ See USCIS, OP&S Policy Research Division (PRD), I-129--H-
1B Petitions reported with Stateless Country of Citizenship, ELIS 
Petitions FYs 2020-23, PRD 252. The reported numbers do not include 
beneficiaries whose country of citizenship information was missing, 
blank, or unknown. The reported numbers for FY 2020 and FY 2021 were 
both zero, as USCIS was not using ELIS at that time.
    \106\ DOS, ``Visa Statistics,'' https://travel.state.gov/content/travel/en/legal/visa-law0/visa-statistics.html (last visited 
Mar. 16, 2023).
---------------------------------------------------------------------------

    As discussed above, conducting the registration selection process 
based on unique beneficiaries would significantly reduce or remove the 
advantage of submitting multiple registrations solely to increase the 
chances of selection and better allow for an equal playing field for 
both employers and beneficiaries, while continuing to allow 
beneficiaries to have multiple job offers and multiple registrations. 
This would significantly reduce or remove an incentive for employers 
and individuals to pursue registration without the existence of a bona 
fide job offer and an intent to employ the individual for each 
registration.
    The proposed change would potentially benefit beneficiaries by 
giving them greater autonomy to choose the employer for whom they 
ultimately work. If multiple unrelated companies submitted 
registrations for a beneficiary and the beneficiary were selected, then 
the beneficiary could have greater bargaining power or flexibility to 
determine which company or companies could submit an H-1B petition for 
the beneficiary, because all of the companies that submitted a 
registration for that unique beneficiary would be notified that their 
registration was selected and they are eligible to file a petition on 
behalf of that beneficiary. Under the current selection process, 
however, the beneficiary could only be petitioned for by the specific 
company that submitted the selected registration. While another company 
could subsequently file a petition for concurrent employment, the 
beneficiary would still have to be initially employed in H-1B status by 
the same company that filed the initial cap-subject petition based on 
the selected registration.
    The proposed change may also potentially benefit companies that 
submit legitimate registrations for unique beneficiaries by increasing 
their chances to employ a specific beneficiary in H-1B status. Again, 
under the current selection process, a company could file a petition 
for and employ a beneficiary in H-1B status only if their registration 
for that specific beneficiary was selected. Under the proposed 
beneficiary-centric selection process, any company that submitted a 
registration for a selected beneficiary could file a petition for and 
potentially employ a beneficiary in H-1B status because all of the 
prospective petitioners that submitted a registration for that selected 
beneficiary would receive a selection notice. As previously discussed, 
the data show that the current system may result in an unfair advantage 
of selection for registrations potentially involving prospective 
petitioners that worked together to submit multiple registrations for 
the same beneficiary to unfairly improve their chance of selection. The 
beneficiary-centric process is intended to correct this and level the 
playing field for companies submitting legitimate registrations for 
unique beneficiaries and not attempting to unfairly improve their 
chance of selection.
    DHS is also proposing minor changes to 8 CFR 214.2(h)(8)(iii)(A)(5) 
through (7) and (h)(8)(iii)(E) to conform the regulatory text to the 
proposed new selection process and clarify that USCIS would select 
``beneficiaries'' rather than ``registrations.''
    DHS expects USCIS to have sufficient time to develop, thoroughly 
test, and implement the modifications to the registration system and 
selection process and give stakeholders sufficient time to adjust to 
these new procedures by the time the rule finalizing this proposed rule 
would publish and become effective. USCIS has already begun planning 
the development work of the new selection process in the electronic H-
1B registration tool. As indicated before, DHS may move to finalize 
certain provisions through one or more final rules after carefully 
considering all public comments and may possibly do so in time for the 
FY 2025 cap season, depending on agency resources. In particular, DHS 
may seek to finalize the provisions relating to the beneficiary centric 
registration selection process in proposed 8 CFR 214.2(h)(8)(iii)(A)(4) 
before moving to finalize the other proposed provisions in a separate 
rule.
    However, DHS and USCIS cannot predict, with certainty, agency 
resources for the next few years or even when the

[[Page 72900]]

final rule would publish. Therefore, there is also the possibility that 
DHS would need to delay the effective date of 8 CFR 
214.2(h)(8)(iii)(A)(4). This delayed effective date might only apply to 
the proposed changes describing the beneficiary-centric selection 
process and, in that case, would not impact any other provisions in 
this proposed rule, if finalized.
    DHS may need to delay the effective date if it determines that 
USCIS does not have sufficient time to ensure proper functionality of 
the beneficiary-centric selection process, including completing all 
requisite user testing. DHS may need to delay the effective date for 
other reasons as well, such as to avoid the confusion that could result 
if the final rule took effect too close to the start of the initial 
registration period for the upcoming cap season, or to avoid disparate 
treatment of registrations if the final rule took effect in the middle 
of the initial registration period, or during a subsequent registration 
and selection period, particularly if USCIS needed to open a subsequent 
registration period later that year. In the event DHS needed to further 
delay the effective date of these provisions beyond the effective date 
of the final rule, DHS would publish a Federal Register Notice advising 
the regulated public of the new delayed effective date. That Federal 
Register Notice would be published at least 30 calendar days in advance 
of the first date of the initial registration period.
3. Bar on Multiple Registrations Submitted by Related Entities
    DHS regulations already preclude the filing of multiple H-1B cap-
subject petitions by related entities for the same beneficiary, unless 
the related petitioners can establish a legitimate business need for 
filing multiple cap-subject petitions for the same beneficiary. See 8 
CFR 214.2(h)(2)(i)(G). DHS is not proposing to change that, but, 
rather, is proposing to extend a similar limitation to the submission 
of registrations. See proposed 8 CFR 214.2(h)(2)(i)(G). When an 
employer submits a registration, they attest on the H-1B Registration 
Tool that they intend to file a petition based on that registration. If 
two related employers submit registrations for a cap-subject petition 
for the same beneficiary, without a legitimate business need, both 
employers are attesting to their intent to file a petition for that 
beneficiary. If they are both selected, and they lack a legitimate 
business need, they are left with one of two choices: (1) both file 
petitions in violation of 8 CFR 214.2(h)(2)(i)(G); or (2) do not file 
and potentially violate the attestation made at the time of 
registration. Therefore, employers are left with two bad options. To 
allow related employers to submit registrations, but not allow them to 
file petitions, creates an inconsistency between the antecedent 
procedural step of registration and the petition filing. Extending the 
bar on multiple petition filings by related entities to multiple 
registration submissions by related entities for the same cap-subject 
beneficiary would harmonize the expectations for petition filing and 
registration submission.
    While DHS anticipates that changing the way beneficiaries are 
selected would reduce frivolous registrations and their negative 
effects, DHS cannot guarantee with certainty that this change would 
completely eliminate entities from working with each other to submit 
registrations to unfairly increase chances of selection for a 
beneficiary by submitting slightly different identifying information or 
other means that DHS cannot anticipate. Therefore, adding this 
provision would serve as an additional tool available to DHS to 
militate against such abuse and bolster the integrity of the 
registration process. Furthermore, proposed 8 CFR 214.2(h)(2)(i)(G) is 
necessary because of the possibility that registration could be 
suspended, or that the implementation of the beneficiary-centric 
selection process could be delayed. If registration were suspended, the 
bar on multiple petitions would still be relevant, and if 
implementation of the beneficiary-centric selection process were 
delayed, the bar on multiple registrations would still be relevant.
4. Registrations With False Information or That Are Otherwise Invalid
    Although registration is an antecedent procedural step undertaken 
prior to filing an H-1B cap-subject petition, the validity of the 
registration information is key to the registrant's eligibility to file 
a petition. The information contained in the registration, including 
the required attestations, must be valid. Currently, the regulations 
state that it is grounds for denial or revocation if the statements of 
facts contained in the petition are not true and correct, inaccurate, 
fraudulent, or misrepresented a material fact.\107\ In this rule, DHS 
proposes to codify that those requirements extend to the information 
provided in the registration and to make clear that this includes if 
attestations on the registration are determined to be false. See 
proposed 8 CFR 214.2(h)(10)(ii) and (iii) and (h)(11)(iii)(A)(2).
---------------------------------------------------------------------------

    \107\ See 8 CFR 214.2(h)(10)(ii) and (h)(11)(iii)(A)(2).
---------------------------------------------------------------------------

    To allow companies to provide false information on the registration 
without consequence would allow them to potentially take a cap number 
for which they are ineligible. As such, DHS proposes codifying that 
providing untrue, incorrect, inaccurate, or fraudulent statements of 
fact, or misrepresenting material facts, including providing false 
attestations on the registration, would be grounds for denial or 
revocation of the petition that was based on that registration.
    DHS is also proposing changes to the regulations governing 
registration that would provide USCIS with clearer authority to deny or 
revoke the approval of a petition based on a registration that was not 
properly submitted or was otherwise invalid. Specifically, DHS is 
proposing to add that if a petitioner submits more than one 
registration per beneficiary in the same fiscal year, all registrations 
submitted by that petitioner relating to that beneficiary for that 
fiscal year may be considered not only invalid, but that ``USCIS may 
deny or revoke the approval of any petition filed for the beneficiary 
based on those registrations.'' See proposed 8 CFR 
214.2(h)(8)(iii)(A)(2).
    Additionally, DHS is proposing to add that USCIS may deny or revoke 
the approval of an H-1B petition if it determines that the fee 
associated with the registration is declined, not reconciled, disputed, 
or otherwise invalid after submission. See proposed 8 CFR 
214.2(h)(8)(iii)(D)(2). DHS is also proposing a new provision that adds 
an invalid registration as a ground for revocation. See proposed 8 CFR 
214.2(h)(11)(iii)(A)(6). Through these provisions, DHS aims to bolster 
the integrity of the registration system.
5. Alternatives Considered
    DHS considered the alternative of eliminating the registration 
system and reverting to the paper-based filing system stakeholders used 
prior to implementing registration. However, when DHS considered the 
immense cost savings that registration provides to both USCIS and 
stakeholders and the significant resources the agency would incur to 
revert back to a paper-based filing system for all cap-subject cases, 
the benefits of having a registration system still outweigh the costs 
and any potential problems caused by frivolous filings. As a result, 
DHS is proposing to make changes to the registration system to improve 
it and militate against the potential for frivolous filings. DHS 
continues to consider options to

[[Page 72901]]

improve the registration system and welcomes public comment on this 
issue.
6. Provisions To Ensure Bona Fide Job Offer for a Specialty Occupation 
Position
a. Contracts
    Under proposed 8 CFR 214.2(h)(4)(iv)(C), DHS proposes to codify 
USCIS' authority to request contracts, work orders, or similar 
evidence, in accordance with 8 CFR 103.2(b) (USCIS may request 
additional evidence if the evidence submitted does not establish 
eligibility) and 8 CFR 214.2(h)(9) (``USCIS will consider all the 
evidence submitted and any other evidence independently required to 
assist in adjudication.''). Such evidence may take the form of 
contracts or legal agreements, if available, or other evidence 
including technical documentation, milestone tables, or statements of 
work. Evidence submitted should show the contractual relationship 
between all parties, the terms and conditions of the beneficiary's 
work, and the minimum educational requirements to perform the duties. 
Uncorroborated statements about a claimed in-house project for a 
company with no history of developing projects in-house, standing 
alone, would generally be insufficient to establish that the claimed 
in-house work exists.
    The submitted contracts should include both the master services 
agreement and accompanying statement(s) of work (or similar legally 
binding agreements under different titles) signed by an authorized 
official of any party in the contractual chain, including the 
petitioner, the end-client company for which the beneficiary will 
perform work, and any intermediary or vendor company. In general, the 
master services agreement (also commonly called a supplier agreement) 
sets out the essential contractual terms and provides the basic 
framework for the overall relationship between the parties.\108\ The 
statement of work (also commonly called a work order) provides more 
specific information, such as the scope of services to be performed, 
details about the services, and the allocation of responsibilities 
among the parties.\109\ The petitioner may also submit letters signed 
by an authorized official of the end-client company for which the 
beneficiary will work and any intermediary or vendor company.
---------------------------------------------------------------------------

    \108\ See 3 David M. Adlerstein et at., Successful Partnering 
Between Inside and Outside Counsel sec. 49:35.
    \109\ See 3 David M. Adlerstein et at., Successful Partnering 
Between Inside and Outside Counsel sec. 49:37.
---------------------------------------------------------------------------

    Other types of documentation petitioners may provide include 
technical documentation, milestone tables, marketing analyses, cost-
benefit analyses, brochures, and funding documents. Overall, these 
documents should be detailed enough to provide a sufficiently 
comprehensive view of the position being offered to the beneficiary and 
the terms and conditions under which the work would be performed. The 
documentation should also include the minimum educational requirements 
to perform the duties. Documentation that merely sets forth the general 
obligations of the parties to the agreement, or that does not provide 
specific information pertaining to the actual work to be performed, 
would generally be insufficient.\110\
---------------------------------------------------------------------------

    \110\ When requested evidence may contain trade secrets, for 
example, the petitioner may redact or sanitize the relevant sections 
to provide a document that is still sufficiently detailed and 
comprehensive, yet does not reveal sensitive commercial information. 
However, it is critical that the unredacted information contain all 
information necessary for USCIS to adjudicate the petition. Although 
a petitioner may always refuse to submit confidential commercial 
information, if it is deemed too sensitive, the petitioner must also 
satisfy the burden of proof and runs the risk of denial. Cf. Matter 
of Marques, 16 I&N Dec. 314, 316 (BIA 1977) (in refusing to disclose 
material and relevant information that is within his knowledge, the 
respondent runs the risk that he may fail to carry his burden of 
persuasion with respect to his application for relief).
---------------------------------------------------------------------------

    Through proposed 8 CFR 214.2(h)(4)(iv)(C), DHS seeks to put 
stakeholders on notice of the kinds of evidence that could be requested 
to establish the terms and conditions of the beneficiary's work and the 
minimum educational requirements to perform the duties. This evidence, 
in turn, could establish that the petitioner has a bona fide job offer 
for a specialty occupation position for the beneficiary. DHS is 
proposing conforming changes to the introductory paragraph (h)(4)(iv) 
to distinguish the types of evidence that are required as initial 
evidence addressed in paragraphs (h)(4)(iv)(A) and (B), from the 
evidence USCIS may request under new paragraph (h)(4)(iv)(C).
b. Non-Speculative Employment
    DHS proposes to codify its requirement that the petitioner must 
establish, at the time of filing, that it has a non-speculative 
position in a specialty occupation available for the beneficiary as of 
the start date of the validity period as requested on the petition. See 
proposed 8 CFR 214.2(h)(4)(iii)(F). This change is consistent with 
current DHS policy guidance that an H-1B petitioner must establish that 
employment exists at the time of filing the petition and that it will 
employ the beneficiary in a specialty occupation.\111\
---------------------------------------------------------------------------

    \111\ See USCIS, ``Rescission of Policy Memoranda,'' PM-602-0114 
(June 17, 2020) (citing Matter of Chawathe, 25 I&N Dec. 369 (AAO 
2010)).
---------------------------------------------------------------------------

    The requirement of non-speculative employment derives from the 
statutory definition of an H-1B nonimmigrant worker as someone who is 
``coming temporarily to the United States to perform services . . . in 
a specialty occupation . . . .'' See INA section 101(a)(15)(H)(i)(b), 8 
U.S.C. 1101(a)(15)(H)(i)(b). To determine whether the H-1B worker will 
perform services in a specialty occupation as required, USCIS must 
examine the nature of the services the beneficiary will perform in the 
offered position. Where the proposed position is speculative, meaning 
that it is undetermined, then the petitioner will not be able to 
establish the nature of the offered position. Speculative employment 
precludes the agency from ascertaining whether those duties normally 
require the attainment of a U.S. bachelor's or higher degree in a 
directly related specific specialty to qualify the position as a 
specialty occupation, and whether the beneficiary has the appropriate 
qualifications to perform those duties. Speculative employment 
undermines the integrity and a key goal of the H-1B program, which is 
to help U.S. employers obtain the skilled workers they need to conduct 
their business, subject to annual numerical limitations, while 
protecting the wages and working conditions of U.S. workers. DHS 
believes that expressly prohibiting speculative employment, consistent 
with current practice, would align with Congressional intent and would 
prevent possible misunderstanding of the specialty occupation 
eligibility requirement.
    The agency has long held and communicated the view that speculative 
employment is not permitted in the H-1B program. For example, a 1998 
proposed rule documented this position, stating that, historically, 
USCIS (or the Service, as it was called at the time) has not granted H-
1B classification on the basis of speculative, or undetermined, 
prospective employment.\112\ That proposed rule explained that the H-1B 
classification was not intended as a vehicle for a person to engage in 
a job search within the United States, or for

[[Page 72902]]

employers to bring in temporary foreign workers to meet possible 
workforce needs arising from potential business expansions or the 
expectation of potential new customers or contracts.\113\ If the 
employment is speculative, USCIS is unable to properly analyze the 
intended employment and determine whether the position is a specialty 
occupation.\114\
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    \112\ See ``Petitioning Requirements for the H Nonimmigrant 
Classification,'' 63 FR 30419, 30419-30420 (June 4, 1998) (proposed 
rule to be codified at 8 CFR part 214).
    \113\ See id. at 30420.
    \114\ See id. See also Government Accountability Office, ``H-1B 
Foreign Workers: Better Controls Needed to Help Employers and 
Protect Workers,'' GAO/HEHS-00-157 (Sept. 2000), https://www.gao.gov/assets/hehs-00-157.pdf (``The petition is required to 
contain the necessary information to show that a bona fide job 
exists . . . .''); Serenity Info Tech, Inc. v. Cuccinelli, 461 F. 
Supp. 3d 1271, 1286 (N.D. Ga. 2020) (``Demonstrating that the 
purported employment is actually likely to exist for the beneficiary 
is a basic application requirement . . . .'').
---------------------------------------------------------------------------

    Note, however, that establishing non-speculative employment does 
not mean demonstrating non-speculative daily work assignments through 
the duration of the requested validity period. DHS does not propose to 
require employers to establish non-speculative and specific assignments 
for every day of the intended period of employment.\115\ Again, under 
proposed 8 CFR 214.2(h)(4)(iii)(F), a petitioner must demonstrate, at 
the time of filing, availability of non-speculative employment as of 
the requested start date. However, DHS does not require a petitioner to 
identify and document the beneficiary's specific day-to-day 
assignments.\116\ DHS also does not intend to limit validity periods 
based on the end-date of contracts, work orders, itineraries, or 
similar documentation. Speculative employment should not be confused 
with employment that is contingent on petition approval, visa issuance 
(when applicable), or the grant of H-1B status. DHS recognizes that 
employment may be actual, but contingent on petition approval, visa 
issuance, or the beneficiary being granted H-1B status.
---------------------------------------------------------------------------

    \115\ See ITServe Alliance, Inc. v. Cissna, 443 F. Supp. 3d 14, 
39 (D.D.C. 2020) (the U.S. District Court for the District of 
Columbia, in considering a requirement that an H-1B petitioner 
establish non-speculative assignments for the entire time requested 
in a petition, explained that ``very few, if any, U.S. employer 
would be able to identify and prove daily assignments for the future 
three years for professionals in specialty occupations'' and that 
``[n]othing in [the statutory definition of `specialty occupation'] 
requires specific and non-speculative qualifying day-to-day 
assignments for the entire time requested in the petition''); 
Serenity Info Tech, 461 F. Supp. 3d at 1286 (agreeing with the 
determination by the court in ITServe Alliance that the statute does 
not require specific and non-speculative qualifying day-to-day 
assignments).
    \116\ USCIS, ``Rescission of Policy Memoranda,'' PM-602-0114 at 
3 (June 17, 2020) (stating that ``a petitioner is not required to 
identify and document the beneficiary's specific day-to-day 
assignments'').
---------------------------------------------------------------------------

c. LCA Corresponds With the Petition
    DHS is proposing to update the regulations to expressly include 
DHS's existing authority to ensure that the LCA properly supports and 
corresponds with the accompanying H-1B petition. The proposed text at 8 
CFR 214.2(h)(4)(i)(B)(1)(ii) would align DHS regulations with existing 
DOL regulations, which state that DHS has the authority to determine 
whether the LCA supports and corresponds with the H-1B petition. See 20 
CFR 655.705(b). It would also codify DHS's authority to determine 
whether all other eligibility requirements have been met, such as 
whether the beneficiary for whom H-1B classification is sought 
qualifies to perform services in the specialty occupation as prescribed 
in INA section 214(i)(2), 8 U.S.C. 1184(i)(2). While DHS already has 
the authority under INA sections 101(a)(15)(H)(i)(b), 103(a), and 
214(a)(1) and (c)(1), 8 U.S.C. 1101(a)(15)(H)(i)(b), 1103(a), and 
1184(a)(1) and (c)(1), to determine whether the LCA supports and 
corresponds with the H-1B petition, this authority currently is only 
stated in DOL's regulations and not in DHS's regulations.\117\ By 
adding it to DHS regulations, DHS would align its regulations with 
existing DOL regulations, which would add clarity and provide 
transparency to stakeholders.
---------------------------------------------------------------------------

    \117\ See 20 CFR 655.705(b).
---------------------------------------------------------------------------

    The current statute and regulations require that a petitioner file 
an LCA certified by the Secretary of Labor with its H-1B petition, 
unless filing for certain Department of Defense workers.\118\ Among 
other information, the employer must provide the prevailing wage rate, 
occupational classification (``Standard Occupational Classification 
(SOC) occupational title''),\119\ and place of employment for the 
offered position on the LCA. The employer must attest on the LCA that 
it will pay the beneficiary the higher of the prevailing wage for the 
occupational classification in the area of employment or the employer's 
actual wage.\120\ It must also attest to the truthfulness and accuracy 
of the information provided on the LCA.\121\
---------------------------------------------------------------------------

    \118\ See INA section 212(n)(1); 8 CFR 214.2(h)(1)(ii)(B)(1); 
(h)(4)(i)(B)(1) and (2); (h)(4)(iii)(B).
    \119\ SOC refers to the Standard Occupational Classification 
code system, a classification system used by the DOL and other 
Federal agencies to categorize occupations. See BLS, ``Standard 
Occupational Classification,'' https://www.bls.gov/soc/ (last 
visited Oct. 26, 2022); OMB, ``Statistical Programs & Standards,'' 
https://www.whitehouse.gov/omb/information-regulatory-affairs/statistical-programs-standards/ (last visited Oct. 26, 2022).
    \120\ See 20 CFR 655.730-655.731.
    \121\ See id.
---------------------------------------------------------------------------

    DHS proposes to amend existing regulations to state clearly that, 
although the Secretary of Labor certifies the LCA, DHS has the 
authority and obligation to determine whether the certified LCA 
properly supports and corresponds with the H-1B petition.\122\ DHS also 
proposes to amend the regulations to clarify its existing authority and 
obligation to determine whether all eligibility requirements for H-1B 
classification have been met.\123\
---------------------------------------------------------------------------

    \122\ There are four Federal agencies involved in the process 
relating to H-1B nonimmigrant classification and employment: DOL, 
DOS, U.S. Department of Justice, and DHS. In general, DOL 
administers the LCA process and LCA enforcement provisions. As 
noted, DHS determines, among other things, whether the petition is 
properly supported by an LCA that corresponds with the petition, 
whether the occupation named in the LCA is a specialty occupation, 
and whether the qualifications of the nonimmigrant meets the 
statutory and regulatory requirements for H-1B visa classification. 
Department of Justice administers the enforcement and disposition of 
complaints regarding an H-1B-dependent or willful violator 
employer's failure to offer an H-1B position to an equally or better 
qualified U.S. worker, or such employer's willful misrepresentation 
of material facts relating to this obligation. DOS, through U.S. 
Embassies and consulates, is responsible for issuing H-1B visas. See 
20 CFR 655.705.
    \123\ See, e.g., 8 U.S.C. 1184(c)(1) (stating ``[t]he question 
of importing any alien as a nonimmigrant under subparagraph (H) . . 
. in any specific case or specific cases shall be determined by the 
[Secretary of Homeland Security]'').
---------------------------------------------------------------------------

    This proposed regulation would more clearly summarize DHS's 
existing authority under INA section 101(a)(15)(H)(i)(b), 103(a), and 
214(a)(1) and (c)(1), 8 U.S.C. 1101(a)(15)(H)(i)(b), 1103(a), and 
1184(a)(1) and (c)(1). This authority is also referenced, in part, in 
DOL's regulation at 20 CFR 655.705(b), which states in pertinent part 
that DHS accepts an employer's H-1B petition with the DOL-certified LCA 
attached, and in doing so, ``DHS determines whether the petition is 
supported by an LCA which corresponds with the petition'' and otherwise 
meets the statutory requirements for the classification.\124\ Thus, 
DHS's proposed regulation would mirror DOL regulations and expressly 
clarify DHS's existing authority with respect to reviewing the 
certified LCA within the context of adjudicating the H-1B petition.
---------------------------------------------------------------------------

    \124\ See Matter of Simeio Solutions, LLC, 26 I&N Dec. 542, 546 
n.6 (AAO 2015) (``USCIS must determine whether the attestations and 
content of an LCA correspond to and support the H-1B visa 
petition'').
---------------------------------------------------------------------------

    When determining whether the submitted certified LCA properly

[[Page 72903]]

corresponds with the petition, consistent with current practice, USCIS 
would consider all the information on the LCA, including, but not 
limited to, the standard occupational classification (SOC) code, wage 
level (or an independent authoritative source equivalent), and 
location(s) of employment. USCIS would evaluate whether that 
information sufficiently aligns with the offered position, as described 
in the rest of the record of proceeding. In other words, USCIS would 
compare the information contained in the LCA against the information 
contained in the petition and supporting evidence. USCIS would not, 
however, supplant DOL's responsibility with respect to wage 
determinations. The wage level is not solely determinative of whether 
the position is a specialty occupation.
    DHS notes that the LCA, H-1B petition, and supporting documentation 
must be for the same position; however, the same position does not 
necessarily mean that all information describing the position must be 
identical. A petitioner may legitimately supplement or clarify the 
record with additional information about the offered position in 
response to an RFE, on motion, or on appeal. So long as the 
supplemental information does not materially change the position 
described in the original H-1B petition, DHS would consider the 
position to be the same. DHS would view a change to be material for 
these purposes if the change would have required the petitioner to file 
an amended or new petition with the corresponding LCA or if the change 
was made to make the position description comport with an originally 
submitted LCA.\125\
---------------------------------------------------------------------------

    \125\ See 8 CFR 103.2(b)(1) (an applicant or petitioner must 
establish eligibility at the time of filing); 8 CFR 
214.2(h)(2)(i)(E) (petitioner must file a new or amended petition 
with USCIS to reflect any material change in the terms and 
conditions of employment or the foreign citizen's eligibility for H-
1B status); Matter of Simeio Solutions, LLC, 26 I&N Dec. 542, 547 
(AAO 2015) (``When there is a material change in the terms and 
conditions of employment, the petitioner must file an amended or new 
H-1B petition with the corresponding LCA. 8 CFR 
214.2(h)(2)(i)(E).''). See also Matter of Izummi, 22 I&N Dec. 169, 
176 (Assoc. Comm'r 1998) (a petitioner may not make material changes 
to a petition in an effort to make a deficient petition conform to 
USCIS requirements).
---------------------------------------------------------------------------

    Additionally, DHS proposes to improve 8 CFR 214.2(h)(4)(i)(B), by 
redesignating existing paragraphs (h)(4)(i)(B)(1) through (6) as 
proposed paragraphs (h)(4)(i)(B)(1)(i) through (vi) and adding a new 
heading to clarify that these provisions all relate to LCA 
requirements. DHS is also proposing technical changes throughout this 
section, such as replacing ``shall'' with ``must,'' ``application'' 
with ``certified labor condition application,'' and ``the Service'' 
with ``USCIS,'' for additional clarity.
    In separate provisions that are also related to the LCA, DHS 
proposes to revise the grounds for denial or revocation related to the 
statements of facts contained in the petition, TLC, or the LCA. See 
proposed 8 CFR 214.2(h)(10)(ii) and (h)(11)(iii)(A)(2). This would 
codify DHS's current practices, as the LCA is incorporated into and 
considered part of the H-1B petition, just like the TLC is incorporated 
into and considered part of the H-2A or H-2B petition.\126\
---------------------------------------------------------------------------

    \126\ See 8 CFR 103.2(b)(1) (any evidence submitted in 
connection with a benefit request is incorporated into and 
considered part of the request); USCIS, ``Rescission of Policy 
Memoranda,'' PM-602-0114, at 2 (June 17, 2020) (``The petitioner is 
required to attest under penalty of perjury on the H-1B petition and 
LCA that all of the information contained in the petition and 
supporting documents is complete, true, and correct.''), https://www.uscis.gov/sites/default/files/document/memos/PM-602-0114_ITServeMemo.pdf; Matter of Simeio Solutions, 26 I&N Dec. 542, 
546 n.6 (AAO 2015) (``USCIS must determine whether the attestations 
and content of an LCA correspond to and support the H-1B visa 
petition, including the specific place of employment. 20 CFR 
655.705(b) (2014); see also 8 CFR 214.2(h)(4)(i)(B).'').
---------------------------------------------------------------------------

    While current 8 CFR 214.2(h)(11)(iii)(A)(2) already refers to the 
``temporary labor certification,'' it does not expressly refer to the 
``labor condition application.'' DHS proposes to add an express 
reference to the LCA in proposed 8 CFR 214.2(h)(11)(iii)(A)(2) to 
resolve any doubts that a false statement on the LCA--just like a false 
statement on the TLC--could provide a basis for USCIS to revoke an H 
petition approval. The purpose of the proposed change to 8 CFR 
214.2(h)(10)(ii) is to clarify and better align with the language in 
proposed 8 CFR 214.2(h)(11)(iii)(A)(2) to expressly reference 
inaccurate or false statements on the petition, TLC, or LCA, as 
applicable, as a basis for denial of an H petition.
d. Revising the Definition of U.S. Employer
    DHS is proposing to revise the definition of ``United States 
employer.'' Currently, 8 CFR 214.2(h)(4)(ii) defines the term ``United 
States employer'' as a person, firm, corporation, contractor, or other 
association, or organization in the United States that: (1) Engages a 
person to work within the United States; (2) has an employer-employee 
relationship with respect to employees under 8 CFR part 214, as 
indicated by the fact that it may hire, pay, fire, supervise, or 
otherwise control the work of any such employee; and (3) has an 
Internal Revenue Service Tax identification number.
    DHS proposes several changes to the ``United States employer'' 
definition at 8 CFR 214.2(h)(4)(ii) to bring it in line with our 
current practice. First, in place of the employer-employee relationship 
requirement, DHS proposes to codify the existing requirement that the 
petitioner has a bona fide job offer for the beneficiary to work within 
the United States. DHS also proposes to replace the requirement that 
the petitioner ``[e]ngages a person to work within the United States'' 
with the requirement that the petitioner have a legal presence and is 
amenable to service of process in the United States. DHS is not 
proposing to change the current requirement at 8 CFR 214.2(h)(4)(ii) 
that the petitioner must have an IRS Tax identification number.
e. Employer-Employee Relationship
    DHS proposes to remove from the definition of U.S. employer the 
reference to an employer-employee relationship, which, in the past, was 
interpreted using common law principles and was a significant barrier 
to the H-1B program for certain petitioners, including beneficiary-
owned petitioners. This proposed change is consistent with current 
USCIS policy guidance, and removing the employer-employee relationship 
language from the regulations would promote clarity and transparency in 
the regulations. It would also support DHS's overall commitment to 
reducing administrative barriers, including those that unnecessarily 
impede access to USCIS immigration benefits.\127\ This proposed change 
reflects USCIS's current practices since June 2020, when, following a 
court order and settlement agreement,\128\ USCIS formally rescinded its 
January 2010 policy guidance on the employer-employee relationship 
analysis under common law.\129\ As

