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H-1B VISA CAP WILL SOON BE REACHED
Last year, Congress temporarily raised the limit on the cap of H-1B workers allowed into the country. 115,000 workers will be permitted to get new H-1B visas this year, up from the normal cap of 65,000 visas. The demand has been particularly high for H-1B workers because of the extremely strong state of the US economy as well as massive efforts to thwart problems with the Y2K bug. Most thought the substantial increase in visas would be enough to meet demand. But information Siskind, Susser, Haas & Devine has received not only demonstrates that 115,000 visas is not enough to meet demand, but that the visa cap will be hit even earlier this year and that it is highly likely that cases filed at this point will not be approvable until the 2000 fiscal year that begins October 1, 1999. 
Sources tell us that as of a few weeks ago, the INS had approved 80,963 H-1B cases, but that there were more than 50,000 cases still awaiting adjudication. Only 34,000 visas remain available, so of the cases already filed, many will not be approved for this fiscal year. The INS is expected to soon make an announcement on this matter and we have not been able to receive official confirmation yet.

One point that is surely to be contentious in the next several days and weeks is how the INS will decide which cases get to be approved this year and which ones will not. The Vermont and Nebraska Service Centers both process cases considerably faster than the service centers in Texas and California. Our sources tell us that the INS is considering a plan to give preference to cases filed in Texas and California rather than relying on a system where cases are counted against the cap in the order approved (which would presumably favor applications filed in Vermont and Nebraska).

Because the INS has yet to announce the cap has been reached, it still may be advantageous to file applications in order to have them pending for approval at the beginning of the 2000 fiscal year in October. Many believe that the 2000 cap could be reached in the first few months of the coming fiscal year. Also, if last year is an indicator, the INS will treat people with cases pending before the cap is reached more favorably than people who filed afterwards. For example, last year F-1 students who filed before the cap was reached were able to remain legally (though not authorized to work) in the US between the expiration of their practical training cards and the October 1st start dates of their new H-1B visas. Those that filed later found themselves having to leave the country in order to remain legal.
At this point, it is far from clear how the INS will deal with the cap being reached earlier. The cap has been hit early in each of the last three years and each year the INS has had a different policy. Our sources indicate that the INS still has not yet issued a clear policy and we should expect to see more changes. Many are already criticizing the agency for poor handling of this issue for the fourth year in a row. Some of the complaints focus on the counting of H-1B visa usage. The INS currently receives batch reports, not real time reports, from the INS Service Centers on H-1B usage and never really has an up-to-the-minute picture on what is really happening. Also, the INS has been sending out an extremely large number of Requests for Evidence in cases filed by Indians, the nation that has the highest number of H-1B visa holders. The RFEs tend to focus on applications filed by people in the Chennai area of India. This may partly explain why California Service Center processing times for H-1B cases are very high (160 to 175 days at last count) and why the backlog in H-1B cases is so high. Also, the breakdown of LCA processing at the Department of Labor regional office in California has contributed as well since a large number of cases have been filed that cannot be approved until the LCA is submitted. 
However, even though we do not know for sure how the cap will be handled this year, it is still useful to discuss how the INS interpreted the cap last year since much of that interpretation may remain unchanged. First, who is subject to the cap? According to the INS, the cap applies to new or initial employment. It does not affect cases of sequential H-1B employment (changing from one H-1B employer to another), concurrent H-1B employment (having two H-1B jobs at the same time), extensions of H-1B employment and amended H-1B petitions. With respect to sequential employment, the INS last year had a 30 day policy to determine if the employment was really sequential. If there is a break of more than 30 days between when employment ends with one employer and a new application is put in for H-1B status, then the new petition will be considered subject to the cap.
How will H-1B applications subject to the cap be processed. For cases filed before the cap was reached last year, the INS instituted the policy of contacting the attorney or petitioner to advise them the cap was reached and give them the option of withdrawing the petition or asking for an October 1st or later start date. For cases filed after the cap was hit, applications were returned and applicants were advised to wait to refile after new numbers were available or to refile with an October 1st or later start date.
One thing is becoming increasingly clear. There is no will in Congress to raise the cap even higher this year. Any work on this issue in Congress will probably have to affect next year’s cap. However, based on the current pace of applications, it is certainly possible the cap could be hit again within the first few months of Fiscal Year 2000 and without a legislative fix or a serious downturn in the US economy, a crisis even larger will happen next year.