At long last, the U.S. Department of Labor (DOL) has published the final regulations for PERM (Program Electronic Review Management), the new streamlined labor certification process that will replace both the Reduction in Recruitment (RIR) and regular supervised labor certification processes. The PERM regulations take effect on March 28, 2005. All currently pending labor certification cases and new cases filed before March 28, 2005 will be transferred to one of the DOL Backlog Reduction Centers for processing. After March 28, 2005, the DOL will no longer accept new RIR or regular supervised labor certification cases, and all labor certification cases must be filed under the PERM procedures. The following is a summary of the new regulations, with our analysis of the impact of certain provisions:
PERM represents a change in the procedure by which the DOL will receive and review labor certifications. While there are a number of substantive changes to the rules and standards applied in adjudicating labor certifications, the principal changes are procedural.
Under the new PERM rules, employers will file labor certification applications on Form ETA 9089, either electronically or by mail. This single application form contains the information formerly presented on Forms ETA 750A, ETA 750B, and the prevailing wage determination form. No supporting documentation, such as recruitment and prevailing wage evidence, is filed with the Form ETA 9089. Instead, the employer must maintain such documentation for five years after the date of filing, and may need to submit it to the DOL on request.
Prior to filing the application, as is the current practice in most states, employers will still need to obtain a prevailing wage determination through the State Workforce Agency (SWA) responsible for the area of intended employment. The employer must offer to pay the foreign worker 100% of the prevailing wage as determined by the SWA, not 95%, as was previously allowed. In a positive development, as of March 28, 2005, a new four-tier wage system will replace the existing two-tier wage system.
PERM applications will undergo an initial review by DOL staff to ensure that the petitioning employers are valid entities that are actually conducting business. The principal review of the applications will be done automatically by DOL computers. The automated review process will check whether the applications are complete, and will apply certain review criteria to the applications to determine which applications should be the subject of a DOL audit. In addition, a random selection of applications will be audited to ensure the overall integrity of the process.
A DOL “audit” under the PERM regulations consists of an automatically generated letter setting forth the information that the DOL would like to review before making a determination in the case. The employer will be given 30 days within which to reply to the audit. The DOL estimates that cases approved without an audit will be processed in 45 to 60 days. Approved cases that were filed electronically will be certified and returned to employers electronically. Employers then must sign the certified application and retain a copy of the signed application. The original signed application will later be filed in conjunction with an Immigrant Visa Petition (Form I-140) with U.S. Citizenship and Immigration Services (USCIS).
Conversion of pending cases to PERM:
Cases currently filed as Reduction in Recruitment (RIR) or regular supervised labor certification applications may be withdrawn and re-filed as PERM cases without a loss of the original priority date, in certain circumstances. To retain the original priority date, the newly filed PERM application must be for an identical position as the original case. An “identical” position is defined as a position for which the employer, foreign national, job title, job location, job requirements, and job description are the same as those in the original application. The new PERM case must be filed within 210 days of withdrawal of the prior application in order to maintain the original priority date. However, to re-file a case under PERM, the employer must conduct a fully PERM-compliant recruitment campaign during the six months prior to re-filing the application.
The PERM conversion provisions are less attractive than we had hoped. The fact that an employer must conduct a new recruitment campaign prior to refiling makes conversion of the cases costly. In addition, if there may now be qualified U.S. applicants for a given position or worksite, it may not be advisable to re-advertise in order to convert a case to PERM. The limits imposed by the need for “identical” applications also present a variety of problems. If the applications are not found to be “identical,” then the re-filed application will be processed under the later filing date, the original application will be deemed withdrawn, and the priority date of the original application will be lost. This could have a disastrous effect for employees needing to preserve labor certification filing dates for seventh and subsequent year H-1B extensions under AC21, or for employment-based third preference applicants from India, China, and the Philippines who are now subject to priority date quotas.
Employers will need to weigh the potential time savings under the PERM program against the added costs and potential risks of withdrawing a pending labor certification application to re-file the case under PERM. A more viable alternative for some employers may be to simply file a PERM application for an employee, without requesting withdrawal of the prior case and without indicating on the Form 9089 that the employer intends to utilize the filing date from a previously submitted labor certification case. However, this approach could be problematic if the DOL takes the position that similar labor certification applications are “duplications.” This risk could be minimized if the new application offers a different position or employment at a different worksite to the employee.
