Administration Welcomes Foreign Entrepreneurs with Proposed Rule

The Department of Homeland Security has closed out the summer with an encouraging proposal designed to allow certain founders of start-up companies from abroad to come to the U.S. for an initial stay of up to two years to build their business here. In a move recognizing the entrepreneurial spirit embodied by the many foreign individuals who have contributed to making the United States a beacon of innovation and creative ambition, the service released an advance copy of the proposed “International Entrepreneur Rule.” The drafters of the proposal lay out the intended benefits in their introduction: “to increase and enhance entrepreneurship, innovation, and job creation in the United States. The proposed rule would add new regulatory provisions guiding the use of parole on a case-by-case basis with respect to entrepreneurs of start-up entities whose entry into the United States would provide a significant public benefit through the substantial and demonstrated potential for rapid business growth and job creation.”

Under the current framework, foreigners wanting to build businesses in the United States must navigate a complex set of visa categories, each of which contains significant limitations. For example, B-1 business visitor status allows foreign businesspeople to enter the country for a much shorter timeframe (typically six months, extendable), and restricts them to non-employment activities; the E-2 investor visa category is only available to individuals holding select nationalities where a bi-lateral treaty exists with the U.S.; and the EB5 “green card investor” visa category requires the foreign individual to put from $500,000-$1,000,000 at risk to qualify. If implemented, the proposed “International Entrepreneur Rule” would provide two years (extendable to five years) of stay in the U.S. to establish and grow a business with a much lower financial commitment ($345,000 capital requirement, which may include investment from qualified U.S. persons or government grants of at least $100,000, or some combination thereof). Under the rule, international entrepreneurs must maintain an active role in the business and at least 15 percent ownership of the enterprise, two requirements that should not present an issue for most new company founders.

While the public must await publication of the proposal in the Federal Register to submit comments within the 45-day comment window, immigration and business advocates can together celebrate the agency’s attention to this fundamental component of maintaining America’s competitive advantage, today and into the future.

Jackson Lewis will continue to monitor developments of this exciting new initiative.


L-1 Visa Applicants on Blanket L Petition Must Use of New Form I-129S starting August 29, 2016

The Department of State reportedly has confirmed that starting August 29, 2016, U.S. consular posts (i.e., embassies, consulates general, and other U.S. missions abroad) will accept only USCIS’s new, June 2, 2016, version of Form I-129S from L-1 nonimmigrant intracompany transferees. This is in line with USCIS’s prior announcement, at “Starting 08/29/2016, USCIS will only accept the 06/02/16 edition. Until then, you can use the 06/12/13 edition.”

This means that all employers who have employees or prospective transferring employees making applications abroad for blanket-based L-1 visas must ensure that such applicants appearing at the relevant consular post on or after August 29th present the June 2, 2016, edition of Form I-129S with their petition or application package. As usual, the form is presented in triplicate. Any applicant appearing before August 29th can continue to use the June 12, 2013, edition.

This change affects only blanket-based L-1 applications. Workers applying for visas based on an approved individual L-1 petition do not use Form I-129S and are not subject to this requirement.

Please contact your immigration counsel at Jackson Lewis with any questions.



5th Circuit Throws Out I-9 Fines Against Employer for Alleged Section 2 Attestation Deficiencies

Vacating a $226,000 fine against Employer Solutions Staffing Group for alleged Form I-9 violations, the Fifth Circuit Court of Appeals has ruled that it was not a violation for employer to have one of its agents inspect original employee documents in Texas and have another person in Minnesota complete the employer attestation in Section 2 after reviewing photocopies of the documents sent by the Texas person reviewing the forms. Employer Solutions Staffing Group v. OCAHO, No. 15-60173 (5th Cir.  Aug. 11, 2016).