[[Page 72904]]

explained in USCIS's June 2020 policy memorandum ``Rescission of Policy 
Memoranda,'' when assessing whether an employer and a beneficiary have 
an employer-employee relationship under current 8 CFR 214.2(h)(4)(ii), 
the petitioner need only establish that it meets at least one of the 
``hire, pay, fire, supervise, or otherwise control the work of'' 
factors with respect to the beneficiary.\130\ H-1B petitioners are 
required to submit an LCA attesting that they will pay the beneficiary, 
see, e.g., 8 CFR 214.2(h)(4)(i)(B), as well as a copy of any written 
contracts between the petitioner and the beneficiary (or a summary of 
the terms of the oral agreement under which the beneficiary will be 
employed, if a written contract does not exist), which typically 
demonstrates that they will hire and pay the beneficiary, see 8 CFR 
214.2(h)(4)(iv). Therefore, H-1B petitioners generally will meet the 
employer-employee relationship under current 8 CFR 214.2(h)(4)(ii) 
simply by submitting the required LCA and employment agreement as part 
of the initial evidence for Form I-129. As a result, the current 
employer-employee relationship requirement has limited practical value 
and could be a potential source of confusion if maintained in the 
regulations. As an additional integrity measure, and as explained in 
more detail below, DHS is proposing to codify the existing requirement 
that the petitioner have a bona fide job offer for the beneficiary to 
work within the United States.
---------------------------------------------------------------------------

    \127\ See, e.g., ``Identifying Barriers Across U.S. Citizenship 
and Immigration Services (USCIS) Benefits and Services; Request for 
Public Input,'' 86 FR 20398 (Apr. 19, 2021).
    \128\ See ITServe Alliance, Inc. v. Cissna, 443 F.Supp.3d 14, 19 
(D.D.C. 2020) (finding that the USCIS policy interpreting the 
existing regulation to require a common-law employer-employee 
relationship violated the Administrative Procedure Act as applied 
and that the itinerary requirement at 8 CFR 214.2(h)(2)(i)(B) is 
ultra vires as it pertains to H-1B petitions).
    \129\ See USCIS, ``Rescission of Policy Memoranda,'' PM-602-0114 
(June 17, 2020), https://www.uscis.gov/sites/default/files/document/memos/PM-602-0114_ITServeMemo.pdf. This memorandum rescinded the 
USCIS policy memorandum ``Determining Employer-Employee Relationship 
for Adjudication of H-1B Petitions, Including Third-Party Site 
Placements,'' HQ 70/6.2.8 (AD 10-24) (Jan. 8, 2010).
    \130\ Id. at 2.
---------------------------------------------------------------------------

    As indicated above, the previous analysis created significant 
barriers to the H-1B program for certain petitioners, including 
beneficiary-owned petitioners. For example, a beneficiary-owner may 
have been unlikely to establish a common-law employer-employee 
relationship with the petitioning entity, even if working for the 
petitioning entity in a specialty occupation and as a W-2 employee, and 
thus denied classification as an H-1B specialty occupation worker. 
Furthermore, USCIS's previous policy was not entirely consistent with 
DOL's regulatory definition of an H-1B employer. DOL's definition of 
``employer'' at 20 CFR 655.715 states, in pertinent part, ``In the case 
of an H-1B nonimmigrant (not including E-3 and H-1B1 nonimmigrants), 
the person, firm, contractor, or other association or organization in 
the United States that files a petition with [USCIS] on behalf of the 
nonimmigrant is deemed to be the employer of that nonimmigrant.'' The 
definition further states, ``In the case of an E-3 and H-1B1 
nonimmigrant, the person, firm, contractor, or other association or 
organization in the United States that files an LCA with [DOL] on 
behalf of the nonimmigrant is deemed to be the employer of that 
nonimmigrant.'' As a result of USCIS's 2010 policy guidance, it was 
often the case that USCIS concluded a petitioner was not an employer 
for purposes of the H-1B petition even though DOL deemed that same 
petitioner to be an employer for purposes of the LCA. This disparity 
increased the potential for confusion among H-1B stakeholders. It is in 
DHS's interests to promote, to the extent possible, a more consistent 
framework among DHS and DOL regulations for H-1B, E-3, and H-1B1 
petitions and to increase clarity for stakeholders. However, the 
proposed removal of the employer-employee requirement from 8 CFR 
214.2(h)(4)(ii) is not intended to narrow in any way the scope of 
petitioners against whom DOL may enforce the H-1B labor requirements.
f. Bona Fide Job Offer
    Under the second prong of the definition of ``U.S. employer'' at 8 
CFR 214.2(h)(4)(ii), DHS proposes to codify the existing requirement 
that the petitioner have a bona fide job offer for the beneficiary to 
work within the United States.\131\ While this requirement is not 
currently expressly stated in the regulations, it is reflected in 
current USCIS policy guidance, which states that the petitioner must 
establish that ``[a] bona fide job offer . . . exist[s] at the time of 
filing.'' \132\
---------------------------------------------------------------------------

    \131\ Consistent with existing practice, the phrase ``within the 
United States'' does not and would not prohibit H-1B nonimmigrants 
from travelling internationally.
    \132\ See USCIS, ``Rescission of Policy Memoranda,'' PM-602-0114 
(June 17, 2020); see also USCIS, Adjudicator's Field Manual (AFM) 
Chapter 31.3(g)(4) at 24, ``H1-B Classification and Documentary 
Requirements has been partially superseded as of June 17, 2020,'' 
available at https://www.uscis.gov/sites/default/files/document/policy-manual-afm/afm31-external.pdf (last visited Sept. 5, 2023) 
(``The burden of proof falls on the petitioner to demonstrate the 
need for such an employee. Unless you are satisfied that a 
legitimate need exists, such a petition may be denied because the 
petitioner has failed to demonstrate that the beneficiary will be 
employed in a qualifying specialty occupation.''). While USCIS 
retired the AFM in May 2020, this example nevertheless illustrates 
the agency's historical interpretation.
---------------------------------------------------------------------------

    This proposed change would also be consistent with the current H-1B 
Registration Tool, where the petitioner must attest at the time of 
registration that each registration for an H-1B cap-subject beneficiary 
reflects a legitimate job offer. DHS's proposal to codify the 
requirement for a bona fide job offer requirement would complement 
DHS's proposal to codify the requirement to demonstrate a non-
speculative position in a specialty occupation for the beneficiary at 
proposed 8 CFR 214.2(h)(4)(iii)(F).
    DHS proposes to codify the bona fide job offer requirement in place 
of the current requirement that the petitioner ``[e]ngages a person to 
work within the United States'' under the first prong of current 8 CFR 
214.2(h)(4)(ii). As currently written, the requirement for a petitioner 
to ``engage[ ] a person to work within the United States'' has limited 
practical value because it does not specify that the petitioner should 
engage the beneficiary (rather than ``a person'') and it does not 
specify that the work to be performed must be within the United States.
    Furthermore, DHS proposes to add clarification that the bona fide 
job offer may include ``telework, remote work, or other off-site work 
within the United States.'' See proposed 8 CFR 214.2(h)(4)(ii). While 
USCIS currently allows these types of work arrangements (provided they 
are consistent with the certified LCA and other regulatory 
requirements), the regulations do not state this expressly. DHS 
believes this clarification is helpful as more businesses allow and 
more workers choose telework, remote work, or other types of work 
arrangements.\133\ DHS emphasizes that nothing in the proposed rule 
would change the Department of Labor's administration and enforcement 
of statutory and regulatory requirements related to labor condition 
applications. See 8 U.S.C. 1182(n); 20 CFR part 655 Subparts H and I. 
These requirements would be unaffected by this proposed rule and would 
continue to apply to all H-1B employers.
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    \133\ See, e.g., Kim Parker, Juliana Menasce Horowitz, and 
Rachel Minkin, ``COVID-19 Pandemic Continues to Reshape Work in 
America'' (Feb. 16, 2022), https://www.pewresearch.org/social-trends/2022/02/16/covid-19-pandemic-continues-to-reshape-work-in-america/ (among those who have a workplace outside of their home, in 
January 2022, 61 percent said they choose not to go into their 
workplace, compared to only 31 percent of this population surveyed 
in October 2020); Greg Iacurci, ``Why Labor Economists Say the 
Remote Work `Revolution' is Here to Stay'' (Dec. 1, 2022), https://www.cnbc.com/2022/12/01/why-labor-economists-say-the-remote-work-revolution-is-here-to-stay.html (the share of remote workers had 
been doubling every 15 years prior to 2020, but the subsequent 
increase during the pandemic amounted to 30 years of pre-pandemic 
growth).
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g. Legal Presence and Amenable to Service of Process
    In the second prong of the definition of U.S. employer at 8 CFR 
214.2(h)(4)(iv)(D), DHS proposes to add a new requirement that the 
petitioner has a legal presence in the United States

[[Page 72905]]

and is amenable to service of process in the United States. Legal 
presence, in this context, means that the petitioner is legally formed 
and authorized to conduct business in the United States. In order to 
employ an individual legitimately in a specialty occupation, an 
employer should be able to conduct business legally in the United 
States.\134\ If USCIS discovers at any time while the petition is 
pending that the petitioner does not have a legal presence in the 
United States, it may issue a request for additional evidence and 
provide the petitioner the opportunity to cure that deficiency.
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    \134\ See, e.g., In Re. 9019481, 2020 WL 9668720 (AAO July 17, 
2020) (``[T]he record of proceeding does not contain evidence 
demonstrating the Petitioner is active and in good standing with any 
State. If a petitioner is no longer in business, then no bona fide 
job offer exists to support the petition.''); In Re. 16130730, 2021 
WL 2806409 (AAO Apr. 27, 2021) (``[T]he petitioner has not 
demonstrated that it is an entity in active and good standing. . . . 
If the petitioner is not actually in business, it cannot qualify as 
an entity with standing to file an H-1B petition.'').
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    ``Amenable to service of process'' means that the petitioner may be 
sued in a court in the United States. Since the petitioner undertakes 
legal obligations to employ the beneficiary according to the terms and 
conditions on the petition and LCA, the petitioner should not be able 
to avoid liability for not complying with these obligations by later 
claiming that it is not the employer or is not amenable to service of 
process. The requirement that the petitioner is amenable to service of 
process in the United States is also found in other classifications, 
such as H-2B, O-1, and P-1. Those regulations state that ``a foreign 
employer is any employer who is not amenable to service of process in 
the United States.'' See 8 CFR 214.2(h)(6)(iii)(B); (o)(2)(i); and 
(p)(2)(i), respectively.
7. Beneficiary-Owners
    In the fourth prong of the definition of U.S. employer at 8 CFR 
214.2(h)(4)(ii), DHS proposes to codify a petitioner's ability to 
qualify as a U.S. employer even when the beneficiary possesses a 
controlling interest in that petitioner. As discussed above, 
historically, USCIS's common law analysis of the employer-employee 
relationship has been an impediment for certain beneficiary-owned 
businesses to use the H-1B program. While USCIS has not applied the 
common law analysis of the employer-employee relationship since June 
2020, when it rescinded its 2010 policy memorandum,\135\ DHS believes 
that prospective beneficiary-owned businesses may still be reluctant to 
participate in the H-1B program due to the legacy of its now-rescinded 
memorandum. Through this proposed change to 8 CFR 214.2(h)(4)(ii), DHS 
seeks to clarify its current policy and encourage more beneficiary-
owned businesses to participate in the H-1B program.\136\
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    \135\ See USCIS, ``Determining Employer-Employee Relationship 
for Adjudication of H-1B Petitions, Including Third-Party Site 
Placements,'' HQ 70-6.2.8, AD 10-24 (Jan. 8, 2010).
    \136\ Again, DHS emphasizes that nothing in the proposed rule 
would change the Department of Labor's administration and 
enforcement of statutory and regulatory requirements related to 
labor condition applications. See 8 U.S.C. 1182(n); 20 CFR part 655, 
subparts H and I. These requirements would be unaffected by this 
proposed rule and would continue to apply to all H-1B employers.
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    The United States has long been a destination for top talent from 
all over the world, including for entrepreneurs and innovators. The 
United States continues to build and expand initiatives to support its 
evolving workforce with policies such as the passage of the CHIPS and 
Science Act of 2022, which will foster innovation in many ways, 
including by reducing the barriers of entry to startups.\137\ While the 
United States prides itself on its ability to attract global talent, 
there are limited pathways for entrepreneurs to come to the United 
States under existing regulations. To promote access to H-1Bs for 
entrepreneurs, start-up entities, and other beneficiary-owned 
businesses, DHS is proposing to add provisions to specifically address 
situations where a potential H-1B beneficiary owns a controlling 
interest in the petitioning entity. If more entrepreneurs are able to 
obtain H-1B status to develop their business enterprises, the United 
States could benefit from the creation of jobs, new industries, and new 
opportunities.\138\ At the same time, DHS seeks to set reasonable 
conditions for when the beneficiary owns a controlling interest in the 
petitioning entity to better ensure program integrity. These proposed 
conditions would apply when a beneficiary owns a controlling interest, 
meaning that the beneficiary owns more than 50 percent of the 
petitioner or when the beneficiary has majority voting rights in the 
petitioner. These proposed conditions would not apply when a 
beneficiary does not own a controlling interest in the petitioning 
entity. DHS believes it is reasonable to limit the application of these 
conditions to H-1B petitioners where the beneficiary has a controlling 
interest to ensure that the beneficiary will be employed in a specialty 
occupation in a bona fide job opportunity.
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    \137\ See The CHIPS and Science Act of 2022, Public Law 117-167 
(Aug. 22, 2022).
    \138\ See, e.g., National Bureau of Economic Research, ``Winning 
the H-1B Visa Lottery Boosts the Fortunes of Startups'' (Jan. 2020), 
https://www.nber.org/digest/jan20/winning-h-1b-visa-lottery-boosts-fortunes-startups (``The opportunity to hire specialized foreign 
workers gives startups a leg up over their competitors who do not 
obtain visas for desired employees. High-skilled foreign labor 
boosts a firm's chance of obtaining venture capital funding, of 
successfully going public or being acquired, and of making 
innovative breakthroughs.''); Pierre Azoulay, et al., ``Immigration 
and Entrepreneurship in the United States'' (National Bureau of 
Economic Research, Working Paper 27778 (Sept. 2020), https://www.nber.org/system/files/working_papers/w27778/w27778.pdf 
(``immigrants act more as `job creators' than `job takers' and . . . 
non-U.S. born founders play outsized roles in U.S. high-growth 
entrepreneurship'').
---------------------------------------------------------------------------

    One of the proposed conditions is that the beneficiary may perform 
duties that are directly related to owning and directing the 
petitioner's business as long as the beneficiary will perform specialty 
occupation duties authorized under the petition a majority of the time. 
See proposed 8 CFR 214.2(h)(4)(ii). ``A majority of the time'' in this 
context means that the beneficiary must perform specialty occupation 
duties more than 50 percent of the time.
    By requiring that the beneficiary perform specialty occupation 
duties a majority of the time, the beneficiary-owner would have 
flexibility to perform non-specialty occupation duties that are 
directly related to owning and directing the petitioner's business. 
This proposed rule would not preclude the beneficiary from being 
authorized for concurrent employment with two or more entities 
(including another entity where the beneficiary is also an owner with a 
controlling interest) so long as each entity has been approved to 
employ the beneficiary in a specialty occupation and the individual 
otherwise satisfies all eligibility requirements. In this concurrent 
employment scenario, where a beneficiary seeks concurrent employment 
with more than one entity and the beneficiary owns a controlling 
interest in each of the petitioners filing to authorize concurrent 
employment, the ``majority of the time'' standard must be met with 
respect to each petition, and the beneficiary must comply with the 
terms and conditions of each petition.
    The proposed language at 8 CFR 214.2(h)(4)(ii) would state that a 
beneficiary may perform non-specialty occupation duties as long as such 
non-specialty occupation duties are directly related to owning and 
directing the petitioner's business. Additionally and similar to other 
H-1B petitions, a beneficiary-owner may perform some incidental duties, 
such as making copies or answering the telephone. DHS expects a 
beneficiary-owner would need to perform some non-specialty

[[Page 72906]]

occupation duties when growing a new business or managing the business. 
Notwithstanding incidental duties, non-specialty occupation duties must 
be directly related to owning and directing the business. These duties 
may include, but are not limited to: signing leases, finding investors, 
and negotiating contracts. The goal is to ensure that a beneficiary who 
is the majority or sole owner and employee of a company would not be 
disqualified by virtue of having to perform duties directly related to 
owning and directing their own company, while also ensuring that the 
beneficiary would still be ``coming temporarily to the United States to 
perform services . . . in a specialty occupation'' as required by INA 
section 101(a)(15)(H)(i)(b).
    The proposed ``majority of the time'' framework would allow a 
beneficiary-owner to perform some non-specialty occupation duties that 
are directly related to owning and directing the business, as long as a 
majority of their time performing the job would be spent performing the 
specialty occupation duties authorized in the approved petition. USCIS 
would analyze all of the job duties--specialty occupation duties and 
non-specialty occupation duties--which the petitioner must accurately 
describe in the petition along with the expected percentage of time to 
be spent performing each job duty, to determine whether the job would 
be in a specialty occupation and to determine whether the non-specialty 
occupation duties are directly related to owning and directing the 
business. If the beneficiary would spend a majority of their time 
performing specialty occupation duties, and if the non-specialty 
occupation duties are directly related to owning and directing the 
business, then the position may qualify as a specialty occupation.\139\
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    \139\ See GCCG Inc v. Holder, 999 F. Supp. 2d 1161, 1167 (N.D. 
Cal. 2013) (agreeing with Defendant that for USCIS to find the 
petitioner's proffered job to be a specialty occupation, the 
majority of the beneficiary's time must be spent performing the 
duties of the specialty occupation).
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    The ``majority of the time'' analysis would be similar to the 
approach generally taken for other H-1B petitions, although it would be 
more limiting in order to mitigate against potential abuse.\140\ 
However, DHS acknowledges that past adjudicative practices have not 
been entirely consistent as to what level of non-specialty occupation 
duties is permissible and what level of such duties would result in a 
finding that the proffered position as a whole does not qualify as a 
specialty occupation.\141\ Codifying the ``majority of the time'' 
framework would provide clarity in the regulations as to what is 
permissible in the specific context of beneficiary-owners. This, in 
turn, would better ensure consistency in adjudications of petitions 
involving beneficiary-owners. DHS again emphasizes that nothing in the 
proposed rule would change the Department of Labor's administration and 
enforcement of statutory and regulatory requirements related to labor 
condition applications, including requirements concerning the 
appropriate prevailing wage and wage level when the proffered position 
involves a combination of occupations.\142\ For example, in some cases 
the petition might involve a combination of occupations that can affect 
the petitioner's wage obligation, as detailed in DOL's wage 
guidance.\143\ Generally, when an H-1B employer requests a prevailing 
wage determination from DOL, the National Prevailing Wage Center will 
assign to the position the occupational code that has the higher of the 
prevailing wages amongst the combination of occupations. Under this 
proposed rule, a petitioner may be authorized to employ a beneficiary-
owner in a combination of occupations, provided that the petitioner 
pays the required wage, consistent with existing DOL wage guidance, 
even when the beneficiary-owner is performing non-specialty occupation 
duties as authorized by USCIS.
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    \140\ See, e.g., GCCG Inc v. Holder, 999 F. Supp. 2d 1161, 1165-
68 (N.D. Cal. 2013) (finding the beneficiary to be mainly performing 
non-specialty occupation duties and explaining that USCIS requires 
the beneficiary's duties to entail mainly the performance of 
specialty occupation duties for the position to qualify as a 
specialty occupation); Engaged in Life, LLC v. Johnson, No. 14-
06112-CV-DW, 2015 WL 11111211, at *4 (W.D. Mo. Oct. 13, 2015) 
(citing GCCG Inc.).
    \141\ See, e.g., In Re. 8423340, 2020 WL 9668851, at *12 (AAO 
July 27, 2020) (``[W]e will permit the performance of duties that 
are incidental to the primary duties of the proffered position as 
acceptable when they occur by chance, are intermittent, and are of a 
minor consequence. Anything beyond such incidental duties (e.g., 
predictable, recurring, and substantive job responsibilities), must 
be specialty occupation duties or the proffered position as a whole 
cannot be approved as a specialty occupation.''); In Re. M-C-, 2016 
WL 8316337, at *4 (AAO Dec. 23, 2016) (``[A]nything beyond 
incidental duties, that is predictable, recurring, and substantive 
job responsibilities, must be specialty occupation duties or the 
proffered position as a whole cannot be approved as a specialty 
occupation.''); In Re. 1280169, 2018 WL 2112902 (AAO Apr. 20, 2018) 
(concluding that the beneficiary's position, on the whole, will 
include non-qualifying duties inconsistent with those of a 
specialty-occupation caliber position because the non-qualifying 
duties have not been shown to be incidental to the performance of 
the primary duties of the proffered position).
    \142\ See 8 U.S.C. 1182(n); 20 CFR part 655, subparts H and I.
    \143\ DOL, ``Round 3: Implementation of the Revised Form ETA-
9141 FAQs'' at 1 (July 16, 2021), https://www.dol.gov/sites/dolgov/files/ETA/oflc/pdfs/NPWC%20Round%203%20Frequently%20Asked%20Questions%20-%20Implementation%20of%20Revised%20Form%20ETA-9141.pdf (When there 
is a combination of occupations, the SOC code with the highest wage 
is assigned.); DOL, ``Prevailing Wage Determination Policy Guidance 
Nonagricultural Immigration Programs Revised November 2009'' at 4, 
https://www.flcdatacenter.com/download/npwhc_guidance_revised_11_2009.pdf (last visited Oct. 3, 2023) (If 
the employer's job opportunity involves a combination of 
occupations, the National Prevailing Wage Center should list the 
relevant occupational code for the highest paying occupation.).
---------------------------------------------------------------------------

    DHS is also proposing to limit the validity period for beneficiary-
owned entities. DHS proposes to limit the validity period for the 
initial petition and first extension (including an amended petition 
with a request for an extension of stay) of such a petition to 18 
months each. See proposed 8 CFR 214.2(h)(9)(iii)(E). Any subsequent 
extension would not be limited and may be approved for up to 3 years, 
assuming the petition satisfies all other H-1B requirements. DHS 
proposes limiting the first two validity periods to 18 months as a 
safeguard against possible fraudulent petitions. While DHS sees a 
significant advantage in promoting the H-1B program to entrepreneurs, 
DHS believes that guardrails for beneficiary-owner petitions would be 
helpful to mitigate the potential for abuse of the H-1B program. 
Limiting the first two validity periods to 18 months each would allow 
DHS adjudicators to review beneficiary-owned petitions more frequently, 
and limiting the nature of non-specialty occupation duties that may be 
performed, would deter potential abuse and help to maintain the 
integrity of the H-1B program. DHS seeks public comments on these 
proposed safeguards and additional safeguards and flexibilities for 
beneficiary-owned businesses.
8. Site Visits
    Pursuant to its authority under INA sections 103(a), 214(a), 
235(d)(3) and 287(b), 8 U.S.C. 1103(a), 1184(a), 1225(d)(3) and 
1357(b), sections 402, 428 and 451(a)(3) of the HSA, 6 U.S.C. 202, 236 
and 271(a)(3), and 8 CFR 2.1, USCIS conducts inspections, evaluations, 
verifications, and compliance reviews, to ensure that a petitioner and 
beneficiary are eligible for the benefit sought and that all laws have 
been complied with before and after approval of such benefits. These 
inspections, verifications, and other compliance reviews may be 
conducted telephonically or electronically, as well as through physical 
on-site inspections (site visits). The existing authority to conduct 
inspections, verifications, and other compliance reviews is vital to 
the

[[Page 72907]]

integrity of the immigration system as a whole and to the H-1B program 
specifically. In this rule, DHS is proposing to add regulations 
specific to the H-1B program to codify its existing authority and 
clarify the scope of inspections and the consequences of a petitioner's 
or third party's refusal or failure to fully cooperate with these 
inspections. See proposed 8 CFR 214.2(h)(4)(i)(B)(2). The authority of 
USCIS to conduct on-site inspections, verifications, or other 
compliance reviews to verify information does not relieve the 
petitioner of its burden of proof or responsibility to provide 
information in the petition (and evidence submitted in support of the 
petition) that is complete, true, and correct.\144\
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    \144\ See 8 CFR 103.2(b). In evaluating the evidence, the truth 
is to be determined not by the quantity of evidence alone but by its 
quality. See Matter of Chawathe, 25 I&N Dec. 376 (quoting Matter of 
E-M-, 20 I&N Dec. 77, 80 (Comm'r 1989).
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    In July 2009, USCIS started a compliance review program as an 
additional way to verify information in certain visa petitions.\145\ 
Under this program, USCIS Fraud Detection and National Security (FDNS) 
officers make unannounced site visits to collect information as part of 
a compliance review. A compliance review verifies whether petitioners 
and beneficiaries are following the immigration laws and regulations 
that are applicable in a particular case. This process includes 
researching information in government databases, reviewing public 
records and evidence accompanying the petition, and interviewing the 
petitioner and beneficiary.\146\ It also includes conducting site 
visits.
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    \145\ See USCIS, Administrative Site Visit and Verification 
Program, https://www.uscis.gov/about-us/organization/directorates-and-program-offices/fraud-detection-and-national-security-directorate/administrative-site-visit-and-verification-program (last 
updated March 6, 2023).
    \146\ Outside of the administrative compliance review program, 
USCIS conducts forms of compliance review in every case, including, 
for example, by researching information in relevant government 
databases or by reviewing public records and evidence accompanying 
the petition.
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    The site visits conducted by USCIS through its compliance review 
program have uncovered a significant amount of noncompliance in the H-
1B program. For instance, during FYs 2019-22, USCIS conducted a total 
of 27,062 H-1B compliance reviews and found 5,037 of them, equal to 
18.6 percent, to be noncompliant or indicative of fraud.\147\ These 
compliance reviews (during FYs 2019-22) consisted of reviews conducted 
under both the Administrative Site Visit and Verification Program, 
which began in 2009, and the Targeted Site Visit and Verification 
Program, which began in 2017. The targeted site visit program allows 
USCIS to focus resources where fraud and abuse of the H-1B program may 
be more likely to occur.\148\
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    \147\ DHS, USCIS, PRD (2022). PRD196. USCIS conducted these site 
visits through its Administrative and Targeted Site Visit Program. A 
finding of noncompliance indicates that the petitioner and/or third-
party company is not complying with the terms and conditions of the 
petition but does not indicate that the petitioner willfully 
misrepresented information provided to USCIS. An example of 
noncompliance may include a petitioner sending a worker to an end-
client, who without the petitioner's knowledge, uses the worker to 
perform duties substantially different from those specified in the 
petition.
    \148\ See USCIS, ``Putting American Workers First: USCIS 
Announces Further Measures to Detect H-1B Visa Fraud and Abuse,'' 
(Apr. 3, 2017), https://www.uscis.gov/archive/putting-american-workers-first-uscis-announces-further-measures-to-detect-h-1b-visa-fraud-and-abuse.
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    The data from FYs 2013-19 include data only from the Administrative 
Site Visit and Verification Program.\149\ During FYs 2013-16, USCIS 
conducted 30,786 H-1B compliance reviews. Of those, 3,811 (12 percent) 
were found to be noncompliant.\150\ From FY 2016 through March 27, 
2019, USCIS conducted 20,492 H-1B compliance reviews and found 2,341 
(11.4 percent) to be noncompliant.\151\ Of the site visits conducted 
during FYs 2013-22, lack of cooperation may have contributed to a 
finding of noncompliance, although not all findings of noncompliance 
mean there was a lack of cooperation.
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    \149\ See USCIS, ``Administrative Site Visit and Verification 
Program,'' https://www.uscis.gov/about-us/directorates-and-program-offices/fraud-detection-and-national-security/administrative-site-visit-and-verification-program (last updated Mar. 6, 2023).
    \150\ See USCIS, ``Fiscal Year 2017 Report to Congress: H-1B and 
L-1A Compliance Review Site Visits, Fraud Detection and National 
Security Compliance Review Data (October 1, 2012, to September 30, 
2016),'' at 7 (Jan. 17, 2018), https://www.dhs.gov/sites/default/files/publications/USCIS%20-%20H-1B%20and%20L-1A%20Compliance%20Review%20Site%20Visits.pdf (last visited Mar. 23, 
2023). Note that USCIS conducted these site visits only through its 
Administrative Site Visit Program.
    \151\ DHS, USCIS, PRD (2019). Summary of H-1B Site Visits Data. 
Note that USCIS conducted these site visits only through its 
Administrative Site Visit Program.
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    Site visits are important to maintaining the integrity of the H-1B 
program and in detecting and deterring fraud and noncompliance with H-
1B program requirements.\152\ Cooperation is crucial to USCIS's ability 
to verify information about employers and workers, and the overall 
conditions of employment. Therefore, as noted above, DHS is proposing 
additional regulations specific to the H-1B program to set forth the 
scope of on-site inspections and the consequences of a petitioner's or 
third party's refusal or failure to fully cooperate with these 
inspections. This proposed rule would provide a clear disincentive for 
petitioners that do not cooperate with compliance reviews and 
inspections while giving USCIS a greater ability to access and confirm 
information about employers and workers as well as identify fraud.
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    \152\ DHS acknowledges the 2017 Office of Inspector General 
report that addressed concerns with the H-1B site visit program and 
made recommendations for improvement. DHS, Office of Inspector 
General, ``USCIS Needs a Better Approach to Verify H-1B Visa 
Participants,'' OIG-18-03 (Oct. 20, 2017), https://www.oig.dhs.gov/sites/default/files/assets/2017/OIG-18-03-Oct17.pdf. Since the 
issuance of this report, USCIS has greatly improved its site visit 
program pursuant to the report's recommendations, such that USCIS 
believes the concerns addressed in the 2017 report no longer 
pertain. Specifically, the report's assessment that ``USCIS site 
visits provide minimal assurance that H-1B visa participants are 
compliant and not engaged in fraudulent activity'' no longer 
pertains. As of March 31, 2019, the recommendations have been 
resolved. See DHS, Office of Inspector General, ``DHS Open 
Unresolved Recommendations Over Six Months Old, as of March 31, 
2019,'' https://www.oig.dhs.gov/sites/default/files/DHS-Open-Recommendations-As-Of-033119_053019.pdf (not listing OIG-18-03 as an 
``open unresolved'' report). DHS maintains that site visits, 
generally, are an important and effective tool for the H-1B program. 
The site visit provisions at proposed 8 CFR 214.2(h)(4)(i)(B)(2)(i) 
would directly support USCIS's continued efforts to strengthen the 
effectiveness of the site visit program and the integrity of the H-
1B program overall.
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    The proposed regulations would make clear that inspections may 
include, but are not limited to, an on-site visit of the petitioning 
organization's facilities, interviews with its officials, review of its 
records related to compliance with immigration laws and regulations, 
and interviews with any other individuals or review of any other 
records that USCIS may lawfully obtain and that it considers pertinent 
to verify facts related to the adjudication of the petition, such as 
facts relating to the petitioner's and beneficiary's eligibility and 
continued compliance with the requirements of the H-1B program. See 
proposed 8 CFR 214.2(h)(4)(i)(B)(2). The proposed regulation would also 
clarify that an inspection may take place at the petitioning 
organization's headquarters, satellite locations, or the location where 
the beneficiary works or will work, including the beneficiary's home, 
or third-party worksites, as applicable. The proposed provisions would 
make clear that an H-1B petitioner or any employer must allow access to 
all sites where the labor will be performed for the purpose of 
determining compliance with applicable H-1B requirements. The word 
``employer'' used in this context would include petitioners and third-
party contractors. DHS believes that the ability to inspect various 
locations is critical because the purpose of a site

