Proposed H-1B Regulation Changes Could Greatly Impact Consulting Companies

The Department of Homeland Security (DHS) recently published its Spring 2019 regulatory agenda, which lists rules that the federal government expect to take action on in the next few months. The agenda gives insight as to the agency’s priorities. One of the major aspects of the proposed regulations is a proposal to “strengthen the H-1B nonimmigrant visa classification program.”

            Regulations regarding the strengthening of the H-1B program are currently at the proposed rule stage. This means it is extremely early in the process and there is not a significant amount of information out yet. What we do know is that DHS will propose to revise the definition of specialty occupation to increase the focus on obtaining the best and the brightest foreign nationals via the H-1B program in accordance with President Trump’s Buy American Hire American Executive Order. Further, DHS plans to try and revise the definition of employment and employer-employee relationship to better protect U.S. workers and wages. In addition, DHS will propose additional requirements designed to ensure employers pay appropriate wages to H-1B visa holders.

            Over time, we have seen that DHS and USCIS have attempted to redefine the employer-employee relationship in a way that makes it more restrictive and consequently reduces the ability of consulting companies to meet their burden of proof. First, the 2010 Neufeld Memo and subsequent USCIS guidance set out to create standards for the employer-employee relationship in a way that made it more restrictive than previously defined through regulation. Next, on February 22, 2018, USCIS provided further restrictions via policy memorandum. This memorandum was strictly created to further restrict third party placement workers.

            While it is unclear how USCIS intends to redefine the employer-employee relationship, it is safe to assume that, if they are successful, it will only be more a restrictive view of the employer-employee relationship. Based on the past increase of burden put on consulting companies with the Neufeld Memo and the February 22, 2018 memo, and USCIS’ increase in denials for consulting companies, DHS seems to be trending towards making things harder for consulting companies.

By: Rahul Reddy & Steven Brown

   

Rahul is the founding partner of Reddy & Neumann P.C. His practice covers employment-based immigration, in which he represents corporate clients in far-ranging industries. 

Steven Brown is an attorney in the firm's H-1B Department and represents our business clients throughout the entire H-1B, H-4, and H-4 EAD process. Additionally, Steven works with clients with Department of Labor Compliance included assistance with wage and hours investigations. Steven prides himself in being able to provide his clients with creative solutions to complex immigration problems.