# Retention of EB-1, EB-2, and EB-3 Immigrant Workers and Program Improvements Affecting High-Skilled Nonimmigrant Workers > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/fr%3A2016-27540 ## Record - **Collection:** Federal Register - **Document type:** Rule - **Published:** November 18, 2016 - **Citation:** 81 FR 82398 ## Text DEPARTMENT OF HOMELAND SECURITY 8 CFR Parts 204, 205, 214, 245 and 274a [CIS No. 2571-15; DHS Docket No. USCIS-2015-0008] RIN 1615-AC05 Retention of EB-1, EB-2, and EB-3 Immigrant Workers and Program Improvements Affecting High-Skilled Nonimmigrant Workers AGENCY: U.S. Citizenship and Immigration Services, DHS. ACTION: Final rule. SUMMARY: The Department of Homeland Security (DHS) is amending its regulations related to certain employment-based immigrant and nonimmigrant visa programs. Specifically, the final rule provides various benefits to participants in those programs, including the following: improved processes and increased certainty for U.S. employers seeking to sponsor and retain immigrant and nonimmigrant workers; greater stability and job flexibility for those workers; and increased transparency and consistency in the application of DHS policy related to affected classifications. Many of these changes are primarily aimed at improving the ability of U.S. employers to hire and retain high-skilled workers who are beneficiaries of approved employment-based immigrant visa petitions and are waiting to become lawful permanent residents, while increasing the ability of those workers to seek promotions, accept lateral positions with current employers, change employers, or pursue other employment options. DATES: This final rule is effective January 17, 2017. ADDRESSES: Comments and related materials received from the public, as well as background documents mentioned in this preamble as being available in the docket, are part of docket USCIS-2015-0008. For access to the online docket, go to http://www.regulations.gov and enter this rulemaking's eDocket number: USCIS-2015-0008 in the “Search” box. FOR FURTHER INFORMATION CONTACT: Kathleen Angustia or Nikki Lomax-Larson, Adjudications Officers (Policy), Office of Policy and Strategy, U.S. Citizenship and Immigration Services, Department of Homeland Security, 20 Massachusetts Avenue NW., Washington, DC 20529. The contact telephone number is (202) 272-8377. SUPPLEMENTARY INFORMATION: Table of Contents I. Abbreviations II. Executive Summary A. Purpose and Summary of the Regulatory Action 1. Clarifications and Policy Improvements 2. Summary of Changes From the Notice of Proposed Rulemaking B. Legal Authority C. Costs and Benefits III. Background A. ACWIA and AC21 1. The American Competitiveness and Workforce Improvement Act of 1998 2. The American Competitiveness in the Twenty-first Century Act of 2000 i. AC21 Provisions Relating to Employment-based Immigrant Visas ii. AC21 Provisions Seeking To Improve the H-1B Nonimmigrant Worker Classification a. Exemptions From the H-1B Numerical Cap b. Application of the H-1B Numerical Cap to Persons Previously Counted c. H-1B Portability B. Processing Applications for Employment Authorization Documents C. The Increasing Challenges Caused by Immigrant Visa Backlogs IV. Discussion of Comments A. Overview of the Comments B. Authority of DHS To Administer and Enforce Immigration Laws 1. Description of DHS's Legal Authority 2. Public Comments and Responses C. Immigration Fraud and National Security Concerns 1. Description of Final Rule and Changes From the NPRM 2. Public Comments and Responses D. Petitions for Employment-Based Immigrants and Priority Date Retention 1. Description of Final Rule and Changes From the NPRM 2. Public Comments and Responses i. Establishing a Priority Date ii. Retaining a Priority Date iii. Priority Date Not Retained if Approval Revoked for Fraud, Willful Misrepresentation, DOL Revocation, Invalidation by USCIS or DOS, Material Error, or Denied Petition iv. Beneficiary Standing To Challenge the Revocation of an Employment-Based Immigrant Visa Petition's Approval E. Continuing and Bona Fide Job Offer and Supplement J Form 1. Description of Final Rule and Changes From NPRM 2. Public Comments and Responses i. Portability Under INA 204(j) ii. Concerns Raised Regarding Supplement J iii. Miscellaneous Comments on Supplement J F. Compelling Circumstances Employment Authorization 1. Description of Final Rule and Changes From NPRM 2. Public Comments and Responses i. Support for Compelling Circumstances Employment Authorization ii. Status of Individuals Who Are Granted a Compelling Circumstances EAD iii. Changing the Scope of Proposed Employment Authorization iv. Illustrations of Compelling Circumstances v. Nonimmigrant and Immigrant Classifications of Individuals Eligible To Request Employment Authorization Based on Compelling Circumstances vi. Application Timeframes for Compelling Circumstances EADs vii. EAD Validity Period viii. Visa Bulletin Dates ix. Renewals of Employment Authorization Granted Pursuant to Compelling Circumstances x. Automatically Granting Advance Parole to Individuals Who Have Compelling Circumstances EADs xi. Employment Authorization Parity for Legal and Undocumented Workers, Including Individuals Granted Deferred Action for Childhood Arrivals (DACA) G. Nonimmigrant Grace Periods 1. Description of Final Rule and Changes From NPRM 2. Public Comments and Responses i. Length of the 10-Day Grace Periods ii. Eligibility for 10-Day Grace Periods iii. Miscellaneous Comments on 10-day Grace Periods iv. Length of the 60-Day Grace Period v. Frequency of the 60-Day Grace Period vi. Classifications Eligible for the 60-Day Grace Period vii. Clarifying the Meaning of “up to” in the 60-Day Grace Period viii. Employment Authorization During the Grace Periods H. Job Portability for H-1B Nonimmigrant Workers 1. Description of Final Rule and Changes From NPRM 2. Public Comments and Responses i. H-1B Status Requirement ii. International Travel and Successive Portability Petitions (“Bridge Petitions”) iii. Portability to New Employment Subject to the Cap I. H-1B Licensing Requirements 1. Description of Final Rule and Changes From NPRM 2. Public Comments and Responses i. Duties Without Licensure—Expand Circumstances ii. Unlicensed Employment Under Supervision iii. Duration of H-1B Petition Approval iv. Unrestricted Extendable Licenses J. Employers Exempt from H-1B Numerical Limitations and Qualifying for Fee Exemptions 1. Description of Final Rule and Changes From NPRM 2. Public Comments and Responses i. Include Government Entities in the Definition of “Related or Affiliated” ii. Clarify that a Nonprofit Entity Only Needs To Meet One of the Criteria in 8 CFR 214.2(h)(8)(ii)(F)( 2 ) and 8 CFR 214.2(h)(19)(iii)(B) iii. The “Primary Purpose” Requirement for Nonprofit Entities Seeking Exemptions Based on Formal Written Affiliation Agreements iv. Formal Written Affiliation Agreement v. Impose Additional Requirements To Qualify as an Institution of Higher Education vi. Impose Additional Requirements on the Nature of Employment at a Qualifying Nonprofit Entity or Nonprofit Research Organization vii. Expand Interpretation of Research Organization viii. Requirement that the H-1B Worker Perform a Majority of Duties “at” the Cap Exempt Entity ix. Codify Existing USCIS Deference Policy x. Create a Mechanism To Obtain a Pre-Determination of Cap Exemption xi. Allot H-1B Visas Subject to the Cap on a Quarterly Basis xii. Request for Continuation of Cap-Subject Employment When Concurrent Cap-Exempt H-1B Employment Ends xiii. Prohibit Cap-Exempt H-1B Worker From Concurrent Employment K. Exemptions to the Maximum Admission Period of H-1B Nonimmigrants 1. Description of Final Rule and Changes From NPRM 2. Public Comments and Responses i. Recapture of H-1B Time ii. AC21 106(a) and (b)—Lengthy Adjudication Delay Exemptions iii. AC21 104(c)—Per Country Limitations iv. Spousal Eligibility