[[Page 72908]]

inspection is to confirm information related to the petition, and any 
one of these locations may have information relevant to a given 
petition. If the petitioner and any third-party contractor does not 
allow USCIS officials to interview H-1B workers, including in the 
absence of the employer or the employer's representatives, this may 
also result in denial or revocation of the associated H-1B petition(s). 
The interviews may take place on the employer's property, or as 
feasible, at a neutral location agreed to by the interviewee and USCIS 
away from the employer's property. The presence of employer 
representatives during such interviews can reasonably be expected to 
have a chilling effect on the ability of interviewed workers to speak 
freely and, in turn, impede the Government's ability to ensure 
compliance with the terms and conditions of the H-1B program.
    The proposed regulation also states that if USCIS is unable to 
verify facts related to an H-1B petition, including due to the failure 
or refusal of the petitioner or third party to cooperate in an 
inspection or other compliance review, then the lack of verification of 
pertinent facts, including from failure or refusal to cooperate, may 
result in denial or revocation of the approval of any petition for 
workers who are or will be performing services at the location or 
locations that are a subject of inspection or compliance review, 
including any third-party worksites. See proposed 8 CFR 
214.2(h)(4)(i)(B)(2). A determination that a petitioner or third party 
failed or refused to cooperate would be case specific, but it could 
include situations where one or more USCIS officers arrived at a 
petitioner's worksite, made contact with the petitioner and properly 
identified themselves to a petitioner's representative, and the 
petitioner refused to speak to the officers or refused entry into the 
premises or refused permission to review human resources (HR) records 
pertaining to the beneficiary. Failure or refusal to cooperate could 
also include situations where a petitioner or employer agreed to speak 
but did not provide the information requested within the time period 
specified, or did not respond to a written request for information 
within the time period specified. Before denying or revoking the 
petition, USCIS would provide the petitioner an opportunity to rebut 
adverse information and present information on its own behalf in 
compliance with 8 CFR 103.2(b)(16).
    This new provision would put petitioners on notice of the specific 
consequences for noncompliance or lack of cooperation, whether by them 
or by a third party. It has long been established that, in H-1B visa 
petition proceedings, it is the petitioner's burden to establish 
eligibility for the immigration benefit sought.\153\ If USCIS conducts 
a site visit to verify facts related to the H-1B petition or to verify 
that the beneficiary is or will be employed consistent with the terms 
of the petition approval, and is unable to verify relevant facts and 
otherwise confirm general compliance, then the petition could properly 
be denied or the approval revoked. This would be true whether the 
unverified facts related to a petitioner worksite or a third-party 
worksite at which a beneficiary had been or would be placed by the 
petitioner. It would also be true whether the failure or refusal to 
cooperate were by the petitioner or a third party. Petitioners could 
consider notifying third parties at whose worksites beneficiaries may 
be working about the possibility of DHS verification efforts regarding 
the immigration benefit.
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    \153\ See INA section 291, 8 U.S.C. 1361; Matter of Simeio 
Solutions, 26 I&N Dec. 542, 549 (AAO 2015) (``It is the petitioner's 
burden to establish eligibility for the immigration benefit 
sought.''); Matter of Skirball Cultural Center, 25 I&N Dec. 799, 806 
(AAO 2012) (``In visa petition proceedings, the burden of proving 
eligibility for the benefit sought remains entirely with the 
petitioner.'').
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9. Third-Party Placement (Codifying Defensor)
    In certain circumstances where an H-1B worker provides services for 
a third party, USCIS would look to that third party's requirements for 
the beneficiary's position, rather than the petitioner's stated 
requirements, in assessing whether the proffered position qualifies as 
a specialty occupation. As required by both INA section 214(i)(1) and 8 
CFR 214.2(h)(4)(i)(A)(1), an H-1B petition for a specialty occupation 
worker must demonstrate that the worker will perform services in a 
specialty occupation that requires theoretical and practical 
application of a body of highly specialized knowledge and attainment of 
a baccalaureate or higher degree in the specific specialty (or its 
equivalent) as a minimum requirement for entry into the occupation in 
the United States. This proposal would ensure that petitioners are not 
circumventing specialty occupation requirements by imposing token 
requirements or requirements that are not normal to the third party.
    Specifically, under proposed 8 CFR 214.2(h)(4)(i)(B)(3), if the 
beneficiary will be staffed to a third party, meaning they will be 
contracted to fill a position in a third party's organization, the 
actual work to be performed by the beneficiary must be in a specialty 
occupation. Therefore, it is the requirements of that third party, and 
not the petitioner, that are most relevant when determining whether the 
position is a specialty occupation. If the beneficiary will work for a 
third party and perform work that is part of the third party's regular 
operations, the actual work to be performed by the beneficiary must be 
in a specialty occupation based on the requirements for the position 
imposed by that third party. While a petitioning employer may be the 
entity that hires and pays the beneficiary, the actual services the 
beneficiary provides may be for a third party. When interpreting the 
meaning of ``perform services . . . in a specialty occupation,'' INA 
section 101(a)(15)(H)(i)(b), in the context of certain third-party 
placements, USCIS would look to the position requirements imposed by 
the third party if the beneficiary will be ``staffed'' to that third 
party. Under such an interpretation, a position would not qualify as a 
specialty occupation simply because the petitioning employer decides to 
require a baccalaureate or higher degree in a specific specialty.\154\
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    \154\ See Defensor v. Meissner, 201 F.3d 384, 388 (5th Cir. 
2000) (``If only [the employer]'s requirements could be considered, 
then any alien with a bachelor's degree could be brought into the 
United States to perform a non-specialty occupation, so long as that 
person's employment was arranged through an employment agency which 
required all clients to have bachelor's degrees. Thus, aliens could 
obtain six year visas for any occupation, no matter how unskilled, 
through the subterfuge of an employment agency. This result is 
completely opposite the plain purpose of the statute and 
regulations, which is to limit [H-1B] visas to positions which 
require specialized experience and education to perform.'').
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    As stated in proposed 8 CFR 214.2(h)(4)(i)(B)(3), ``staffed'' means 
that the beneficiary ``will be contracted to fill a position in a third 
party's organization and becomes part of that third party's 
organizational hierarchy by filling a position in that hierarchy (and 
not merely providing services to the third party.'' There is a 
difference between a beneficiary who is ``staffed'' to a third party 
and a beneficiary who provides services to a third party (whether or 
not at a third-party location). A beneficiary who is ``staffed'' to a 
third party becomes part of that third party's organizational hierarchy 
by filling a position in that hierarchy, even when the beneficiary 
technically remains an employee of the petitioner. In this circumstance 
where the beneficiary fills a position within the third party's 
organizational hierarchy, the third party would be better

[[Page 72909]]

positioned than the petitioner to be knowledgeable of the actual degree 
requirements for the beneficiary's work. Thus, it is reasonable for 
USCIS to consider the requirements of the third party as determinative 
of whether the position is a specialty occupation. See proposed 8 CFR 
214.2(h)(4)(i)(B)(3).
    Compared to all cases where the H-1B beneficiary provides services 
to a third party, a third party would not always be in a better 
position than the petitioner to set the requirements of the proffered 
position. For example, a beneficiary may provide software development 
services to a third party as part of the petitioner's team of software 
developers on a discrete project, or a beneficiary employed by a large 
accounting firm may provide accounting services to various third-party 
clients. In these examples, proposed 8 CFR 214.2(h)(4)(i)(B)(3) would 
not apply, because it would not be reasonable to assume that the third 
party would be better positioned than the petitioner to know the actual 
degree requirements for the beneficiary's work. DHS narrowed down the 
applicability of proposed 8 CFR 214.2(h)(4)(i)(B)(3) to only the subset 
of beneficiaries who would be ``staffed'' to a third party because 
these examples illustrate how a third party's degree requirements would 
not always be as relevant as the petitioner's degree requirements.
    Proposed 8 CFR 214.2(h)(4)(i)(B)(3) would be generally consistent 
with long-standing USCIS practice.\155\ In Defensor v. Meissner, 201 
F.3d 384 (5th Cir. 2000), the court recognized that, if only the 
petitioner's requirements are considered, then any beneficiary with a 
bachelor's degree could be brought to the United States in H-1B status 
to perform non-specialty occupation work, as long as that person's 
employment was arranged through an employment agency that required all 
staffed workers to have bachelor's degrees. This result would be the 
opposite of the plain purpose of the statute and regulations, which is 
to limit H-1B visas to positions that require specialized education to 
perform the duties. If the work that the beneficiary would actually 
perform does not require the theoretical and practical application of a 
body of highly specialized knowledge and attainment of a baccalaureate 
or higher degree in a specific specialty or its equivalent, then the 
position would not qualify as an H-1B specialty occupation. In such a 
case, the petitioning employer's stated education and experience 
requirements for the beneficiary's position would not be determinative 
to the specialty occupation assessment. USCIS would make the 
determination as to whether the beneficiary would be ``staffed'' to a 
third party on a case-by-case basis, taking into consideration the 
totality of the relevant circumstances.
---------------------------------------------------------------------------

    \155\ See, e.g., In Re. ---, 2010 WL 3010500 (AAO Jan. 12, 2010) 
(``In support of this analysis, USCIS routinely cites Defensor v. 
Meissner, 201 F.3d 384 (5th Cir. 2000), in which an examination of 
the ultimate employment of the beneficiary was deemed necessary to 
determine whether the position constitutes a specialty 
occupation.''); In Re. 5037859, 2019 WL 6827396 (AAO Nov. 7, 2019) 
(``The scenario in Defensor has repeatedly been recognized by 
Federal Courts as appropriate in determining which entity should 
provide the requirements of an H-1B position and the actual duties a 
beneficiary would perform.'') (citing to Altimetrik Corp. v. USCIS, 
No. 2:18-cv-11754, at *7 (E.D. Mich. Aug. 21, 2019); Valorem 
Consulting Grp. v. USCIS, No. 13-1209-CV-W-ODS, at *6 (W.D. Mo. Jan. 
15, 2015); KPK Techs. v. Cuccinelli, No. 19-10342, at *10 (E.D. 
Mich. Sep. 16, 2019); Altimetrik Corp. v. Cissna, No. 18-10116, at 
*11 (E.D. Mich. Dec. 17, 2018); Sagarwala v. Cissna, No. CV 18-2860 
(RC), 2019 WL 3084309, at *9 (D.D.C. July 15, 2019)).
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D. Request for Preliminary Public Input Related to Future Actions/
Proposals

1. Use or Lose
    DHS wants to ensure that the limited number of H-1B cap-subject 
visas and new H-1B status grants available each fiscal year are used 
for non-speculative job opportunities. Demand for H-1B workers who 
would be subject to the annual numerical limitations, including those 
eligible under the advanced degree exemption, has routinely exceeded 
the annual H-1B numerical allocations. DHS believes there is a problem 
of petitioners filing H-1B cap-subject petitions even though there is 
no job opportunity available as of the requested start date. As 
illustrated by the data below, a significant percentage of H-1B 
beneficiaries do not enter the United States within six months of the 
requested employment start date or H-1B petition approval date, 
whichever was later, or within 90 days of the visa validity start date. 
The data also show a large percentage of new or amended petitions 
received before the beneficiary's arrival in the United States, 
suggesting that there may not have been a bona fide job opportunity 
available at the time of filing and the initial petition filed was 
simply to secure an H-1B cap number for the worker. Given the history 
of demand for H-1B visas that greatly exceeds supply, it is of great 
concern when a petitioner requests an H-1B cap number and receives 
approval, but does not use that approved H-1B petition to employ an H-
1B worker when the petitioner claimed to need that worker to start and 
significantly delays such employment by six months or more.
    DHS has compiled internal data to help demonstrate the potential 
scale of the problem. The first two tables below focus on delayed entry 
into the United States by beneficiaries of H-1B cap-subject petitions 
that selected consular processing. The third table looks at the same 
population of cases and amended or new petitions received prior to the 
beneficiary's arrival in the United States. DHS believes that these may 
be indicators that the petitioners in these cases had speculative job 
opportunities at the time of filing their H-1B petitions.
    Table 9 shows data on H-1B cap-subject petitions that selected 
consular processing into the United States and that DHS was able to 
match with the beneficiary's arrival data into the United States.

[[Page 72910]]

[GRAPHIC] [TIFF OMITTED] TP23OC23.015

    This table shows that, from FYs 2017 through 2022 (excepting FY 
2021),\156\ on average, approximately 43 percent of H-1B cap-subject 
beneficiaries of petitions that selected consular processing (and that 
DHS was able to match with the beneficiaries' arrival data) did not 
enter the United States in H-1B status within six months of the 
requested employment start date on the H-1B petition or the H-1B 
petition approval date, whichever was later.\157\ While it is 
reasonable to conclude that some of these delays were due to legitimate 
reasons (e.g., long consular wait times), other delays may have been 
due to illegitimate reasons (e.g., the petitioner filing an H-1B 
petition despite not having work available on the requested start 
date). While DHS is aware that these data are imperfect, in part 
because DHS was not able to match some petitions with beneficiary 
arrival data, these data illustrate the scale of the issue--that nearly 
half of beneficiaries who consular processed appear to have not entered 
the United States in H-1B status within six months of the requested 
start date.
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    \156\ FY 2021 data was not included because of the variances in 
visa entries and closed borders due to the COVID-19 pandemic.
    \157\ These data only track whether a beneficiary entered the 
United States in H-1B status after 6 months of the employment start 
date or H-1B petition approval date, whichever was later; the data 
do not track a beneficiary's prior or subsequent travel history into 
or outside of the United States. By capturing data on entries made 
after the requested employment start date on the H-1B petition or 
the H-1B petition approval date, whichever was later, these data 
should exclude entries that were made after 6 months of the 
requested employment start date because of a delay in USCIS 
approving the H-1B petition.
---------------------------------------------------------------------------

    DHS is aware that there have been significant visa delays at some 
consulates, especially during the last few years. Table 10 takes this 
into account by showing data on H-1B beneficiaries who went through 
consular processing, who arrived more than 90 days after their DOS visa 
validity start date, and for whom DHS was able to match with arrival 
data into the United States with corresponding H-1B petitions.

[[Page 72911]]

[GRAPHIC] [TIFF OMITTED] TP23OC23.016

    This table shows that, from FYs 2017 through 2022 (excepting FY 
2021),\158\ on average, more than 26 percent of H-1B cap-subject 
beneficiaries who selected consular processing arrived in the United 
States more than 90 days after the DOS visa validity start date. Again, 
while it is reasonable to conclude that some of these delays were due 
to legitimate reasons (e.g., a medical emergency pertaining to the 
beneficiary or the beneficiary's immediate family), other delays may 
have been due to illegitimate reasons (e.g., the petitioner filing an 
H-1B petition despite not having work available on the requested start 
date).
---------------------------------------------------------------------------

    \158\ FY 2021 data was not included because of the variances in 
visa entries and closed borders due to the COVID-19 pandemic.
---------------------------------------------------------------------------

    DHS has also compiled internal data on the number of amended or new 
petitions received prior to the beneficiary's arrival in the United 
States, which may also be an indicator that a petitioner had a 
speculative job opportunity at the time of filing. Table 11 shows data 
on the percentage of amended or new petitions received prior to the 
beneficiary's arrival in the United States that DHS was able to match 
with the beneficiary's arrival data into the United States.
---------------------------------------------------------------------------

    \159\ Part 2, question 2, asks for the ``Basis for 
Classification,'' and option ``a'' is for ``New employment.''
    \160\ Part 2, question 2, asks for the ``Basis for 
Classification,'' and option ``b'' is for ``Continuation of 
previously approved employment without change with the same 
employer.''
    \161\ Part 2, question 2, asks for the ``Basis for 
Classification,'' and option ``c'' is for ``Change in previously 
approved employment.''
    \162\ Part 2, question 2, asks for the ``Basis for 
Classification,'' and option ``f'' is for ``Amended petition.''

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[[Page 72912]]

[GRAPHIC] [TIFF OMITTED] TP23OC23.017

    Table 11 shows that from FYs 2017 through 2022 (excepting FY 
2021),\163\ an average of approximately 15 percent of amended or new 
petitions where the beneficiary selected consular processing are 
received prior to the beneficiary's arrival in the United States. 
Again, while it is reasonable to conclude that some of these amended or 
new petitions were due to legitimate reasons (e.g., a legitimate shift 
in work location or end-client project), other petitions may have been 
filed due to illegitimate reasons (e.g., the petitioner filing an H-1B 
petition despite not having work available on the requested start 
date). DHS believes that these data illustrate that there may be a 
problem with petitioners filing H-1B petitions and taking up cap 
numbers without having non-speculative job opportunities as of the 
requested start date on the petition.
---------------------------------------------------------------------------

    \163\ FY 2021 data was not included because of the variances in 
visa entries and closed borders due to the COVID-19 pandemic.
---------------------------------------------------------------------------

    DHS is looking for the most effective ways to prevent petitioners 
from receiving approval for speculative H-1B employment, and to curtail 
the practice of delaying H-1B cap-subject beneficiary's employment in 
the United States until a bona fide job opportunity materializes. DHS 
has considered various approaches--two of which are discussed below but 
has determined that each of them has potentially significant downsides.
    For example, although current 8 CFR 214.2(h)(8)(ii)(B) requires 
petitioners to notify USCIS if a petition goes unused because the 
beneficiary does not apply for admission to the United States, so that 
the agency may revoke approval of the petition, this regulatory 
provision does not include a deadline for admission or a reporting 
deadline. Thus, one approach DHS considered would be to amend 8 CFR 
214.2(h)(8)(ii)(B) to require petitioners to notify USCIS if a 
beneficiary does not apply for admission after a certain amount of 
time, so that USCIS may revoke the approval of the petition. DHS could 
add a reporting requirement, so that a failure to report, or reporting 
that the beneficiary had not yet been admitted within the required 
timeframe, could be a basis for revocation. This proposal would also 
afford petitioners an opportunity to provide legitimate reasons for the 
delay in admission and avoid revocation. However, this approach would 
not prevent a petitioner without a legitimate reason for the delay from 
circumventing the intent of this provision, such as by filing an 
amended petition for the cap-subject beneficiary and further delaying 
their admission, or having the beneficiary enter the United States one 
day before the deadline and then leaving shortly thereafter. In 
addition, while the revocation of the H-1B petition may serve as a 
disincentive to the petitioner and discourage such conduct the next 
time around, it may not be the most efficient way to deter the filing 
of the H-1B petition itself given the time that would have elapsed 
between the time of filing and the final revocation.
    Another approach DHS considered would be to create a rebuttable 
presumption that a petitioner had only a speculative position available 
for the beneficiary of an approved H-1B cap-subject petition, which 
would be triggered if certain circumstances occurred. These 
circumstances might include delayed entry or filing an amended petition 
before the beneficiary would have been admitted to the United States in 
H-1B status. If the petitioner were unable to rebut this presumption, 
USCIS could deny any extension request based on the previously approved 
cap-subject H-1B cap-subject petition and could revoke the initial 
petition approval. Regarding delayed entry, DHS considered proposing 
that the rebuttable presumption would be triggered if the beneficiary 
had not entered the United States in H-1B status either within a 
certain number of days of the requested start date or within a

[[Page 72913]]

certain number of days of the validity date of their H-1B nonimmigrant 
visa based on the cap-subject petition. Ultimately, DHS concluded that 
this approach of a rebuttable presumption would create significant 
evidentiary burdens for legitimate petitioners. Further, while it would 
bolster program integrity, similar to the first approach, it would not 
be an efficient deterrent given the time that would have elapsed 
between the time of filing and the denial of the extension request or 
the final revocation.
    As discussed, DHS is aware that either option could have a broad 
reach and potentially include petitions for beneficiaries whose 
admission into the United States was delayed for legitimate reasons 
beyond their control, such as lengthy consular processing times. Either 
option would place an additional burden on petitioners, which may be 
particularly difficult to overcome for a subsequent petitioner that is 
distinct from the original petitioner that filed the initial H-1B cap-
subject petition. Further, the above options would focus on the 
beneficiary's timely admission into the United States but would not 
account for the beneficiary's or petitioner's subsequent actions.
    Therefore, because DHS believes there is a problem of petitioners 
filing H-1B cap-subject petitions for speculative job opportunities 
that would not be fully resolved by the changes at proposed 8 CFR 
214.2(h)(4)(iii)(F), DHS is seeking preliminary public comments on the 
approaches described above, as well as soliciting ideas that would 
further curb or eliminate the possibility that petitioners may have 
speculative job opportunities at the time of filing or approval of H-1B 
petitions and delay admission of H-1B beneficiaries until they have 
secured work for them. DHS is hoping to use the public input it 
receives to develop proposals that would further strengthen the 
programmatic framework and complement provisions already proposed in 
this NPRM, such as the proposed requirement that the petitioner 
establish a non-speculative position for the beneficiary as of the 
start date of the validity period under proposed 8 CFR 
214.2(h)(4)(iii)(F) and the proposed requirement that a petitioner have 
a bona fide job offer under proposed 8 CFR 214.2(h)(4)(ii). 
Specifically, DHS is requesting ideas and, where possible, supporting 
data for future regulatory, subregulatory, and enforcement actions that 
USCIS could take, alone or in partnership with other agencies, to 
mitigate this behavior. With respect to the two approaches discussed 
above, DHS encourages commenters to provide input on how a time 
restriction on admission, or a rebuttable presumption as described 
above, could impact legitimate business practices. DHS also encourages 
commenters to provide ideas on other ways DHS could better ensure 
petitions are filed only for non-speculative job opportunities without 
imposing an unnecessary burden on H-1B cap-subject petitioners.
2. Beneficiary Notification
    DHS is seeking preliminary public input on ways to provide H-1B and 
other Form I-129 beneficiaries with notice of USCIS actions taken on 
petitions filed on their behalf, including receipt notices for a 
petition to extend, amend, or change status filed on their behalf. 
USCIS does not currently provide notices directly to Form I-129 
beneficiaries. DHS is aware that the lack of petition information may 
leave Form I-129 beneficiaries unable to verify their own immigration 
status and susceptible to employer abuse.\164\ DHS is also aware that 
having case status information would improve worker mobility and 
protections.
---------------------------------------------------------------------------

    \164\ See DHS, Office of the Citizenship and Immigration 
Services Ombudsman, Recommendation to Remove a Barrier Pursuant to 
Executive Order 14012: Improving U.S. Citizenship and Immigration 
Services' Form I-129 Notification Procedures Recommendation Number 
62 (Mar. 31, 2022), https://www.dhs.gov/sites/default/files/2022-03/CIS%20OMBUDSMAN_I-129_BENEFICIARY_RECOMMENDATION_fnl_03-2022_508.pdf 
(``lack of direct notification may leave them without status 
documentation, rendering them noncompliant with the law, susceptible 
to abuse by employers, and unable to access benefits requiring proof 
of status''). This report formally recommended that USCIS directly 
notify beneficiaries of Form I-129 actions taken in the petition on 
their behalf.
---------------------------------------------------------------------------

    DHS is committed to addressing the issue of beneficiary 
notification but is not at this time proposing a specific beneficiary 
notification process or regulation. The agency continues to research 
and consider the feasibility, benefits, and costs of various options 
separate and apart from this proposed rule. At this time, DHS would 
like to solicit preliminary public comments on various options, and in 
particular, one option currently being considered for potential future 
action separate from this rulemaking. This option would require Form I-
129 petitioners to provide a copy of the notice of USCIS action to 
beneficiaries in the United States seeking extension or change of 
status. DHS believes such notification may be especially beneficial in 
the context of extensions or changes of status. While beneficiaries who 
are outside of the United States will receive basic petition 
information on Form I-94, Arrival-Departure Record, and on their 
nonimmigrant visa, beneficiaries who are already in the United States 
must rely entirely on petitioners and employers to provide such 
information.\165\
---------------------------------------------------------------------------

    \165\ The Form I-797 approval notice instructs petitioners that 
the lower portion of the notice, including Form I-94, ``should be 
given to the beneficiary(ies).''
---------------------------------------------------------------------------

    DHS recognizes this option would leave open the possibility that 
petitioners would not comply with this requirement, something DHS 
intends to forestall, but believes it would still provide benefits and 
worker protections while USCIS continues to explore other options, 
including the feasibility of technological solutions that would allow 
USCIS to directly notify beneficiaries or allow beneficiaries to 
directly access case status.\166\ DHS is particularly interested in 
comments that cite evidence of the expected costs and burdens on 
petitioners as a result of such a requirement, as well as comments and 
evidence about the extent that such a provision would benefit H-1B 
workers, which DHS will take into consideration when crafting potential 
future solutions or regulatory proposals.
---------------------------------------------------------------------------

    \166\ See USCIS Memorandum, Response to Recommendations on 
Improving Form I-129 Notification Procedures (Aug. 11, 2022), 
https://www.dhs.gov/sites/default/files/2022-08/SIGNED%20USCIS%20Response%20to%20Formal%20Recommendation%20-%20Form%20I-129.08122022_v2.pdf.
---------------------------------------------------------------------------

E. Potential Publication of One or More Final Rules

    As indicated earlier in this preamble, after carefully considering 
public comments it receives on this NPRM, DHS may publish one or more 
final rules to codify the provisions proposed in this NPRM.

F. Severability

    DHS intends for the provisions of this proposed rule, if finalized 
through one or more final rules, to be severable from each other such 
that if a court were to hold that any provision is invalid or 
unenforceable as to a particular person or circumstance, the rule would 
remain in effect as to any other person or circumstance. While the 
various provisions of this proposed rule, taken together, would provide 
maximum benefit with respect to modernizing the H-1B program and 
strengthening program integrity, none of the provisions are 
interdependent and unable to operate separately, nor is any single 
provision essential to the rule's overall workability. DHS welcomes 
public input on the severability of provisions contained in this 
proposed rule.

[[Page 72914]]

V. Statutory and Regulatory Requirements

A. Executive Order 12866 (Regulatory Planning and Review) and Executive 
Order 13563 (Improving Regulation and Regulatory Review)

    Executive Orders (E.O.) 12866 (Regulatory Planning and Review), as 
amended by Executive Order 14094 (Modernizing Regulatory Review), and 
13563 (Improving Regulation and Regulatory Review) direct agencies to 
assess the costs and benefits of available regulatory alternatives and, 
if a regulation is necessary, to select regulatory approaches that 
maximize net benefits (including potential economic, environmental, 
public health and safety effects, distributive impacts, and equity). 
E.O. 13563 emphasizes the importance of quantifying both costs and 
benefits, of reducing costs, of harmonizing rules, and of promoting 
flexibility.
    The Office of Management and Budget (OMB) has designated this 
proposed rule a ``significant regulatory action'' as defined under 
section 3(f) of E.O. 12866, as amended by Executive Order 14094, but it 
is not significant under section 3(f)(1) because its annual effects on 
the economy do not exceed $200 million in any year of the analysis. 
Accordingly, OMB has reviewed this proposed rule.
1. Summary
    As discussed in the preamble, the purpose of this rulemaking is to 
modernize and improve the regulations governing the H-1B program by: 
(1) modernizing and streamlining H-1B program requirements and 
improving program efficiency; (2) providing greater benefits and 
flexibilities for petitioners and beneficiaries; and (3) improving 
integrity measures.
    For the 10-year period of analysis of the proposed rule DHS 
estimates the annualized net costs of this rulemaking will be 
$6,339,779 annualized at 3 percent and 7 percent. Table 12 provides a 
more detailed summary of the proposed rule provisions and their 
impacts.
BILLING CODE 9111-97-P

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[[Page 72924]]


[GRAPHIC] [TIFF OMITTED] TP23OC23.027

    In addition to the impacts summarized above, and as required by OMB 
Circular A-4, Table 13 presents the prepared accounting statement 
showing the costs and benefits that would result if this proposed rule 
is finalized.\167\
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    \167\ OMB, Circular A-4 (Sept. 17, 2003), https://www.whitehouse.gov/wp-content/uploads/legacy_drupal_files/omb/circulars/A4/a-4.pdf (last viewed June 1, 2021).