PERM recruitment requirements:
>>Mandatory recruitment for all positions:
- Two Sunday newspaper advertisements. The employer must place an advertisement on two different Sundays in the newspaper of general circulation in the area of intended employment most appropriate to the occupation and the workers likely to apply for the job opportunity. The advertisements need not be four weeks apart (as originally planned by DOL), but they must run in separate editions of the newspaper (i.e., in consecutive weeks). The advertisements must run no more than 180 and no fewer than 30 days prior to the filing of the PERM application. An employer may choose to run an advertisement in a professional journal in lieu of one of the Sunday newspaper advertisements if the position requires experience and an advanced degree, and a professional journal is a reasonable form of recruitment for the position.
The advertisements must contain enough specificity to apprise applicants of the job opportunity that is available. In contrast to the proposed regulations, the ad need not contain a full job description, minimum requirements, or the offered salary. However, the ad must include the company name and contact information. According to the DOL, “an advertisement that includes a descriptive job title, the name of the employer, and the means to contact the employer might be sufficient to apprise potentially qualified applicants of the job opportunity.” Despite this flexible language, employers may still choose to include a brief job description or job requirements in their ads, in order to minimize the number of unqualified applicant responses.
- Job order with the State Workforce Agency (SWA). The final PERM regulations require the employer to place a job order with the SWA serving the area of intended employment for a period of 30 days. Job orders are typically posted through the America’s Job Bank, or the state equivalent. The job order must begin no more than 180 days prior to the filing of the application. Unlike with the print advertisements, the job order may end within the 30-day period prior to filing the application.
- Posted notice. The employer must post the job opportunity internally at the place of employment for 10 consecutive business days, and the notice period must conclude at least 30 days prior to the filing of the application. In addition, the employer must use any in-house media, whether electronic or printed, that it normally uses for recruitment for similar positions in the organization. For example, if the company’s practice is to post internal job opportunities on its intranet for two weeks, then it should post PERM job opportunities in the same manner.
>>Additional recruitment requirements for professional positions:
A “professional” position is an occupation for which a bachelor’s degree or higher is customarily required. The DOL regulations include a list of the occupations that are considered to be professional positions for the purpose of the following additional recruitment requirements.
In addition to the two Sunday advertisements, the 30-day SWA job order, and the internal posting, employers recruiting for a professional position must perform three additional forms of recruitment from the below list of options:
- Job fairs
- Employer website
- Job search website other than the employer’s (under PERM, an internet ad generated in conjunction with a print ad will count for this purpose)
- On-campus recruiting (if the job requires a degree, but no experience)
- Trade journals or newsletters
- Contracts with private employment firms
- Employee referral programs with incentives
- Posting at a campus placement office (if the job requires a degree, but no experience)
- Local and ethnic newspapers
- Radio and television advertisements
All of the additional recruitment must take place during the 180 days prior to filing of the application. Only one of the forms of additional recruitment for professionals may take place in the 30 days prior to filing. The additional recruitment steps need not be specific to the job opportunity at issue in the labor certification, but rather may simply announce an opening in the general occupation.
The employer must prepare a signed recruitment report that describes the recruitment steps taken and the results. The report must be retained by the employer and submitted to DOL in the case of an audit. The report must describe the recruitment steps undertaken, the number of hires, and the number of U.S. workers rejected, categorized by the lawful job-related reasons for rejection.
The employer must also retain each resume received in reply to the PERM recruitment campaign for five years after filing. If an employer receives a large number of unsolicited or general applications for employment, we suggest that the PERM recruitment efforts direct applicants to note the specific job title or job code for which they are applying. In addition, employers should sort and retain resumes according to the ground used for rejection of each applicant.
Standard for “qualified” U.S.applicants:
A U.S. worker is considered to be “qualified” for the position if he or she possesses the education, experience and skills required by the employer for the position. If a U.S. worker does not possess one of the required special skills listed in the application (i.e., for example, experience with a software or hardware platform), but could acquire the skill during a “reasonable period of on the job training,” then the lack of the skill is not a lawful basis for rejecting the worker. The PERM regulations do not define how long a “reasonable period” of training might be.
Allowable requirements for a position:
The new regulations make several changes with respect to the requirements that an employer may set for a position. Under current law, a foreign national may not generally satisfy the experience requirement of a labor certification using experience gained while working for the petitioning employer in the same position for which certification is sought. The rationale for this rule is that the DOL requires employers to provide U.S. workers with the same opportunity to obtain on-the-job training as is offered to foreign national employees.