In February 2013, ICE alleged that ESSG failed to ensure that 242 employees completed properly Section 1, or failed to complete properly Section 2 or 3 of the I-9 Form, thereby committing substantive paperwork violations. Further, ICE claimed ESSG violated the Immigration and Nationality Act and ordered ESSG to pay fines totaling $237,162.75. An administrative law judge ruled for ICE in a Summary Decision, finding ESSG failed to complete properly Section 2 of the I-9 Form for 242 employees. The ALJ fined ESSG $226,270 for these violations. The employer appealed.

The Court said the INA provides for attestation by a “person or entity” and is unclear whether the person who reviews the documents and completes the attestation has to be the same person. Therefore, it was reasonable to interpret the attestation as valid as long as the same “entity” both reviews the documents and completes the attestation. Likewise, neither the relevant regulations nor the Form I-9 provided that the same individual who inspected the employee documents must complete the employer attestation. Therefore, the Court found that it was not a violation for ESSG to complete its Forms I-9 in the manner that it did and vacated the ALJ’s order.

This decision is unlikely to change the best practice and advice that the person reviewing the original documents should be the same person that signs the attestation. Indeed, after fining ESSG, but before the Court made its decision, ICE changed the I-9 instructions to make clear that the same person who examines the document must be the same person that signs the form.

Employers facing fines for the same issue as ESSG, and where the Forms I-9 were completed prior to 2013, should determine with the assistance of counsel whether the Fifth Circuit decision affects their situation.

Department of Justice, California Employer Reach Non-Prosecution Agreement over Potential Criminal Violations of Immigration Laws

Gridley, California-based natural food company Mary’s Gone Crackers Inc. agreed and consented to payment of $1.5 million and establishment of a corporate compliance program under a non-prosecution agreement reached with the U.S. Attorney’s Office for the Eastern District of California on July 19, 2016. The agreement requires the company to establish a corporate compliance program covering its I-9 procedures and its E-verify system, in addition to requiring complete disclosure of immigration violations within 24 hours of discovery. The company also agreed to provide corporate compliance reporting to the U.S. Attorney’s Office for two years. In exchange for compliance, no federal charges will be brought against the company. However, if the company fails to perform or to fulfill completely each of its obligations under the agreement, regardless of whether the U.S. Attorney’s Office becomes aware of the breach after the Term of Agreement is complete, the company will be subject to prosecution for any federal criminal violation of which the U.S. Attorney’s Office has knowledge.

The alleged violations date back to March 2012, when U.S. Immigration and Customs Enforcement (ICE) audited the company’s I-9 immigration forms for its employees and notified the company that 49 of its employees did not appear to have valid U.S. work authorization.

Mary’s Gone Crackers Inc. subsequently informed ICE that 48 of the employees had resigned or had been terminated and that one employee had provided corrected documents. Within weeks, however, the company rehired, under new names, at least 13 of the employees who were terminated or resigned. One such undocumented employee never actually stopped working for the company at all, but continued to work under an assumed name and received payment as an independent contractor – thereby avoiding being listed on the company’s payroll.

In January 2013, federal law enforcement (Homeland Security Investigations) executed a search warrant at the company’s Gridley facility and discovered that at least 12 of the 13 rehired individuals were still working at Mary’s Gone Crackers Inc. Following the January 2013 search warrant the company cooperated with the Department of Justice’s investigation and took remedial measures that included terminating employees, stopping use of outside counsel involved in the alleged violations, and taking steps to ensure compliance with immigration laws and I-9 regulations.




DOL Judge Says Flagging Economy Insufficient Basis to Relieve H-1B Employers of Wage Obligations

Employers employing foreign nationals in H-1B nonimmigrant visa status must pay their H-1B employees the wage specified on the Labor Condition Application (LCA) certified by DOL, regardless of whether the H-1B employer is enduring difficult economic or financial periods due to struggling national economy, an Administrative Law Judge for the Department of Labor has ruled in Department of Labor Wage and Hour Division v. Shriiji Krupa Inc.

This ruling reminds H-1B employers that they must adhere to the attestations made in the LCA governing the employment of their H-1B employees, even in the face of claimed business hardship.