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[[Page 72926]]


[GRAPHIC] [TIFF OMITTED] TP23OC23.029

BILLING CODE 9111-97-C

2. Background

    The purpose of this rulemaking is to propose changes that DHS 
believes would modernize and improve the regulations relating to the H-
1B program by: (1) streamlining the requirements of the H-1B program 
and improving program efficiency; (2) providing greater benefits and 
flexibilities for petitioners and beneficiaries; and (3) improving 
integrity measures. Some of the proposed provisions would narrowly 
impact other nonimmigrant classifications.
3. Costs, Transfers, and Benefits of the Proposed Rule
a. Amended Petitions
    DHS proposes to clarify when an amended or new H-1B petition must 
be filed due to a change in an H-1B worker's place of employment. 
Specifically, this rule proposes to clarify that any change of work 
location that requires a new LCA is itself considered a material change 
and therefore requires the petitioning employer to file an amended or 
new petition with USCIS before the H-1B worker may perform work under 
the changed conditions.
    This proposed change would clarify requirements for H-1B amended 
petitions by codifying Matter of Simeio \168\ and incorporating DOL 
rules on when a new LCA is not necessary. DHS estimates that this 
proposed change would save petitioners filing amended petitions 5 
minutes for each petition (0.08 hours).
---------------------------------------------------------------------------

    \168\ See USCIS, ``USCIS Final Guidance on When to File an 
Amended or New H-1B Petition After Matter of Simeio Solutions, 
LLC,'' PM-602-0120 (July 21, 2015), https://www.uscis.gov/sites/default/files/document/memos/2015-0721_Simeio_Solutions_Transition_Guidance_Memo_Format_7_21_15.pdf.
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    USCIS received a low of 17,057 amended petitions in FY 2022, and a 
high of 80,102 amended petitions in FY 2018. Based on the 5-year annual 
average, DHS estimates that 59,947 petitioners file for an amended 
petition each year shown in Table 14. DHS does not know if all of these 
amended petitions are due to a change in an H-1B worker's place of 
employment. Because of this, DHS cannot estimate how many of these new 
and amended petitions would benefit by consolidating existing 
requirements and providing clearer regulatory text pertaining to when a 
petitioner must submit an amended or new petition.
[GRAPHIC] [TIFF OMITTED] TP23OC23.030


[[Page 72927]]


    DHS conducted a sensitivity analysis to estimate the number of 
petitions that may benefit from this proposed change. Table 15 presents 
the lower and upper bound number of petitions filed annually for 
amended petitions and for new petitions, which corresponds to a range 
of 10 to 90 percent.
[GRAPHIC] [TIFF OMITTED] TP23OC23.031

    Using the lower and upper bounds of the estimated annual population 
for the petitioners who would file amended petitions, DHS estimates the 
cost savings based on the opportunity cost of time of gathering and 
submitting information by multiplying the estimated time burden savings 
for those filing an amended petition (5 minutes or 0.08 hours) by the 
compensation rate of an HR specialist, in-house lawyer, or outsourced 
lawyer, respectively. DHS does not know the exact number of petitioners 
who will choose an in-house or an outsourced lawyer but assumes it may 
be a 50/50 split and therefore provides an average. Table 16 shows that 
the total annual cost savings would range from $59,545 to $535,801. DHS 
estimates the total cost savings to be the average between the lower 
bound and the upper bound estimates. Based on this DHS estimates the 
average cost savings from this provision to be $297,673.
BILLING CODE 9111-97-P
[GRAPHIC] [TIFF OMITTED] TP23OC23.032

BILLING CODE 9111-97-C
b. Deference to Prior USCIS Determinations of Eligibility in Requests 
for Extensions of Petition Validity
    DHS seeks to codify and clarify its existing deference policy at 
proposed 8 CFR 214.1(c)(5). Deference has helped promote consistency 
and efficiency for both USCIS and its stakeholders. The deference 
policy instructs officers to consider prior determinations involving 
the same parties and facts, when there is no material error with the 
prior determination, no material change in circumstances or in 
eligibility, and no new material information adversely impacting the 
petitioner's, applicant's, or beneficiary's eligibility. This provision 
proposes to codify the deference policy \169\ dated April 27, 2021. 
Relative to the no action baseline there are no costs to the public. 
The benefit of codifying this policy is that

[[Page 72928]]

there may be some transparency benefits to having the policy in the CFR 
so the public has the requirements in one place. Relative to a pre-
policy baseline petitioners may need to take time to familiarize 
themselves with those changes made in the 2021 deference policy memo. 
The provision applies to all nonimmigrant classifications for which 
form I-129 is filed to request an extension of stay (i.e., E-1, E-2, E-
3, H-1B, H-1B1, H-2A, H-2B, H-3, L-1, O-1, O-2, P-1, P-1S, P-2, P-2S, 
P-3, P-3S, Q-1, R-1, and TN nonimmigrant classifications). The 
deference policy had been in effect since 2004 but was rescinded in 
2017. After USCIS rescinded deference in 2017, the number of RFEs and 
denials increased.
---------------------------------------------------------------------------

    \169\ See USCIS, ``Deference to Prior Determinations of 
Eligibility in Requests for Extensions of Petition Validity, Policy 
Alert,'' PA-2021-05 (April 27, 2021), https://www.uscis.gov/sites/default/files/document/policy-manual-updates/20210427-Deference.pdf 
(last visited on Mar. 23, 2023).
---------------------------------------------------------------------------

    Table 17 shows the number for Form I-129 RFEs filed for an 
extension of stay or amendment of stay, who are applying for a 
continuation of previously approved employment or a change in 
previously approved employment from FY 2018 through FY 2022. USCIS 
received a low of 13,467 RFEs for Form I-129 classifications in FY 
2022, and a high of 43,430 RFEs for Form I-129 classifications in FY 
2020. Based on a 5-year annual average, 31,327 petitioners who filed 
for an extension of stay or amendment of stay, who are applying for a 
continuation of previously approved employment or a change in 
previously approved employment receive an RFE for Form I-129 per year.
[GRAPHIC] [TIFF OMITTED] TP23OC23.033

    DHS is proposing to codify the deference policy that applies to the 
adjudication of a petition. This proposed change could affect the 
number of RFEs that USCIS sends for Form I-129. USCIS estimates that 
there may be a reduction in RFEs, as officers adjudicating a Form I-129 
involving the same parties and the same underlying facts would not need 
to re-adjudicate eligibility. The reduction in RFEs may save time and 
make the overall process faster for petitioners and USCIS.
    Table 18 shows the number of Form I-129 receipts, submitted 
concurrently with a Form G-28, filed for a continuation of previously 
approved employment or a change in previously approved employment, and 
requesting an extension of stay or amendment of stay, on which USCIS 
issued an RFE. Based on the 5-year annual average, DHS estimates that 
23,475 petitioners who received an RFE filed with a Form G-28 and 7,853 
petitioners who received an RFE filed without a Form G-28.
BILLING CODE 9111-97-P
[GRAPHIC] [TIFF OMITTED] TP23OC23.034


[[Page 72929]]


    DHS conducted a sensitivity analysis to estimate the number of 
petitions that may benefit from codifying and clarifying its existing 
deference policy. Table 19 presents the lower and upper bound number of 
petitions filed annually for amended petitions and for new petitions, 
which corresponds to a range of 10 to 90 percent.
[GRAPHIC] [TIFF OMITTED] TP23OC23.035

    Using the lower and upper bounds of the estimated annual population 
for the petitioners who may no longer have to provide duplicative data, 
DHS estimates the cost savings based on the opportunity cost of time of 
gathering and submitting duplicative information by multiplying the 
estimated time burden to gather information 10 minutes (0.167 hours) by 
the compensation rate of an HR specialist, in-house lawyer, or 
outsourced lawyer, respectively. DHS does not know the exact number of 
petitioners who will choose an in-house or an outsourced lawyer but 
assumes it may be a 50/50 split and therefore provides an average. 
Table 20 shows that the total annual cost savings due to the codifying 
and clarifying its existing deference policy would range from $67,691 
to $609,132. DHS estimates the total cost savings to be the average 
between the lower bound and the upper bound estimates. Based on this 
DHS estimates the average cost savings from this provision to be 
$338,412.
[GRAPHIC] [TIFF OMITTED] TP23OC23.036

BILLING CODE 9111-97-C
c. Evidence of Maintenance of Status
    DHS seeks to clarify current requirements and codify current 
practices concerning evidence of maintenance of status at proposed 8 
CFR 214.1(c)(1) through (7). Primarily, DHS seeks to clarify that 
evidence of maintenance of status is required for petitions where there 
is a request to extend or amend the beneficiary's stay.
    This proposed change would list examples of additional evidence 
types that petitioners may provide, but would not limit petitioners to 
those specific evidence types. The proposed form instructions further 
state that if the beneficiary is employed in the United States, the 
petitioner may submit copies of the beneficiary's last two pay stubs, 
Form W-2, and other relevant evidence, as well as a copy of the 
beneficiary's Form I-94, passport, travel document, or Form I-797. This 
proposed change may decrease the number of RFEs and NOIDs by clearly 
stating what types of supporting documentation are relevant and 
clarifying that petitioners should submit such supporting documentation 
upfront, rather than waiting for USCIS to issue a request for 
additional information. This may benefit petitioners by saving them the 
time to review and respond to RFEs and NOIDs.
    DHS is proposing to codify into regulation the instructions that, 
when seeking an extension of stay, the applicant or petitioner must 
submit supporting evidence to establish that the

[[Page 72930]]

applicant or beneficiary maintained the previously accorded 
nonimmigrant status before the extension request was filed. 
Additionally, DHS is proposing to remove the sentence: ``Supporting 
evidence is not required unless requested by the director.'' \170\ DHS 
expects that these proposed changes would reduce confusion for 
applicants and petitioners, clarify what evidence is required for all 
extension of stay requests, and simplify adjudications by decreasing 
the need for RFEs and NOIDs.
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    \170\ See proposed 8 CFR 214.2(h)(14). See also proposed 8 CFR 
214.2(l)(14)(i) (removing ``Except in those petitions involving new 
offices, supporting documentation is not required, unless requested 
by the director.''); proposed 8 CFR 214.2(o)(11) and (p)(13) 
(removing ``Supporting documents are not required unless requested 
by the Director.'').
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    Based on the 5-year annual average, DHS estimates that 299,025 Form 
I-129 petitions are filed requesting an extension of stay. Of those 
total filed petitions, DHS estimates that 61,781 petitioners who 
requested an extension of stay received an RFE and the remaining 
237,244 did not receive and RFE as shown in Table 21.
[GRAPHIC] [TIFF OMITTED] TP23OC23.037

    DHS estimates that 29,195 petitions are filed requesting to amend 
the stay. Of those, DHS estimates that 9,723 petitions that are filed 
requesting to amend the stay receive an RFE and 19,473 do not receive 
an RFE.
[GRAPHIC] [TIFF OMITTED] TP23OC23.038

    DHS estimates that 89,241 petitions are filed requesting to change 
status and extend the stay. Of those, DHS estimates that 30,318 
petitions that are filed requesting to change status and extend the 
stay receive an RFE and 58,922 do not receive an RFE.

[[Page 72931]]

[GRAPHIC] [TIFF OMITTED] TP23OC23.039

    It is important to note that issuing RFEs and NOIDs takes time and 
effort for adjudicators--to send, receive, and adjudicate 
documentation--and it requires additional time and effort for 
applicants or petitioners to respond, resulting in extended timelines 
for adjudications.\171\ Data on RFEs and NOIDs related to maintenance 
of status are not standardized or tracked in a consistent way, thus 
they are not very accurate or reliable. Within this context, the data 
can provide some insight, however minimal, that these requests and 
notices have been present and that they continue to occur.
---------------------------------------------------------------------------

    \171\ The regulations state that when an RFE is served by mail, 
the response is timely filed if it is received no more than 3 days 
after the deadline, providing a total of 87 days for a response to 
be submitted if USCIS provides the maximum period of 84 days under 
the regulations. The maximum response time for a NOID is 30 days. 
See https://www.uscis.gov/policy-manual/volume-1-part-e-chapter-6.
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    DHS anticipates that USCIS adjudicators may issue fewer RFEs and 
NOIDs related to maintenance of status under this proposed rule due to 
clarity of what types of supporting documentation are relevant and 
clarification that petitioners should submit such supporting 
documentation upfront, rather than waiting for USCIS to issue a request 
for additional information, which would reduce the burden on 
applicants, petitioners, and adjudicators, and save time processing 
applications and petitions. Because the data are not standardized or 
tracked consistently DHS cannot estimate how many RFEs and NOIDs are 
related to maintenance of status.
d. Eliminating the Itinerary Requirement for H Programs
    DHS is proposing to eliminate the H programs' itinerary 
requirement. See proposed 8 CFR 214.2(h)(2)(i)(B) and (F). Current 8 
CFR 214.2(h)(2)(i)(B) states that ``A petition that requires services 
to be performed or training to be received in more than one location 
must include an itinerary with the dates and locations of the services 
or training and must be filed with USCIS as provided in the form 
instructions.'' In addition, current 8 CFR 214.2(h)(2)(i)(F) contains 
additional language requiring an itinerary for H petitions filed by 
agents as the petitioner.
    DHS recognizes this change may affect H-1B petitioners filing for 
beneficiaries performing services in more than one location and 
submitting itineraries. However, due to the absence of detailed data on 
petitioners submitting itineraries, DHS estimates the affected 
population as the estimated number of petitions filed annually for 
workers placed at off-site locations. DHS assumes the petitions filed 
for workers placed at off-site locations are likely to indicate that 
beneficiaries may be performing services at multiple locations and, 
therefore, petitioners are likely to submit itineraries. Eliminating 
the itinerary requirement would reduce petitioner burden and promote 
more efficient adjudications, without compromising program integrity. 
This proposed change may benefit petitioners who have beneficiaries at 
alternative worksites.
    Table 24 shows the total number of Form I-129 H-1B Receipts with 
and without Form G-28, FY 2018 through FY 2022. USCIS received a low of 
398,285 Form I-129 H-1B Receipts in FY 2021, and a high of 474,311 Form 
I-129 H-1B Receipts in FY 2022. Based on the 5-year annual average, DHS 
estimates that there are 427,822 Form I-129 H-1B petitioners each year.

[[Page 72932]]

[GRAPHIC] [TIFF OMITTED] TP23OC23.040

    Table 25 shows the average number of Form I-129 H-1B petitions 
approved in FYs 2018-22 for workers placed at off-site locations. 
Nearly 31 percent of petitions were approved for workers placed at off-
site locations. DHS uses the estimated 31 percent as the proportion of 
both the population of received petitions and the population of 
approved petitions that are for workers placed at off-site locations.
[GRAPHIC] [TIFF OMITTED] TP23OC23.041

    DHS conducted a sensitivity analysis to estimate the number of H-1B 
petitions filed annually for workers placed at off-site locations that 
may contain itineraries (132,625).\172\ Table 26 presents the lower and 
upper bound number of petitions filed annually for workers placed at 
off-site locations who may submit itineraries, which corresponds to a 
range of 10 to 90 percent.
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    \172\ DHS uses the proportion of petitions approved for off-site 
workers (31 percent from Table 25) as an approximate measure to 
estimate the number of petitions received annually for off-site 
workers from the total number of petitions filed. 132,625 petitions 
filed requesting off-site workers = 427,822 petitions filed annually 
x 31 percent.
[GRAPHIC] [TIFF OMITTED] TP23OC23.042

    Using the lower and upper bounds of the estimated annual population 
for H-1B petitioners who may no longer be required to gather and submit 
itinerary information, DHS estimates the cost savings based on the 
opportunity cost of time of gathering and submitting itinerary 
information by multiplying the estimated time burden to gather

[[Page 72933]]

itinerary information (0.08 hours) by the compensation rate of an HR 
specialist, in-house lawyer, or outsourced lawyer, respectively. Table 
27 shows that the total annual cost savings due to the itinerary 
exemption would range from $141,704 to $1,275,277. Since the itinerary 
information normally is submitted with the Form I-129 H-1B package, 
there would be no additional postage cost savings. DHS estimates the 
total cost savings to be the average between the lower bound and the 
upper bound estimates. Based on this DHS estimates the average cost 
savings from this provision to be $708,491.
BILLING CODE 9111-97-P
[GRAPHIC] [TIFF OMITTED] TP23OC23.043

BILLING CODE 9111-97-C
    DHS acknowledges the proposal to eliminate the itinerary 
requirement may also affect H petitions filed by agents as well as H-2 
petitions filed for beneficiaries performing work in more than one 
location or for multiple employers, however, DHS has not estimated 
these cost savings here.
e. Validity Period Expires Before Adjudication
    DHS proposes to allow H-1B petitions to be approved or have their 
requested validity period dates extended if USCIS adjudicates and deems 
the petition approvable after the initially requested validity period 
end-date, or the period for which eligibility has been established, has 
passed. This typically would happen if USCIS deemed the petition 
approvable upon a favorable motion to reopen, motion to reconsider, or 
appeal.
    If USCIS adjudicates an H-1B petition and deems it approvable after 
the initially requested validity period end-date, or the last day for 
which eligibility has been established, USCIS may issue an RFE asking 
whether the petitioner wants to update the dates of intended 
employment. This change may increase the number of RFE's; however, it 
may save petitioners from having to file another H-1B petition and 
USCIS from having to intake and adjudicate another petition.
    If in response to the RFE the petitioner confirms that it wants to 
update the dates of intended employment and submits a different LCA 
that corresponds to the new requested validity dates, even if that LCA 
was certified after the date the H-1B petition was filed, and assuming 
all other eligibility criteria are met, USCIS would approve the H-1B 
petition for the new requested period or the period for

[[Page 72934]]

which eligibility has been established, as appropriate, rather than 
require the petitioner to file a new or amended petition. Under a no-
action baseline, the requirement to file an amended or new petition 
results in additional filing costs and burden for the petitioner. DHS 
expects that this proposed change would save petitioners the difference 
between the opportunity cost of time and the fee to file an additional 
form, and the nominal opportunity cost of time and expense associated 
with responding to the RFE. This proposed change would benefit 
beneficiaries selected under the cap, who would retain cap-subject 
petitions while their petition validity dates are extended or whose 
petitions now may be approved rather than denied based on this 
technicality.
f. H-1B Cap Exemptions
    DHS proposes to revise the requirements to qualify for H-1B cap 
exemption when a beneficiary is not directly employed by a qualifying 
institution, organization, or entity at 8 CFR 214.2(h)(8)(iii)(F)(4). 
These proposed changes intend to clarify, simplify, and modernize 
eligibility for cap-exempt H-1B employment, so that they are less 
restrictive and better reflect modern employment relationships. The 
proposed changes also intend to provide additional flexibility to 
petitioners to better implement Congress's intent to exempt from the 
annual H-1B cap certain H-1B beneficiaries who are employed at a 
qualifying institution, organization, or entity.
    DHS is also proposing to revise 8 CFR 214.2(h)(19)(iii)(C), which 
states that a nonprofit research organization is an entity that is 
``primarily engaged in basic research and/or applied research,'' and a 
governmental research organization is a Federal, State, or local entity 
``whose primary mission is the performance or promotion of basic 
research and/or applied research.'' DHS proposes to replace ``primarily 
engaged'' with ``a fundamental activity of'' in order to permit a 
nonprofit entity that conducts research as a fundamental activity but 
is not primarily engaged in research to meet the definition of a 
nonprofit research entity. This would likely increase the population of 
petitioners who are now eligible for the cap exemption and, by 
extension, would likely increase the number of petitions that may be 
cap-exempt.
    These proposed changes would result in a transfer to petitioners 
who qualify for a cap exemption for their employees under the proposed 
rule. This would reduce transfers for petitioners because the 
petitioners would no longer have to pay the registration fee or ACWIA 
fees applicable to initial cap-subject petitions. DHS does not have 
data to precisely estimate how many additional petitioners would now 
qualify for these cap exemptions, but we welcome public comment on this 
topic to help inform analysis in the final rule. This proposed change 
would be a reduction in transfers from the petitioners to USCIS because 
USCIS would no longer receive these petitioners' registration fees. 
There would be no change in DHS resources. While DHS cannot estimate 
the precise reduction in transfers, DHS estimates that a fairly small 
population, between 0.3 percent-0.8 percent of annual petitioners, may 
no longer use the H-1B registration tool as a result of these new 
exemptions. Using these percentages, DHS estimates that approximately 
1,067 \173\ (0.3 percent) up to 2,845 \174\ (0.8 percent) registrants 
would no longer pay the $10 registration fee. DHS estimates the 
reduction in transfers from registrants to range from $10,670 \175\ to 
$28,450 \176\ annually. DHS invites public comment on these transfers 
to cap exempt petitioners and the percentage of current registrants 
(prospective petitioners who are cap subject) who may no longer submit 
a registration for the H-1B cap. While DHS discusses these transfers 
qualitatively in this proposal, DHS intends to quantify them in the 
final rule.
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    \173\ Calculation: 355,592 registrations * 0.3% = 1,067 
registrations.
    \174\ Calculation: 355,592 registrations * 0.8% = 2,845 
registrations.
    \175\ Calculation: 1,067 registrations * $10 registration fee = 
$10,670 cost savings.
    \176\ Calculation: 2,845 registrations * $10 registration fee = 
$28,450 cost savings.
---------------------------------------------------------------------------

    Aside from the reduction in transfers from not having to pay the 
registration fee, petitioners that qualify under the proposed cap 
exemptions would also benefit from not having to wait for H-1B cap 
season to commence employment. This may allow approved petitioners to 
have their H-1B workers commence employment earlier, prior to the 
beginning of the fiscal year on October 1.
g. Automatic Extension of Authorized Employment ``Cap-Gap''
    DHS proposes to extend the automatic cap-gap extension at 8 CFR 
214.2(f)(5)(vi). Currently, the automatic extension is valid only until 
October 1 of the fiscal year for which H-1B status is being requested, 
but DHS proposes to extend this until April 1 of the fiscal year. See 
proposed 8 CFR 214.2(f)(5)(vi). This change would result in more 
flexibility for both students and USCIS and would help to avoid 
disruption to U.S. employers that are lawfully employing F-1 students 
while a qualifying H-1B cap-subject petition is pending.
    Each year, a number of U.S. employers seek to employ F-1 students 
via the H-1B program by requesting a COS and filing an H-1B cap 
petition with USCIS. Many F-1 students complete a program of study or 
post-completion OPT in mid-spring or early summer. Per current 
regulations, after completing their program or post-completion OPT, F-1 
students have 60 days to take the steps necessary to maintain legal 
status or depart the United States.\177\ However, because the change to 
H-1B status cannot occur earlier than October 1, an F-1 student whose 
program or post-completion OPT expires in mid-spring has two or more 
months following the 60-day period before the authorized period of H-1B 
status begins.
---------------------------------------------------------------------------

    \177\ See 8 CFR 214.2(f)(5)(iv).
---------------------------------------------------------------------------

    Under current regulations, the automatic cap-gap extension is valid 
only until October 1 of the fiscal year for which H-1B status is being 
requested. DHS is proposing to change the automatic extension end date 
from October 1 to April 1 to avoid disruptions in employment 
authorization that some F-1 nonimmigrants awaiting the change to H-1B 
status have been experiencing over the past several years. Table 28 
shows the historical completions volumes. Based on the 5-year annual 
average, DHS estimates that 31,834 F-1 nonimmigrants annually may be 
able to avoid employment disruptions while waiting to obtain H-1B 
status. Preventing such employment disruptions would also benefit 
employers of F-1 nonimmigrants with cap-gap extensions. The change in 
the automatic extension end date may benefit petitioners as well.

[[Page 72935]]

[GRAPHIC] [TIFF OMITTED] TP23OC23.044

    This proposed change in the automatic extension end date would also 
allow USCIS greater flexibility in allocating officer resources to 
complete adjudications without the pressure of completing as many COS 
requests as possible before October 1. There are additional benefits of 
this proposed rule that have not been captured in the summary of costs 
and benefits of this rulemaking. DHS estimates that this change would 
benefit up to 5 percent (1,592) of the population (31,834) on an annual 
basis and on the low end 318 (1 percent); however, F-1 students who are 
beneficiaries of H-1B cap petitions that provide cap-gap relief would 
be able to avoid employment disruptions while waiting to obtain H-1B 
status. DHS estimates that an F-1 student who is the beneficiary of an 
H-1B cap petition makes $42.48 \178\ per hour in compensation. Based on 
a 40 hour work week,\179\ DHS estimates the potential compensation for 
each F-1 student who is the beneficiary of an H-1B cap petition to be 
$44,174 \180\ for 6 months of employment from October 1st to April 1st. 
DHS estimates that this potential compensation may be a benefit to F-1 
students who are seeking a COS to a H-1B status. This benefit ranges 
from $14,047,332 \181\ to $70,325,008 \182\ annually. In addition, 
other impacts such as payroll taxes and adjustments for the value of 
time have not been monetized here, which would reduce the monetized 
benefit of this compensation. DHS intends to include these impacts in 
the final rule and invites public comment on these additional benefits 
to F-1 students who would be the beneficiaries of H-1B petitions.
---------------------------------------------------------------------------

    \178\ $42.48 Total Employee Compensation per hour. See BLS, 
Economic News Release, ``Employer Costs for Employee Compensation--
December 2022,'' Table 1. ``Employer Costs for Employee Compensation 
by ownership [Dec. 2022],'' https://www.bls.gov/news.release/archives/ecec_03172023.htm (last visited Mar. 21, 2023).
    \179\ See, e.g., 8 CFR 214.2(f)(5)(vi)(A) (describing cap-gap 
employment) and (f)(11)(ii)(B) (describing OPT and noting that it 
may be full-time).
    \180\ Calculation: $42.48* 40 hours = $1,699 per week * 26 weeks 
= $44,174 per 6 months.
    \181\ Calculation: $44,174 per 6 months* 318 (1 percent of 
31,834) F-1 students = $14,047,332.
    \182\ Calculation: $44,174 per 6 months* 1,592 (5 percent of 
31,834) F-1 students = $70,325,008.
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h. Start Date Flexibility for Certain H-1B Cap-Subject Petitions
    DHS proposes to eliminate all the text currently at 8 CFR 
214.2(h)(8)(iii)(A)(4), which relates to a limitation on the requested 
start date, because the current regulatory language is ambiguous. The 
removal of this text would provide clarity and flexibility to employers 
with regard to the start date listed on H-1B cap-subject petitions. 
This clarity may help petitioners by reducing confusion as to what 
start date they have to put on the petition.
    In 2020, USCIS implemented the first electronic registration 
process for the FY 2021 H-1B cap. In that year, and for each subsequent 
fiscal year, prospective petitioners seeking to file H-1B cap-subject 
petitions (including for beneficiaries eligible for the advanced degree 
exemption) were required to first electronically register and pay the 
associated H-1B registration fee for each prospective beneficiary. 
Because of this DHS only has data for Cap Year 2021 through FY 2023. 
Table 29 shows the number of cap-subject registrations received and 
selected by USCIS during Cap Year 2021 through FY 2023. Based on the 3-
year annual average DHS estimates that 127,980 registrations are 
selected each year. DHS cannot estimate the number of petitioners that 
would benefit from this clarification to the start date on their 
petition.