for H-1B Extensions Beyond Six Years under AC21 L. Whistleblower Protections in the H-1B Nonimmigrant Program 1. Description of Final Rule and Changes From NPRM 2. Public Comments and Responses M. Haitian Refugee Immigrant Fairness Act of 1998 1. Changes to DHS HRIFA regulations N. Application for Employment Authorization 1. Description of Final Rule and Changes From NPRM 2. Public Comments and Responses i. Adjudication Timeframes for Initial and Renewal Applications of Employment Authorization ii. Earlier Filing for EAD Renewals iii. Concurrent Filings iv. Potential Gaps in Employment Authorization v. Interim EADs vi. Automatic Extensions of EADs and Advance Parole vii. H-4 Nonimmigrant Spouses viii. F-1 Nonimmigrant Students ix. Expanding Automatic Extensions to Additional Categories x. State Driver's License Issues xi. Form I-9 and Automatic Extensions of EADs xii. National Security and Fraud Concerns xiii. Separate Rulemaking for the Elimination of the EAD 90-Day Processing Timeframe xiv. Requests for Premium Processing O. Employment Authorization and Reverification on Form I-9 1. Description of Final Rule and Changes From NPRM 2. Public Comments and Responses i. Reverification ii. Use of Form I-9 To Change Employment Authorization Categories iii. Comments Suggesting Additional Revisions P. Other Comments 1. Procedural Aspects of the Rulemaking 2. Assertions That the Employment-Based Immigration System Enables Slavery and Servitude to Employers 3. Limits on Employment-Based Immigration by Country 4. Guidance on National Interest Waivers 5. The Revised Visa Bulletin System Q. Public Comments and Responses on Statutory and Regulatory Requirements 1. Regulatory Impact Analysis 2. General Economy 3. Labor Market and Labor Force Impact, Including Jobs, Wages, and Job Portability i. Effect of the Rule on the Availability of Jobs in the United States ii. Effect of the Rule on Job Portability for Foreign Workers iii. Effect of the Rule on Wages iv. Effect of Employment-Based Immigration on Falling Income v. Effect of the Rule on Costs Incurred by Employers 4. DHS Estimate of 155,000 Compelling Circumstances Employment Authorization Applicants 5. Unfunded Mandates Reform Act Violation 6. Review under the National Environmental Policy Act (NEPA) V. Statutory and Regulatory Requirements A. Executive Orders 12866 and 13563 (Regulatory Planning and Review) B. Regulatory Flexibility Act C. Unfunded Mandates Reform Act of 1995 D. Small Business Regulatory Enforcement Fairness Act of 1996 E. Executive Order 13132 (Federalism) F. Executive Order 12988 (Civil Justice Reform) G. Paperwork Reduction Act I. Abbreviations AC21 American Competitiveness Act of the 21st Century ACWIA American Competitiveness and Workforce Improvement Act of 1998 APA Administrative Procedure Act CBP U.S. Customs and Border Protection CFR Code of Federal Regulations DACA Deferred Action for Childhood Arrivals DHS Department of Homeland Security DOL Department of Labor DOJ Department of Justice DOS Department of State EAD Employment Authorization Document EB Employment-based immigrant visa category EB-1 Employment-based first preference immigrant visa petition EB-2 Employment-based second preference immigrant visa petition EB-3 Employment-based third preference immigrant visa petition EB-4 Employment-based fourth preference immigrant visa petition EB-5 Employment-based fifth preference immigrant visa petition FDNS Fraud Detection and National Security FR Federal Register FY Fiscal Year HSA Homeland Security Act of 2002 IIRIRA Illegal Immigration Reform and Immigrant Responsibility Act of 1996 ICE U.S. Immigration and Customs Enforcement INA Immigration and Nationality Act LCA Labor Condition Application LPR Lawful Permanent Resident NOID Notice of Intent to Deny NPRM Notice of Proposed Rulemaking RFE Request for Evidence RIA Regulatory Impact Analysis SOC Standard Occupational Classification STEM Science, Technology, Engineering, and Mathematics TPS Temporary Protected Status U.S.C. United States Code USCIS U.S. Citizenship and Immigration Services II. Executive Summary A. Purpose and Summary of the Regulatory Action DHS is amending its regulations related to certain employment-based immigrant and nonimmigrant visa programs. The final rule is intended to benefit U.S. employers and foreign workers participating in these programs by streamlining the processes for employer sponsorship of nonimmigrant workers for lawful permanent resident (LPR) status, increasing job portability and otherwise providing stability and flexibility for such workers, and providing additional transparency and consistency in the application of DHS policies and practices related to these programs. These changes are primarily intended to better enable U.S. employers to employ and retain high-skilled workers who are beneficiaries of employment-based immigrant visa (Form I-140) petitions, while increasing the ability of these workers to further their careers by accepting promotions, changing positions with current employers, changing employers, and pursuing other employment opportunities. 1. Clarifications and Policy Improvements First, the final rule largely conforms DHS regulations to longstanding DHS policies and practices established in response to certain sections of the American Competitiveness and Workforce Improvement Act of 1998 (ACWIA), Public Law 105-277, div. C, tit. IV, 112 Stat. 2681, and the American Competitiveness in the Twenty-first Century Act of 2000 (AC21), Public Law 106-313, 114 Stat. 1251, as amended by the 21st Century Department of Justice Appropriations Authorization Act, Public Law 107-273, 116 Stat. 1758 (2002). 1 Those sections were intended, among other things, to provide greater flexibility and job portability to certain nonimmigrant workers, particularly those who have been sponsored for LPR status as employment-based immigrants, while enhancing opportunities for innovation and expansion, maintaining U.S. competitiveness, and protecting U.S. workers. The final rule further clarifies and improves DHS policies and practices in this area—policies and practices that have long been specified through a series of policy memoranda and precedent decisions of the U.S. Citizenship and Immigration Services (USCIS) Administrative Appeals Office. By clarifying such policies in regulation, DHS provides greater transparency and certainty to affected employers and workers, while increasing consistency among DHS adjudications. In addition, this final rule clarifies several interpretive questions raised by AC21 and ACWIA. 1 Except where changes to current policies and practices are noted in the preamble of this final rule, these amendments capture the longstanding policies and practices that have developed since AC21 and ACWIA were enacted. DHS also notes that policies implementing AC21 and ACWIA provisions, if not referenced, discussed, or changed through this rulemaking, remain in place. Specifically, the final rule clarifies and improves policies and practices related to: • H-1B extensions of stay under AC21. The final rule addresses the ability of H-1B nonimmigrant workers who are being sponsored for LPR status (and their dependents in H-4 nonimmigrant status) to extend their nonimmigrant stay beyond the otherwise applicable 6-year limit pursuant to AC21. • INA 204(j) portability. The final rule addresses the ability of certain workers who have pending applications for adjustment of status to change employers or jobs without endangering the approved Form I-140 petitions filed on their behalf. • H-1B portability. The final rule addresses the ability of H-1B nonimmigrant workers to change jobs or employers, including: (1) Beginning employment with new H-1B employers upon the filing of non-frivolous petitions for new H-1B employment (“H-1B portability petition”); and (2) allowing H-1B employers to file successive H-1B portability petitions (often