An H-1B employer must pay an employee the greater of the actual or prevailing wage specified in the certified LCA (see 20 C.F.R. § 655.731). If the actual wage is the same as the prevailing wage, then the employer must pay that wage to the employee during the term of the approved employment, even during periods of nonproductive time due to lack of available or assigned work. An employer is relieved from fulfilling its wage obligation only where an H-1B employee has voluntarily requested or decided to minimize or leave employment or where an employer has effectuated a bona fide termination of the employee (see 20 C.F.R. § 655.731(c)(7)(ii)).

In Shrijii Krupa, the Administrator for the DOL’s Wage and Hour Division alleged that the employer, which operates two gas station convenience stores in Florida, failed to pay three of its H-1B employees wages totaling nearly $230,000 in violation of its obligations under the applicable LCAs. WHD alleged the employees were essentially paid on a part-time basis, at a lower wage than specified on the LCA, in which the employer attested it would pay these full-time employees the prevailing wage for their positions. The employer argued the effects of the national recession of 2008 made it impossible to meet the wage obligations under the LCA.

Siding with WHD, the ALJ rejected the employer’s “flagging economy” defense as legally insufficient to justify relief of its obligation to pay the required wage under the LCA. The ALJ emphasized that the employer’s non-payment of the required wage was not due to any voluntary action or request of the H-1B employees. The ALJ further noted the employer’s delayed submittal of a new LCA to reflect part-time employment did not relieve it of its obligation to pay full-time wages under the LCA applicable to the H-1B employees’ employment prior to submittal of the new LCA. Accordingly, the ALJ found that the employer must pay the nearly $230,000 in back wages to its H-1B employees.

This case is a stark reminder to H-1B employers that they must comply with wage obligations under the certified LCA unless the employee voluntarily reduces work, there is a bona fide termination of employment, or a new LCA becomes effective. Absent one of those circumstances, the employer must pay wages as attested in the controlling LCA.

State Department May Revoke Visa for DUI Arrest without Determination of Guilt

Individuals who hold nonimmigrant visas in the U.S. are likely to face severe consequences if arrested for Driving Under the Influence (DUI) or a related offense, based on the recently released guidance from the U.S. Department of State (DOS).

Earlier this year, DOS made public all unclassified content in Volume 9 of its Foreign Affairs Manual (FAM), the policy manual for DOS and its officers. The recently revealed 9 FAM provides that DOS “has the authority to prudentially revoke a visa on the basis of a potential [health-related ground of] ineligibility” when DOS receives notification of “an arrest or conviction of driving under the influence, driving while intoxicated, or similar arrests/convictions (DUI) that occurred within the previous five years.”

The new “prudential revocation” policy arises out of the agency’s increased concerns about drunk driving and DUI-related offenses and reflects a much more aggressive approach to addressing those concerns than was true in the past. DOS can prudentially revoke an otherwise valid nonimmigrant visa immediately upon notification of the DUI arrest, even while the individual is in the United States, based on the suspicion that the individual is ineligible for a visa on physical or mental health-related grounds. Prior this new guidance, DOS required a visa applicant to submit only a physician’s report related to a previous DUI conviction before receiving a newly issued visa when the individual is outside the U.S. at a consular post. The new guidance applies only in cases involving a DUI arrest. Unlike other grounds for inadmissibility or ineligibility for a visa, a determination of guilt is not required. — It is enough for the individual to be arrested for a DUI-related offense, of which DOS is notified directly by local law enforcement.

Although visa revocation can be a ground for court-ordered removal from the U.S., DOS has stated that a prudential revocation based on a DUI arrest does not require the individual to leave the United States. However, DOS reportedly has issued notices to individuals arrested for DUI-related offenses requiring them to depart the U.S. immediately and report to their consular post overseas.

This new visa revocation guidance obviously presents significant concerns for nonimmigrant visa holders and their families and employers. Individuals who may be affected by this new policy should consult an attorney. Jackson Lewis will continue to monitor this new policy, how it is being enforced, and the potential consequences to our clients.