[[Page 72936]]

[GRAPHIC] [TIFF OMITTED] TP23OC23.045

    This proposed change is also a potential cost savings to 
petitioners who, in the event USCIS cap-subject petitions that were 
rejected solely due to start date, would no longer need to re-submit 
their petition(s).
i. The H-1B Registration System
    Through issuance of a final rule in 2019, Registration Requirement 
for Petitioners Seeking To File H-1B Petitions on Behalf of Cap-Subject 
Aliens,\183\ DHS developed a new way to administer the H-1B cap 
selection process to streamline processing and provide overall cost 
savings to employers seeking to file H-1B cap-subject petitions. In 
2020, USCIS implemented the first electronic registration process for 
the FY 2021 H-1B cap. In that year, and for each subsequent fiscal 
year, prospective petitioners seeking to file H-1B cap-subject 
petitions (including for beneficiaries eligible for the advanced degree 
exemption) were required to first electronically register and pay the 
associated H-1B registration fee for each prospective beneficiary. When 
registration is required, an H-1B cap-subject petition is not eligible 
for filing unless it is based on a selected registration that was 
properly submitted by the prospective petitioner, or their 
representative, for the beneficiary.
---------------------------------------------------------------------------

    \183\ See ``Registration Requirement for Petitioners Seeking To 
File H-1B Petitions on Behalf of Cap-Subject Aliens,'' 84 FR 888 
(Jan. 31, 2019).
---------------------------------------------------------------------------

    Table 30 shows the number of cap registration receipts by year, as 
well as the number of registrations that were selected to file I-129 H-
1B petitions. The number of registrations has increased over the past 3 
years. DHS believes that this increase is partially due to the increase 
in multiple companies submitting registrations for the same 
beneficiary. USCIS received a low of 274,237 H-1B Cap-Subject 
Registrations for cap year FY 2021, and a high of 483,927 H-1B Cap-
Subject Registrations for cap year 2023. DHS has not included cap year 
2024 data into this analysis because such data are incomplete.\184\
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    \184\ While the initial registration selection process has been 
completed, DHS is unable to determine at this time how many total 
petitions will be submitted within the filing period.
[GRAPHIC] [TIFF OMITTED] TP23OC23.046

    DHS estimates the current public reporting time burden for an H-1B 
Registration is 31 minutes (0.5167 hours), which includes the time for 
reviewing instructions, gathering the

[[Page 72937]]

required information, and submitting the registration.
    The number of Form G-28 submissions allows USCIS to estimate the 
number of H-1B registrations that an attorney or accredited 
representative submits and thus estimate the opportunity costs of time 
for an attorney or accredited representative to file each form. Table 
31 shows the number of Cap-Subject registrations received with and 
without Form G-28. USCIS received a low of 148,964 Cap-Subject 
Registrations with Form G-28 in cap year 2022, and a high of 207,053 
Cap-Subject Registrations with Form G-28 in cap year 2023. Based on a 
3-year annual average, DHS estimates the annual average receipts of 
Cap-Subject Registrations to be 171,330 with 48 percent of 
registrations submitted by an attorney or accredited representative.
[GRAPHIC] [TIFF OMITTED] TP23OC23.047

    In order to estimate the opportunity costs of time for completing 
and filing an H-1B registration DHS assumes that a registrant will use 
an HR specialist, an in-house lawyer, or an outsourced lawyer to 
prepare an H-1B registration.\185\ DHS uses the mean hourly wage of 
$35.13 for HR specialists to estimate the opportunity cost of the time 
for preparing and submitting the H-1B registration.\186\ Additionally, 
DHS uses the mean hourly wage of $78.74 for in-house lawyers to 
estimate the opportunity cost of the time for preparing and submitting 
the H-1B registration.\187\
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    \185\ USCIS limited its analysis to HR specialists, in-house 
lawyers, and outsourced lawyers to present estimated costs. However, 
USCIS understands that not all entities employ individuals with 
these occupations and, therefore, recognizes equivalent occupations 
may also prepare and file these petitions or registrations.
    \186\ See BLS, ``Occupational Employment and Wage Statistics, 
Occupational Employment and Wages, May 2022, 13-1071 Human Resources 
Specialists,'' https://www.bls.gov/oes/2022/may/oes131071.htm (last 
visited May 11, 2023).
    \187\ See BLS, ``Occupational Employment and Wage Statistics, 
Occupational Employment and Wages, May 2022, 23-1011 Lawyers,'' 
https://www.bls.gov/oes/2022/may/oes231011.htm (last visited May 11, 
2023).
---------------------------------------------------------------------------

    DHS accounts for worker benefits when estimating the total costs of 
compensation by calculating a benefits-to-wage multiplier using the BLS 
report detailing the average employer costs for employee compensation 
for all civilian workers in major occupational groups and industries. 
DHS estimates that the benefits-to-wage multiplier is 1.45 and, 
therefore, is able to estimate the full opportunity cost per 
petitioner, including employee wages and salaries and the full cost of 
benefits such as paid leave, insurance, retirement, etc.\188\ DHS 
multiplied the average hourly U.S. wage rate for HR specialists and in-
house lawyers by 1.45 to account for the full cost of employee 
benefits, for a total of $50.94 \189\ per hour for an HR specialist and 
$114.17 \190\ per hour for an in-house lawyer. DHS recognizes that a 
firm may choose, but is not required, to outsource the preparation of 
these petitions and, therefore, presents two wage rates for lawyers. To 
determine the full opportunity costs of time if a firm hired an 
outsourced lawyer, DHS multiplied the average hourly U.S. wage rate for 
lawyers by 2.5 \191\ for a total of $196.85 \192\ to approximate an 
hourly wage rate for an outsourced lawyer \193\ to prepare and submit 
an H-1B registration.\194\
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    \188\ The benefits-to-wage multiplier is calculated as follows: 
(Total Employee Compensation per hour)/(Wages and Salaries per hour) 
($42.48 Total Employee Compensation per hour)/($29.32 Wages and 
Salaries per hour) = 1.44884 = 1.45 (rounded). See BLS, Economic 
News Release, ``Employer Costs for Employee Compensation'' (Dec. 
2022), Table 1. ``Employer Costs for Employee Compensation by 
ownership'' (Dec. 2022), https://www.bls.gov/news.release/archives/ecec_03172023.htm (last visited Mar. 21, 2023). The Employer Costs 
for Employee Compensation measures the average cost to employers for 
wages and salaries and benefits per employee hour worked.
    \189\ Calculation: $35.13 * 1.45 = $50.94 total wage rate for HR 
specialist.
    \190\ Calculation: $78.74 * 1.45 = $114.17 total wage rate for 
in-house lawyer.
    \191\ The ICE ``Safe-Harbor Procedures for Employers Who Receive 
a No-Match Letter'' used a multiplier of 2.5 to convert in-house 
attorney wages to the cost of outsourced attorney based on 
information received in public comment to that rule. We believe the 
explanation and methodology used in the Final Small Entity Impact 
Analysis for that rule remains sound for using 2.5 as a multiplier 
for outsourced labor wages in this proposed rule, see https://www.regulations.gov/document/ICEB-2006-0004-0922, at page G-4.
    \192\ Calculation: $78.74 * 2.5 = $196.85 total wage rate for an 
outsourced lawyer.
    \193\ The DHS analysis in ``Exercise of Time-Limited Authority 
To Increase the Fiscal Year 2018 Numerical Limitation for the H-2B 
Temporary Nonagricultural Worker Program,'' 83 FR 24905 (May 31, 
2018), https://www.federalregister.gov/documents/2018/05/31/2018-11732/exercise-of-time-limited-authority-to-increase-the-fiscal-year-2018-numerical-limitation-for-the, used a multiplier of 2.5 to 
convert in-house attorney wages to the cost of outsourced attorney 
wages. The DHS Immigration and Customs Enforcement (ICE) rule 
``Final Small Entity Impact Analysis: `Safe-Harbor Procedures for 
Employers Who Receive a No-Match Letter' '' at G-4 (Aug. 25, 2008), 
https://www.regulations.gov/document/ICEB-2006-0004-0922, also uses 
a multiplier. The methodology used in the Final Small Entity Impact 
Analysis remains sound for using 2.5 as a multiplier for outsourced 
labor wages in this proposed rule.
    \194\ The DHS analysis in ``Exercise of Time-Limited Authority 
To Increase the Fiscal Year 2018 Numerical Limitation for the H-2B 
Temporary Nonagricultural Worker Program,'' 83 FR 24905 (May 31, 
2018), https://www.federalregister.gov/documents/2018/05/31/2018-11732/exercise-of-time-limited-authority-to-increase-the-fiscal-year-2018-numerical-limitation-for-the, used a multiplier of 2.5 to 
convert in-house attorney wages to the cost of outsourced attorney 
wages. Also, the analysis for a DHS ICE rule, ``Final Small Entity 
Impact Analysis: `Safe-Harbor Procedures for Employers Who Receive a 
No-Match Letter' '' at G-4 (Aug. 25, 2008), https://www.regulations.gov/document/ICEB-2006-0004-0922, used a multiplier. 
The methodology used in the Final Small Entity Impact Analysis 
remains sound for using 2.5 as a multiplier for outsourced labor 
wages in this proposed rule.

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[[Page 72938]]

    Table 32 displays the estimated annual opportunity cost of time for 
submitting an H-1B registration employing an in-house or outsourced 
lawyer to complete and submit an H-1B registration. DHS does not know 
the exact number of registrants who will choose an in-house or an 
outsourced lawyer but assumes it may be a 50/50 split and therefore 
provides an average. These current opportunity costs of time for 
submitting an H-1B registration using an attorney or other 
representative are estimated to range from $10,107,038 to $17,426,385 
with an average of $13,766,712. 
[GRAPHIC] [TIFF OMITTED] TP23OC23.048

    To estimate the current remaining opportunity cost of time for an 
HR specialist submitting an H-1B registration without a lawyer, DHS 
applies the estimated public reporting time burden (0.5167 hours) to 
the compensation rate of an HR specialist. Table 33 estimates the 
current total annual opportunity cost of time to HR specialists 
completing and submitting an H-1B registration will be approximately 
$4,849,904.
[GRAPHIC] [TIFF OMITTED] TP23OC23.049

    Table 34 shows the proposed estimated time burden will increase by 
5 minutes to 36 minutes (0.6 hours) to the eligible population and 
compensation rates of those who may submit registrations with or 
without a lawyer due to changes in the instructions, adding clarifying 
language regarding denying or revoking approved H-1B petitions, adding 
passport instructional language, and adding verification before 
submitting instructions. DHS does not know the exact number of 
registrants who will choose an in-house or an outsourced lawyer but 
assumes it may be a 50/50 split and therefore provides an average. DHS 
estimates that these current opportunity costs of time for submitting 
an H-1B registration using an attorney or other representative range 
from $11,736,448 to $20,235,786 with an average of $15,986,117.

[[Page 72939]]

[GRAPHIC] [TIFF OMITTED] TP23OC23.050

    To estimate the current remaining opportunity cost of time for an 
HR specialist submitting an H-1B registration without a lawyer, DHS 
applies the proposed estimated public reporting time burden (0.6 hours) 
to the compensation rate of an HR specialist. Table 35 estimates the 
current total annual opportunity cost of time to HR specialists 
completing and submitting the H-1B registration will be approximately 
$5,631,784.
[GRAPHIC] [TIFF OMITTED] TP23OC23.051

    DHS estimates the total additional annual cost to petitioners 
completing and filing Form I-129 H-1B are expected to be $3,001,285 
shown in Table 36. This table shows the current total opportunity cost 
of time to submit an H-1B registration and the proposed total 
opportunity cost of time.
[GRAPHIC] [TIFF OMITTED] TP23OC23.052


[[Page 72940]]


j. Beneficiary Centric Selection
    Under the proposed provision, DHS would modify the random selection 
process. Registrants would continue to submit registrations on behalf 
of beneficiaries, and beneficiaries would continue to be able to have 
more than one registration submitted on their behalf, as generally 
allowed by applicable regulations. If a random selection were necessary 
(meaning, more registrations are submitted than the number of 
registrations USCIS projected as needed to reach the numerical 
allocations), then the random selection would be based on each unique 
beneficiary identified in the registration pool, rather than each 
registration. If a beneficiary is selected, then all registrants who 
properly submitted a registration for that selected beneficiary would 
be notified of the selection and that they are eligible to file an H-1B 
cap petition on behalf of the beneficiary during the applicable 
petition filing period.
    DHS believes that changing how USCIS conducts the selection process 
to select by unique beneficiaries instead of registrations would give 
each unique beneficiary an equal chance at selection and would reduce 
the advantage that beneficiaries with multiple registrations submitted 
on their behalf have over beneficiaries with a single registration 
submitted on their behalf. DHS believes that it would also reduce the 
incentive that registrants may have to work with others to submit 
registrations for the same beneficiary to unfairly increase the chance 
of selection for the beneficiary because doing so under the 
beneficiary-centric selection approach would not result in an increase 
in the odds of selection. Selecting by unique beneficiary could also 
result in other benefits, such as giving beneficiaries greater autonomy 
regarding their H-1B employment and improving the chances of selection 
for legitimate registrations.
    Because the integrity of the new selection process would rely on 
USCIS's ability to accurately identify each individual beneficiary, and 
all registrations submitted on their behalf, DHS proposes to require 
the submission of valid passport information, including the passport 
number, country of issuance, and expiration date, in addition to the 
currently required information. See proposed 8 CFR 
214.2(h)(8)(iii)(A)(4)(ii). While the proposed passport requirement 
could impact individuals who do not yet hold passports at the time of 
registration, DHS has determined the described benefits of program 
integrity outweigh any additional burden to prospective beneficiaries. 
DHS invites public comment on the proposed passport requirement.
    DHS estimates that the annual average receipts of H-1B 
registrations is 355,592 with 71 percent of registrations being 
submitted for a beneficiary with only a single registration. DHS 
estimates that 29 percent \195\ of registrations are submitted by 
companies for beneficiaries who have also had other registrations 
submitted on their behalf. Based on this new provision DHS estimates 
that there may be a reduction in registrations because beneficiaries 
will be less inclined to find as many different employers to submit 
registrations on their behalf as doing so would not affect their chance 
of selection. Also, DHS expects to see less abuse by unscrupulous 
registrants as they would not be able to increase the chance of 
selection for a beneficiary by working together with others to submit 
multiple registrations for the same beneficiary.
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    \195\ Calculation: 100%-71% Registrations for a single 
beneficiary = 29% Registrations submitted for multiple 
beneficiaries.
    \196\ Calculation: Total Registrations 355,592--Total number of 
unique beneficiaries with registrations submitted on their behalf 
282,091 = 73,501 Estimate of registrations that may no longer be 
submitted.
[GRAPHIC] [TIFF OMITTED] TP23OC23.053

    DHS estimates that 73,501 \196\ registrations annually may no 
longer be submitted due to this proposed change. Of those 73,501 
registrations, DHS estimated that an attorney or accredited 
representative submitted 48 percent of registrations and an HR 
representative submitted the remaining 52 percent shown in Table 31.
    Table 38 displays the estimated annual opportunity cost of time for 
submitting an H-1B registration employing an in-house or outsourced 
lawyer to complete and submit an H-1B registration. DHS does not know 
the exact number of prospective petitioners who will choose an in-house 
or an outsourced lawyer but assumes it may be a 50/50 split and 
therefore provides an average. DHS estimates that these current 
opportunity costs of time for submitting an H-1B registration using an 
attorney or other representative range from $2,081,225 to $3,588,413, 
with an average of $2,834,819.

[[Page 72941]]

[GRAPHIC] [TIFF OMITTED] TP23OC23.054

    To estimate the current remaining opportunity cost of time for an 
HR specialist submitting an H-1B registration without a lawyer, DHS 
applies the estimated public reporting time burden (0.5167 hours) to 
the compensation rate of an HR specialist. Table 39 estimates the 
current total annual opportunity cost of time to HR specialists 
completing and submitting an H-1B registration will be approximately 
$1,006,003.
[GRAPHIC] [TIFF OMITTED] TP23OC23.055

    DHS estimates the total annual opportunity cost savings of time for 
not having to complete and submit H-1B registrations for beneficiaries 
with multiple registrations are expected to be $3,840,822, shown in 
Table 40.
[GRAPHIC] [TIFF OMITTED] TP23OC23.056

    Prospective petitioners seeking to file H-1B cap-subject petitions, 
including for beneficiaries eligible for the advanced degree exemption, 
must first electronically register and pay the associated $10 H-1B 
registration fee for each prospective beneficiary. Due to this proposed 
change DHS estimates that prospective petitioners may now see an 
additional cost savings of $735,010. The annual total cost savings of 
this proposed beneficiary centric selection is $4,575,832.\197\
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    \197\ Calculation: Total Opportunity Cost Savings of time for H-
1B Registrations ($3,840,822) + Total Cost Savings for Registration 
Fees ($735,010) = $4,575,832 Total Cost Savings.
[GRAPHIC] [TIFF OMITTED] TP23OC23.057


[[Page 72942]]


k. Bar on Multiple Registrations Submitted by Related Entities
    DHS regulations already preclude the filing of multiple H-1B cap-
subject petitions by related entities for the same beneficiary unless 
the related petitioners can establish a legitimate business need for 
filing multiple cap-subject petitions for the same beneficiary. DHS is 
not proposing to change this in the current regulation. Rather, DHS is 
proposing to extend a similar limitation to the submission of 
registrations by related entities. See proposed 8 CFR 
214.2(h)(2)(i)(G). When an employer submits a registration, they attest 
that they intend to file a petition based on that registration and that 
there is a legitimate job offer. To allow related employers to submit 
registrations without a legitimate business need, but not allow them to 
file petitions without a legitimate business need, creates an 
inconsistency between the antecedent procedural step of registration 
and the petition filing. Extending the bar on multiple petition filings 
by related entities to multiple registration submissions by related 
entities for the same cap-subject beneficiary would harmonize the 
expectations for petition filing and registration submission.
    While the proposed changes to the beneficiary centric selection are 
intended to reduce frivolous registrations, DHS cannot guarantee with 
certainty that such change would eliminate entities from working with 
each other to submit registrations to unfairly increase chances of 
selection for a beneficiary by submitting slightly different 
identifying information or other means. Therefore, this provision may 
serve as an additional deterrent to further reduce the incentive for 
companies filing multiple registrations to have a higher chance of 
selection. This change may benefit petitioners whose chances of 
selection have been negatively affected by companies filing multiple 
registrations to increase the chances of selection. DHS cannot estimate 
the number of petitioners that this provision may benefit, because DHS 
cannot accurately measure how many petitioners are not submitting 
legitimate registrations or filing legitimate petitions in this manner.
l. Registrations With False Information or That Are Otherwise Invalid
    Although registration is an antecedent procedural step undertaken 
prior to filing an H-1B cap-subject petition, the validity of the 
registration information is key to the registrant's eligibility to file 
a petition. As stated in the current regulations, ``[t]o be eligible to 
file a petition for a beneficiary who may be counted against the H-1B 
regular cap or the H-1B advanced degree exemption for a particular 
fiscal year, a registration must be properly submitted in accordance 
with 8 CFR 103.2(a)(1), [8 CFR 214.2(h)(8)(iii),] and the form 
instructions.'' See 8 CFR 214.2(h)(8)(iii)(A)(1). USCIS does not 
consider a registration to be properly submitted if the information 
contained in the registration, including the required attestations, was 
not true and correct. Currently, the regulations state that it is 
grounds for denial or revocation if the statements of facts contained 
in the petition are not true and correct, inaccurate, fraudulent, or 
misrepresented a material fact. DHS proposes to clarify in the 
regulations that the grounds for denial of an H-1B petition or 
revocation of an H-1B petition approval extend to the information 
provided in the registration and to expressly state in the regulations 
that this includes attestations on the registration that are determined 
by USCIS to be false.
    DHS is also proposing changes to the regulations governing 
registration that would provide USCIS with clearer authority to deny or 
revoke the approval of a petition based on a registration that was not 
properly submitted or was otherwise invalid.
    Specifically, DHS is proposing to add that if a petitioner submits 
more than one registration per beneficiary in the same fiscal year, all 
registrations filed by that petitioner relating to that beneficiary for 
that fiscal year may be considered not only invalid, but that ``USCIS 
may deny or revoke the approval of any petition filed for the 
beneficiary based on those registrations.''
    Additionally, DHS is proposing to add that USCIS may deny or revoke 
the approval of an H-1B petition if it determines that the fee 
associated with the registration is declined, not reconciled, disputed, 
or otherwise invalid after submission.
    These proposed changes may increase the need for RFEs and NOIDs. It 
is important to note that issuing RFEs and NOIDs takes time and effort 
for adjudicators--to send, receive, and adjudicate documentation--and 
it requires additional time and effort for petitioners to respond, 
resulting in extended timelines for adjudications.\198\ Data on RFEs 
and NOIDs related to H-1B false information are not standardized or 
tracked in a consistent way, thus they are not accurate or reliable.
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    \198\ The regulations state that when an RFE is served by mail, 
the response is timely filed if it is received no more than 3 days 
after the deadline, providing a total of 87 days for a response to 
be submitted if USCIS provides the maximum period of 84 days under 
the regulations. The maximum response time for a NOID is 30 days. 
See https://www.uscis.gov/policy-manual/volume-1-part-e-chapter-6.
---------------------------------------------------------------------------

m. Provisions To Ensure Bona Fide Job Offer for a Specialty Occupation 
Position
(1) Contracts
    DHS proposes to codify USCIS' authority to request contracts, work 
orders, or similar evidence. See proposed 8 CFR 214.2(h)(4)(iv)(C). 
Such evidence may take the form of contracts or legal agreements, if 
available, or other evidence including technical documentation, 
milestone tables, or statements of work. Evidence submitted should show 
the contractual relationship between all parties, the terms and 
conditions of the beneficiary's work, and the minimum educational 
requirements to perform the duties.
    While USCIS already has the authority to request contracts and 
other similar evidence, the regulations do not state this authority. By 
proposing to codify this authority, USCIS is putting stakeholders on 
notice of the kinds of evidence that could be requested to establish 
the terms and conditions of the beneficiary's work and the minimum 
educational requirements to perform the duties. This evidence, in turn, 
could establish that the petitioner has a bona fide job offer for a 
specialty occupation position for the beneficiary. Relative to the no 
action baseline, this change has no costs associated with it, and there 
may be transparency benefits due to this proposed change. Relative to 
the pre policy baseline petitioners may have taken time to find 
contracts or legal agreements, if available, or other evidence 
including technical documentation, milestone tables, or statements of 
work. DHS cannot estimate how much time it would have taken for 
petitioners to provide that information.
(2) Non-Speculative Employment
    DHS proposes to codify its requirement that the petitioner must 
establish, at the time of filing, that it has a non-speculative 
position in a specialty occupation available for the beneficiary as of 
the start date of the validity period as requested on the petition. See 
proposed 8 CFR 214.2(h)(4)(iv)(D). This change is consistent with 
current DHS policy guidance that an H-1B petitioner must establish that 
employment exists at the time of filing the petition and that

[[Page 72943]]

it may employ the beneficiary in a specialty occupation.\199\ Relative 
to the no action baseline, this change has no costs associated with it, 
and there may be transparency benefits due to this proposed change. 
Relative to the pre policy baseline petitioners may require time to 
provide documentation to establish that their position was a non-
speculative position in a specialty occupation. DHS cannot estimate how 
much time it takes for petitioners to provide that information.
---------------------------------------------------------------------------

    \199\ See USCIS, ``Rescission of Policy Memoranda,'' PM-602-0114 
(June 17, 2020) (citing Matter of Chawathe, 25 I&N Dec. 369 (AAO 
2010)).
---------------------------------------------------------------------------

(3) LCA Corresponds With the Petition
    DHS is proposing to update the regulations to expressly include 
DHS's existing authority to ensure that the LCA properly supports and 
corresponds with the accompanying H-1B petition. Relative to the no 
action baseline, this change has no costs and may yield transparency 
benefits due to consistency between regulation and current policy. 
Relative to the pre policy baseline petitioners may have taken time to 
provide their LCA to DHS, however DHS cannot estimate how much time it 
would have taken for petitioners to provide that information.
(4) Revising the Definition of U.S. Employer
    DHS is proposing to revise the definition of ``United States 
employer.'' First, DHS proposes to eliminate the employer-employee 
relationship requirement. In place of the employer-employee 
relationship requirement, DHS proposes to codify the requirement that 
the petitioner has a bona fide job offer for the beneficiary to work, 
which may include telework, remote work, or other off-site work within 
the United States. DHS also proposes to replace the requirement that 
the petitioner ``[e]ngages a person to work within the United States'' 
with the requirement that the petitioner have a legal presence and is 
amenable to service of process in the United States. Relative to the no 
action baseline, this change has no costs associated with it, and there 
may be transparency benefits due to this proposed change. Relative to 
the pre policy baseline, petitioners may require time to provide 
documentation establishing a bona fide job offer for the beneficiary to 
work. DHS cannot estimate how much time petitioners take to provide 
that information.
(5) Employer-Employee Relationship
    DHS proposes to eliminate the employer-employee relationship 
requirement, which, in the past, has been a significant barrier to the 
H-1B program for certain petitioners, including beneficiary-owned 
petitioners. This proposed change would benefit petitioners because it 
may decrease confusion and increase clarity for stakeholders. Relative 
to the no action baseline, this change has no costs associated with it, 
and there may be transparency benefits due to this proposed change. 
Relative to the pre policy baseline petitioners may have taken time to 
understand the change.
n. Beneficiary-Owners
    DHS proposes to codify a petitioner's ability to qualify as a U.S. 
employer even when the beneficiary possesses a controlling interest in 
that petitioner. To promote access to H-1Bs for entrepreneurs, start-up 
entities, and other beneficiary-owned businesses, DHS is proposing to 
add provisions to specifically address situations where a potential H-
1B beneficiary owns a controlling interest in the petitioning entity. 
If more entrepreneurs are able to obtain H-1B status to develop their 
business enterprise, the United States could benefit from the creation 
of jobs, new industries, and new opportunities.\200\ This proposed 
change would benefit H-1B petitions filed by start-up entities and 
other beneficiary-owned businesses, or filed on behalf of entrepreneurs 
who have a controlling interest in the petitioning entity. DHS is 
unable to estimate how many petitioners would benefit from this 
proposed change.
---------------------------------------------------------------------------

    \200\ See, e.g., National Bureau of Economic Research, ``Winning 
the H-1B Visa Lottery Boosts the Fortunes of Startups'' (Jan. 2020), 
https://www.nber.org/digest/jan20/winning-h-1b-visa-lottery-boosts-fortunes-startups (``The opportunity to hire specialized foreign 
workers gives startups a leg up over their competitors who do not 
obtain visas for desired employees. High-skilled foreign labor 
boosts a firm's chance of obtaining venture capital funding, of 
successfully going public or being acquired, and of making 
innovative breakthroughs.''). Pierre Azoulay, et. al, ``Immigration 
and Entrepreneurship in the United States'' (National Bureau of 
Economic Research, Working Paper 27778 (Sept. 2020) https://www.nber.org/system/files/working_papers/w27778/w27778.pdf 
(``immigrants act more as `job creators' than `job takers' and . . . 
non-U.S. born founders play outsized roles in U.S. high-growth 
entrepreneurship'').
---------------------------------------------------------------------------

    DHS is also proposing to limit the validity period for beneficiary-
owned entities. DHS proposes to limit the validity period for the 
initial petition and first extension (including an amended petition 
with a request for an extension of stay) of such a petition to 18 
months. See proposed 8 CFR 214.2(h)(9)(iii)(E). Any subsequent 
extension would not be limited and may be approved for up to 3 years, 
assuming the petition satisfies all other H-1B requirements. DHS 
proposes limiting the first two validity periods to 18 months as a 
safeguard against possible fraudulent petitions. While DHS sees a 
significant advantage in promoting the H-1B program to entrepreneurs 
and allowing these beneficiaries to perform a significant amount of 
non-specialty occupation duties, unscrupulous petitioners might abuse 
such provisions without sufficient guardrails. DHS believes that there 
may be a cost to petitioners associated with this change however cannot 
estimate how many petitioners may be affected by limiting the validity 
period.
o. Site Visits
    USCIS conducts inspections, evaluations, verifications, and 
compliance reviews, to ensure that a petitioner and beneficiary are 
eligible for the benefit sought and that all laws have been complied 
with before and after approval of such benefits. These inspections, 
verifications, and other compliance reviews may be conducted 
telephonically or electronically, as well as through physical on-site 
inspections (site visits). DHS is proposing to add regulations specific 
to the H-1B program to codify its existing authority and clarify the 
scope of inspections and the consequences of a petitioner's or third 
party's refusal or failure to fully cooperate with these inspections. 
Currently, site visit inspections are not mandatory for petitioners 
filing Form I-129 on behalf of H-1B specialty occupation nonimmigrant 
workers. Using its general authority, USCIS may conduct audits, on-site 
inspections, reviews, or investigations to ensure that a beneficiary is 
entitled to the benefits sought and that all laws have been complied 
with before and after approval of such benefits.\201\ The authority to 
conduct on-site inspection is critical to the integrity of the H-1B 
program to detect and deter fraud and noncompliance.
---------------------------------------------------------------------------

    \201\ See INA section 103 and 8 CFR 2.1. As stated in subsection 
V.A.5.ii(d) of this analysis, regulation would also clarify the 
possible scope of an inspection, which may include the petitioning 
organization's headquarters, satellite locations, or the location 
where the beneficiary works or will work, including third-party 
worksites, as applicable.

