Managing H-1B Status Into the 7th Year and Beyond

Many foreign nationals in H-1B status are able to obtain extensions of H-1B status beyond the traditional six-year limit, courtesy of the American Competitiveness in the Twenty-First Century Act (AC-21). This is particularly important for foreign nationals who quickly proceed through the PERM labor certification process and the I-140 immigrant petition, only to find themselves barred from filing an I-485 application to adjust to permanent resident status because their priority date is not current on the State Department's Visa Bulletin.
An increasing number of foreign nationals thus find themselves in an 8th, A9th, or even 10th year of H-1B status due to lengthy visa backlogs. These ongoing extensions of H-1B status can raise questions about a foreign national's obligation to his sponsoring employer, and about the employer's ongoing obligation to the foreign national while the permanent residence process remains pending. This legal update will address some of the most commonly raised questions that employers may be receiving from foreign national employees who have started the permanent residence process, or from candidates who have applied for employment.

"How can I qualify for an H-1B extension beyond six years?"

To qualify to extend status beyond six years, AC-21 requires the foreign national to meet one of the following requirements:

(1) The foreign national is the beneficiary of a PERM labor certification application that was filed at least 365 days before the sixth anniversary of the foreign national's H-1B
status: In this situation, the employer is permitted to file a petition to extend the foreign national's H-1B status in one-year increments beyond the normal six-year limit.

(2) Alternatively, the foreign national is the beneficiary of an I-140 immigrant petition that was approved before the foreign national reached the end of his six years of H-1B status and has been prevented from filing an I-485 application due to per country visa limitations (i.e, the visa backlog): In this situation, the employer is permitted to file a petition to extend the foreign national's H-1B status in three-year increments beyond the normal six-year limit.

"Can I be approved for an extension of status beyond six years if I change employers?"

Yes, but only under certain circumstances. A foreign national employee is eligible for an H-1B extension beyond six years only if he has been sponsored for permanent residence by his employer within one of the timeframes described above. If the employee leaves the
sponsoring employer before he becomes eligible for I-485 portability (discussed below), the Employee could lose the chance to obtain further H-1B extensions unless he and his new employer carefully coordinate the timing of the remaining steps of the permanent residence process. This scenario is best illustrated by an example:

Let's say that the foreign national is the beneficiary of a PERM application that was filed at least 365 days before he reached the six-year limit of his H-1B status. The PERM Application has been approved and an I-140 petition is pending on his behalf, but he cannot yet file an I-485 adjustment of status application because his priority date is not current. He is now in his seventh year of H-1B status, and he has learned that he will be laid off. Fortunately, he has found a new employer that is willing to sponsor him for H-1B status and for permanent residence.

In this situation, USCIS has been willing to approve an H-1B extension beyond six years even when the foreign national is no longer employed with the company that sponsored the
PERM application. See Interoffice Memorandum, Michael Aytes, Acting Director of Domestic Operations, U.S. Citizenship and Immigration Services, Dec. 27, 2005, p. 4 (hereinafter "2005 Aytes Memorandum.") The new employer should expect, however, that the foreign national's opportunity to obtain further extensions will be limited. AC-21 created the availability of extensions beyond six years for the purpose of allowing foreign nationals to continue H-1B employment with the sponsoring employer in cases where the permanent residence process could not be completed during the initial six years of H-1B status. When the foreign national leaves the original sponsoring employer, the foreign national is no longer
fulfilling the purpose of this provision of AC-21.

Therefore, it is critical that the new employer file a PERM application on behalf of the foreign national as quickly as possible. The goal of the new employer will be to obtain at least a one-year extension of H-1B status for the foreign national employee, and during that one year of H-1B status, the new employer will attempt to secure a PERM approval. The employer will then file an I-140 petition -- likely with the $1,000 USCIS Premium Processing fee -- in order to obtain approval of the I-140 petition before the foreign national reaches the end of his current period of H-1B status. After the I-140 petition is
approved, the foreign national will be able to file an I-485 application or, if he is subject to the visa backlog, he will be eligible for a three-year extension of H-1B status with the new employer. Receiving approval of an I-140 petition with the new employer means that the foreign national will no longer be dependent on the PERM application that was filed by his prior employer.

If the I-140 petition is not approved before the foreign national reaches the end of his current period of H-1B status, he and his new employer will be subject to the discretion of USCIS when the new employer next requests an extension of H-1B status. USCIS could decide that the foreign national is ineligible for additional extensions of H-1B status because he is no longer employed with the original sponsoring employer and has displayed no intention of returning to the original sponsoring employer. If an additional extension is denied, the foreign national may have no choice but to depart the United States to await the approval of the new employer's I-140 petition.