Author: Christopher Preston





Key Updates Provided by Government Agencies at National Law Conference

In late June, the American Immigration Lawyers Association (AILA) held its annual immigration law conference in Las Vegas, Nevada. The conference featured a series of open forums where representatives from a number of government agencies met with immigration attorneys to discuss key updates and address specific questions about immigration adjudications, trends and policy.

Below is a summary of points that may be of particular interest to our employer clients and their ongoing efforts to employ foreign nationals in the United States:

  • U.S. Citizenship and Immigration Services (USCIS): USCIS reported capacity issues which have resulted in slower processing times for immigration benefits, particularly for H-1B petitions. USCIS is prioritizing cases filed under this year’s H-1B Cap where beneficiaries are receiving “cap gap” status and work authorization extensions through September 30, 2016. H-1B extensions in particular are taking approximately 8+ months to adjudicate, so employers and employees should plan accordingly. Employers should contact their Jackson Lewis attorney to discuss alternative strategies, such as premium processing, as necessary.
  • U.S. Department of Labor (US DOL): The US DOL Office of Foreign Labor Certification reported that its overall workload is increasing, and noted a particular increase in PERM labor certification filings. At present, it is taking DOL approximately 4-5 months to adjudicate PERM applications. The agency recently reorganized to address the increased workload, but employers should expect PERM processing times to slow over the coming months. Prevailing wage determinations are expected to continue to take approximately 10 weeks. Additionally, the DOL reminded attendees that new prevailing wage information would be published on July 1, 2016, so employers should anticipate that any determinations issued after this date will contain the new wage data.
  • U.S. Department of State (US DOS): The US DOS reported extensive wait times for nonimmigrant visa appointments at consular posts in India. The DOS is working to resolve the backlog, but at present, some posts are experiencing wait times of more than 100 days. Obtaining an expedited visa appointment for an urgent business matter is rare. Employers filing nonimmigrant visa petitions with USCIS requesting consular notification or those seeking to transfer employees from abroad pursuant to the Blanket L process should therefore plan for delays, as should employees currently in the United States who need to apply for a visa the next time they travel to India.

Employers Risk Higher Penalties for Hiring Unauthorized Workers

The U.S. Department of Justice is increasing civil monetary penalties substantially for employers who knowingly employ an unauthorized worker and for certain other immigration-related violations, according to an interim final rule the Department has published. The rule will take effect on August 1, 2016, and will apply to violations occurring after November 2, 2016. The increases come in response to the Bipartisan Budget Act of 2015, which requires agencies to adjust penalties for inflation.

Under the Immigration Reform and Control Act of 1986 (IRCA), it is unlawful for an employer to hire or continue to employ a person knowing that the person is not authorized to work in the United States. IRCA requires employers to verify employment eligibility of all employees by completing a Form I-9, and failure to comply with these rules subjects employers to substantial civil monetary penalties.

Under the interim final rule, the minimum penalty for a first offense of knowingly employing an unauthorized worker will increase from $375 to $539 per worker, and the maximum penalty will increase from $3,200 to $4,313 per worker. The largest increase raises the maximum civil penalty for multiple violations from $16,000 to $21,563 per worker. Paperwork violations can now be assessed a maximum penalty of $2,156 per relevant individual, up from $1,100. Finally, for unfair immigration-related employment practices, the maximum penalty increases from $3,200 to $3,563 per person discriminated against.

Author: By Matthew J. Martinez


Supreme Court Agrees to Hear Birthright Citizenship Case

The U.S. Supreme Court has agreed to decide whether a man born outside the U.S., out of wedlock, to a U.S. citizen father and a noncitizen mother could benefit from birthright citizenship. A decision in this case can mean protection from deportation for many. Lynch v. Morales-Santana, 804 F.3d 520 (2d Cir. 2015), cert. granted (U.S. June 28, 2016) (No. 15-1191).