referred to as “bridge petitions”) and clarifying how these petitions affect lawful status and work authorization. • Counting against the H-1B annual cap. The final rule clarifies the way in which H-1B nonimmigrant workers are counted against the annual H-1B numerical cap, including: (1) The method for calculating when these workers may access so-called remainder time ( i.e., time when they were physically outside the United States), thus allowing them to use their full period of H-1B admission; and (2) the method for determining which H-1B nonimmigrant workers are “cap-exempt” as a result of previously being counted against the cap. • H-1B cap exemptions. The final rule clarifies and improves the method for determining which H-1B nonimmigrant workers are exempt from the H-1B numerical cap due to their employment at an institution of higher education, a nonprofit entity related to or affiliated with such an institution, or a governmental or nonprofit research organization, including a revision to the definition of the term “related or affiliated nonprofit entity.” • Protections for H-1B whistleblowers. The final rule addresses the ability of H-1B nonimmigrant workers who are disclosing information in aid of, or otherwise participating in, investigations regarding alleged violations of Labor Condition Application (LCA) obligations in the H-1B program to provide documentary evidence to USCIS to demonstrate that their resulting failure to maintain H-1B status was due to “extraordinary circumstances.” • Form I-140 petition validity. The final rule clarifies the circumstances under which an approved Immigrant Petition for Alien Worker (Form I-140 petition) remains valid, even after the petitioner withdraws the petition or the petitioner's business terminates, including for purposes of status extension applications filed on behalf of the beneficiary, job portability of H-1B nonimmigrants, and job portability under section 204(j) of the Immigration and Nationality Act (INA), 8 U.S.C. 1154(j). Second, this rule builds on the provisions listed above by making changes consistent with the goals of AC21 and ACWIA to further provide stability and flexibility in certain immigrant and nonimmigrant visa categories. The amended provisions improve the ability of certain foreign workers, particularly those who are successfully sponsored for LPR status by their employers, to accept new employment opportunities, pursue normal career progression, better establish their lives in the United States, and contribute more fully to the U.S. economy. These changes also provide certainty for the regulated community and improve consistency across DHS adjudications, thereby enhancing DHS's ability to fulfill its responsibilities related to U.S. employers and certain foreign workers. Specifically, the final rule provides the following: • Establishment of priority dates. To enhance clarity for the regulated community, the final rule provides that a priority date is generally established based upon the filing of certain applications or petitions. The new regulatory language is consistent with existing DHS practice in establishing priority dates for other Form I-140 petitions that do not require permanent labor certifications (labor certifications)—such as petitions filed under the employment-based first preference immigrant visa (EB-1) category. 2 See final 8 CFR 204.5(d). 3 2 The EB-1 preference category is for individuals with extraordinary ability, outstanding professors and researchers, and multinational executives and managers. 3 In this final rule, the word “final” before a reference to 8 CFR is used to refer to a provision promulgated through this final rule and the word “proposed” before 8 CFR is used to refer to a provision of the proposed rule. See Retention of EB-1, EB-2, and EB-3 Immigrant Workers and Program Improvements Affecting High-Skilled Nonimmigrant Workers; Proposed Rule, 80 FR 81899 (Dec. 31, 2015). • Retention of priority dates. To enhance job portability for workers with approved Form I-140 petitions, the final rule explains the circumstances under which workers may retain priority dates and effectively transfer those dates to new and subsequently approved Form I-140 petitions. Priority date retention will generally be available as long as the approval of the initial Form I-140 petition was not revoked for fraud, willful misrepresentation of a material fact, the invalidation or revocation of a labor certification, or material error. This provision improves the ability of certain workers to accept promotions, change employers, or pursue other employment opportunities without fear of losing their place in line for immigrant visas. See final 8 CFR 204.5(e). • Retention of employment-based immigrant visa petitions. To enhance job portability for certain workers with approved Form I-140 petitions in the EB-1, second preference (EB-2), and third preference (EB-3) categories, but who are unable to obtain LPR status due to immigrant visa backlogs, the final rule provides that Form I-140 petitions that have been approved for 180 days or more would no longer be subject to automatic revocation based solely on withdrawal by the petitioner or the termination of the petitioner's business. See final 8 CFR 205.1(a)(3)(iii)(C) and (D). • Eligibility for employment authorization in compelling circumstances. To enhance stability and job flexibility for certain high-skilled nonimmigrant workers in the United States with approved Form I-140 petitions who cannot obtain an immigrant visa due to statutory limits on the number of immigrant visas that may be issued, the final rule allows certain beneficiaries in the United States in E-3, H-1B, H-1B1, L-1, or O-1 nonimmigrant status to apply for separate employment authorization for a limited period if there are compelling circumstances that, in the discretion of DHS, justify the issuance of employment authorization. See final 8 CFR 204.5(p). • 10-day nonimmigrant grace periods. To promote stability and flexibility for certain high-skilled nonimmigrant workers, the final rule provides two grace periods of up to 10 days, consistent with those already available to individuals in some nonimmigrant classifications, to individuals in the E-1, E-2, E-3, L-1, and TN classifications. The rule allows an initial grace period of up to 10 days prior to the start of an authorized validity period, which provides nonimmigrants in the above classifications a reasonable amount of time to enter the United States and prepare to begin employment in the country. The rule also allows a second grace period of up to 10 days after the end of an authorized validity period, which provides a reasonable amount of time for such nonimmigrants to depart the United States or take other actions to extend, change, or otherwise maintain lawful status. See final 8 CFR 214.1(l)(1). • 60-day nonimmigrant grace periods. To further enhance job portability, the final rule establishes a grace period of up to 60 consecutive days during each authorized validity period for individuals in the E-1, E-2, E-3, H-1B, H-1B1, L-1, O-1 or TN classifications. This grace period allows high-skilled workers in these classifications, including those whose employment ceases prior to the end of the petition validity period, to more readily pursue new employment should they be eligible for other employer-sponsored nonimmigrant classifications or employment in the same classification with a new employer. The grace period also allows U.S. employers to more easily facilitate changes in employment for existing or newly recruited nonimmigrant workers. See final 8 CFR 214.1(l)(2). • H-1B licensing. To provide clarity and certainty to the regulated community, the final regulations codify current DHS policy regarding exceptions to the requirement that makes the approval of an H-1B petition contingent upon the beneficiary's licensure where