Jan 14 2010
Alternatives to the H-1B Visa 

If you needed an H-1B this year and did not get one, or you are worried that you will not be able to hire the right people this year because there are no H-1B visas available, then you may be interested in what we say in this article.  There are a number of ways to work around the H-1B cap.  Some of the options are obvious and some are creative.  The following discussion describes a number of options that McCown & Evans has used in the past to help our clients secure the services of foreign employees.  We welcome your inquiries and look forward to discussing these options with you.

1. Exemptions From H-1B Cap:

Certain categories of H-1B employers are exempt from the annual numerical limit placed on new H-1B visas.  These employers may qualify to sponsor H-1B employees at any time during the year, and even after the H-1B cap has been reached.  The following is a list of the pertinent categories of “cap-exempt” employers.

1. Institutions of higher education

Generally speaking, these are universities, teaching hospitals, or other educational organizations above the high-school level.

2. Non-profit research organizations or governmental research organizations

These are organizations that have as their principal function the conduct of basic and/or applied research, usually in the sciences, social sciences, or humanities.  Basic research is defined as research that advances scientific knowledge.  Applied research is defined as research to gain knowledge to determine the means by which a specific, recognized need may be met, usually having specific commercial objectives.  It is possible for a non-profit organization that is not entirely committed to research to argue that it is primarily engaged in research activities.

3. Non-profit organizations affiliated to institutions of higher education

For non-profit organizations, this is a flexible category.  It is possible to enter into an affiliation agreement with a university or other institution of higher education for a wide variety of purposes.  McCown & Evans has assisted a number of non-profit organizations to formalize relationships with universities for the purpose of qualifying for a cap exemption under this category.  We have handled cases for a variety of non-profit organizations such as a legal services provider, a medical organization, and a software development association. 

One creative solution for a prospective H-1B employee who was not selected under the cap is for the employee to first gain part-time H-1B employment through sponsorship by a cap-exempt employer and then file a concurrent part-time H-1B petition with U.S. Citizenship and Immigration Services (USCIS) for a cap-subject employer.  In such circumstances, neither petition will be subject to the H-1B cap.

2. J-1 Exchange Visitor Visas:

1. J-1 Trainees

J-1 visas are available to individuals participating in on-the-job training programs and therefore are often good alternatives to H-1Bs for newly-hired employees who will be learning skills particular to a company’s systems, procedures, or technologies.   J-1 programs for trainees allow foreign nationals to complete paid or unpaid training programs with private companies or non-profit organizations.  The company or organization, or its attorneys, may work with an approved J-1 program sponsor to acquire J-1 visas for prospective trainees.  In order to qualify as a J-1 trainee, the foreign national must enter the U.S. to participate in a structured and guided work-based training program in his or her field and meet one of these requirements:

• The foreign national must have a degree or professional certificate from a foreign post-secondary academic institution and at least one year of related work experience in his or her field acquired outside the U.S; OR
• The foreign national must have five years of related work experience outside the U.S. in his or her field. 

The J-1 trainee can be admitted to the U.S. for a period of up to 18 months.  Upon the completion of a J-1 training program, the individual may apply for an additional training program after residing for two years outside the U.S.

2. J-1 Interns

J-1 programs for interns also allow foreign nationals to enter the U.S. to participate in work-based internship programs to build on academic experience or to develop practical skills in the academic or career field.  In order to qualify as an intern, the foreign national must meet one of these requirements:

• The foreign national must be currently enrolled in and pursuing studies at a degree or certificate granting post-secondary academic institution outside the U.S.; OR

• The foreign national must have graduated from a degree or certificate granting post-secondary academic institution outside the U.S. no more than 12 months prior to the internship program start date.  

The maximum duration for an internship program for a J-1 intern is 12 months, but an individual may participate in an additional internship in the original field of study if the intern changes majors within the same degree level, or enrolls in a higher level degree program.   If the individual no longer qualifies for an internship because he or she no longer has student status abroad or is not within 12 months of graduation, the individual can apply for J-1 trainee status after residing for two years outside the United States.

Dependents (spouses and unmarried children under 21 years of age) of J-1 exchange visitors are entitled to J-2 status, and may qualify for work authorization in the United States as long as the employment is not required for the support of the principal J-1 exchange visitor.  Sometimes, a viable strategy for a prospective H-1B worker who was not selected under the cap and who does not qualify for J-1 status might be for the individual’s spouse to obtain a J-1 intern or training visa, which will allow the prospective H-1B worker to apply for work authorization as a dependent in J-2 status.

While J-1 exchange visitors are expected to return to their home countries after completion of training in the United States, there is generally no bar to a J-1 visa holder obtaining H-1B or another work-authorized status in the future.  J-1 visa holders from certain countries, however, may be subject to a two-year home residence period following completion of their training if the training category falls under the “Skills List” of skills identified as being in short supply in the trainee’s country of last residence.  If the two-year home residence requirement applies due to the Skills List, waivers are available and are generally easy to obtain.