"Am I required to be in H-1B status to qualify for an extension beyond six years?"

No. A recent memorandum issued by Michael Aytes of USCIS confirms that a foreign national who meets one of the criteria described in AC-21 is eligible for an extension of H-1B status beyond the six-year limit even if the foreign national is not currently in H-1B status. See Interoffice Memorandum, Michael Aytes, Associate Director, Domestic Operations, U.S. Citizenship and Immigration Services, Dec. 5, 2006, p.3 (hereinafter "2006 Aytes Memorandum"). For example, in the scenario described above, the foreign national may have been compelled to leave the U.S. because he did not qualify for an H-1B extension under any of the provisions of AC-21. A few months after leaving the U.S., however, an I-140 petition is approved on his behalf. If he is subject to the visa backlog, he will become eligible
for a three-year extension of H-1B status because he is the beneficiary of an approved I-140 petition. The 2006 Aytes memorandum confirms that this foreign national can be approved for
a three-year extension of H-1B status and can return to the U.S. to resume employment.

Alternatively, a foreign national who has filed an I-485 application may obtain an Employment Authorization Card (EAC), which will provide her with employment authorization while the I-485 application remains pending. Because she now possesses an EAC, she and her employer may decide that is no longer necessary to incur the expense of ongoing H-1B extensions. At a later time, however, she may decide that she wants to resume H-1B status because she has a fiancé abroad whose only opportunity to join her in the U.S. will be through entry on an H-4 dependent visa. Or, she may have a concern that the I-485 application will be denied, which would result in revocation of the EAC. The memorandum confirms that whether the foreign national is in the U.S. or abroad, she will be eligible for a one-year extension of H-1B status beyond six years even if she does not currently hold H-1B status.

"When am I permitted to change jobs while my I-485 application is pending?"

Under AC-21, a foreign national with a pending I-485 application is permitted to change jobs within the sponsoring company – and is even permitted to join a new employer – as long as: (1) the I-485 application has been pending for at least 180 days; and (2) the new job is in a same or similar occupation as the position for which the foreign national has been sponsored for permanent residence. This is commonly referred to as "I-485 portability" or "I-140 portability." It is wise for the foreign national to wait until the I-140 immigrant petition has been approved before changing employers, although in some cases USCIS may be willing to approve the I-140 petition even if USCIS learns that the foreign national has ported to new employment. See 2005 Aytes Memorandum, pp. 2-3.

USCIS has not issued regulations to provide guidance on AC-21, so the precise scope and timing of a foreign national's ability to change employment during the I-485 process has not been formally defined. Some commentators believe that a foreign national is not eligible to take advantage of I-485 portability until the 181st day after the I-485 application was received by USCIS. Other commentators believe that a foreign national is free to port to a new job immediately after filing the I-485 application, as long as the I-485 ultimately remains pending for over 180 days.

To maximize the chances that the I-485 application will ultimately be approved, the safest approach for the foreign national is to wait until the I-485 application has been pending for 180 days before changing jobs. However, if the foreign national is required to leave the position for which he was sponsored for permanent residence prior to the 180th day – for example, due to a lay-off or because the employer has shut down operations – then an argument can be made that AC-21 allows the foreign national to accept a different job in a same or similar occupation at any time, as long as the I-485 is not adjudicated by USCIS within 180 days.

"I left my employment after the PERM labor certification application was approved. My former employer told me that they will be substituting a different employee for the approved
PERM application. Am I eligible for a 7th year extension of H-1B status with my new employer based on the approved PERM labor certification?"

No. If an employer substitutes a different employee for an approved PERM labor certification, only the substituted employee is eligible for an extension of H-1B status beyond the six-year limit. See 2005 Aytes Memorandum, p. 6.

In 2006, the U.S. Department of Labor proposed eliminating the availability of labor certification substitution. If the proposal is implemented, employers will cease to have the option of substituting a different employee into an approved PERM labor certification.

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These are some of the more common questions that arise when a foreign national is approaching or surpasses the six-year limit on H-1B status, but employers may face many other questions when employees reach the six-year limit or when they consider hiring a candidate who has already passed the six-year limit. Careful consideration of the unique facts of each case and well-informed strategizing are the keys to maximizing the foreign national's chances of remaining in the U.S. in H-1B status while pursuing permanent
residence.