licensure is required to fully perform the duties of the relevant specialty occupation. The final rule generally allows for the temporary approval of an H-1B petition for an otherwise eligible unlicensed worker, if the petitioner can demonstrate that the worker is unable for certain technical reasons to obtain the required license before obtaining H-1B status. The final rule also clarifies the types of evidence that would need to be submitted to support approval of an H-1B petition on behalf of an unlicensed worker who will work in a state that allows the individual to be employed in the relevant occupation under the supervision of licensed senior or supervisory personnel. See final 8 CFR 214.2(h)(4)(v)(C). As noted above, these changes codify and improve USCIS policies concerning various employment-based immigrant and nonimmigrant visa classifications, including by making it easier to hire and retain nonimmigrant workers who have approved Form I-140 petitions and giving such workers additional career options as they wait for immigrant visas to become available. These improvements are increasingly important considering the lengthy waits and consistently growing demand for immigrant visas. Finally, to provide additional stability and certainty to U.S. employers and individuals eligible for employment authorization in the United States, this final rule changes several DHS regulations governing the processing of applications for employment authorization. First, to minimize the risk of any gaps in employment authorization, this final rule automatically extends the validity of Employment Authorization Documents (EADs or Forms I-766) in certain circumstances based on the timely filing of EAD renewal applications. Specifically, the rule automatically extends the employment authorization and validity of existing EADs issued to certain employment-eligible individuals for up to 180 days from the date of expiration, as long as: (1) A renewal application is filed based on the same employment authorization category as the previously issued EAD (or the renewal application is for an individual approved for Temporary Protected Status (TPS) whose EAD was issued under 8 CFR 274a.12(c)(19)); (2) the renewal application is timely filed prior to the expiration of the EAD (or, in accordance with an applicable Federal Register notice regarding procedures for renewing TPS-related employment documentation) and remains pending; and (3) the individual's eligibility for employment authorization continues beyond the expiration of the EAD and an independent adjudication of the underlying eligibility is not a prerequisite to the extension of employment authorization. Concurrently, DHS eliminates the regulatory provisions that require adjudication of the Application for Employment Authorization (Form I-765 or EAD application) within 90 days of filing and that authorize interim EADs in cases where such adjudications are not conducted within the 90-day timeframe. These changes provide enhanced stability and certainty to employment-authorized individuals and their employers while reducing opportunities for fraud and protecting the security related processes undertaken for each EAD application. See final 8 CFR 247a.13(d). 2. Summary of Changes From the Notice of Proposed Rulemaking Following careful consideration of public comments received, DHS has made several modifications to the regulatory text proposed in the Notice of Proposed Rulemaking (NPRM) published in the Federal Register on December 31, 2015. See Retention of EB-1, EB-2, and EB-3 Immigrant Workers and Program Improvements Affecting High-Skilled Nonimmigrant Workers; Proposed Rule, 80 FR 81899. Those changes include the following: • Retaining a Priority Date. In the final rule, DHS is responding to public comment by revising proposed 8 CFR 204.5(e)(2)(iv), a provision that identifies when error related to the approval of an employment-based immigrant visa petition can lead to loss of a priority date. The term “error” is clarified to mean “material error” in final 8 CFR 204.5(e)(2)(iv), which now states that a priority date may not be retained if USCIS revokes the approval of the Form I-140 petition because it determined that there was a material error with regard to the petition's approval. • Eligibility for employment authorization in compelling circumstances. In the final rule, DHS is responding to public comment by revising several aspects of proposed 8 CFR 204.5(p) governing requests for EADs in compelling circumstances. First, DHS is revising proposed 8 CFR 204.5(p)(1)(i), which discusses the eligibility of principal beneficiaries of immigrant visa petitions to obtain EADs in compelling circumstances. In the final rule, DHS provides clarification that principal beneficiaries may be eligible to file applications for such EADs during the authorized periods of admission that immediately precede or follow the validity periods of their nonimmigrant classifications ( i.e., “grace periods”). Second, DHS also is making several revisions to proposed 8 CFR 204.5(p)(3), which addresses certain eligibility requirements for principal beneficiaries and family members seeking to renew EADs issued in compelling circumstances. DHS clarifies in final § 204.5(p)(3) that applicants seeking to extend such employment authorization must file a renewal Form I-765 before the expiration of their current employment authorization. DHS also streamlines and clarifies the regulatory text covering the two instances in which applicants may be eligible to apply for renewal. DHS clarifies that under final § 204.5(p)(3)(i)(A), applicants may apply for renewal if the principal beneficiary continues to demonstrate compelling circumstances and an immigrant visa is not authorized for issuance to the principal beneficiary based on his or her priority date. DHS also clarifies that under final § 204.5(p)(3)(i)(B), a principal beneficiary may apply for renewal if his or her priority date is one year or less either before or after the relevant date in the Department of State Visa Bulletin. In determining whether the difference between the principal beneficiary's priority date and the date upon which immigrant visas are authorized for issuance is one year or less, DHS will use the applicable Final Action Date in the Visa Bulletin that was in effect on the date the application for employment authorization is filed. Third, DHS is removing a ground of ineligibility that was proposed in § 204.5(p)(5), as it was duplicative of requirements for renewal under § 204.5(p)(3)(i)(B), which authorizes eligibility for renewals when the difference between the principal beneficiary's priority date and the date upon which immigrant visas are authorized for issuance to the principal beneficiary is 1 year or less according to the Visa Bulletin in effect on the date the application for employment authorization is filed. Fourth, DHS is revising proposed § 204.5(p)(3)(ii) to clarify that family members may submit applications to renew employment authorization concurrently with renewal applications filed by the principal beneficiaries, or while such applications are pending, but family renewal applications cannot be approved unless the principal beneficiaries' applications are granted under paragraph (p)(3)(i) and remain valid. Finally, DHS is making several technical revisions for readability and clarity. • Automatic revocation. In the final rule, DHS is responding to public comment by editing proposed 8 CFR 205.1(a)(3)(iii)(C) and (D), which provide the grounds for automatically revoking Form I-140 petitions. DHS is revising these provisions to clarify that a Form I-140 petition will remain approved if a request to withdraw it is received or the petitioner terminates its business 180 days or more after either the date of the petition's approval or the date of filing of an associated application for adjustment of status. 