On October 1, 2003, the allotment of H-1B visas provided annually by Congress dropped from 195,000 to 65,000. Out of that number, 6,800 are reserved for the H-1B1 program for nationals of Chile and Singapore. Numbers not used of that 6,800 (which will likely be several thousand) will be made available in the 45 day period beginning October 1^st.

On August 12, 2005, USCIS announced that it had received enough applications to meet the 2006 cap (which covers the fiscal year running from October 1, 2005 to September 30, 2006. The new cap will begin on October 1, 2006, and until then it will be impossible to obtain new H-1B visas for cap subject employees except for visas leftover from the H-1B1 program. USCIS will describe the process for distributing any reallocated numbers in a future announcement.

Who is actually subject to the cap?

Not every H-1B applicant is subject to the general cap. Visas will still be available for applicants filing for amendments, extensions, and transfers unless they are transferring from an exempt employer or exempt position and were not counted towards the cap previously.

The cap also does not apply to applicants filing H-1B visas through institutions of higher education, nonprofit research organizations, and government research organizations. Note that the statute states that applicants who work AT such institutions are covered so individuals employed by entities other than these institutions but who provide services at the qualifying institution should be cap exempt. An example would be a physician employed by a medical group who serves patients at an exempt university hospital.

Physicians receiving waivers of J-1 home residency requirements as a result of agreeing to serve in underserved communities are exempt. Also, graduates of US masters and doctoral degree programs draw numbers from a “bonus” allotment of 20,000 visas. As noted above, nationals of Singapore and Chile draw from a separate cap of 6,800 (5,400 for Singapore and 1,400 for Chile).

When was the last time the H-1B cap was hit?

The H-1B cap was last hit on October 1, 2004 for the 2005 fiscal year.

What will happen to petitions that were not filed in time?

All applications received on August 9, 2005 or earlier will be processed. For applications received on August 10, 2005, USCIS will apply a computer-generated random selection process. According to USCIS, the process will randomly select the exact number of petitions from the day’s receipts needed to meet the cap.

Aside from the randomly selected cases received on August 10^th, all cases filed on that date or later that are subject to the H-1B cap will be returned. Returned petitions will be accompanied by the filing fee.

Can an applicant re-submit an H-1B application?

Petitioners may re-submit their petitions when H-1B visas become available for FY 2007. The earliest date a petitioner may file a petition requesting FY 2007 H-1B employment with an employment start date of October 1, 2006 would be April 1, 2006.

What will happen to the petitions that do not count against the cap?

Petitions for current H-1B workers normally do not count towards the congressionally mandated H-1B cap. USCIS will continue to process petitions filed to:

• Extend the amount of time a current H-1B worker may remain in the United States
• Change the terms of employment for current H-1B workers
• Allow current H-1B workers to change employers (unless the beneficiary is transferring from a cap exempt employer to a cap subject employer and was never counted towards the cap- in that case the beneficiary will be subject to the cap)
• Allow current H-1B workers to work concurrently in a second H-1B position

USCIS will also continue to process petitions for new H-1B employment filed by applicants who will be employed at an institution of higher education or a related or affiliated nonprofit entity, or at a nonprofit research organization or a governmental research organization. USCIS will also continue to process H-1B petitions for workers from Singapore and Chile consistent with Public Laws 108-77 and 108-78. And doctors working in underserved communities as a result of receiving a J-1 home residency requirement waiver sponsored by a state or federal agency will also be exempt from the annual cap. Nationals of Singapore and Chile and graduates of US masters and doctoral programs will be counted against caps specifically set aside for those groups.

What will happen to F and J visa holders who are beneficiaries of an H-1B petition?

In the past, INS (now USCIS) had safeguards in place for those with F and J visa status. According to 8 CFR Section 214.2 (f)(5)(vi), if it can be determined that all of the H-1B visas will be used before the end of the current fiscal year, the director of USCIS can extend the duration of status of any F-1 student if the employer has timely filed an application for change of status to H-1B. However, this past year USCIS chose not to exercise this discretion and no word has been given on whether they will or will not do so this year.

8 CFR Section 214.2(j)(1)(vi) has similar language regarding those in J status. If the USCIS director can determine that all of the H-1B visas will be used before the end of the current fiscal year, the director of USCIS may extend the duration of status of any J-1 nonimmigrant if the employer has timely filed an application for change of status to H-1B. USCIS also declined this past year to exercise this discretion. There is no word yet on plans for this year.

When will the numbers in the new 20,000 “bonus” cap be filled?

According to USCIS, as of August 12, 2005, for fiscal years 2005 and 2005, USCIS has received approximately 10,000 and 8,000 of such petitions, respectively. Given the pace of usage, these visas should remain available for several more months. To qualify in this bonus cap, applicants must have earned a US master’s or higher degree. Graduates of medical residency and fellowship programs do not qualify in this category.

What will happen if I am not exempt from the cap and my current status expires after the numbers run out?

In order to deal with the lack of H-1B visas, a number of alternate categories may be available including O-1 visas, TN visas for Canadians and Mexicans, E-1 and E-2 visas, L-1s and J-1 training programs. Many will look at pursuing graduate education in the US and then will be eligible for the bonus H-1B quota.

An option available to many this year will be filing for permanent residency. There are many work-related green card applications that can be filed without a labor certification. And the new PERM labor certification program means that employment authorization can be obtained much earlier. Now that concurrent filing of I-140 and adjustment of status applications area available, it may be possible to secure an employment authorization document in a matter of a couple of months after the green card process is started.

We advise people subject to the cap looking for alternative strategies to consult early with their immigration lawyers.