On November 30, the Department of Homeland Security published its proposed changes to the H-1B lottery procedure, which, if implemented, will go into effect for the cap-subject H-1B applications to be filed in spring 2019.

The Current System

For several years, the cap-subject H-1B filing process has involved the submission of thousands of I-129 petitions during the first week of April, followed by a lottery conducted in mid-April to randomly select the applications that USCIS can statutorily accept and process (65,000 for the “bachelor’s cap,” with an additional 20,000 reserved for holders of U.S. advanced degrees). Because the total number of eligible applications submitted for the lottery has routinely outnumbered the 85,000 total that could be accepted (190,000 applications were submitted in April 2018, for example), tens of thousands of H-1B petitions are prepared every year only to be mailed back to the petitioners if they are not selected.

The Proposed Changes

DHS’s proposal seeks to eliminate the unnecessary filing and return of thousands of unselected applications by first conducting the lottery using an electronic registration system, followed by the filing of complete petitions only by those applicants who have been notified of selection. The proposal also seeks to increase the number of selected applications whose beneficiaries are holders of U.S. master’s degrees. The proposed procedure would involve:

• Electronic registration via submission of basic biographic data of the beneficiary (name, date of birth, country of citizenship, passport number, gender, and education level) and the petitioner (employer name, address, contact info, and federal employer ID number) through an online system. The registration period would last at least 14 days, and would start at least 14 days prior to April 1. Official announcement of the registration window would occur at least 30 days prior to the registration start date.
• The lottery would be conducted at the end of the registration period, and selected registrants would be notified with instructions on how and when to submit the complete I-129 petition.
• The order in which bachelor’s and master’s cap applicants are selected would be reversed, making all master’s cap registrants eligible in the selection of the 65,000 bachelor’s cap slots, and then putting the remaining master’s cap registrants towards the 20,000 slots reserved for holders of advanced U.S. degrees. Reversing the selection order is expected to increase the overall percentage of U.S. advanced degree holders among the selected applications by approximately 15%.
• Selected registrants would be instructed to submit the complete I-129 petition during one of two 60-day filing windows: either April 1 to May 31, or May 1 to June 30. The staggered filing periods are intended to aid USCIS service centers in managing their workflow.

Takeaways

One of the main concerns raised about the proposal is the uncertainty it creates for the upcoming 2019 cap season, given that there does not appear to be enough time to implement such a drastic change in procedure by April. If the rule goes into effect, official announcement of the registration window and instructions could arrive as late as mid-February according to the proposed timeline. The procedure is predicated upon development of a new and untested electronic system that could easily experience technical problems under the weight of tens of thousands of users attempting to register during the same period. The proposed rule acknowledges that electronic registration may be delayed beyond 2019 if the system is not fully operable in time, in which case the procedure would revert to the current filing process with potentially minimal notice. Furthermore, there may be legal challenges to implementation of the rule, particularly for the provision that would reverse the order of selection for master’s cap applicants.

The nominal amount of information required for registration in the lottery also raises concerns regarding potential abuse of the system. Without the need to attest to the occupation category, wage, job description, or other supporting evidence for the H-1B specialty occupation, the registration pool may be flooded with frivolous or baseless entries, diluting the probability of qualified applicants being selected. While the proposal does provide for data mining of the registration and filing systems to detect fraud, discovery of abuse will mainly occur after the lottery has been conducted, at which point the harm to meritorious unselected applicants will be difficult to reverse.

Employers and beneficiaries, many of whom begin planning for cap-subject filings in January, are left with high uncertainty for how to prepare for a crucial process that could affect their ability to retain necessary talent and plan their careers. While some objectives of the proposal are worthwhile, namely eliminating the unnecessary filing and return of unselected applications, DHS would be prudent to delay implementation of a new system in order to allow time for thorough preparation and careful execution. The public may submit comments to DHS concerning this proposed rule (identified by DHS Docket No. USCIS-2008-0014) through January 2, 2019, at the Federal eRulemaking Portal.

In the absence of a concrete timeline, companies who are planning to sponsor an employee in the lottery are urged to begin making arrangements early, and to err on the side of caution by preparing the full petition for their workers, including the certified LCA and I-129 forms, by March. This will allow the application to be submitted quickly in the event the registration system fails and DHS reverts back to the previous procedure.

By Rebecca Chen

Rebecca is a partner at Reddy & Neumann and has been with the firm since 2009. Her practice includes non-immigrant and immigrant visa petitions.