4 In addition, DHS is removing the phrase, “provided that the revocation of a petition's approval under this clause will not, by itself, impact a beneficiary's ability to retain his or her priority date under 8 CFR 204.5(e)” in § 205.1(a)(3)(iii)(C) and (D) because that phrase was redundant of text in 8 CFR 204.5(e), which, as proposed and retained in this final rule, already establishes the ability of the beneficiary to retain his or her priority date if his or her immigrant visa petition is revoked on any ground other than those enumerated in final 8 CFR 204.5(e)(2)(i)-(iv). The deletion of the redundant text does not change the substance of the provisions. 4 Such petitions will remain approved unless revoked on other grounds. • Period of stay. In the final rule, DHS is responding to public comment by revising proposed 8 CFR 214.1(l), which concerns authorized grace periods that may immediately precede and follow periods of nonimmigrant petition validity and other authorized periods of stay. DHS is removing from proposed 8 CFR 214.1(l)(1) the phrase “to prepare for departure from the United States or to seek an extension or change of status based on a subsequent offer of employment” because it is unnecessarily limiting and did not fully comport with how the existing 10-day grace period may be used by individuals in the H, O and P nonimmigrant visa classifications. DHS is adding the phrase “or otherwise provided status” after “an alien admissible in E-1, E-2, E-3, H-1B, L-1, or TN classification and his or her dependents may be admitted to the United States” to clarify that the 10-day grace period may be granted to these nonimmigrants at time of admission or upon approval of an extension of stay or change of status. Moreover, in § 214.1(l)(2), DHS is adding the O-1 classification to the list of visa classifications for which USCIS will not consider an individual to have failed to maintain nonimmigrant status for a period of up to 60 days or until the end of the authorized validity period, whichever is shorter, solely because of the cessation of the employment on which the visa classification was based. In addition, DHS is clarifying that the 60-day grace period must be used in a single period of consecutive days during the relevant authorized validity period. DHS also is changing the phrase “for a one-time period during any authorized validity period,” to read “once during each authorized validity period” to clarify that the 60-day grace period may be provided to an individual only once per authorized validity period. However, an individual may be provided other such grace periods if he or she receives a new authorized validity period in one of the eligible nonimmigrant classifications. In addition, DHS is making other technical revisions to proposed § 214.1(l)(1), (2) and (3). • Duties without licensure. In the final rule, DHS is responding to public comment by modifying proposed 8 CFR 214.2(h)(4)(v)(C), which sets standards for H-1B adjudication absent the beneficiary's full licensure. First, DHS is revising proposed 8 CFR 214.2(h)(4)(v)(C)( 1 ) to expand the evidence USCIS will examine in cases where a state allows an individual without licensure to fully practice the occupation under the supervision of licensed senior or supervisory personnel to include “evidence that the petitioner is complying with state requirements.” Second, DHS is expanding the language in § 214.2(h)(4)(v)(C)( 2 ) to account for other technical requirements in state or local rules or procedures that may, like the lack of a Social Security number or employment authorization, pose obstacles to obtaining a license. Specifically, in § 214.2(h)(4)(v)(C)( 2 )( i ), DHS is adding the phrase “or met a technical requirement” following the references to the Social Security number and employment authorization. DHS is making similar conforming changes in two places in § 214.2(h)(4)(v)(C)( 2 )( ii ). Third, in § 214.2(h)(4)(v)(C)( 2 )( ii ), which discusses the petitioner's qualifications for a license, DHS is adding “substantive” in front of the word “requirements,” to allow flexibility to account for various state specific requirements. DHS is adding these clarifications to address other analogous obstacles of which DHS is not specifically aware, which present similar situations where the beneficiary is qualified for licensure, but may not obtain the licensure because of a technical requirement. In addition, DHS is making technical edits by replacing the use of the word “or” with “and” in the first clause of 8 CFR 214.2(h)(4)(v)(C)( 2 )( ii ) to reflect that the beneficiary must have filed an application for the license in accordance with State and local rules and procedures. This does not change the intended meaning of the proposed rule. Finally, DHS is making a technical edit in the second clause by replacing the use of “and/or” with “or” preceding “procedures.” • Definitions of non-profit entities related to or affiliated with an institution of higher education and governmental research organizations. In the final rule, DHS is responding to public comment by editing proposed 8 CFR 214.2(h)(8)(ii)(F) and (h)(19), which define which entities are (1) nonprofit entities that are related to or affiliated with institutions of higher education, and (2) governmental research organizations for purposes of the H-1B visa program. H-1B nonimmigrant workers who are employed at such entities are exempt from the annual limitations on H-1B visas. Such entities are also exempt from paying certain fees in the H-1B program. At § 214.2(h)(8)(ii)(F)( 2 ), DHS is adding the phrase “if it satisfies any one of the following conditions,” to clarify that a petitioner only has to meet one of the listed requirements. DHS is adding the same clarifying language to 8 CFR 214.2(h)(19)(iii)(B). In § 214.2(h)(8)(ii)(F)( 2 )( iv ) and (h)(19)(iii)(B)( 4 ), which address cap exemption and ACWIA fee exemption, respectively, for a nonprofit entity that is related to or affiliated with an institution of higher education based on a formal written affiliation agreement, DHS is replacing the term “primary purpose” with “fundamental activity” in response to public comments suggesting the term “primary purpose” was too restrictive. As a result, when a nonprofit entity claims exemption from the cap and ACWIA fee based on a formal written affiliation agreement with an institution of higher education, the final rule requires that “a fundamental activity” of the nonprofit entity is to directly contribute to the research or education mission of the institution of higher education. DHS is also removing the phrase “absent shared ownership or control” from § 214.2 (h)(8)(ii)(F)( 2 )( iv ) and (h)(19)(iii)(B)(4) to clarify that an entity need not prove the absence of shared ownership or control when relying on the existence of a formal affiliation agreement to establish that a nonprofit entity is related to or affiliated with an institution of higher education. In addition, DHS is defining the phrase “governmental research organization” in § 214.2(h)(19)(iii)(C) to include state and local government research entities, and not just federal government research entities, whose primary mission is the performance or promotion of basic research and/or applied research. This definition is adopted for cap exemption purposes at 8 CFR 214.2(h)(8)(ii)(F)( 3 ). • Calculating the maximum H-1B admission period. In the final rule, DHS is responding to public comment by revising proposed 8 CFR 214.2(h)(13)(iii)(C), which discusses how to calculate the time spent physically outside the United States during the validity of an H-1B petition that will not count against an individual's maximum authorized period of stay in H-1B status. DHS is amending the regulatory text to clarify that there is no temporal limit on recapturing time. The amendment makes clear that such time may be recaptured in a