Articles Posted in H1B Visas

By Ekaterina Powell, Esq.

As April 2014 is approaching, we would like to remind our readers to start preparing for H-1B filing. As you may already know, there is a numerical limit on the H-1B visas allotted for each fiscal year. There are 65,000 H-1B visas available with additional 20,000 visas for those with U.S. Master’s degrees. What is important is that visas are not recaptured if H-1B is not approved, thus only 65,000 first filed H-1B petitions will be considered.

April 1 is the first day when you can file a cap-subject H-1B petition. If you do not file on April 1, you risk not getting into the cap. Even though the application is in April, the H-1B employee will not be available to start working for the employer until the beginning of the fiscal year, which is October 1, with the limited exceptions described below.

By Ekaterina Powell, Esq.

We get a lot of inquiries from entrepreneurs who want to come to the U.S. to engage in their businesses whether they can qualify for H-1B visa. Below is a summary of the current USCIS trends and practical tips in making H-1B for entrepreneurs a success.

Proving Valid Employer-Employee Relationship between Entrepreneur and Business

Over two years ago, USCIS has started its initiative to promote start-up businesses and spur job creation. Since then, USCIS has issued a number of updates describing the opportunities for entrepreneurs and explaining how they can qualify for H-1B and other visas to work in their own businesses.

Specifically, USCIS has clarified that entrepreneurs with an ownership stake in their own companies, including sole employees, may be able to obtain an H-1B visa if they can demonstrate that the company has the independent right to control their employment.

In other words, in order to qualify for H-1B in your own company, you have to show that there is an employer-employee relationship between you and your business, as indicated by the fact that the company has the authority to supervise your work, fire, and otherwise treat you as a regular employee of the company.

When USCIS updated its Questions & Answers: USCIS Issues Guidance Memorandum on Establishing the “Employee-Employer Relationship” in H-1B Petitions posted on USCIS website, it gave an example of a sole owner who could qualify for H-1B in his/her own company. USCIS states that the necessary employer-employee relationship can be established if there a separate Board of Directors which has the ability to hire, fire, pay, supervise or otherwise control the beneficiary’s employment.

USCIS has also recently created a website “Entrepreneur Pathways” dedicated to explaining the U.S. visa options for H-1B entrepreneurs. The website provides further information on the documentary evidence that can be presented to show a valid employer-employee relationship if the H-1B beneficiary has an ownership stake in the petitioning business.

Aside from showing a Board of Directors that controls your work, you can present evidence of preferred shareholders, investors or other factors establishing that the petitioning company has the right to control the terms of your employment.

As evidence of the right to control your work, you may be able to present the following:
• Term Sheet
• Capitalization Table
• Stock purchase Agreement
• Investor rights Agreement
• Voting Agreement
• Organizational documents and operating agreements/bylaws
In addition to the documents listed as examples, you may submit a combination of any other documents that sufficiently establish that there is a valid employer-employee relationship.
In our experience, we have found that it is also useful to present the documents below to show the right to control the beneficiary’s work:

• Employment Agreement between the petitioner and beneficiary or Employment Offer Letter detailing the terms and conditions of employment and explaining how the employer will exercise its right to control the beneficiary, how often the beneficiary will have to report on the progress of work and to whom, how the beneficiary will be supervised throughout H-1B employment, the extent of the employer’s discretion over when and how long the beneficiary will work, the method of payment, the employer’s role in paying and hiring assistants to be utilized by the beneficiary, the provision of employee benefits, and other relevant considerations;
• A description of the performance review process along with progress and performance evaluations;
• Letters from the directors/investors/preferred shareholders explaining how the right to control the work of the beneficiary will be exercised on a day-to-day basis, who will supervise the beneficiary and evaluate the work product of the beneficiary, and explaining the management structure of the company;
• Copy of petitioner’s organizational chart, demonstrating beneficiary’s supervisory chain;
• Other relevant documents.

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Recently, US Consulates are reportedly increasing their scrutiny of H-1B visa applications with respect to the wage rates paid to H-1B workers. Before a H-1B worker may apply for a H-1B visa, his or her US employer obtain a certified labour condition application (LCA) from the Department of Labor before filing a petition with USCIS. The certified LCA lists the wage rate that the employer promises to pay the H-1B worker in the United States. This wage rate is based on the wage level selected by the US employer on the LCA, and is based on the complexity of the job duties and the amount of education and experience that is required to perform those duties. The Department of Labor issued guidance in 2009 that defines each of the four wage levels that US employers may select.

The four wage levels are based on the level of experience the H-1B worker has and the complexities of the job duties for the H-1B worker. For instance, the first level is the “entry” level position concerns those employees who perform routine tasks that require limited, if any, exercise of judgement. The tasks provide experience and familiarity with the employer’s methods, practices and programs. These employees may perform higher-level work for training and development purposes. These employees work under close supervision and receive specific instructions on required tasks and expected results. Their work is closely monitored and reviewed for accuracy.

On the other end of the wage level spectrum is the Level 4 (Fully Competent) H-1B worker. These workers are for competent employees who have sufficient experience in the occupation to plan and conduct work requiring judgement and the independent evaluation, selection, modification and application of standard procedures and techniques. Such employees use advanced skills and diversified knowledge to solve unusual and complex problems. These employees receive only technical guidance and their work is reviewed only for application of sound judgement and effectiveness in meeting the establishment’s procedures and expectations. They generally have management and/or supervisory responsibilities.