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The U.S.’s “Greatest” Utility Business Visa, Typically Oversubscribed and the Subject of Scarcity, Remains Available

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Ryan E. Lamb & Samuel J. Frederick
Foster Swift Employment, Labor & Benefits Quarterly
Fall 2010

For employers interested in hiring a foreign worker for a "specialty occupation" (typically, a job that requires at least a Bachelor’s degree or its functional equivalent), an H-1B Employment Visa is an option with a number of very attractive features: (i) duration – H-1B’s are issued for an initial term of 3 years, with the option of a 3 year extension; (ii) dual intent – the visa holder can have a temporary intent or a permanent intent to reside in the U.S.; this allows the visa holder to pursue permanent residency, if desired, without leaving the U.S. and without violating his or her temporary visa status; (iii) change of status – an H-1B can often be obtained in the U.S. without traveling to a foreign consulate to acquire the new visa and seek re-entry to the U.S.; and (iv) portability – in the event of a change in employment, an H-1B can be transferred to a different employer.

In recent years, a major hurdle has negatively affected the H-1B’s effectiveness – the need to win the "lottery" in order to obtain a visa.

As with many U.S. Visas, H-1Bs are subject to a quota system for availability. Currently, only 65,000 "regular" or "cap subject" H-1B Visas are available annually. There are also modified-cap or cap-exempt categories limited to certain applicants. H-1B Visas subject to the cap have starting dates at the beginning of the "fiscal year," that runs from October 1 to September 30 each year. This means that one could not apply for an H-1B for fiscal year 2011 (Oct. 1, 2010 – Sep. 30, 2011) until April 1, 2010, with an employment starting date of October 1, 2010.

Until 2009, recent filing years had experienced more than 120,000 applications for H-1B Visas filed on the first day of filing availability (April 1 each year – although the "April Fool’s Day" irony did not become apparent until the exhaustion of the cap became routine). All applications filed on April 1 (when the cap is met on the 1st day of filing) were literally placed in a random lottery drawing for the 65,000 visas available. Thus, filing an application for an H-1B Visa on April 1 (no sooner, no later) provided applicants with a roughly 50% chance of pursuing a visa. Losers of the lottery were out of luck and out their filing fees.

Recently, however, with the slowed economy, the cap has not been reached as quickly as in the past. Last year, the cap was not reached until December 21, 2009. Currently, as of the last cap count dated July 16, 2010, 39,700 visas remain available. However, this can change quickly, depending upon national hiring and filing activity.

For years dynamic and growing companies have been frustrated by the cap’s impact on their ability to hire the best and the brightest talents to meet their needs. As economic activity ramps up, you may wish to apply for a Visa before they run out.