subsequent H-1B petition on behalf of the foreign worker, “at any time before the alien uses the full period of authorized H-1B admission described in section 214(g)(4) of the Act.” DHS also is making a technical edit to § 214.2(h)(13)(iii)(C)( 1 ) to clarify which form may be used for this provision. • Lengthy adjudication delay exemption from section 214(g)(4) of the Act. In the final rule, DHS is responding to public comment by revising several subsections of proposed 8 CFR 214.2(h)(13)(iii)(D), which governs when a nonimmigrant may be eligible for H-1B status in 1-year increments beyond the 6-year limitation that otherwise applies. DHS is amending the text of proposed 8 CFR 214.2(h)(13)(iii)(D)( 1 ) by striking the phrase, “prior to the 6-year limitation being reached.” This change clarifies that a qualifying labor certification or Form I-140 petition is not required to be filed 365 days before the 6-year limitation is reached in order for the individual to be eligible for an exemption under section 106(a) of AC21; instead, the labor certification or Form I-140 petition would need to be filed at least 365 days before the day the exemption would take effect. DHS is also making several revisions to simplify and clarify § 214.2(h)(13)(iii)(D)( 5 ), which concerns advance filing; § 214.2(h)(13)(iii)(D)( 6 ), which defines petitioners who may seek the exemption; § 214.2(h)(13)(iii)(D)( 7 ), which describes subsequent exemption approvals after the 7th year; and § 214.2(h)(13)(iii)(D)( 10 ), which describes limits on future exemptions from the lengthy adjudication delay. • Per country and worldwide limits. In the final rule, DHS is responding to public comment by revising proposed 8 CFR 214.2(h)(13)(iii)(E), which governs when a nonimmigrant may be eligible for H-1B status in 3-year increments beyond the 6-year limitation that otherwise applies. This provision addresses eligibility for an extension of H-1B status under section 104(c) of AC21. DHS is striking the phrase, “the unavailability must exist at time of the petition's adjudication” to reflect longstanding DHS policy. By striking this phrase, DHS is clarifying that if the Visa Bulletin that was in effect on the date the H-1B petition is filed shows that the individual was subject to a per country or worldwide visa limitation, DHS may grant the extension under section 104(c) of AC21, even if the immigrant visa is available when the petition is adjudicated, so long as the beneficiary is otherwise eligible. • Retaliatory action claims. In the final rule, DHS is responding to public comment by amending proposed 8 CFR 214.2(h)(20), which discusses eligibility for extensions of stay in H-1B status or change of status to other nonimmigrant classifications by beneficiaries who faced retaliatory action from their employers. Additionally, DHS is making a minor technical change to this section, correcting “labor certification application” to “labor condition application.” • Validity of petition for continued eligibility for adjustment of status. In the final rule, DHS is responding to public comment by amending proposed 8 CFR 245.25(a), which governs the circumstances in which an individual with a pending application for adjustment of status can move to a job in the same or a similar occupational classification. In particular, revisions are being made to implement DHS's current section 204(j) portability policy and longstanding practice related to the adjudication of qualifying Form I-140 petitions that are not approved at the time the beneficiary's application for adjustment of status has been pending for 180 days or more. First, in § 245.25(a), DHS is replacing a general reference in the NPRM to a “USCIS designated form” with a specific reference to “Form I-485 Supplement J” as the form DHS intends to be used for an individual to demonstrate continuing eligibility for adjustment of status based on an existing or new job offer under INA 204(j). Second, DHS also is clarifying that the Supplement J may be accompanied by “material and credible documentary evidence, in accordance with form instructions.” This revision expands the types of evidence that can be submitted in support of Supplement J beyond “material and credible information provided by another Federal agency, such as information from the Standard Occupational Classification (SOC) system,” as had been proposed. As a result, DHS is deleting the evidentiary list included in proposed § 245.25(b). Third, DHS is revising proposed § 245.25(a)(2)(ii) to reaffirm that a qualifying Form I-140 petition must be approved before DHS examines a portability request under INA 204(j). Moreover, DHS is adding § 245.25(a)(2)(ii)(B) to confirm that, unless approval of the petition would be inconsistent with a statutory requirement, a pending qualifying Form I-140 petition may be approved if (1) the petitioner established the ability to pay at the time of filing the petition and (2) all other eligibility criteria are met at the time of filing and until the beneficiary's application for adjustment of status has been pending for 180 days. Finally, DHS is reorganizing and renumbering § 245.25(a), and making other technical and conforming edits. • Concurrently filed EAD applications. In the final rule, DHS is responding to public comment by amending proposed 8 CFR 274a.13(a) to facilitate USCIS's ability to notify the public of changes in concurrent filing procedures for EAD applications. DHS is adding text indicating that USCIS may announce on its Web site circumstances in which an EAD application may be filed concurrently with a related benefit request that, if granted, would form the basis for eligibility for employment authorization. Under the proposed rule, such announcement was limited to form instructions. • Automatic extensions of employment authorization for renewal applicants. In the final rule, DHS is responding to public comment by amending proposed 8 CFR 274a.13(d) to clarify timeliness and termination rules for the automatic extension of certain EAD renewal applicants. DHS is clarifying that a renewal EAD application filed on the basis of a grant of TPS is timely if filed during the period described in the applicable Federal Register notice regarding procedures for renewing TPS. DHS is also making clarifying edits to the termination provision at § 274a.13(d)(3). In addition to the above changes that were made in response to public comment, DHS is making several technical changes to the regulatory text in this final rule so that DHS regulations better reflect current ACWIA fee amounts and filing procedures: • ACWIA fee amount and filing procedures. DHS is making technical changes to 8 CFR 214.2(h)(19)(i), (ii), (v), (vi) and (vii) to update the amount of the ACWIA fee applicable to certain H-1B petitions in accordance with statutory amendments, as well as procedures for submitting the fee to USCIS, or claiming an exemption from the fee, to conform with current procedures. 5 The statutory fee amount in INA 214(c)(9), 8 U.S.C. 1184(c)(9), was amended by section 1 of Pub. L. 106-311 (Oct. 17, 2000) (changing the fee amount from $500 to $1,000), and the Consolidated Appropriations Act, 2005, Pub. L. 108-447, Division J, Title IV, sec. 422 (L-1 Visa and H-1B Visa Reform Act) (Dec. 8, 2004) (permanently extending the fee and changing the fee amount from $1,000 to a bifurcated amount of $1,500 for employers with more than 25 employees, and half that amount for those with up to 25 employees). DHS is updating its regulations to conform the fee amount to the figure in current INA 214(c)(9). DHS regulations at 8 CFR 103.7(b)(1)(i)(CCC) and form instructions for the Petition for a Nonimmigrant Worker, Form I-129, already reflect these updated fee amounts. The technical changes also reflect the elimination of references to the now obsolete Form I-129W, which has been replaced by the Form I-129 H-1B and H-1B1 Data Collection and Filing Fee Exemption Supplement and which is already being used to make determinations for ACWIA fee exemptions. 