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[[Page 72944]]

    In July 2009, USCIS started the Administrative Site Visit and 
Verification Program \202\ as an additional method to verify 
information in certain visa petitions under scrutiny. Under this 
program, FDNS officers are authorized to make unannounced site visits 
to collect information as part of a compliance review, which verifies 
whether petitioners and beneficiaries are following the immigration 
laws and regulations that are applicable in a particular case. This 
process includes researching information in government databases, 
reviewing public records and evidence accompanying the petition, 
interviewing the petitioner or beneficiary, and conducting site visits. 
Once the FDNS officers complete the site visit, they write a Compliance 
Review Report for any indicators of fraud or noncompliance to assist 
USCIS in final adjudicative decisions.
---------------------------------------------------------------------------

    \202\ See USCIS, ``Administrative Site Visit and Verification 
Program,'' https://www.uscis.gov/about-us/directorates-and-program-offices/fraud-detection-and-national-security/administrative-site-visit-and-verification-program (last visited Sept. 18, 2019). See 
USCIS, ``Administrative Site Visit and Verification Program,'' 
https://www.uscis.gov/about-us/directorates-and-program-offices/fraud-detection-and-national-security/administrative-site-visit-and-verification-program (last visited Sept. 18, 2019). See USCIS, 
``Administrative Site Visit and Verification Program,'' https://www.uscis.gov/about-us/directorates-and-program-offices/fraud-detection-and-national-security/administrative-site-visit-and-verification-program https://www.uscis.gov/about-us/directorates-and-program-offices/fraud-detection-and-national-security/administrative-site-visit-and-verification-program (last visited 
Sept. 18, 2019).
---------------------------------------------------------------------------

    The site visits conducted under USCIS's existent, general 
authority, and thus part of the baseline against which this proposed 
rule's impact should be measured, have uncovered a significant amount 
of noncompliance in the H-1B program.\203\ Further, when disaggregated 
by worksite location, the noncompliance rate was found to be higher for 
workers placed at an off-site or third-party location compared to 
workers placed at a petitioner's on-site location.\204\ As a result, 
USCIS began conducting more targeted site visits related to the H-1B 
program, focusing on the cases of H-1B dependent employers (i.e., 
employers who have a high ratio of H-1B workers compared to U.S. 
workers, as defined by statute) for whom USCIS cannot validate the 
employer's basic business information through commercially available 
data, and on employers petitioning for H-1B workers who work off-site 
at another company or organization's location.
---------------------------------------------------------------------------

    \203\ USCIS, Office of Policy and Strategy, PRD, Summary of H-1B 
Site Visits Data.
    \204\ Id.
---------------------------------------------------------------------------

    DHS believes that site visits are important to maintain the 
integrity of the H-1B program to detect and deter fraud and 
noncompliance in the H-1B program, which in turn ensures the 
appropriate use of the H-1B program and the protection of the interests 
of U.S. workers. These site visits would continue in the absence of 
this proposed rule and DHS notes that current Form I-129 instructions 
notify petitioners of USCIS' legal authority to verify information 
before or after a case decision, including by means of unannounced 
physical site inspection. Hence, DHS is proposing additional 
requirements specific to the H-1B program to set forth the scope of on-
site inspections, and the consequences of a petitioner's or third 
party's refusal or failure to fully cooperate with existing 
inspections. DHS does not foresee the rule leading to more on-site 
inspections.
    This proposed rule would provide a clear disincentive for 
petitioners that do not cooperate with compliance reviews and 
inspections while giving USCIS greater authority to access and confirm 
information about employers and workers as well as identify fraud.
    The proposed regulations would make clear that inspections may 
include, but are not limited to, an on-site visit of the petitioning 
organization's facilities, interviews with its officials, review of its 
records related to compliance with immigration laws and regulations, 
and interviews with any other individuals or review of any other 
records that USCIS may lawfully obtain and that it considers pertinent 
to verify facts related to the adjudication of the petition, such as 
facts relating to the petitioner's and beneficiary's eligibility and 
continued compliance with the requirements of the H-1B program. See 
proposed 8 CFR 214.2(h)(4)(i)(B)(2). The proposed regulation would also 
clarify that an inspection may take place at the petitioning 
organization's headquarters, satellite locations, or the location where 
the beneficiary works or will work, including third-party worksites, as 
applicable. The proposed provisions would make clear that an H-1B 
petitioner or any employer must allow access to all sites where the 
labor will be performed for the purpose of determining compliance with 
applicable H-1B requirements. The proposed regulation would state the 
consequences if USCIS is unable to verify facts related to an H-1B 
petition due to the failure or refusal of the petitioner or a third-
party worksite to cooperate with a site visit. These failures or 
refusals may be grounds for denial or revocation of any H-1B petition 
related to locations that are a subject of inspection, including any 
third-party worksites. See proposed 8 CFR 214.2(h)(4)(i)(B)(2).
    In order to estimate the population impacted by site visits, DHS 
uses site inspection data used to verify facts pertaining to the H-1B 
petition adjudication process. The site inspections were conducted at 
H-1B petitioners' on-site locations and third-party worksites during FY 
2018 through FY 2022. For instance, from FY 2019 through FY 2022, USCIS 
conducted a total of 27,062 H-1B compliance reviews and found 5,037 of 
them, equal to 19 percent, to be noncompliant or indicative of 
fraud.\205\ These compliance reviews (from FY 2019 through FY 2022) 
consisted of reviews conducted under both the Administrative Site Visit 
and Verification Program and the Targeted Site Visit and Verification 
Program, which began in 2017. The targeted site visit program allows 
USCIS to focus resources where fraud and abuse of the H-1B program may 
be more likely to occur.\206\
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    \205\ DHS, USCIS, PRD (2022). PRD196. USCIS conducted these site 
visits through its Administrative and Targeted Site Visit Programs.
    \206\ See USCIS, ``Putting American Workers First: USCIS 
Announces Further Measures to Detect H-1B Visa Fraud and Abuse,'' 
(April 3, 2017), https://www.uscis.gov/archive/putting-american-workers-first-uscis-announces-further-measures-to-detect-h-1b-visa-fraud-and-abuse.
---------------------------------------------------------------------------

    Table 42 shows the number of H-1B worksite inspections conducted 
each year and the number of visits that resulted in compliance and 
noncompliance. USCIS received a low of 1,057 fraudulent/noncompliant 
cases in FY 2022, and a high of 1,469 fraudulent/noncompliant cases in 
FY 2021. DHS estimates that, on average, USCIS conducted 6,766 H-1B 
worksite inspections annually from FY 2019 through FY 2022 and of those 
DHS finds a noncompliance rate of 19 percent. Assuming USCIS continues 
worksite inspections at the 4-year annual average rate, the population 
impacted by this proposed provision would be 1,259 or 19 percent of H-
1B petitioners visited who are found noncompliant or indicative of 
fraud. The outcomes of site visits under the proposed rule are 
indeterminate as currently noncooperative petitioners might be found to 
be fully compliant, might continue to not cooperate with site visits 
despite penalties, or might be forced to reveal fraudulent practices to 
USCIS. The expected increase in cooperation from current levels would 
be the most important impact of the proposed provision, which DHS 
discusses below. DHS notes that the increased cooperation might come 
disproportionately from site visits of third-party worksites that did 
not sign Form I-129 attesting to permit

[[Page 72945]]

unannounced physical site inspections of residences and places of 
employment by USCIS.
[GRAPHIC] [TIFF OMITTED] TP23OC23.058

    Table 43 shows the average duration of time to complete each 
inspection was 1.08 hours. Therefore, DHS assumes that USCIS would 
continue to conduct the same number of annual worksite inspections 
(7,252), on average, and that the average duration of time for a USCIS 
immigration officer to conduct each worksite inspection would be an 
average of 1.08 hours. The data in Table 42 and Table 43 differ 
slightly based on the different search criteria, pull dates and systems 
accessed. DHS also assumes that the average duration of time of 1.08 
hours to conduct an inspection covers the entire inspection process, 
which includes interviewing the beneficiary, the on-site supervisor or 
manager and other workers, as applicable, and reviewing all records 
pertinent to the H-1B petitions available to USCIS when requested 
during inspection.
[GRAPHIC] [TIFF OMITTED] TP23OC23.059

    DHS assumes that a supervisor or manager, in addition to the 
beneficiary, would be present on behalf of a petitioner while a USCIS 
immigration officer conducts the worksite inspection. The officer would 
interview the beneficiary to verify the date employment started, work 
location, hours, salary, and duties performed to corroborate with the 
information provided in an approved petition. The supervisor or manager 
would be the most qualified employee at the location who could answer 
all questions pertinent to the petitioning organization and its H-1B 
nonimmigrant workers. They would also be able to provide the proper 
records available to USCIS immigration officers. Consequently, for the 
purposes of this economic analysis, DHS assumes that on average two 
individuals would be interviewed during each worksite inspection: the 
beneficiary and the supervisor or manager. DHS uses their respective 
compensation rates in the estimation of the worksite inspection 
costs.\207\ However, if any other worker or on-site manager is 
interviewed, the same compensation rates would apply.
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    \207\ DHS does not estimate any other USCIS costs associated 
with the worksite inspections (i.e., travel and deskwork relating to 
other research, review and document write up) here because these 
costs are covered by fees collected from petitioners filing Form I-
129 for H-1B petitions. All such costs are reported under the 
Federal Government Cost section.
---------------------------------------------------------------------------

    DHS uses hourly compensation rates to estimate the opportunity cost 
of time a beneficiary and supervisor or manager would incur during 
worksite inspections. Based on data obtained from a USCIS report in 
2022, DHS estimates that an H-1B worker earned an average of $116,000 
per year in FY 2021.\208\ DHS therefore estimates the salary of an H-1B 
worker is

[[Page 72946]]

approximately $116,000 annually, or $55.77 hourly wage.\209\ The annual 
salary does not include noncash compensation and benefits, such as 
health insurance and transportation. DHS adjusts the average hourly 
wage rate using a benefits-to-wage multiplier to estimate the average 
hourly compensation of $ 80.87 for an H-1B nonimmigrant worker.\210\ In 
order to estimate the opportunity cost of time they would incur during 
a worksite inspection, DHS uses an average hourly compensation rate of 
$91.47 per hour for a supervisor or manager, where the average hourly 
wage is $63.08 per hour worked and average benefits are $28.39.\211\ 
While the average duration of time to conduct an inspection is 
estimated at 1.08 hours in this analysis, DHS is not able to estimate 
the average duration of time for a USCIS immigration officer to conduct 
an interview with a beneficiary or supervisor or manager. In the 
absence of this information, DHS assumes that it would on average take 
0.54 hours to interview a beneficiary and 0.54 hours to interview a 
supervisor or manager.\212\
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    \208\ This is the annual average earning of all H-1B 
nonimmigrant workers in all industries with known occupations 
(excluding industries with unknown occupations) for FY 2021. It is 
what employers agreed to pay the nonimmigrant workers at the time 
the applications were filed and estimated based on full-time 
employment for 12 months, even if the nonimmigrant worker worked 
fewer than 12 months. USCIS, ``Characteristics of H-1B Specialty 
Occupation Workers, Fiscal Year 2021 Annual Report to Congress, 
October 1, 2020-September 30, 2021,'' at 16, Table 9a (Mar. 2, 
2022), https://www.uscis.gov/sites/default/files/document/data/H1B_Characteristics_Congressional_Report_FY2021-3.2.22.pdf.
    \209\ The hourly wage is estimated by diving the annual salary 
by the total number of hours worked in a year (2,080, which is 40 
hours of full-time workweek for 52 weeks). $55.77 hourly wage = 
$116,000 annual pay / 2,080 annual work hours. According to DOL that 
certifies the LCA of the H-1B worker, a full-time H-1B employee 
works 40 hours per week for 52 weeks for a total of 2,080 hours in a 
year assuming full-time work is 40 hours per week. DOL, Wage and 
hour Division: ``Fact Sheet #68--What Constitutes a Full-Time 
Employee Under H-1B Visa Program? '' (July 2009), https://www.dol.gov/whd/regs/compliance/whdfs68.htm (Last visited July 30, 
2019).
    \210\ Hourly compensation of $ 80.87 = $55.77 average hourly 
wage rate for H-1B worker x 1.45 benefits-to-wage multiplier. See 
section V.A.5. for estimation of the benefits-to-wage multiplier.
    \211\ Hourly compensation of $91.47 = $63.08 average hourly wage 
rate for Management Occupations (national) x 1.45 benefits-to-wage 
multiplier. See BLS, ``Occupational Employment and Wage Statistics, 
Occupational Employment and Wages, May 2022, 11-0000 Management 
Occupations (Major Group),'' https://www.bls.gov/oes/2022/may/oes110000.htm (last visited May 11, 2023).
    \212\ DHS assumes that beneficiary takes 50 percent of average 
inspection duration and supervisor or manager takes 50 percent. 
Average duration of interview hours for beneficiaries (0.54) = 
Average inspection duration (1.08) x 50% = 0.54 (rounded). Average 
duration of interview hours for Supervisors or managers (0.54) = 
Average inspection duration (1.08) x 50% = 0.54 (rounded).
---------------------------------------------------------------------------

    In Table 44, DHS estimates the total annual opportunity cost of 
time for worksite inspections of H-1B petitions by multiplying the 
average annual number of worksite inspections (7,252) by the average 
duration the interview would take for a beneficiary or supervisor or 
manager and their respective compensation rates. DHS obtains the total 
annual cost of the H-1B worksite inspections to be $674,881 for this 
proposed rule.
[GRAPHIC] [TIFF OMITTED] TP23OC23.060

    This proposed change may affect employers who do not cooperate with 
site visits who would face denial or revocation of their petition(s), 
which could result in costs to those businesses. Petitioners may face 
financial losses because they may lose access to labor for extended 
periods, which could result in too few workers, loss of revenue, and 
some could go out of business. DHS expects program participants to 
comply with program requirements, however, and notes that those that do 
not could experience significant impacts due to this proposed rule. DHS 
expects that the proposed rule would hold certain petitioners more 
accountable for violations, including certain findings of labor law and 
other violations, and would prevent registrations with false 
information from taking a cap number for which they are ineligible.
p. Third-Party Placement (Codifying Defensor)
    In this proposed provision, in certain circumstances USCIS would 
look at the third party's requirements for the beneficiary's position, 
rather than the petitioner's stated requirements, in assessing whether 
the proffered position qualifies as a specialty occupation.
    As required by both INA section 214(i)(1) and 8 CFR 
214.2(h)(4)(i)(A)(1), an H-1B petition for a specialty occupation 
worker must demonstrate that the worker will perform services in a 
specialty occupation, which requires theoretical and practical 
application of a body of highly specialized knowledge and attainment of 
a baccalaureate or higher degree in the specific specialty (or its 
equivalent) as a minimum requirement for entry into the occupation in 
the United States. This proposal would ensure that petitioners are not 
circumventing specialty occupation requirements by imposing token 
requirements or requirements that are not normal to the third party. 
Specifically, under proposed 8 CFR 214.2(h)(4)(i)(B)(3), if the 
beneficiary will be staffed to a third party, meaning they will be 
contracted to fill a position in a third party's organization, the 
actual work to be performed by the beneficiary must be in a specialty 
occupation. Therefore, it is the requirements of that third party, and 
not the petitioner, that are most relevant when determining whether the 
position is a specialty occupation. Relative to the no action baseline, 
this change has no costs associated with it, and there may

[[Page 72947]]

be transparency benefits due to this proposed change. Relative to the 
pre policy baseline petitioners may have taken time to demonstrate that 
the worker will perform services in a specialty occupation, which 
requires theoretical and practical application of a body of highly 
specialized knowledge and attainment of a baccalaureate or higher 
degree in the specific specialty. Because this has been in place for a 
long time, DHS cannot estimate how much time it would have taken for 
petitioners to provide that information.

q. Additional Time Burden for Form I-129 H-1B

    DHS estimates the current public reporting time burden is 2 hours 
and 20 minutes (2.34 hours), which includes the time for reviewing 
instructions, gathering the required documentation and information, 
completing the petition, preparing statements, attaching necessary 
documentation, and submitting the petition.\213\ This proposed rule 
would increase the burden per response by 5 minutes. Table 45 shows the 
total receipts received for Form I-129 H-1B \214\ for FY 2018 through 
FY 2022. The table also details the number of Form I-129 H-1B receipts 
filed with an attorney or accredited representative using Form G-28. 
The number of Form G-28 submissions allows USCIS to estimate the number 
of Form I-129 H-1B that are filed by an attorney or accredited 
representative and thus estimate the opportunity costs of time for a 
petitioner, attorney, or accredited representative to file each form. 
USCIS received a low of 319,090 H-1B receipts filed with Form G-28 in 
FY 2021, and a high of 383,737, H-1B receipts filed with Form G-28 in 
FY 2022. Based on a 5-year annual average, DHS estimates the annual 
average receipts of Form I-129 to be 338,850 with 79 percent of 
petitions filed by an attorney or accredited representative.
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    \213\ See Instructions for Petition for a Nonimmigrant Worker 
(time burden estimate in the Paperwork Reduction Act section). Form 
I-129 H-1B, https://www.uscis.gov/sites/default/files/document/forms/i-129.pdf. OMB No. 1615-1615-0009. Expires Nov. 30, 2025. The 
public reporting burden for this collection of information is 
estimated at 2 hours and 20 minutes (2.34 hours) per response.
    \214\ The term ``Form I-129 H-1B'' refers to a Form I-129 that 
is filed for H-1B classification.
[GRAPHIC] [TIFF OMITTED] TP23OC23.061

    In order to estimate the opportunity costs of time for completing 
and filing Form I-129 H-1B, DHS assumes that a petitioner will use an 
HR specialist, an in-house lawyer, or an outsourced lawyer to prepare 
Form I-129 H-1B petitions.\215\ DHS uses the mean hourly wage of $35.13 
for HR specialists to estimate the opportunity cost of the time for 
preparing and submitting Form I-129 H-1B.\216\ Additionally, DHS uses 
the mean hourly wage of $78.74 for in-house lawyers to estimate the 
opportunity cost of the time for preparing and submitting Form I-129 H-
1B.\217\
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    \215\ USCIS limited its analysis to HR specialists, in-house 
lawyers, and outsourced lawyers to present estimated costs. However, 
USCIS understands that not all entities employ individuals with 
these occupations and, therefore, recognizes equivalent occupations 
may also prepare and file these petitions.
    \216\ See BLS, ``Occupational Employment and Wage Statistics, 
Occupational Employment and Wages, May 2022, 13-1071 Human Resources 
Specialists,'' https://www.bls.gov/oes/2022/may/oes131071.htm (last 
visited May 11, 2023).
    \217\ See BLS, ``Occupational Employment and Wage Statistics, 
Occupational Employment and Wages, May 2022, 23-1011 Lawyers,'' 
https://www.bls.gov/oes/2022/may/oes231011.htm (last visited May. 
11, 2023).
---------------------------------------------------------------------------

    DHS accounts for worker benefits when estimating the total costs of 
compensation by calculating a benefits-to-wage multiplier using the BLS 
report detailing the average employer costs for employee compensation 
for all civilian workers in major occupational groups and industries. 
DHS estimates that the benefits-to-wage multiplier is 1.45 and, 
therefore, is able to estimate the full opportunity cost per 
petitioner, including employee wages and salaries and the full cost of 
benefits such as paid leave, insurance, retirement, etc.\218\ DHS 
multiplied the average hourly U.S. wage rate for HR specialists and in-
house lawyers by 1.45 to account for the full cost of employee 
benefits, for a total of $50.94 \219\ per hour for an HR specialist and 
$114.17 \220\ per hour for an in-house lawyer. DHS recognizes that a 
firm may choose, but is not required, to outsource the preparation of 
these petitions and, therefore, presents two wage rates for lawyers. To 
determine the full opportunity costs of time if a firm hired an 
outsourced lawyer, DHS multiplied the average hourly U.S. wage rate for 
lawyers by 2.5 for a total of $196.85 \221\ to approximate an hourly 
wage rate for

[[Page 72948]]

an outsourced lawyer \222\ to prepare and submit Form I-129 H-1B.\223\
---------------------------------------------------------------------------

    \218\ The benefits-to-wage multiplier is calculated as follows: 
(Total Employee Compensation per hour)/(Wages and Salaries per hour) 
($42.48 Total Employee Compensation per hour)/($29.32 Wages and 
Salaries per hour) = 1.44884 = 1.45 (rounded). See BLS, Economic 
News Release, ``Employer Costs for Employee Compensation--December 
2022,'' Table 1. ``Employer Costs for Employee Compensation by 
ownership [Dec. 2022],'' https://www.bls.gov/news.release/archives/ecec_03172023.htm (last visited Mar. 21, 2023). The Employer Costs 
for Employee Compensation measures the average cost to employers for 
wages and salaries and benefits per employee hour worked.
    \219\ Calculation: $35.13 * 1.45 = $50.94 total wage rate for HR 
specialist.
    \220\ Calculation: $78.74 * 1.45 = $114.17 total wage rate for 
in-house lawyer.
    \221\ Calculation: $78.74 * 2.5 = $196.85 total wage rate for an 
outsourced lawyer.
    \222\ The DHS analysis in ``Exercise of Time-Limited Authority 
To Increase the Fiscal Year 2018 Numerical Limitation for the H-2B 
Temporary Nonagricultural Worker Program,'' 83 FR 24905 (May 31, 
2018), https://www.federalregister.gov/documents/2018/05/31/2018-11732/exercise-of-time-limited-authority-to-increase-the-fiscal-year-2018-numerical-limitation-for-the, used a multiplier of 2.5 to 
convert in-house attorney wages to the cost of outsourced attorney 
wages.
    The DHS ICE rule ``Final Small Entity Impact Analysis: `Safe-
Harbor Procedures for Employers Who Receive a No-Match Letter' '' at 
G-4 (Aug. 25, 2008), https://www.regulations.gov/document/ICEB-2006-0004-0922, also uses a multiplier. The methodology used in the Final 
Small Entity Impact Analysis remains sound for using 2.5 as a 
multiplier for outsourced labor wages in this proposed rule.
    \223\ The DHS analysis in ``Exercise of Time-Limited Authority 
To Increase the Fiscal Year 2018 Numerical Limitation for the H-2B 
Temporary Nonagricultural Worker Program,'' 83 FR 24905 (May 31, 
2018), https://www.federalregister.gov/documents/2018/05/31/2018-11732/exercise-of-time-limited-authority-to-increase-the-fiscal-year-2018-numerical-limitation-for-the, used a multiplier of 2.5 to 
convert in-house attorney wages to the cost of outsourced attorney 
wages.
    Also, the analysis for a DHS ICE rule, ``Final Small Entity 
Impact Analysis: `Safe-Harbor Procedures for Employers Who Receive a 
No-Match Letter' '' at G-4 (Aug. 25, 2008), https://www.regulations.gov/document/ICEB-2006-0004-0922, used a multiplier. 
The methodology used in the Final Small Entity Impact Analysis 
remains sound for using 2.5 as a multiplier for outsourced labor 
wages in this proposed rule.
---------------------------------------------------------------------------

    To estimate the opportunity cost of time to complete and file Form 
I-129 H-1B, DHS applies the estimated time burden (2.34 hours) to the 
eligible population and compensation rates of those who may file with 
or without a lawyer.\224\ Table 46 shows the estimated annual 
opportunity cost of time for Form I-129 H-1B petitioners employing an 
in-house or outsourced lawyer to complete and file Form I-129 H-1B 
petitions. DHS does not know the exact number of petitioners who will 
choose an in-house or an outsourced lawyer but assumes it may be a 50/
50 split and therefore provides an average. DHS estimates that these 
current opportunity costs of time for Form I-129 H-1B petitioners using 
an attorney or other representative range from $90,526,421 to 
$156,084,137 with an annual average of $123,305,279.
---------------------------------------------------------------------------

    \224\ See ``Instructions for Petition for a Nonimmigrant 
Worker,'' Form I-129, OMB No. 1615-0009, expires Nov. 30, 2025, 
https://www.uscis.gov/sites/default/files/document/forms/i-129instr.pdf (last visited Nov. 3, 2022).
---------------------------------------------------------------------------

BILLING CODE 9111-97-P
[GRAPHIC] [TIFF OMITTED] TP23OC23.062

    To estimate the current remaining opportunity cost of time for an 
HR specialist filing Form I-129 H-1B without a lawyer, DHS applies the 
estimated public reporting time burden (2.34 hours) to the compensation 
rate of an HR specialist. Table 47 estimates the current total annual 
opportunity cost of time to HR specialists completing and filing I-129 
H-1B requests will be approximately $10,605,427.
[GRAPHIC] [TIFF OMITTED] TP23OC23.063

    Table 48 shows the proposed estimated time burden (2.42 hours) to 
the eligible population and compensation rates of those who may file 
with or without a lawyer. DHS does not know the exact number of 
petitioners who will choose an in-house or an outsourced lawyer but 
assumes it may be a 50/50 split and therefore provides an average. 
These current opportunity costs of time for Form I-129 H-1B petitioners 
using an attorney or other representative are estimated to range from 
$93,621,341 to $161,420,346 with an annual average of $127,520,844.

[[Page 72949]]

[GRAPHIC] [TIFF OMITTED] TP23OC23.064

    To estimate the current remaining opportunity cost of time for an 
HR specialist filing Form I-129 H-1B without a lawyer, DHS applies the 
estimated public reporting time burden (2.42 hours) to the compensation 
rate of an HR specialist. Table 49 estimates the current total annual 
opportunity cost of time to HR specialists completing and filing I-129 
H-1B requests will be approximately $10,968,006.
[GRAPHIC] [TIFF OMITTED] TP23OC23.065

    DHS estimates the total additional annual cost to petitioners 
completing and filing Form I-129 H-1B are expected to be $4,578,144 
shown in Table 50. This table shows the current total opportunity cost 
of time to file Form I-129 H-1B and the proposed total opportunity cost 
of time.
[GRAPHIC] [TIFF OMITTED] TP23OC23.066

    Finally, many DHS rulemakings include monetized or unquantified 
familiarization costs. This is appropriate when a likely consequence of 
proposed regulations could be additional individuals seeking out and 
consuming more specialized resources, such as immigration attorneys' 
time in order to access the same benefits. This section has emphasized 
that employers of H-1B beneficiaries already consume significant 
specialized resources. In contrast to policies that impose additional 
requirements upon petitioners and registrants, DHS believes the 
proposed modernization, efficiencies, flexibilities and integrity 
improvements have no likely consequence to current consumption of 
specialized resources such as HR Specialists' time, in-house attorneys'

[[Page 72950]]

time, and even out-sourced attorneys time inclusive of indirect costs. 
An assumption that hundreds of thousands will spend 4 or more hours 
reading the entirety of this proposed rule, in addition to the 2.42 
hour burden of Form I-129 H-1B, risks overrepresenting the interests of 
immigration attorneys relative to the other impacts this Regulatory 
Impact Analysis describes using supporting data and evidence. DHS 
invites public comment on familiarization costs and how any such costs 
should be accurately modeled.

r. Additional Time Burden for H Classification Supplement to Form I-129

    DHS estimates the current public reporting time burden at 2 hours, 
for the H Classification Supplement, which includes the time for 
reviewing instructions, gathering the required documentation and 
information, completing the petition, preparing statements, attaching 
necessary documentation, and submitting the petition.\225\ This 
proposed rule would strengthen program integrity by codifying the 
authority to request contracts from petitioners. This change will 
increase the burden per response 5 minutes.
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    \225\ See Instructions for Petition for a Nonimmigrant Worker 
(time burden estimate in the Paperwork Reduction Act section). Form 
I-129 H Classification Supplement, https://www.uscis.gov/sites/default/files/document/forms/i-129.pdf. OMB No. 1615-1615-0009. 
Expires Nov. 30, 2025. The public reporting burden for this 
collection of information is estimated at 2 hours (2.0 hours) per 
response.
---------------------------------------------------------------------------

    Table 51 shows the total receipts received for H-1B petitions for 
FY 2018 through FY 2022. The table also shows the number of H-1B 
petitions submitted by an attorney or accredited representative using 
Form G-28. The number of Form G-28 submissions allows USCIS to estimate 
the number of H-1B petitions that an attorney or accredited 
representative submitted and thus estimate the opportunity costs of 
time for an attorney or accredited representative to file each form 
USCIS received a low of 398,285 of H-1B petitions in FY 2021, and a 
high of 474,311 of H-1B petitions in FY 2022. Based on a 5-year annual 
average, DHS estimates the annual average receipts of H-1B petitions to 
be 338,850 with 79 percent of petitions filed by an attorney or 
accredited representative.
[GRAPHIC] [TIFF OMITTED] TP23OC23.067

    Table 52 shows the estimated annual opportunity cost of time for 
submitting an H-1B petition employing an in-house or outsourced lawyer 
to complete and submit an H-1B petition. DHS does not know the exact 
number of petitioners who will choose an in-house or an outsourced 
lawyer but assumes it may be a 50/50 split and therefore provides an 
average. DHS estimates that these current annual opportunity costs of 
time for filing an H-1B petition using an attorney or other 
representative range from $77,373,009 to $133,405,245 with an average 
of $105,389,127.
[GRAPHIC] [TIFF OMITTED] TP23OC23.068

    To estimate the current remaining opportunity cost of time for an 
HR specialist filing Form I-129 H-1B without a lawyer, DHS applies the 
estimated public reporting time burden (2 hours) to the compensation 
rate of an HR specialist. Table 53 estimates the current total annual 
opportunity cost of time to HR specialists completing and

[[Page 72951]]

filing an H-1B petition will be approximately $9,064,467.
[GRAPHIC] [TIFF OMITTED] TP23OC23.069

    Table 54 shows the proposed increased estimated time burden of 2 
hours and 4 minutes (2.07 hours) to the eligible population and 
compensation rates of those who may file with or without a lawyer. DHS 
does not know the exact number of petitioners who will choose an in-
house or an outsourced lawyer but assumes it may be a 50/50 split and 
therefore provides an average. DHS estimates that these current annual 
opportunity costs of time for filing an H-1B petition using an attorney 
or other representative range from $80,081,064 to $138,074,429 with an 
average of $109,077,747.
[GRAPHIC] [TIFF OMITTED] TP23OC23.070

    To estimate the current remaining opportunity cost of time for an 
HR specialist filing Form I-129 H-1B without a lawyer, DHS applies the 
estimated public reporting time burden (2.07 hours) to the compensation 
rate of an HR specialist. Table 55 estimates the current total annual 
opportunity cost of time to HR specialists completing and filing an H-
1B petition will be approximately $9,381,724.
[GRAPHIC] [TIFF OMITTED] TP23OC23.071

    DHS estimates the total additional annual cost to petitioners 
completing and filing Form I-129 H-1B are expected to be $4,005,877 
shown in Table 56. This table shows the current total opportunity cost 
of time to file an H-1B H Supplement and the proposed total opportunity 
cost of time.

