On November 30th, the INS published an interim rule implementing, inter alia, the recently passed H1B bill's provision mandating the imposition of a $500 fee for most H1B petitions (see 63 FR 65657 et seq., November 30, 1998). Attorneys may want to note an interesting and little noticed point in a part of the INS's comments in the Federal Register. This may help attorneys in some cases from sending in an un-necessary $500 fee.

The rule adds, inter alia, 8 CFR 214.2(h)(19), which reads, in part, as follows:

"(19) Additional fee for filing certain H-1B petitions - (i) A United States employer ... who files a Form I-129, or or after December 1, 1998, and before October 1, 2001, must include the additional fee ... if the petition if filed for any of the following purposes:

(A) An initial grant of H-1B status ...;

(B) An initial extension of stay ...; or

(C) Authorization for a change in employment, as provided in paragraph

(h)(2)(i)(D) of this section..."

In the supplementary information to this interim rule, the INS answers the question: "Who Is Required to Pay This Fee?" as follows: "The new $500 filing fee must be paid by United States employers when they file H-1B petitions on or after December 1, 1998, and before October 1, 2001, for any of the following purposes:

(1) an initial grant of H-1B status under section 101(a)(15)(H)(i)(b) of the INA;

(2) an extension of stay for individuals currently in H-1B status; or

(3) authorization for a change in employment for individuals currently in H-1B status.

All United States employers seeking authorization for a change in employment (e.g., a change from one specialty occupation to another specialty occupation) for an H-1B nonimmigrant must pay the additional $500 fee..."

What's wrong with this? A surprising amount. The INS is confusing employMENT and employERS. These are two totally distinct words in the statute, and in the regs (and ofcourse, in common sense). Let us analyze the issue and study its impact on when the new $500 should *not* be paid.

The new section 8 CFR 214.2(h)(19)(C) refers to a change in employMENT as provided in 8 CFR 214.2(h)(2)(i)(D). However, 8 CFR 214.2(h)(2)(i)(D) reads as follows: "(D) Change of employers. If the alien is in the United States and seeks to change employers, the prospective new employer must file a petition on Form I-129 requesting classification and extension of the alien's stay in the United States. If the new petition is approved, the extension of stay may be granted for the validity of the approved petition. The validity of the petition and the alien's extension of stay shall conform to the limits on the alien's temporary stay that are prescribed in paragraph (h)(13) of this section. The alien is not authorized to begin the employment with the new petitioner until the petition is approved. An H-1A nonimmigrant alien may not change employers."

In other words, 8 CFR 214.2(h)(2)(i)(D) refers to employERS, and *not* employMENT. Thus, the new 8 CFR 214.2(h)(19)(C) is to be read as referring *only* to a change in employERS.

Indeed the statute bears out this interpretation. The new H1B bill provides (Section 414(a)) that: " ... The Attorney General shall impose a fee on an employer ... filing ... a petition ... (i) initially to grant an alien nonimmigrant status ... (ii) to extend the stay of an alien having such a status (unless the employer previously has obtained an extension for such alien); or (iii) to obtain authorization for an alien having such status to change employers..." The statute is clear - it refers solely to employERS, not to employMENT.

Thus both the actual text of the new interim rule (read with its reference to 8 CFR 214.2(h)(2)(i)(D)), and the actual text of the statute both say that a fee is required only when the alien changes employERS, not when the alien changes employMENT.

This stands in marked contrast to the INS example in the supplementary information accompanying the rule that a change in employment where the new fee must be paid occurs when the alien changes "from one specialty occupation to another specialty occupation". When such change in occupation occurs with the same employer, and where an initial extension of stay in not sought, a $500 fee NEED NOT be paid to the INS. In practice, such a situation would most often arise when the alien is promoted, or otherwise moved within the same company's organization, and an amended H1B petition is filed.

Attorneys may thus want to avoid the mistake of sending in an unnecessary $500 fee on the basis of the mistaken example in the supplementary information provided by the INS. Since the regulation is open for comment until January 29, 1998, attorneys may want to send in this point as a comment for the INS to correct when it issues the final rule.