5 DHS finds that prior notice and comment for these technical changes is unnecessary, as DHS is merely conforming its regulations to the self-implementing statutory amendments. See 5 U.S.C. 553(b)(B). • Additional entities exempt from the ACWIA fee. DHS is making a technical change to 8 CFR 214.2(h)(19)(iii) to include other entities that are statutorily exempt from the ACWIA fee, and thus to conform the regulation to INA 214(c)(9)(A), 8 U.S.C. 1184(c)(9)(A), as amended by section 1 of Pub. L. 106-311. DHS added a new paragraph (D) to include primary or secondary educational institutions, and a new paragraph (E) to include nonprofit entities that engage in an established curriculum-related clinical training of students registered at an institution of higher education. The Form I-129 and its form instructions already list these entities as fee exempt. B. Legal Authority The authority of the Secretary of Homeland Security (Secretary) for these regulatory amendments is found in various sections of the Immigration and Nationality Act (INA), 8 U.S.C. 1101 et seq., ACWIA, AC21, and the Homeland Security Act of 2002 (HSA), Public Law 107-296, 116 Stat. 2135, 6 U.S.C. 101 et seq. General authority for issuing the final rule is found in section 103(a) of the INA, 8 U.S.C. 1103(a), which authorizes the Secretary to administer and enforce the immigration and nationality laws, as well as section 102 of the HSA, 6 U.S.C. 112, which vests all of the functions of DHS in the Secretary and authorizes the Secretary to issue regulations. Further authority for the regulatory amendments in the final rule is found in the following sections: • Section 205 of the INA, 8 U.S.C. 1155, which grants the Secretary broad discretion in determining whether and how to revoke the approval of any Form I-140 petition approved under section 204 of the INA, 8 U.S.C. 1154; • Section 214 of the INA, 8 U.S.C. 1184, including section 214(a)(1), 8 U.S.C. 1184(a)(1), which authorizes the Secretary to prescribe by regulation the terms and conditions of the admission of nonimmigrants; • Section 274A(h)(3)(B) of the INA, 8 U.S.C. 1324a(h)(3)(B), which recognizes the Secretary's authority to extend employment authorization to noncitizens in the United States; • Section 413(a) of ACWIA, which amended section 212(n)(2)(C) of the INA, 8 U.S.C. 1182(n)(2)(C), to authorize the Secretary to provide certain whistleblower protections to H-1B nonimmigrant workers; • Section 414 of ACWIA, which added section 214(c)(9) of the INA, 8 U.S.C. 1184(c)(9), to authorize the Secretary to impose a fee on certain H-1B petitioners to fund the training and education of U.S. workers; • Section 103 of AC21, which amended section 214(g) of the INA, 8 U.S.C. 1184(g), to provide: (1) An exemption from the H-1B numerical cap for certain H-1B nonimmigrant workers employed at institutions of higher education, nonprofit entities related to or affiliated with such institutions, and nonprofit research organizations or governmental research organizations; (2) that an H-1B nonimmigrant who ceases to be employed by a cap-exempt employer, and who was not previously counted against the cap, will be subject to the H-1B numerical limitations; and (3) that a worker who has been counted against the H-1B numerical cap within the 6 years prior to petition approval will not again be counted against the cap unless the individual would be eligible for a new 6-year period of authorized H-1B admission. • Section 104(c) of AC21, which authorizes the extension of authorized H-1B admission beyond the general 6-year maximum for H-1B nonimmigrant workers who have approved EB-1, EB-2, or EB-3 Form I-140 petitions but are subject to backlogs due to application of certain per-country limitations on immigrant visas; • Section 105 of AC21, which added what is now section 214(n) of the INA, 8 U.S.C. 1184(n), 6 to allow an H-1B nonimmigrant worker to begin concurrent or new H-1B employment upon the filing of a timely, non-frivolous H-1B petition; 6 Section 8(a)(3) of the Trafficking Victims Protection Reauthorization Act of 2003, Public Law 108-193, (Dec. 19, 2003), redesignated section 214(m) of the INA, 8 U.S.C. 1184(m), as section 214(n) of the INA, 8 U.S.C. 1184(n). • Sections 106(a) and (b) of AC21, which, as amended, authorize the extension of authorized H-1B admission beyond the general 6-year maximum for H-1B nonimmigrant workers who have been sponsored for permanent residence by their employers and who are subject to certain lengthy adjudication or processing delays; • Section 106(c) of AC21, which added section 204(j) of the INA to authorize certain beneficiaries of approved EB-1, EB-2, and EB-3 Form I-140 petitions who have filed applications for adjustment of status to change jobs or employers without invalidating their approved petitions; and • Section 101(b)(1)(F) of the HSA, 6 U.S.C. 111(b)(1)(F), which establishes as a primary mission of DHS the duty to “ensure that the overall economic security of the United States is not diminished by efforts, activities, and programs aimed at securing the homeland.” C. Costs and Benefits Taken together, the amendments in this final rule are intended to reduce unnecessary disruption to businesses and workers caused by immigrant visa backlogs, as described in Section III.C of this preamble. The benefits from these amendments add value to the U.S. economy by retaining high-skilled workers who make important contributions to the U.S. economy, including technological advances and research and development endeavors, which are highly correlated with overall economic growth and job creation. 7 For more information, the public may consult the Regulatory Impact Analysis (RIA), which addresses the short-term and long-term effects of these regulations. The RIA is available in the docket for this rulemaking. 7 Hart, David, et al., “High-tech Immigrant Entrepreneurship in the United States,” Small Business Administration Office of Advocacy (July 2009), available at: https://www.sba.gov/sites/default/files/rs349tot_0.pdf. See also Fairlie, Robert., “Open for Business: How Immigrants are Driving Small Business Creation in the United States,” The Partnership for a New American Economy (August 2012), available at: http://www.renewoureconomy.org/sites/all/themes/pnae/openforbusiness.pdf; “Immigrant Small Business Owners a Significant and Growing Part of the Economy,” Fiscal Policy Institute (June 2012), available at: http://www.fiscalpolicy.org/immigrant-small-business-owners-FPI-20120614.pdf; Anderson, Stuart, “American Made 2.0 How Immigrant Entrepreneurs Continue to Contribute to the U.S. Economy,” National Venture Capital Association (June 2013), available at: http://nvca.org/research/stats-studies/. DHS has analyzed potential costs of these regulations and has determined that the changes have direct impacts to individual beneficiaries of employment-based nonimmigrant and immigrant visa petitions in the form of filing costs, consular processing costs, and potential for longer processing times for EAD applications during filing surges, among other costs. Because some of these petitions are filed by sponsoring employers, this rule also has indirect effects on employers in the form of employee replacement costs. The amendments clarify and amend policies and practices in various employment-based immigrant and nonimmigrant visa programs, with the primary aim of providing additional stability and flexibility to foreign workers and U.S. employers participating in those programs. In part, the final rule clarifies and improves upon longstanding policies adopted in response to the enactment of ACWIA and AC21 to ensure greater consistency across DHS adjudications and provide greater certainty to regulated employers and workers. These changes provide