SI Review: March/April 2014

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Benefit of Counsel: Dot Your I’s, Cross Your T’s

How to meet IT staffing needs with adeptly filed H-1B petitions

By Katy Chase

There’s no way around it — the terrain remains rough for staffing and IT consulting firms placing H-1B employees at worksites. But staffing firms still can file effective petitions and help fill U.S. companies’ soaring demand for IT services. Success requires understanding the latest developments in this shifting area of immigration law, and applying well thought-out strategies that address the government’s concerns head on. Employers across the country are gearing up for April’s H-1B lottery for cases subject to annual H-1B quotas. Last year we saw the first lottery since 2008 — meaning more petitions were filed than there were numbers available. This year, demand is expected to climb even higher.

But for staffing firms, “winning the lottery” is only the beginning of an uphill battle. For any H-1B petition, the employer must show that the offered job requires at least a bachelor’s degree or its equivalent in a particular field at an appropriate, government-sanctioned “prevailing wage.”

Neufeld. The IT staffing business model has been under attack by the U.S. Citizenship and Immigration Service (USCIS) for several years now, as embodied in the agency’s now-infamous “Neufeld memo” issued in January 2010. This ill-conceived directive, remaining in effect today, instructs USCIS staff to apply new legal standards that have no basis in the regulations. As a result, an employer must go to extra lengths to justify any work performed by an H-1B visa holder off its premises. This requires submitting additional evidence to prove that a valid employer-employee relationship will exist for the entire requested validity period.

What this means is that staffing firms need to work closely with immigration counsel to carefully document compliance with H-1B related posting requirements at client worksites, and to document that the firm will control when, where and how the worker performs the job. Best practices include submitting an employment offer letter that clearly describes the nature of the relationship, including details about the performance review process; a signed employment agreement detailing terms such as the pay rate and benefits given; an organizational chart showing employee supervision; and portions of contracts between the employer and end-clients establishing the employer’s right to control.

Itinerary. Also of concern to the USCIS is whether specific work for the H-1B employee will last for the duration of the period of stay requested. It is illegal for an H-1B employee to be “benched” without pay. The employer must provide an itinerary of specific engagements for the employee that covers the entire period and specifies the dates of each engagement, as well as the names and addresses of all end-clients where work will be performed. Documentation should include copies of the signed purchase or work order(s), and a letter from the end-client confirming that the H-1B employee will be placed there, among other details.

Clearly, it’s an onerous challenge to collect and submit this documentation when the employee start date is still six months out. While it’s best to file with as much information as possible upfront, keep in mind that if the government issues a Request for Evidence several months after filing, it might be more feasible at that time to obtain a work order from the client and other evidence to submit in response.

Compliance enforcement is in full effect, so be sure to dot your i’s and cross your t’s when it comes to placements at third-party sites. Watch for increased Department of Labor site visits, where a contractor may review the labor condition application (LCA) public access files that must be maintained onsite by the employer. The government increasingly imposes stiff penalties upon finding paperwork deficiencies or determining that back wages are owed. Requirements include posting the LCA at the employer site and at all end-client sites. The best practice here is to maintain documentation that you instructed the end-clients to post.

Katy Chase is an attorney. She can be reached at kchase@wsmimmigration.com