In the PERM regulations, the DOL creates a more definitive test, where experience gained by a foreign national with the petitioning employer may be used as qualifying prior experience if the experience was gained in a job that is not “substantially comparable” to the job for which certification is sought. “Substantially comparable” is defined as a job that requires performance of the same job duties for more than 50 percent of the time. This requirement can be documented by providing position descriptions for both the prior position and the current position, indicating the percentage of time spent on each job duty.
The DOL has also liberalized the definition of “employer” for the purpose of determining when prior experience was obtained while with the petitioning employer. In the past, experience obtained with one of the employer’s overseas branches or while with a company that was later acquired by the employer could often not be used by a foreign national to qualify for a position in a labor certification. Under the new PERM regulations, this experience may be considered. The new rule defines employer as “an entity with the same Federal Employer Identification Number” as the petitioning employer. If a foreign national employee gained experience with a separate corporate entity from the petitioning employer, then that experience may be used to demonstrate that the foreign national qualifies for the position at issue in the labor certification.
Alien influence and control over job opportunity
The Form ETA 9089 specifically asks the employer whether the employer is a closely held corporation, partnership, or sole proprietorship in which the foreign worker has an ownership interest. The form also asks if the foreign worker has a familial relationship with any of the owners, stockholders, partners, corporate officers, or incorporators. Presumably, a “yes” answer to these questions might trigger an audit. In the event of an audit, the employer must provide business-related documents such as articles of incorporation; lists of corporate officers, titles, positions, and relationships to the foreign worker; the financial history of the company including total investment of each owner; the name of the individual responsible for interviewing and hiring job applicants; and (for companies with 10 or fewer employees) documentation regarding the family relationship between the employees and the foreign worker.
In the Form ETA 9089, an employer must state whether there have been any layoffs of U.S. workers during the prior six months in the occupation or a related occupation, in the area of intended employment. An employer that has experienced such layoffs must document that it notified and considered potentially qualified former U.S. worker employees, and must document the lawful reasons for not hiring the laid off workers. A layoff is defined as “any involuntary separation of one or more workers without cause or prejudice,” and includes reductions in force, restructurings, and downsizings.
DOL will issue “audit letters” that will request information necessary to make a decision on a case. The audit letters will primarily be standardized computer generated documents. Some of the audit letters will be sent in randomly selected cases to ensure the integrity of the overall labor certification program. Others will be issued based upon unpublished selection criteria. The DOL has stated that these letters will be designed to request only the information needed to make a determination in the case.
Employers will be given 30 days within which to respond to an audit letter. Certifying Officers may, in their discretion, grant one 30 day extension for responses. If an employer does not provide a timely response or obtain an extension of time in which to respond, the DOL will deny the application. In addition, the DOL may, in its discretion, order that an employer be required to pursue regular supervised recruitment in future labor certification applications for up to two years. An order requiring supervised recruitment for future cases is a harsh penalty because it will add significantly to the processing time of an application. In addition, the DOL scrutinizes supervised recruitment applications closely and therefore the process of preparing such an application is more labor intensive and costly.
Certifying Officers may also order supervised recruitment in other cases where they believe that additional scrutiny is required to ensure a proper test of the labor market. No criteria have been established to limit or guide the discretion of the Certifying Officers in this area.
Schedule A I-140 filings:
Employers will continue to file Schedule A applications with the USCIS as part of the I-140 Immigrant Visa Petition process, but there are some changes in the type of notice that must be provided. The application must contain the Form ETA 9089, a prevailing wage determination from the SWA, and evidence that notice has been given to employees (or bargaining representative, if any). As with cases filed with the DOL, the posted noticed must be posted for 10 consecutive business days. In addition, the employer must use any in-house media that might normally be used for recruitment of similar positions in the company. The required notice must be provided no less than 30 days and no more than 180 days prior to filing the I-140 petition.
The PERM regulations make another important substantive change to the requirements for professional nurses seeking Schedule A certification. In the past, a nurse needed only to show that he or she had passed the CGFNS examination. Under the new regulations, nurses must present full CGFNS certification. This is an important change because obtaining full CGFNS certification requires nurses to pass an English language examination and to await a review of their educational credentials. This adds several months to the pre-filing preparation required of nurses. A nurse may also qualify for Schedule A certification by showing that he or she possesses a full and unrestricted nursing license in the state of intended employment, or that he or she has passed the NCLEX-RN examination.
Clients of McCown & Evans should contact their attorney with questions specific to their situation. We will circulate further details regarding the PERM program as additional information is provided.
© McCown & Evans LLP 2005