[[Page 72952]]

[GRAPHIC] [TIFF OMITTED] TP23OC23.072

4. Alternatives Considered
    DHS considered the alternative of eliminating the registration 
system and reverting to the paper-based filing system stakeholders used 
prior to implementing registration. However, when DHS considered the 
immense cost savings that registration provides to both USCIS and 
stakeholders and the significant resources the agency would incur to 
revert back to a paper-based H-1B cap selection process, the benefits 
of having a registration system still outweigh the costs of potential 
abuse of the system.
    DHS is also seeking public comment on how to ensure that the 
limited number of H-1B cap-subject visas, and new H-1B status grants 
available each fiscal year are used for non-speculative job 
opportunities. DHS is seeking public comments on the possible 
approaches described in the preamble, as well as soliciting ideas that 
would further curb or eliminate the possibility that petitioners may 
have speculative job opportunities at the time of filing or approval of 
H-1B petitions and delay admission of H-1B beneficiaries until they 
have secured work for them.
5. Total Quantified Net Costs of the Proposed Regulatory Changes
    In this section, DHS presents the total annual cost savings of this 
proposed rule annualized over a 10-year period of analysis. Table 57 
details the annual cost savings of this proposed rule. DHS estimates 
the total cost savings is $5,920,408.
[GRAPHIC] [TIFF OMITTED] TP23OC23.073

    DHS summarizes the annual costs of this proposed rule. Table 58 
details the annual costs of this proposed rule. DHS estimates the total 
cost is $12,260,187.
[GRAPHIC] [TIFF OMITTED] TP23OC23.074


[[Page 72953]]


    Net costs to the public of $6,339,779 are the total costs minus 
cost savings.\226\ Table 59 illustrates that over a 10-year period of 
analysis from FY 2023 through FY 2032 annualized costs would be 
$6,339,779 using 7-percent and 3-percent discount rates.
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    \226\ Calculations: $12,260,187 Total Costs-$5,920,217 Total 
Cost Savings = $6,339,779 Net Costs.
[GRAPHIC] [TIFF OMITTED] TP23OC23.075

BILLING CODE 9111-97-C

B. Regulatory Flexibility Act (RFA)

1. Initial Regulatory Flexibility Analysis
    The Regulatory Flexibility Act of 1980 (RFA), 5 U.S.C. 601 and 602, 
as amended by the Small Business Regulatory Enforcement Fairness Act of 
1996, Public Law 104-121, requires Federal agencies to consider the 
potential impact of regulations on small businesses, small governmental 
jurisdictions, and small organizations during the development of their 
rules. The term ``small entities'' comprises small businesses, not-for-
profit organizations that are independently owned and operated and are 
not dominant in their fields, and governmental jurisdictions with 
populations of less than 50,000.\227\
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    \227\ A small business is defined as any independently owned and 
operated business not dominant in its field that qualifies as a 
small business per the Small Business Act, 15 U.S.C. 632.
---------------------------------------------------------------------------

    An ``individual'' is not considered a small entity and costs to an 
individual are not considered a small entity impact for RFA purposes. 
In addition, the courts have held that the RFA requires an agency to 
perform a regulatory flexibility analysis of small entity impacts only 
when a rule directly regulates small entities.\228\ Consequently, 
indirect impacts from a rule on a small entity are not considered as 
costs for RFA purposes.
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    \228\ See Small Business Administration, A Guide For Government 
Agencies, How to Comply with the Regulatory Flexibility Act. https://advocacy.sba.gov/wp-content/uploads/2019/06/How-to-Comply-with-the-RFA.pdf (last visited Aug. 23 2023).
---------------------------------------------------------------------------

a. USCIS's RFA analysis for this proposed rule focuses on the 
population of Form I-129 petitions for H-1B workers. Where cost savings 
occur from multiple registrants no longer registering on behalf of a 
common beneficiary, either deliberately or inadvertently, USCIS is 
unable to quantify the portion of potential cost savings accruing to 
small entities. Some of these cost savings may be partially offset by 
the advantage multiple registrations conferred over single, unique 
registrants, but it is ambiguous whether such small entities enjoy this 
advantage or feel increasingly compelled to do this by their belief 
that other lottery competitors are doing so. A Description of the 
Reasons Why the Action by the Agency Is Being Considered
    The purpose of this rulemaking is to modernize and improve the 
regulations relating to the H-1B program by: (1) streamlining the 
requirements of the H-1B program; (2) improving program efficiency; (3) 
providing greater flexibility for petitioners and beneficiaries; and 
(4) improving integrity measures.
b. A Statement of the Objectives of, and Legal Basis for, the Proposed 
Rule
    DHS's objectives and legal authority for this proposed rule are 
discussed earlier in the preamble.
c. A Description and, Where Feasible, an Estimate of the Number of 
Small Entities to Which the Proposed Changes Would Apply
    For this analysis, DHS conducted a sample analysis of historical 
Form I-129 H-1B petitions to estimate the number of small entities 
impacted by this proposed rule. DHS utilized a subscription-based 
electronic database of U.S. entities, ReferenceUSA, as well as three 
other open-access, free databases of public and private entities, 
Manta, Cortera, and Guidestar to determine the North American Industry 
Classification System (NAICS) code, revenue, and employee count for 
each entity. To determine whether an entity is small for purposes of 
RFA, DHS first classified the entity by its NAICS code and then used 
Small Business Administration (SBA) guidelines to classify the revenue 
or employee count threshold for each entity. Some entities were 
classified as small based on their annual revenue, and some by their 
numbers of employees.
    Using FY 2022 internal data on actual filings of Form I-129 H-1B 
petitions, DHS identified 44,593 unique entities. DHS devised a 
methodology to conduct the small entity analysis based on a 
representative, random sample of the potentially impacted population. 
DHS first determined the minimum sample size necessary to achieve a 95-
percent

[[Page 72954]]

confidence level confidence interval estimation for the impacted 
population of entities using the standard statistical formula at a 5-
percent margin of error. DHS then created a sample size greater than 
the minimum necessary to increase the likelihood that our matches would 
meet or exceed the minimum required sample.
    DHS randomly selected a sample of 3,396 entities from the 
population of 44,593 entities that filed Form I-129 for H-1B petitions 
in FY 2022. Of the 3,396 entities, 1,724 entities returned a successful 
match of a filing entity in the ReferenceUSA, Manta, Cortera, and 
Guidestar databases; 1,672 entities did not return a match. Using these 
databases' revenue or employee count and their assigned NAICS code, DHS 
determined 1,209 of the 1,724 matches to be small entities, 515 to be 
non-small entities. DHS assumes filing entities without database 
matches or missing revenue/employee count data are likely to be small 
entities. As a result, in order to prevent underestimating the number 
of small entities this proposed rule would affect, DHS considers all 
the non-matched and missing entities as small entities for the purpose 
of this analysis. Therefore, DHS classifies 2,881 of 3,396 entities as 
small entities, including combined non-matches (1,672), and small 
entity matches (1,209). Thus, DHS estimates that 84.8 percent (2,881 of 
3,396) of the entities filing Form I-129 H-1B petitions are small 
entities.
    In this analysis DHS assumes that the distribution of firm size for 
our sample is the same as the entire population of Form I-129 H-1B 
petitioners. Thus, DHS estimates the number of small entities to be 
84.8 percent of the population of 44,593 entities that filed Form I-129 
under the H-1B classification, as summarized in Table 60 below. The 
annual numeric estimate of the small entities impacted by this proposed 
rule is 37,815 entities.\229\
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    \229\ The annual numeric estimate of the small entities (37,815) 
= Population (44,593) * Percentage of small entities (84.8%).
[GRAPHIC] [TIFF OMITTED] TP23OC23.076

    It should be acknowledged here that DHS's sample frame excludes H-2 
petitioners identified by the RIA as benefitting from the proposal to 
no longer require itineraries, because this requirement has no adverse 
impacts to small entities and DHS has not identified opportunities to 
further enhance this benefit to small entities. Similarly, the proposal 
to codify deference has no adverse impacts to small entities. 
Additionally, while the proposed clarity for evidence of maintenance of 
status may indirectly impact small entities filing such petitions and 
applications, the costs and benefits fall predominantly and more 
directly upon the individuals.
    Following the distributional assumptions above, DHS uses the set of 
1,209 small entities with matched revenue data to estimate the economic 
impact of the proposed rule on each small entity. The economic impact, 
in percentage, for each small entity is the sum of the impacts of the 
proposed changes divided by the entity's sales revenue.\230\ DHS 
constructed the distribution of economic impact of the proposed rule 
based on the sample of 1,209 small entities. USCIS multiplied the 
proposed increase in cost per petition by the number of petitions filed 
by a small entity in FY22 to estimate the increase in cost to that 
small entity. USCIS then divided the increase in cost to that small 
entity by the annual revenue generated by that small entity. The 
average number of petitions filed per small entity was 10.3. 
Consequently, the average quantified increase per small entity was 
$152.43. Based on FY 2022 revenue, of the 1,209 small entities, 0 
percent (0 small entities) would experience a cost increase that is 
greater than 1 percent of revenues.
---------------------------------------------------------------------------

    \230\ The economic impact, in percentage, for each small entity 
i = ((Cost of one petition for entity i x Number of petitions for 
entity i)/Entity i's sales revenue) x 100.
    The cost of one petition for entity i ($14.82) is estimated by 
dividing the total cost of this proposed rule by the estimated 
population. $6,339,779/427,822 = $14.82.
    The entity's sales revenue is taken from ReferenceUSA, Manta, 
Cortera, and Guidestar databases.
---------------------------------------------------------------------------

    In addition to the quantitated costs to small entities, employers 
who do not cooperate with site visits who would face denial or 
revocation of their petition(s), which could result in costs to those 
businesses.
d. A Description of the Projected Reporting, Recordkeeping, and Other 
Compliance Requirements of the Proposed Rule, Including an Estimate of 
the Classes of Small Entities That Will Be Subject to the Requirement 
and the Types of Professional Skills
    The proposed beneficiary-centric selection process would result in 
additional burden to employers reporting beneficiaries' passport 
information in the registration system, on Form I-129 H-1B petition and 
on H Classification Supplement to Form I-129. DHS estimates increase 
for each of these respective burdens is 5 minutes.
e. An Identification of All Relevant Federal Rules, to the Extent 
Practical, That May Duplicate, Overlap, or Conflict With the Proposed 
Rule
    DHS is unaware of any duplicative, overlapping, or conflicting 
Federal rules, but invites any comment and information regarding any 
such rules.
f. A Description of Any Significant Alternatives to the Proposed Rule 
That Accomplish the Stated Objectives of Applicable Statutes and That 
Minimize Any Significant Economic Impact of the Proposed Rule on Small 
Entities
    With respect to beneficiary-centric lottery, there are no burdens 
to be minimized. While collection of passport information imposes some 
burden to prospective employers, USCIS found no other alternatives that 
achieved stated objectives with less burden to small entities.

C. Unfunded Mandates Reform Act of 1995 (UMRA)

    The Unfunded Mandates Reform Act of 1995 (UMRA) is intended, among 
other things, to curb the practice of imposing unfunded Federal 
mandates on State, local, and tribal governments. Title II of UMRA 
requires each Federal agency to prepare a written statement assessing 
the effects of any Federal mandate in a proposed rule, or final rule 
for which the agency published a

[[Page 72955]]

proposed rule, that includes any Federal mandate that may result in a 
$100 million or more expenditure (adjusted annually for inflation) in 
any one year by State, local, and tribal governments, in the aggregate, 
or by the private sector.\231\
---------------------------------------------------------------------------

    \231\ See 2 U.S.C. 1532(a).
---------------------------------------------------------------------------

    In addition, the inflation-adjusted value of $100 million in 1995 
is approximately $192 million in 2022 based on the Consumer Price Index 
for All Urban Consumers (CPI-U).\232\ This proposed rule does not 
contain a Federal mandate as the term is defined under UMRA.\233\ The 
requirements of title II of UMRA, therefore, do not apply, and DHS has 
not prepared a statement under UMRA.
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    \232\ See BLS, ``Historical Consumer Price Index for All Urban 
Consumers (CPI-U): U.S. city average, all items, by month,'' 
www.bls.gov/cpi/tables/supplemental-files/historical-cpi-u-202212.pdf (last visited Jan. 19, 2023). Calculation of inflation: 
(1) Calculate the average monthly CPI-U for the reference year 
(1995) and the current year (2022); (2) Subtract reference year CPI-
U from current year CPI-U; (3) Divide the difference of the 
reference year CPI-U and current year CPI-U by the reference year 
CPI-U; (4) Multiply by 100 = [(Average monthly CPI-U for 2022 - 
Average monthly CPI-U for 1995)/(Average monthly CPI-U for 
1995)]*100=[(292.655-152.383)/152.383]*100=(140.272/
152.383)*100=0.92052263*100=92.05 percent = 92 percent (rounded). 
Calculation of inflation-adjusted value: $100 million in 1995 
dollars*1.92=$192 million in 2022 dollars.
    \233\ The term ``Federal mandate'' means a Federal 
intergovernmental mandate or a Federal private sector mandate. See 2 
U.S.C. 1502(1), 658(6).
---------------------------------------------------------------------------

D. Executive Order 13132 (Federalism)

    This proposed rule would not have substantial direct effects on the 
States, on the relationship between the National Government and the 
States, or on the distribution of power and responsibilities among the 
various levels of government. Therefore, in accordance with section 6 
of Executive Order 13132, it is determined that this proposed rule does 
not have sufficient federalism implications to warrant the preparation 
of a federalism summary impact statement.

E. Executive Order 12988: Civil Justice Reform

    This proposed rule was drafted and reviewed in accordance with E.O. 
12988, Civil Justice Reform. This proposed rule was written to provide 
a clear legal standard for affected conduct and was carefully reviewed 
to eliminate drafting errors and ambiguities, so as to minimize 
litigation and undue burden on the Federal court system. DHS has 
determined that this proposed rule meets the applicable standards 
provided in section 3 of E.O. 12988.

F. Executive Order 13175 (Consultation and Coordination With Indian 
Tribal Governments)

    This proposed rule does not have ``tribal implications'' because, 
if finalized, it would not have substantial direct effects on one or 
more Indian Tribes, on the relationship between the Federal Government 
and Indian Tribes, or on the distribution of power and responsibilities 
between the Federal Government and Indian Tribes. Accordingly, E.O. 
13175, Consultation and Coordination with Indian Tribal Governments, 
requires no further agency action or analysis.

G. National Environmental Policy Act (NEPA)

    DHS and its components analyze proposed actions to determine 
whether the National Environmental Policy Act (NEPA) \234\ applies to 
them and, if so, what degree of analysis is required. DHS Directive 
023-01, Rev. 01 (Directive) and Instruction Manual 023-01-001-01, Rev. 
01 (Instruction Manual) \235\ establish the procedures DHS and its 
components use to comply with NEPA and the Council on Environmental 
Quality (CEQ) regulations for implementing NEPA.\236\ The CEQ 
regulations allow Federal agencies to establish in their NEPA 
implementing procedures categories of actions (``categorical 
exclusions'') that experience has shown normally do not individually or 
cumulatively have a significant effect on the human environment and, 
therefore, do not require preparation of an Environmental Assessment or 
Environmental Impact Statement.\237\ Instruction Manual, Appendix A, 
Table 1 lists the DHS categorical exclusions.
---------------------------------------------------------------------------

    \234\ See Public Law 91-190, 42 U.S.C. 4321 through 4347.
    \235\ See DHS, ``Implementing the National Environmental Policy 
Act,'' DHS Directive 023-01, Rev 01 (Oct. 31, 2014), and DHS 
Instruction Manual Rev. 01 (Nov. 6, 2014), https://www.dhs.gov/publication/directive-023-01-rev-01-and-instruction-manual-023-01-001-01-rev-01-and-catex.
    \236\ See 40 CFR parts 1500 through 1508.
    \237\ See 40 CFR 1501.4(a).
---------------------------------------------------------------------------

    Under DHS NEPA implementing procedures, for an action to be 
categorically excluded, it must satisfy each of the following three 
conditions: (1) The entire action clearly fits within one or more of 
the categorical exclusions; (2) the action is not a piece of a larger 
action; and (3) no extraordinary circumstances exist that create the 
potential for a significant environmental effect.\238\
---------------------------------------------------------------------------

    \238\ See Instruction Manual, section V.B.2 (a-c).
---------------------------------------------------------------------------

    As discussed throughout this preamble, this rulemaking includes a 
number of proposed regulatory improvements affecting H-1B specialty 
occupation workers, as well as a couple of provisions affecting other 
nonimmigrant classifications, including: H-2, H-3, F-1, L-1, O, P, Q-1, 
R-1, E-3, and TN. If finalized, this proposed rule is intended to 
modernize and improve the efficiency of the H-1B program by: (1) 
amending the definition of a ``specialty occupation'' and the specialty 
occupation criteria; (2) clarifying when to file an amended petition; 
(3) codifying deference given to prior USCIS determinations regarding 
the petitioner's, beneficiary's, or applicant's eligibility, when 
adjudicating certain extension requests (both H-1B and other 
nonimmigrant classifications) involving the same parties and the same 
underlying facts; (4) clarifying when a petitioner is required to 
submit evidence of maintenance of status; (5) eliminating the itinerary 
requirement for H nonimmigrant classifications; and (6) allowing H-1B 
petitioners to amend requested validity periods when the validity 
expires before adjudication. If finalized, this rulemaking will also 
modernize exemptions from the H-1B cap, extend automatic ``cap-gap'' 
extensions, and codify start date flexibility for certain cap-subject 
H-1B petitions. In addition, any final rule resulting from this NPRM 
will improve program integrity by curbing abuse of the H-1B 
registration process, including through beneficiary-centric selection; 
codifying USCIS's authority to request contracts; requiring that the 
petitioner establish that it will employ the beneficiary in a non-
speculative position in a specialty occupation; verifying that the LCA 
corresponds with the petition; revising the definition of U.S. 
employer; eliminating the employer-employee relationship requirement; 
codifying the existing requirement that the petitioner have a bona fide 
job offer for the beneficiary to work within the United States; 
requiring that petitioners have a legal presence in the United States 
and be amenable to service of process in the United States; clarifying 
that beneficiary-owners may qualify for H-1B status; conducting site 
visits; and codifying the requirement that the specialty occupation 
determination be assessed based on the third party, rather than the 
petitioner, if a beneficiary will be staffed to a third party.
    DHS is not aware of any significant impact on the environment, or 
any change in the environmental effect from

[[Page 72956]]

current H-1B and other impacted nonimmigrant program rules, that will 
result from the proposed rule changes. DHS therefore finds this 
proposed rule clearly fits within categorical exclusion A3 established 
in the Department's implementing procedures.
    The proposed amendments, if finalized, would be stand-alone rule 
changes and are not a part of any larger action. In accordance with the 
Instruction Manual, DHS finds no extraordinary circumstances associated 
with the proposed rules that may give rise to significant environmental 
effects requiring further environmental analysis and documentation. 
Therefore, this action is categorically excluded and no further NEPA 
analysis is required.

H. Paperwork Reduction Act

    Under the Paperwork Reduction Act of 1995 (PRA), 44 U.S.C. 3501-12, 
DHS must submit to OMB, for review and approval, any reporting 
requirements inherent in a rule unless they are exempt.
    DHS and USCIS invite the general public and other Federal agencies 
to comment on the impact to the proposed collection of information. In 
accordance with the PRA, the information collection notice is published 
in the Federal Register to obtain comments regarding the proposed edits 
to the information collection instrument.
    Comments are encouraged and will be accepted for 60 days from the 
publication date of the proposed rule. All submissions received must 
include the agency name and OMB Control Number 1615-0144 and/or 1615-
0009 in the body of the letter. Please refer to the ADDRESSES and I. 
Public Participation section of this proposed rule for instructions on 
how to submit comments. Comments on this information collection should 
address one or more of the following four points:
    (1) Evaluate whether the collection of information is necessary for 
the proper performance of the functions of the agency, including 
whether the information will have practical utility;
    (2) Evaluate the accuracy of the agency's estimate of the burden of 
the collection of information, including the validity of the 
methodology and assumptions used;
    (3) Enhance the quality, utility, and clarity of the information to 
be collected; and
    (4) Minimize the burden of the collection of information on those 
who are to respond, including through the use of appropriate automated, 
electronic, mechanical, or other technological collection techniques or 
other forms of information technology, e.g., permitting electronic 
submission of responses.
H-1B Registration Tool (OMB Control No. 1615-0144)
    (1) Type of Information Collection: Revision of a Currently 
Approved Collection.
    (2) Title of the Form/Collection: H-1B Registration Tool.
    (3) Agency form number, if any, and the applicable component of DHS 
sponsoring the collection: OMB-64; USCIS.
    (4) Affected public who will be asked or required to respond, as 
well as a brief abstract: Primary: Business or other for-profit. USCIS 
uses the data collected on this form to determine which employers will 
be informed that they may submit a USCIS Form I-129, Petition for 
Nonimmigrant Worker, for H-1B classification.
    (5) An estimate of the total number of respondents and the amount 
of time estimated for an average respondent to respond: The estimated 
total number of respondents for the information collection H-1B 
Registration Tool (Businesses) is 20,950 and the estimated hour burden 
per response is 0.6 hours. The estimated total number of respondents 
for the information collection H-1B Registration Tool (Attorneys) is 
19,339 and the estimated hour burden per response is 0.6 hours. The 
total number of responses (355,590) is estimated by averaging the total 
number of registrations received during the H-1B cap fiscal years 2021, 
2022, and 2023.
    (6) An estimate of the total public burden (in hours) associated 
with the collection: The total estimated annual hour burden associated 
with this collection of information is 213,354 hours.
    (7) An estimate of the total public burden (in cost) associated 
with the collection: The estimated total annual cost burden associated 
with this collection of information is $0.
Form I-129 (OMB Control No. 1615-0009)
    (1) Type of Information Collection: Revision of a Currently 
Approved Collection.
    (2) Title of the Form/Collection: Petition for Nonimmigrant Worker.
    (3) Agency form number, if any, and the applicable component of DHS 
sponsoring the collection: I-129, E-1/E-2 Classification Supplement, 
Trade Agreement Supplement, H Classification Supplement, H-1B and H-1B1 
Data Collection and Filing Exemption Supplement, L Classification 
Supplement, O and P Classification Supplement, Q-1 Classification 
Supplement, and R-1 Classification Supplement; USCIS.
    (4) Affected public who will be asked or required to respond, as 
well as a brief abstract: Primary: Business or other for-profit. USCIS 
uses Form I-129 and accompanying supplements to determine whether the 
petitioner and beneficiary(ies) is (are) eligible for the nonimmigrant 
classification. A U.S. employer, or agent in some instances, may file a 
petition for nonimmigrant worker to employ foreign nationals under the 
following nonimmigrant classifications: H-1B, H-2A, H-2B, H-3, L-1, O-
1, O-2, P-1, P-2, P-3, P-1S, P-2S, P-3S, Q-1, or R-1 nonimmigrant 
worker. The collection of this information is also required from a U.S. 
employer on a petition for an extension of stay or change of status for 
E-1, E-2, E-3, Free Trade H-1B1 Chile/Singapore nonimmigrants and TN 
(USMCA workers) who are in the United States.
    (5) An estimate of the total number of respondents and the amount 
of time estimated for an average respondent to respond: The estimated 
total number of respondents for the information collection I-129 is 
294,751 and the estimated hour burden per response is 2.42 hours. The 
estimated total number of respondents for the information collection E-
1/E-1 Classification Supplement is 4,760 and the estimated hour burden 
per response is 0.67 hours. The estimated total number of respondents 
for the information collection Trade Agreement Supplement is 3,057 and 
the estimated hour burden per response is 0.67 hours. The estimated 
total number of respondents for the information collection H 
Classification is 96,291 and the estimated hour burden per response is 
2.07 hours. The estimated total number of respondents for the 
information collection H-1B and H-1B1 Data Collection and Filing Fee 
Exemption Supplement is 96,291 and the estimated hour burden per 
response is 1 hour. The estimated total number of respondents for the 
information collection L Classification Supplement is 37,831 and the 
estimated hour burden per response is 1.34 hour. The estimated total 
number of respondents for the information collection O and P 
Classification Supplement is 22,710 and the estimated hour burden per 
response is 1 hour. The estimated total number of respondents for the 
information collection Q-1 Classification Supplement is 155 and the 
estimated hour burden per response is 0.34 hours. The estimated total 
number of respondents for the information collection R-1

[[Page 72957]]

Classification Supplement is 6,635 and the estimated hour burden per 
response is 2.34 hours.
    (6) An estimate of the total public burden (in hours) associated 
with the collection: The total estimated annual hour burden associated 
with this collection of information is 1,103,130 hours.
    (7) An estimate of the total public burden (in cost) associated 
with the collection: The estimated total annual cost burden associated 
with this collection of information is $70,681,290.

List of Subjects in 8 CFR Part 214

    Administrative practice and procedure, Aliens, Cultural exchange 
program, Employment, Foreign officials, Health professions, Reporting 
and recordkeeping requirements, Students.

    Accordingly, DHS proposes to amend chapter I of title 8 of the Code 
of Federal Regulations as follows:

PART 214--NONIMMIGRANT CLASSES

0
1. The authority citation for part 214 continues to read as follows:

    Authority:  6 U.S.C. 202, 236; 8 U.S.C. 1101, 1102, 1103, 1182, 
1184, 1186a, 1187, 1221, 1281, 1282, 1301-1305, 1357, and 1372; sec. 
643, Pub. L. 104-208, 110 Stat. 3009-708; Pub. L. 106-386, 114 Stat. 
1477-1480; section 141 of the Compacts of Free Association with the 
Federated States of Micronesia and the Republic of the Marshall 
Islands, and with the Government of Palau, 48 U.S.C. 1901 note and 
1931 note, respectively; 48 U.S.C. 1806; 8 CFR part 2; Pub. L. 115-
218, 132 Stat. 1547 (48 U.S.C. 1806).

0
2. Amend Sec.  214.1 by:
0
a. Revising paragraphs (c)(1) and (4);
0
b. Redesignating paragraph (c)(5) as paragraph (c)(7);
0
c. Adding new paragraph (c)(5) and paragraph (c)(6); and
0
d. Revising newly redesignated paragraph (c)(7).
    The revisions and additions read as follows:


Sec.  214.1   Requirements for admission, extension, and maintenance of 
status.

* * * * *
    (c) * * *
    (1) Extension or amendment of stay for certain employment-based 
nonimmigrant workers. An applicant or petitioner seeking the services 
of an E-1, E-2, E-3, H-1B, H-1B1, H-2A, H-2B, H-3, L-1, O-1, O-2, P-1, 
P-2, P-3, P-1S, P-2S, P-3S, Q-1, R-1, or TN nonimmigrant beyond the 
period previously granted, or seeking to amend the terms and conditions 
of the nonimmigrant's stay without a request for additional time, must 
file for an extension of stay or amendment of stay, on Form I-129, with 
the fee prescribed in 8 CFR 103.7, with the initial evidence specified 
in Sec.  214.2, and in accordance with the form instructions. 
Dependents holding derivative status may be included in the petition if 
it is for only one worker and the form version specifically provides 
for their inclusion. In all other cases, dependents of the worker 
should file extensions of stay using Form I-539.
* * * * *
    (4) Timely filing and maintenance of status. (i) An extension or 
amendment of stay may not be approved for an applicant or beneficiary 
who failed to maintain the previously accorded status or where such 
status expired before the application or petition was filed, except 
that USCIS may excuse the late filing in its discretion where it is 
demonstrated at the time of filing that:
    (A) The delay was due to extraordinary circumstances beyond the 
control of the applicant or petitioner, and USCIS finds the delay 
commensurate with the circumstances;
    (B) The applicant or beneficiary has not otherwise violated their 
nonimmigrant status;
    (C) The applicant or beneficiary remains a bona fide nonimmigrant; 
and
    (D) The applicant or beneficiary is not the subject of deportation 
proceedings under section 242 of the Act (prior to April 1, 1997) or 
removal proceedings under section 240 of the Act.
    (ii) If USCIS excuses the late filing of an extension of stay or 
amendment of stay request, it will do so without requiring the filing 
of a separate application or petition and will grant the extension of 
stay from the date the previously authorized stay expired or the 
amendment of stay from the date the petition was filed.
    (5) Deference to prior USCIS determinations of eligibility. When 
adjudicating a request filed on Form I-129 involving the same parties 
and the same underlying facts, USCIS gives deference to its prior 
determination of the petitioner's, applicant's, or beneficiary's 
eligibility. However, USCIS need not give deference to a prior approval 
if: there was a material error involved with a prior approval; there 
has been a material change in circumstances or eligibility 
requirements; or there is new, material information that adversely 
impacts the petitioner's, applicant's, or beneficiary's eligibility.
    (6) Evidence of maintenance of status. When requesting an extension 
or amendment of stay on Form I-129, an applicant or petitioner must 
submit supporting evidence to establish that the applicant or 
beneficiary maintained the previously accorded nonimmigrant status 
before the extension or amendment request was filed. Evidence of such 
maintenance of status may include, but is not limited to: copies of 
paystubs, W-2 forms, quarterly wage reports, tax returns, contracts, 
and work orders.
    (7) Decision on extension or amendment of stay request. Where an 
applicant or petitioner demonstrates eligibility for a requested 
extension or amendment of stay, USCIS may grant the extension or 
amendment in its discretion. The denial of an extension or amendment of 
stay request may not be appealed.
* * * * *
0
3. Amend Sec.  214.2 by:
0
a. Revising paragraph (f)(5)(vi)(A);
0
b. Removing and reserving paragraph (h)(2)(i)(B);
0
c. Revising paragraphs (h)(2)(i)(E), (F), and (G) and (h)(4)(i)(B);
0
d. Revising the definitions of ``Specialty occupation'' and ``United 
States employer'' in paragraph (h)(4)(ii);
0
e. Revising paragraphs (h)(4)(iii) heading and (h)(4)(iii)(A);
0
f. Adding paragraph (h)(4)(iii)(F);
0
g. Revising paragraph (h)(4)(iv) introductory text;
0
h. Adding paragraph (h)(4)(iv)(C);
0
i. Revising paragraphs (h)(8)(iii)(A)(1), (2), (4), and (5), 
(h)(8)(iii)(A)(6)(i) and (ii), (h)(8)(iii)(A)(7), (h)(8)(iii)(D) and 
(E), (h)(8)(iii)(F)(2)(iv), (h)(8)(iii)(F)(4), and (h)(9)(i);
0
j. Adding paragraphs (h)(9)(ii)(D) and (h)(9)(iii)(E);
0
k. Revising paragraph (h)(10)(ii);
0
l. Adding paragraph (h)(10)(iii);
0
m. Revising paragraphs (h)(11)(ii) and (h)(11)(iii)(A)(2) and (5);
0
n. Adding paragraphs (h)(11)(iii)(A)(6) and (7); and
0
o. Revising paragraphs (h)(14), (h)(19)(iii)(B)(4), (h)(19)(iii)(C), 
(h)(19)(iv), (l)(14)(i), (o)(11), and (p)(13).
    The revisions and additions read as follows:


Sec.  214.2   Special requirements for admission, extension, and 
maintenance of status.