3. Extension of Optional Practical Training Employment Authorization:

Certain students currently in F-1 status in the United States may extend their period of Optional Practical Training (OPT) for an additional 17 months (to a total of 29 months). To qualify for this extension, the following criteria must be met:

·         The student must be in a current period of post-completion OPT based on completion of a bachelor’s, master’s, or doctorate degree in science, technology, engineering, or mathematics (“STEM fields”);

·         The student must file an application for an Employment Authorization Document (EAD) on Form I-765 before the current period of post-completion OPT expires;

·         The student must be employed by (or have an offer of employment from) a U.S. employer in a field directly related to the student’s major area of study; and

·         The student’s current or prospective employer must be enrolled in USCIS’ E-Verify employment verification program.

4. E-2 Investor Visas:

The E-2 treaty investor classification allows individuals who are nationals of countries with which the United States maintains certain treaties to come to the United States to run businesses in which they have made a “substantial” investment and in which they have at least a 50% ownership stake.  Whether the actual amount invested is substantial depends on the type of business and the amount normally necessary to establish a viable enterprise.  In most cases, an investment of $100,000-$150,000 will be considered sufficient.

The E-2 category also allows U.S. companies with treaty nationality (i.e at least 50% ownership by individuals who are nationals of a treaty country) to sponsor employees having that same nationality on E-2 visas.  A current list of the treaty countries can be found at this website: http://travel.state.gov/visa/frvi/reciprocity/reciprocity_3726.html.

E-2 visas can be issued for up to five years and are renewable indefinitely as long as the company and the visa holder continue to qualify for E-2 status. 

Dependents (spouses and unmarried children under 21 years of age) of E-2 visa holders are also eligible for E-2 dependent visas, and E-2 spouses may apply for work authorization in the United States.

5. O-1 Visas:

O-1 visas are available to people with extraordinary ability in the sciences, arts, education, business, or athletics, as demonstrated by their achievement of sustained national or international acclaim.  These visas serve as excellent replacements for H-1B visas for employees who have a record of high achievement.  Individuals seeking to qualify for O-1 status must demonstrate their achievements through extensive documentation from objective sources in their occupational field, including expert affidavits, contracts, awards, and other documentation. 

National or international acclaim can be demonstrated by receipt of a major internationally-recognized award, such as the Nobel Prize, or by documenting accomplishments in at least three of the following categories:

• Receipt of nationally or internationally recognized prizes or awards for excellence in the field;
• Membership in an association in the field that requires outstanding achievement of its members, as judged by recognized national or international experts;
• Published material in professional or major trade publications or major media about the prospective employee;
• Judgment of the work of others in the field;
• Original scientific, scholarly, or business-related contributions of major significance in the field;
• Authorship of scholarly articles in the field in professional journals or other major media;
• Current or previous employment in a critical or essential capacity for organizations and establishments that have a distinguished reputation;
• High salary or other remuneration commanded for services in relation to others in the field, as evidenced by contracts or other reliable evidence; or
• Other comparable evidence.

Dependents (spouses and unmarried children under 21 years of age) of O-1 workers are entitled to O-3 status. However, dependents in O-3 status are not authorized to work in the United States.

6. L-1 Intracompany Transferee Visas:

Companies can apply for an L-1 visa for an employee who, within the three preceding years, has been employed outside the United States for a continuous year by a parent, subsidiary, or affiliate company.  The employee must be coming to work in the United States in a managerial, executive, or specialized knowledge capacity.  

L-1 visa status may generally be approved for up to three years, and can be extended for up to a total of seven years for managerial or executive workers or five years for specialized knowledge workers.   After the end of the maximum L-1 period of stay, an individual must reside outside of the United States for a full year before becoming eligible to reapply for H or L status.

Dependents (spouses and unmarried children under 21 years of age) of L-1 workers are entitled to L-2 status and L-2 spouses may apply for work authorization in the United States.

7. Special Visas for People From Canada, Mexico, Australia, Chile, and Singapore:

The United States has created special visas under its free trade agreements with Canada, Mexico, Australia, Chile, and Singapore.  Therefore, if a company is seeking to hire an employee who is a citizen of one of these countries, there is a chance that there will be a designated visa option for that employee.  The visas for Australia (E-3 visa), Chile (H-1B1 visa), and Singapore (H-1B1 visa) are virtually identical to the H-1B visa in their eligibility criteria.  Therefore, if the prospective employee would have qualified for an H-1B visa, then he or she will probably qualify for the E-3 or H-1B1 visa.  Canadian and Mexican employees seeking TN visas face a different set of qualifying criteria.  Companies seeking to hire a person using a TN visa are advised to seek advice from McCown & Evans regarding eligibility criteria.

8. Permanent Residence (Green Card) Processing:

The permanent residence process usually involves three distinct stages of processing.  During the third stage of processing, called Adjustment of Status, the foreign national beneficiary qualifies to remain and work lawfully in the United States until the green card is approved.  In certain cases, it is possible to initiate the permanent residence process by concurrently filing an I-140 immigrant petition and Adjustment of Status application.  Once the Adjustment of Status application is filed, the beneficiary’s employment authorization is usually approved within three months.  Therefore, for foreign national employees that have at least three months of remaining lawful status either through F-1 optional practical training, J-1 visa status, or another lawful status, it may be possible to devise a strategy by which the employee qualifies to remain legally in the United States and obtain work authorization through the permanent residence process without first obtaining H-1B status.