Birthright citizenship laws have changed throughout the years, and when deciding whether someone is entitled to citizenship by birth, one must review the laws in place at the time of his birth. Luis Ramon Morales-Santana was born outside the U.S. to unwed parents – his mother was a noncitizen and his father was a U.S. citizen. At that time, the laws in place prohibited the transmission of citizenship to Morales-Santana by his U.S. citizen father.

The U.S. Court of Appeals for the Second Circuit, in New York, granted Morales-Santana citizenship, ruling that fathers should have the same benefits as mothers under the statute. The Court held that the citizenship rule applied “archaic and overbroad stereotypes” to parenting roles for children born to unwed parents and violated equal protection rights. The U.S. Department of Justice asked the Supreme Court to reverse this opinion, arguing that a court cannot create new citizenship rules and regulations.

Citizenship laws can be very confusing. Under current citizenship laws for children born out of wedlock to a U.S. citizen father and a noncitizen mother, the child benefits from birthright citizenship if the father is physically present in the U.S. five years prior to the child’s birth, two of which are after the age of 14 (military service counts). The child can also benefit from birthright citizenship if a blood relationship is established, the father agrees to support the child until he or she is 18, and, while the child is under 18, one of three factors is met: (1) the child is legitimated; (2) the father acknowledges paternity; or (3) paternity is established by court adjudication.

The Supreme Court reviewed a similar case several years ago, when the U.S. Court of Appeals for the Ninth Circuit, in San Francisco, upheld the citizenship transmission rules. At that time, Justice Elena Kagan had to recuse herself, and the decision was 4 – 4.

Jackson Lewis will report on the Supreme Court’s decision, expected by June 2017. If the Court upholds the Second Circuit decision, ruling in favor of equal protection for fathers, it could result in citizenship rights for thousands of individuals born abroad to U.S. citizen fathers and may provide remedies to individuals currently facing deportation.

Supreme Court Tie Blocks Expansion of DACA and Creation of DAPA

Disappointing many, the U.S. Supreme Court has tied 4-4 in a case appealing a nationwide injunction on the Obama Administration’s executive action expanding the Deferred Action for Childhood Arrivals (DACA) and creating the Deferred Action for Parents of Americans and Lawful Permanent Residents (DAPA) programs. United States v. Texas, No. 15-674 (June 23, 2016).  The split leaves the district court injunction in place pending further action in the suit.

The eagerly anticipated decision will have a far-reaching and adverse impact on millions of undocumented immigrants. The Supreme Court deadlock means the appeals court ruling stands and continues to block programs. As a result, up to five million undocumented immigrants may not be allowed legal work authorization in the United States or be protected from deportation.

The Obama Administration utilized executive action to create DACA in 2012. Under DACA, certain undocumented immigrants who arrived as minors were able to defer deportation and receive employment authorization. The Administration expanded DACA and introduced DAPA in 2014 with further executive action. The DACA expansion would have increased the period of employment authorization for DACA beneficiaries to three years, instead of two. DAPA would have allowed parents of U.S. citizens or lawful permanent residents (green card holders) to apply for deferred deportation and employment authorization.

In February 2015, Judge Andrew S. Hanen of the U.S. District Court for the Southern District of Texas entered a preliminary injunction, blocking the 2014 DACA expansion and DAPA creation. The U.S. Circuit Court of Appeals for the Fifth Circuit, in New Orleans, affirmed the lower court’s injunction. The Obama Administration appealed the decision to the U.S. Supreme Court.

The U.S. Supreme Court’s decision strongly indicates, at least for the immediate future, that further executive action on immigration on a widespread basis may be difficult and that immigration reform will have to be addressed by Congress, if at all, a view shared by many opponents of the President’s actions. It also suggests strongly that immigration will continue to be a contentious issue in the upcoming Presidential and Congressional elections.

For more information, see Supreme Court’s Decision on Future of DACA and DAPA.