* * * * *
    (f) * * *
    (5) * * *
    (vi) * * *
    (A) The duration of status, and any employment authorization 
granted under 8 CFR 274a.12(c)(3)(i)(B) or (C), of an F-1 student who 
is the beneficiary of an H-1B petition subject to section 214(g)(1)(A) 
of the Act (8 U.S.C. 1184(g)(1)(A)) and who requests a change of status 
will be automatically extended until April 1 of the fiscal year

[[Page 72958]]

for which such H-1B status is being requested or until the validity 
start date of the approved petition, whichever is earlier, where such 
petition:
    (1) Has been timely filed;
    (2) Requests an H-1B employment start date in the fiscal year for 
which such H-1B status is being requested consistent with paragraph 
(h)(2)(i)(I) of this section; and
    (3) Is nonfrivolous.
* * * * *
    (h) * * *
    (2) * * *
    (i) * * *
    (E) Amended or new petition--(1) General provisions. The petitioner 
must file an amended or new petition, with the appropriate fee and in 
accordance with the form instructions, to reflect any material changes 
in the terms and conditions of employment or training or the 
beneficiary's eligibility as specified in the original approved 
petition. An amended or new H-1B, H-2A, or H-2B petition must be 
accompanied by a current or new Department of Labor determination. In 
the case of an H-1B petition, the requirement in this paragraph 
(h)(2)(i)(E)(1) includes a current or new certified labor condition 
application.
    (2) Additional H-1B provisions. The amended or new petition must be 
properly filed before the material change(s) takes place. The 
beneficiary is not authorized to work under the materially changed 
terms and conditions of employment until the new or amended H-1B 
petition is approved and takes effect, unless the beneficiary is 
eligible for H-1B portability pursuant to paragraph (h)(2)(i)(H) of 
this section. Any change in the place of employment to a geographical 
area that requires a corresponding labor condition application to be 
certified to USCIS is considered a material change and requires an 
amended or new petition to be filed with USCIS before the H-1B worker 
may begin work at the new place of employment. Provided there are no 
material changes in the terms and conditions of the H-1B worker's 
employment, a petitioner does not need to file an amended or new 
petition when:
    (i) Moving a beneficiary to a new job location within the same area 
of intended employment as listed on the labor condition application 
certified to USCIS in support of the current H-1B petition approval 
authorizing the H-1B nonimmigrant's employment;
    (ii) Placing a beneficiary at a short-term placements(s) or 
assignment(s) at any worksite(s) outside of the area of intended 
employment for a total of 30 days or less in a 1-year period, or for a 
total of 60 days or less in a 1-year period where the H-1B beneficiary 
continues to maintain an office or work station at their permanent 
worksite, the beneficiary spends a substantial amount of time at the 
permanent worksite in a 1-year period, and the beneficiary's residence 
is located in the area of the permanent worksite and not in the area of 
the short-term worksite(s); or
    (iii) An H-1B beneficiary is going to a non-worksite location to 
participate in employee development, will be spending little time at 
any one location, or when the job is peripatetic in nature, in that the 
normal duties of the beneficiary's occupation (rather than the nature 
of the employer's business) requires frequent travel (local or non-
local) from location to location. Peripatetic jobs include situations 
where the job is primarily at one location, but the beneficiary 
occasionally travels for short periods to other locations on a casual, 
short-term basis, which can be recurring but not excessive (i.e., not 
exceeding 5 consecutive workdays for any one visit by a peripatetic 
worker, or 10 consecutive workdays for any one visit by a worker who 
spends most work time at one location and travels occasionally to other 
locations).
    (F) Agents as petitioners. A United States agent may file a 
petition in cases involving workers who are traditionally self-employed 
or workers who use agents to arrange short-term employment on their 
behalf with numerous employers, and in cases where a foreign employer 
authorizes the agent to act on its behalf. A United States agent may 
be: the actual employer of the beneficiary; the representative of both 
the employer and the beneficiary; or a person or entity authorized by 
the employer to act for, or in place of, the employer as its agent. The 
burden is on the agent to explain the terms and conditions of the 
employment and to provide any required documentation. In questionable 
cases, a contract between the employers and the beneficiary or 
beneficiaries may be required.
    (1) An agent performing the function of an employer must guarantee 
the wages and other terms and conditions of employment by contractual 
agreement with the beneficiary or beneficiaries of the petition.
    (2) A foreign employer who, through a United States agent, files a 
petition for an H nonimmigrant alien is responsible for complying with 
all of the employer sanctions provisions of section 274A of the Act and 
8 CFR part 274a.
    (G) Multiple H-1B petitions or registrations. An employer may not 
file or submit, in the same fiscal year, more than one H-1B petition or 
registration on behalf of the same alien if the alien is subject to the 
numerical limitations of section 214(g)(1)(A) of the Act or is eligible 
for exemption from those limitations under section 214(g)(5)(C) of the 
Act. However, if an H-1B petition is denied, on a basis other than 
fraud or misrepresentation, the employer may file a subsequent H-1B 
petition on behalf of the same alien in the same fiscal year, provided 
that USCIS continues to accept registrations, or petitions if 
registration is suspended, towards the numerical allocations and there 
is a valid registration that was selected on behalf of that 
beneficiary, or if the filing qualifies as exempt from the applicable 
numerical limitations. Otherwise, filing or submitting more than one H-
1B petition or registration by an employer on behalf of the same alien 
in the same fiscal year may result in the denial or revocation of all 
such petitions and invalidation of all such registrations. If USCIS 
believes that related entities (including, but not limited to, a parent 
company, subsidiary, or affiliate) may not have a legitimate business 
need to file or submit more than one H-1B petition or registration on 
behalf of the same alien subject to the numerical limitations of 
section 214(g)(1)(A) of the Act or otherwise eligible for an exemption 
under section 214(g)(5)(C) of the Act, USCIS may issue a request for 
evidence, notice of intent to deny, or notice of intent to revoke each 
petition. If any of the related entities fail to demonstrate a 
legitimate business need to file or submit an H-1B petition or 
registration on behalf of the same alien, all petitions filed on that 
alien's behalf by the related entities may be denied or revoked, and 
all such registrations invalidated. This limitation on petitions and 
registrations will not apply if the multiple filings or submissions 
occurred as a result of USCIS requiring petitioners to refile or 
resubmit previously submitted petitions or registrations.
* * * * *
    (4) * * *
    (i) * * *
    (B) General requirements for petitions involving a specialty 
occupation--(1) Labor condition application requirements. (i) Before 
filing a petition for H-1B classification in a specialty occupation, 
the petitioner must obtain a certified labor condition application from 
the Department of Labor in the occupational specialty in which the 
alien(s) will be employed.
    (ii) Certification by the Department of Labor of a labor condition 
application in

[[Page 72959]]

an occupational classification does not constitute a determination by 
the agency that the occupation in question is a specialty occupation. 
USCIS will determine whether the labor condition application involves a 
specialty occupation as defined in section 214(i)(1) of the Act and 
properly corresponds with the petition. USCIS will also determine 
whether all other eligibility requirements have been met, such as 
whether the alien for whom H-1B classification is sought qualifies to 
perform services in the specialty occupation as prescribed in section 
214(i)(2) of the Act.
    (iii) If all of the beneficiaries covered by an H-1B labor 
condition application have not been identified at the time a petition 
is filed, petitions for newly identified beneficiaries may be filed at 
any time during the validity of the labor condition application using 
photocopies of the same certified labor condition application. Each 
petition must refer by file number to all previously approved petitions 
for that labor condition application.
    (iv) When petitions have been approved for the total number of 
workers specified in the labor condition application, substitution of 
aliens against previously approved openings cannot be made. A new labor 
condition application will be required.
    (v) If the Secretary of Labor notifies USCIS that the petitioning 
employer has failed to meet a condition of paragraph (B) of section 
212(n)(1) of the Act, has substantially failed to meet a condition of 
paragraphs (C) or (D) of section 212(n)(1) of the Act, has willfully 
failed to meet a condition of paragraph (A) of section 212(n)(1) of the 
Act, or has misrepresented any material fact in the application, USCIS 
will not approve petitions filed with respect to that employer under 
section 204 or 214(c) of the Act for a period of at least 1 year from 
the date of receipt of such notice.
    (vi) If the employer's labor condition application is suspended or 
invalidated by the Department of Labor, USCIS will not suspend or 
revoke the employer's approved petitions for aliens already employed in 
specialty occupations if the employer has certified to the Department 
of Labor that it will comply with the terms of the labor condition 
application for the duration of the authorized stay of aliens it 
employs.
    (2) Inspections, evaluations, verifications, and compliance 
reviews. (i) The information provided on an H-1B petition and the 
evidence submitted in support of such petition may be verified by USCIS 
through lawful means as determined by USCIS, including telephonic and 
electronic verifications and onsite inspections. Such verifications and 
inspections may include, but are not limited to: electronic validation 
of a petitioner's or third party's basic business information; visits 
to the petitioner's or third party's facilities; interviews with the 
petitioner's or third party's officials; reviews of the petitioner's or 
third party's records related to compliance with immigration laws and 
regulations; and interviews with any other individuals possessing 
pertinent information, as determined by USCIS, which may be conducted 
in the absence of the employer or the employer's representatives; and 
reviews of any other records that USCIS may lawfully obtain and that it 
considers pertinent to verify facts related to the adjudication of the 
H-1B petition, such as facts relating to the petitioner's and 
beneficiary's H-1B eligibility and compliance. The interviews may be 
conducted on the employer's property, or as feasible, at a neutral 
location agreed to by the interviewee and USCIS away from the 
employer's property. An inspection may be conducted at locations 
including the petitioner's headquarters, satellite locations, or the 
location where the beneficiary works, has worked, or will work, 
including third party worksites, as applicable. USCIS may commence 
verification or inspection under this paragraph for any petition and at 
any time after an H-1B petition is filed, including any time before or 
after the final adjudication of the petition. The commencement of such 
verification and inspection before the final adjudication of the 
petition does not preclude the ability of USCIS to complete final 
adjudication of the petition before the verification and inspection are 
completed.
    (ii) USCIS conducts on-site inspections or other compliance reviews 
to verify facts related to the adjudication of the petition and 
compliance with H-1B petition requirements. If USCIS is unable to 
verify facts, including due to the failure or refusal of the petitioner 
or a third party to cooperate in an inspection or other compliance 
review, then such inability to verify facts, including due to failure 
or refusal to cooperate, may result in denial or revocation of any H-1B 
petition for H-1B workers performing services at the location or 
locations that are a subject of inspection or compliance review, 
including any third party worksites.
    (3) Third party requirements. If the beneficiary will be staffed to 
a third party, meaning they will be contracted to fill a position in a 
third party's organization and becomes part of that third party's 
organizational hierarchy by filling a position in that hierarchy (and 
not merely providing services to the third party), the actual work to 
be performed by the beneficiary must be in a specialty occupation. When 
staffed to a third party, it is the requirements of that third party, 
and not the petitioner, that are most relevant when determining whether 
the position is a specialty occupation.
* * * * *
    (ii) * * *
    Specialty occupation means an occupation that requires theoretical 
and practical application of a body of highly specialized knowledge in 
fields of human endeavor including, but not limited to, architecture, 
engineering, mathematics, physical sciences, social sciences, medicine 
and health, education, business specialties, accounting, law, theology, 
and the arts, and that requires the attainment of a bachelor's degree 
or higher in a specific specialty, or its equivalent, as a minimum for 
entry into the occupation in the United States. The required 
specialized studies must be directly related to the position. A 
position is not a specialty occupation if attainment of a general 
degree, such as business administration or liberal arts, without 
further specialization, is sufficient to qualify for the position. A 
position may allow a range of degrees or apply multiple bodies of 
highly specialized knowledge, provided that each of those qualifying 
degree fields or each body of highly specialized knowledge is directly 
related to the position.
    United States employer means a person, firm, corporation, 
contractor, or other association, or organization in the United States 
that:
    (1) Has a bona fide job offer for the beneficiary to work within 
the United States, which may include telework, remote work, or other 
off-site work within the United States;
    (2) Has a legal presence in the United States and is amenable to 
service of process in the United States; and
    (3) Has an Internal Revenue Service Tax identification number.
    (4) If the H-1B beneficiary possesses a controlling interest in the 
petitioner, such a beneficiary may perform duties that are directly 
related to owning and directing the petitioner's business as long as 
the beneficiary will perform specialty occupation duties a majority of 
the time, consistent with the terms of the H-1B petition.
    (iii) General H-1B requirements--(A) Criteria for specialty 
occupation position. A position does not meet the definition of 
specialty occupation in paragraph (h)(4)(ii) of this section unless

[[Page 72960]]

it also satisfies at least one of the following criteria at paragraphs 
(h)(4)(iii)(A)(1) through (4) of this section:
    (1) A U.S. baccalaureate or higher degree in a directly related 
specific specialty, or its equivalent, is normally the minimum 
requirement for entry into the particular occupation;
    (2) A U.S. baccalaureate or higher degree in a directly related 
specific specialty, or its equivalent, is normally required for 
parallel positions among similar organizations in the employer's United 
States industry;
    (3) The employer, or third party if the beneficiary will be staffed 
to that third party, normally requires a U.S. baccalaureate or higher 
degree in a directly related specific specialty, or its equivalent, for 
the position; or
    (4) The specific duties of the proffered position are so 
specialized, complex, or unique that the knowledge required to perform 
the duties are normally associated with the attainment of a U.S. 
baccalaureate or higher degree in a directly related specific 
specialty, or its equivalent.
    (5) For purposes of the criteria at paragraphs (h)(4)(iii)(A)(1) 
through (4) of this section, normally means conforming to a type, 
standard, or regular pattern, and is characterized by that which is 
considered usual, typical, common, or routine. Normally does not mean 
always.
* * * * *
    (F) Non-speculative position in a specialty occupation. At the time 
of filing, the petitioner must establish that it has a non-speculative 
position in a specialty occupation available for the beneficiary as of 
the start date of the validity period as requested on the petition.
    (iv) General documentary requirements for H-1B classification in a 
specialty occupation. Except as specified in paragraph (h)(4)(iv)(C) of 
this section, an H-1B petition involving a specialty occupation must be 
accompanied by:
* * * * *
    (C) In accordance with 8 CFR 103.2(b) and paragraph (h)(9) of this 
section, USCIS may request evidence such as contracts, work orders, or 
other similar evidence between all parties in a contractual 
relationship showing the terms and conditions of the beneficiary's work 
and the minimum educational requirements to perform the duties.
* * * * *
    (8) * * *
    (iii) * * *
    (A) * * *
    (1) Registration requirement. Except as provided in paragraph 
(h)(8)(iv) of this section, before a petitioner can file an H-1B cap-
subject petition for a beneficiary who may be counted under section 
214(g)(1)(A) of the Act (``H-1B regular cap'') or eligible for 
exemption under section 214(g)(5)(C) of the Act (``H-1B advanced degree 
exemption''), the petitioner must register to file a petition on behalf 
of a beneficiary electronically through the USCIS website 
(www.uscis.gov). To be eligible to file a petition for a beneficiary 
who may be counted against the H-1B regular cap or the H-1B advanced 
degree exemption for a particular fiscal year, a registration must be 
properly submitted in accordance with 8 CFR 103.2(a)(1), paragraph 
(h)(8)(iii) of this section, and the form instructions, for the same 
fiscal year.
    (2) Limitation on beneficiaries. A prospective petitioner must 
electronically submit a separate registration for each beneficiary it 
seeks to register, and each beneficiary must be named. A petitioner may 
only submit one registration per beneficiary in any fiscal year. If a 
petitioner submits more than one registration per beneficiary in the 
same fiscal year, all registrations filed by that petitioner relating 
to that beneficiary for that fiscal year may be considered invalid, and 
USCIS may deny or revoke the approval of any petition filed for the 
beneficiary based on those registrations. If USCIS determines that 
registrations were submitted for the same beneficiary by the same or 
different registrants, but using different identifying information, 
USCIS may find those registrations invalid and deny or revoke the 
approval of any petition filed based on those registrations. 
Petitioners will be given notice and the opportunity to respond before 
USCIS denies or revokes the approval of a petition.
* * * * *
    (4) Selecting registrations based on unique beneficiaries. 
Registrations will be counted based on the number of unique 
beneficiaries who are registered.
    (i) Should a random selection be necessary, each unique beneficiary 
will only be counted once towards the random selection of 
registrations, regardless of how many registrations were submitted for 
that beneficiary. A petitioner may file an H-1B cap-subject petition on 
behalf of a registered beneficiary only after a registration for that 
beneficiary has been selected for that fiscal year. USCIS will notify 
all registrants that submitted a registration on behalf of a selected 
beneficiary that they may file a petition for that beneficiary.
    (ii) Registrations must include the beneficiary's valid passport 
information, as specified in the form instructions. Each beneficiary 
must only be registered under one passport, and if the beneficiary is 
abroad, the passport information must correspond to the passport the 
beneficiary intends to use to enter the United States.
    (5) Regular cap selection. In determining whether there are enough 
registrations for unique beneficiaries to meet the H-1B regular cap, 
USCIS will consider all properly submitted registrations relating to 
beneficiaries that may be counted under section 214(g)(1)(A) of the 
Act, including those that may also be eligible for exemption under 
section 214(g)(5)(C) of the Act. Registrations will be counted based on 
the number of unique beneficiaries that are registered.
    (i) Fewer registrations than needed to meet the H-1B regular cap. 
At the end of the annual initial registration period, if USCIS 
determines that it has received fewer registrations for unique 
beneficiaries than needed to meet the H-1B regular cap, USCIS will 
notify all petitioners that have properly registered that their 
registrations have been selected. USCIS will keep the registration 
period open beyond the initial registration period, until it determines 
that it has received a sufficient number of registrations for unique 
beneficiaries to meet the H-1B regular cap. Once USCIS has received a 
sufficient number of registrations for unique beneficiaries to meet the 
H-1B regular cap, USCIS will no longer accept registrations for 
petitions subject to the H-1B regular cap under section 214(g)(1)(A). 
USCIS will monitor the number of registrations received and will notify 
the public of the date that USCIS has received the necessary number of 
registrations for unique beneficiaries (the ``final registration 
date''). The day the public is notified will not control the applicable 
final registration date. When necessary to ensure the fair and orderly 
allocation of numbers under section 214(g)(1)(A) of the Act, USCIS may 
randomly select the remaining number of registrations for unique 
beneficiaries deemed necessary to meet the H-1B regular cap from among 
the registrations received on the final registration date. This random 
selection will be made via computer-generated selection, based on the 
unique beneficiary.
    (ii) Sufficient registrations to meet the H-1B regular cap during 
initial registration period. At the end of the initial registration 
period, if USCIS

[[Page 72961]]

determines that it has received more than sufficient registrations for 
unique beneficiaries to meet the H-1B regular cap, USCIS will no longer 
accept registrations under section 214(g)(1)(A) of the Act and will 
notify the public of the final registration date. USCIS will randomly 
select from among the registrations properly submitted during the 
initial registration period the number of registrations for unique 
beneficiaries deemed necessary to meet the H-1B regular cap. This 
random selection will be made via computer-generated selection, based 
on the unique beneficiary.
    (6) * * *
    (i) Fewer registrations than needed to meet the H-1B advanced 
degree exemption numerical limitation. If USCIS determines that it has 
received fewer registrations for unique beneficiaries than needed to 
meet the H-1B advanced degree exemption numerical limitation, USCIS 
will notify all petitioners that have properly registered that their 
registrations have been selected. USCIS will continue to accept 
registrations to file petitions for beneficiaries that may be eligible 
for the H-1B advanced degree exemption under section 214(g)(5)(C) of 
the Act until USCIS determines that it has received enough 
registrations for unique beneficiaries to meet the H-1B advanced degree 
exemption numerical limitation. USCIS will monitor the number of 
registrations received and will notify the public of the date that 
USCIS has received the necessary number of registrations for unique 
beneficiaries (the ``final registration date''). The day the public is 
notified will not control the applicable final registration date. When 
necessary to ensure the fair and orderly allocation of numbers under 
sections 214(g)(1)(A) and 214(g)(5)(C) of the Act, USCIS may randomly 
select the remaining number of registrations for unique beneficiaries 
deemed necessary to meet the H-1B advanced degree exemption numerical 
limitation from among the registrations properly submitted on the final 
registration date. This random selection will be made via computer-
generated selection, based on the unique beneficiary.
    (ii) Sufficient registrations to meet the H-1B advanced degree 
exemption numerical limitation. If USCIS determines that it has 
received more than enough registrations for unique beneficiaries to 
meet the H-1B advanced degree exemption numerical limitation, USCIS 
will no longer accept registrations that may be eligible for exemption 
under section 214(g)(5)(C) of the Act and will notify the public of the 
final registration date. USCIS will randomly select the number of 
registrations for unique beneficiaries needed to meet the H-1B advanced 
degree exemption numerical limitation from among the remaining 
registrations for unique beneficiaries who may be counted against the 
advanced degree exemption numerical limitation. This random selection 
will be made via computer-generated selection, based on the unique 
beneficiary.
    (7) Increase to the number of beneficiaries projected to meet the 
H-1B regular cap or advanced degree exemption allocations in a fiscal 
year. Unselected registrations will remain on reserve for the 
applicable fiscal year. If USCIS determines that it needs to increase 
the number of registrations for unique beneficiaries projected to meet 
the H-1B regular cap or advanced degree exemption allocation, and 
select additional registrations for unique beneficiaries, USCIS will 
select from among the registrations that are on reserve a sufficient 
number to meet the H-1B regular cap or advanced degree exemption 
numerical limitation, as applicable. If all of the registrations on 
reserve are selected and there are still fewer registrations than 
needed to meet the H-1B regular cap or advanced degree exemption 
numerical limitation, as applicable, USCIS may reopen the applicable 
registration period until USCIS determines that it has received a 
sufficient number of registrations for unique beneficiaries projected 
as needed to meet the H-1B regular cap or advanced degree exemption 
numerical limitation. USCIS will monitor the number of registrations 
received and will notify the public of the date that USCIS has received 
the necessary number of registrations (the new ``final registration 
date''). The day the public is notified will not control the applicable 
final registration date. When necessary to ensure the fair and orderly 
allocation of numbers, USCIS may randomly select the remaining number 
of registrations for unique beneficiaries deemed necessary to meet the 
H-1B regular cap or advanced degree exemption numerical limitation from 
among the registrations properly submitted on the final registration 
date. If the registration period will be re-opened, USCIS will announce 
the start of the re-opened registration period on the USCIS website at 
www.uscis.gov.
* * * * *
    (D) H-1B cap-subject petition filing following registration--(1) 
Filing procedures. In addition to any other applicable requirements, a 
petitioner may file an H-1B petition for a beneficiary who may be 
counted under section 214(g)(1)(A) or eligible for exemption under 
section 214(g)(5)(C) of the Act only if the petition is based on a 
valid registration, which means that the registration was properly 
submitted in accordance with 8 CFR 103.2(a)(1), paragraph (h)(8)(iii) 
of this section, and the registration tool instructions, and was 
submitted by the petitioner, or its designated representative, on 
behalf of the beneficiary who was selected for that cap season by 
USCIS. A petitioner may not substitute the beneficiary named in the 
original registration or transfer the registration to another 
petitioner. Any H-1B petition filed on behalf of a beneficiary must 
contain and be supported by the same identifying information provided 
in the selected registration. Petitioners must submit evidence of the 
passport used at the time of registration to identify the beneficiary. 
In its discretion, USCIS may find that a change in identifying 
information in some circumstances would be permissible. Such 
circumstances could include, but are not limited to, a legal name 
change due to marriage, change in gender identity, or a change in 
passport number or expiration date due to renewal or replacement of a 
stolen passport, in between the time of registration and filing the 
petition. USCIS may deny or revoke the approval of an H-1B petition 
that does not meet these requirements.
    (2) Registration fee. USCIS may deny or revoke the approval of an 
H-1B petition if it determines that the fee associated with the 
registration is declined, not reconciled, disputed, or otherwise 
invalid after submission. The registration fee is non-refundable and 
due at the time the registration is submitted.
    (3) Filing period. An H-1B cap-subject petition must be properly 
filed within the filing period indicated on the relevant selection 
notice. The filing period for filing the H-1B cap-subject petition will 
be at least 90 days. If petitioners do not meet the requirements of 
this paragraph (h)(8)(iii)(D), USCIS may deny or reject the H-1B cap-
subject petition.
    (E) Calculating the number of registrations needed to meet the H-1B 
regular cap and H-1B advanced degree exemption allocation. When 
calculating the number of registrations for unique beneficiaries needed 
to meet the H-1B regular cap and the H-1B advanced degree exemption 
numerical limitation for a given fiscal year, USCIS will take into 
account historical data related to approvals, denials, revocations, and 
other relevant factors. If necessary,

[[Page 72962]]

USCIS may increase those numbers throughout the fiscal year.
    (F) * * *
    (2) * * *
    (iv) The nonprofit entity has entered into a formal written 
affiliation agreement with an institution of higher education that 
establishes an active working relationship between the nonprofit entity 
and the institution of higher education for the purposes of research or 
education, and a fundamental activity of the nonprofit entity is to 
directly contribute to the research or education mission of the 
institution of higher education. A nonprofit entity may engage in more 
than one fundamental activity.
* * * * *
    (4) An H-1B beneficiary who is not directly employed by a 
qualifying institution, organization, or entity identified in section 
214(g)(5)(A) or (B) of the Act will qualify for an exemption under such 
section if the H-1B beneficiary will spend at least half of their work 
time performing job duties at a qualifying institution, organization, 
or entity and those job duties directly further an activity that 
supports or advances one of the fundamental purposes, missions, 
objectives, or functions of the qualifying institution, organization, 
or entity, namely, either higher education, nonprofit research, or 
government research. Work performed ``at'' the qualifying institution 
may include work performed in the United States through telework, 
remote work, or other off-site work. When considering whether a 
position is cap-exempt, USCIS will focus on the job duties to be 
performed, rather than where the duties are physically performed.
* * * * *
    (9) * * *
    (i) Approval. (A) USCIS will consider all the evidence submitted 
and any other evidence independently required to assist in 
adjudication. USCIS will notify the petitioner of the approval of the 
petition on a Notice of Action. The approval notice will include the 
beneficiary's (or beneficiaries') name(s) and classification and the 
petition's period of validity. A petition for more than one beneficiary 
and/or multiple services may be approved in whole or in part. The 
approval notice will cover only those beneficiaries approved for 
classification under section 101(a)(15)(H) of the Act.
    (B) Where an H-1B petition is approved for less time than requested 
on the petition, the approval notice will provide or be accompanied by 
a brief explanation for the validity period granted.
    (ii) * * *
    (D)(1) If an H-1B petition is adjudicated and deemed approvable 
after the initially requested validity period end-date or end-date for 
which eligibility is established, the officer may issue a request for 
evidence (RFE) asking the petitioner whether they want to update the 
requested dates of employment. Factors that inform whether USCIS issues 
an RFE could include, but would not be limited to: additional petitions 
filed or approved on the beneficiary's behalf, or the beneficiary's 
eligibility for additional time in H-1B status. If the new requested 
period exceeds the validity period of the labor condition application 
already submitted with the H-1B petition, the petitioner must submit a 
certified labor condition application with a new validity period that 
properly corresponds to the new requested validity period on the 
petition and an updated prevailing or proffered wage, if applicable, 
except that the petitioner may not reduce the proffered wage from that 
originally indicated in their petition. This labor condition 
application may be certified after the date the H-1B petition was filed 
with USCIS. The request for new dates of employment and submission of a 
labor condition application corresponding with the new dates of 
employment, absent other changes, will not be considered a material 
change. An increase to the proffered wage will not be considered a 
material change, as long as there are no other material changes to the 
position.
    (2) If USCIS does not issue an RFE concerning the requested dates 
of employment, if the petitioner does not respond, or the RFE response 
does not support new dates of employment, the petition will be 
approved, if otherwise approvable, for the originally requested period 
or until the end-date eligibility has been established, as appropriate. 
However, the petition will not be forwarded to the Department of State 
nor will any accompanying request for a change of status, an extension 
of stay, or amendment of stay, be granted.
    (iii) * * *
    (E) H-1B petition for certain beneficiary-owned entities. The 
initial approval of a petition filed by a United States employer in 
which the H-1B beneficiary possesses a controlling ownership interest 
in the petitioning organization or entity will be limited to a validity 
period of up to 18 months. The first extension (including an amended 
petition with a request for an extension of stay) of such a petition 
will also be limited to a validity period of up to 18 months.
* * * * *
    (10) * * *
    (ii) Denial for statement of facts on the petition, H-1B 
registration, temporary labor certification, labor condition 
application, or invalid H-1B registration. The petition will be denied 
if it is determined that the statements on the petition, H-1B 
registration (if applicable), the application for a temporary labor 
certification, or the labor condition application, were inaccurate, 
fraudulent, or misrepresented a material fact, including if the 
attestations on the registration are determined to be false. An H-1B 
cap-subject petition also will be denied if it is not based on a valid 
registration submitted by the petitioner (or its designated 
representative), or a successor in interest, for the beneficiary named 
or identified in the petition.
    (iii) Notice of denial. The petitioner will be notified of the 
reasons for the denial and of the right to appeal the denial of the 
petition under 8 CFR part 103. There is no appeal from a decision to 
deny an extension of stay to the alien.
    (11) * * *
    (ii) Immediate and automatic revocation. The approval of any 
petition is immediately and automatically revoked if the petitioner 
goes out of business, files a written withdrawal of the petition, or 
the Department of Labor revokes the labor certification upon which the 
petition is based. The approval of an H-1B petition is also immediately 
and automatically revoked upon notification from the H-1B petitioner 
that the beneficiary is no longer employed.
    (iii) * * *
    (A) * * *
    (2) The statement of facts contained in the petition, H-1B 
registration (if applicable), the application for a temporary labor 
certification, or the labor condition application, was not true and 
correct, inaccurate, fraudulent, or misrepresented a material fact, 
including if the attestations on the registration are determined to be 
false; or
* * * * *
    (5) The approval of the petition violated paragraph (h) of this 
section or involved gross error;
    (6) The H-1B cap-subject petition was not based on a valid 
registration submitted by the petitioner (or its designated 
representative), or a successor in interest, for the beneficiary named 
or identified in the petition; or
    (7) The petitioner failed to timely file an amended petition 
notifying USCIS of

[[Page 72963]]

a material change or otherwise failed to comply with the material 
change reporting requirements in paragraph (h)(2)(i)(E) of this 
section.
* * * * *
    (14) Extension of visa petition validity. The petitioner must file 
a request for a petition extension on the Form I-129 to extend the 
validity of the original petition under section 101(a)(15)(H) of the 
Act. A request for a petition extension generally may be filed only if 
the validity of the original petition has not expired.
* * * * *
    (19) * * *
    (iii) * * *
    (B) * * *
    (4) The nonprofit entity has entered into a formal written 
affiliation agreement with an institution of higher education that 
establishes an active working relationship between the nonprofit entity 
and the institution of higher education for the purposes of research or 
education, and a fundamental activity of the nonprofit entity is to 
directly contribute to the research or education mission of the 
institution of higher education. A nonprofit entity may engage in more 
than one fundamental activity.
    (C) A nonprofit research organization or government research 
organization.
    When a fundamental activity of a nonprofit organization is engaging 
in basic research and/or applied research, that organization is a 
nonprofit research organization. When a fundamental activity of a 
governmental organization is the performance or promotion of basic 
research and/or applied research, that organization is a government 
research organization. A governmental research organization may be a 
Federal, state, or local entity. A nonprofit research organization or 
governmental research organization may perform or promote more than one 
fundamental activity. Basic research is general research to gain more 
comprehensive knowledge or understanding of the subject under study, 
without specific applications in mind. Basic research is also research 
that advances scientific knowledge but does not have specific immediate 
commercial objectives although it may be in fields of present or 
potential commercial interest. Applied research is research to gain 
knowledge or understanding to determine the means by which a specific, 
recognized need may be met. Applied research includes investigations 
oriented to discovering new scientific knowledge that has specific 
commercial objectives with respect to products, processes, or services. 
Both basic research and applied research may include research and 
investigation in the sciences, social sciences, or humanities and may 
include designing, analyzing, and directing the research of others if 
on an ongoing basis and throughout the research cycle.
* * * * *
    (iv) Nonprofit or tax-exempt organizations. For purposes of 
paragraphs (h)(19)(iii)(B) and (C) of this section, a nonprofit 
organization or entity must be determined by the Internal Revenue 
Service as a tax exempt organization under the Internal Revenue Code of 
1986, section 501(c)(3), (c)(4), or (c)(6), 26 U.S.C. 501(c)(3), 
(c)(4), or (c)(6).
* * * * *
    (l) * * *
    (14) * * *
    (i) Individual petition. The petitioner must file a petition 
extension on Form I-129 to extend an individual petition under section 
101(a)(15)(L) of the Act. A petition extension generally may be filed 
only if the validity of the original petition has not expired.
* * * * *
    (o) * * *
    (11) Extension of visa petition validity. The petitioner must file 
a request to extend the validity of the original petition under section 
101(a)(15)(O) of the Act on the form prescribed by USCIS, in order to 
continue or complete the same activities or events specified in the 
original petition. A petition extension generally may be filed only if 
the validity of the original petition has not expired.
* * * * *
    (p) * * *
    (13) Extension of visa petition validity. The petitioner must file 
a request to extend the validity of the original petition under section 
101(a)(15)(P) of the Act on the form prescribed by USCIS in order to 
continue or complete the same activity or event specified in the 
original petition. A petition extension generally may be filed only if 
the validity of the original petition has not expired.
* * * * *

Alejandro N. Mayorkas,
Secretary, U.S. Department of Homeland Security.
[FR Doc. 2023-23381 Filed 10-20-23; 8:45 am]
 BILLING CODE 9111-97-P