various benefits to U.S. employers and certain foreign workers, including the enhanced ability of such workers to accept promotions or change positions with their employers, as well as change employers or pursue other employment opportunities. These changes also benefit the regulated community by providing instructive rules governing: (1) Extensions of stay for certain H-1B nonimmigrant workers facing long delays in the immigrant visa process; (2) the ability of workers who have been sponsored by their employers for LPR status to change jobs or employers 180 days after they file applications for adjustment of status; (3) the circumstances under which H-1B nonimmigrant workers may begin employment with a new employer; (4) the method for counting time in status as an H-1B nonimmigrant worker toward maximum periods of stay; (5) the entities that are properly considered related to or affiliated with institutions of higher education for purposes of the H-1B program; and (6) the circumstances under which H-1B nonimmigrant workers can claim whistleblower protections. The increased clarity provided by these rules enhances the ability of certain high-skilled workers to take advantage of the job portability and related provisions in AC21 and ACWIA. The final rule also amends the current regulatory scheme governing certain immigrant and nonimmigrant visa programs to further enhance job portability for certain workers and improve the ability of U.S. businesses to retain highly valued individuals. These benefits are achieved by: (1) Revising the provisions affecting the continued validity of approved Form I-140 petitions, and retention of priority dates of those petitions, for purposes of processing immigrant visas or applications for adjustment of status; (2) establishing a means for certain nonimmigrant workers with approved Form I-140 petitions to directly request separate employment authorization for a limited time when facing compelling circumstances; (3) providing grace periods to certain nonimmigrants to enhance their ability to seek an authorized change of employment; and (4) identifying exceptions to licensing requirements applicable to certain H-1B nonimmigrant workers. The final rule also amends current regulations governing the processing of applications for employment authorization to provide additional stability to certain employment-authorized individuals in the United States while addressing fraud, national security, and operational concerns. To prevent gaps in employment for such individuals and their employers, the final rule provides for the automatic extension of EADs (and, where necessary, employment authorization) upon the timely filing of a renewal application. To protect against fraud and other abuses, the final rule also eliminates current regulatory provisions that require adjudication of applications for employment authorization in 90 days and that authorize interim EADs when that timeframe is not met. DHS has prepared a full costs and benefits analysis of the final rule, which can be found in the docket for this rulemaking on regulations.gov. The table below provides a summary of the provisions and impacts of this rule. Table 1—Summary of Provisions and Impacts Provisions Purpose Expected impact of the final rule Priority Date Clarifies when a priority date is established for employment-based immigrant visa petitions that do not require a labor certification under INA 203(b) Quantitative: • Not estimated. Qualitative: • Removes ambiguity and sets consistent priority dates for affected petitioners and beneficiaries. Priority Date Retention Explains that workers may retain priority dates and transfer those dates to new and subsequently approved Form I-140 petitions, except when USCIS revokes approval of the petition for: Material error, fraud or willful misrepresentation of a material fact, or revocation or invalidation of the labor certification accompanying the petition Quantitative: • Not estimated. Qualitative: • Results in administrative efficiency and predictability by explicitly listing when priority dates are lost as the approval of the petitions that are revoked under these specific grounds cannot be used as a basis for an immigrant visa. • Improves the ability of certain workers to accept promotions, change employers, or pursue other employment opportunities. Employment-Based Immigrant Visa Petition Portability Under 204(j) Incorporates statutory portability provisions into regulation Quantitative: Petitioners - • Opportunity costs of time to petitioners for 1-year range from $126,598 to $4,636,448. DHS/USCIS— • Neutral because the new supplementary form to the application for adjustment of status to permanent residence will formalize the process for USCIS requests for evidence of compliance with INA 204(j) porting. Qualitative: Applicants/Petitioners— • Replaces, through the Supplement J standardized form, the need for individuals to submit job offer and employment confirmation letters. • Provides stability and job flexibility to certain individuals with approved employment-based immigrant visa petitions. • Implements the clarifications regarding “same or similar occupational classifications” through the new Supplement J. • Allows certain foreign workers to advance and progress in their careers. • Potential increased employee replacement costs for employers. DHS/USCIS— • Administrative efficiency. • Standardized and streamlined process. Employment Authorization for Certain Nonimmigrants Based on Compelling Circumstances Provisions allowing certain nonimmigrant principal beneficiaries, and their dependent spouses and children, to apply for employment authorization if the principal is a beneficiary of an approved EB-1, EB-2, or EB-3 immigrant visa petition while waiting for his or her immigrant visa to become available. Applicants must demonstrate compelling circumstances justifying an independent grant of employment authorization Quantitative: Total costs over 10-year period to applicants are: • $731.1 million for undiscounted costs. • $649.9 million at a 3% discounted rate. • $565.2 million at a 7% discounted rate. Qualitative: Applicants— • Provides ability for nonimmigrants who have been sponsored for LPR status to change jobs or employers when compelling circumstances arise. • Incentivizes such skilled nonimmigrant workers contributing to the economy to continue seeking LPR status. • Nonimmigrant principal workers who take advantage of the compelling circumstances EAD will lose their current nonimmigrant status and may not be able to adjust to LPR status in the United States. • Consular processing imposes potentially significant costs, risk and uncertainty for individuals and their families as well. Dependents— • Allows dependents to enter labor market earlier and contribute to household income. 90-Day Processing Time for Employment Authorization Applications Eliminates regulatory requirement for 90-day adjudication timeframe and issuance of interim-EADs. Adds provisions allowing for the automatic extension of EADs for up to 180 days for certain workers filing renewal requests Quantitative: • Not estimated. Qualitative: Applicants— • Removing a regulatory timeframe and moving to one governed by processing goals could potentially lead to longer processing times whenever USCIS is faced with higher than expected filing volumes. If such a situation were to occur, this could lead to potential delays in work employment start dates for first-time EAD applicants until approval is obtained. However, USCIS believes such scenarios will be rare and mitigated by the automatic extension provision for renewal applications which will allow the movement of resources in such situations. • Providing the automatic continuing authorization for up to 180 days for certain renewal applicants could lead to less turnover costs for U.S. employers. In addition, the automatic extension provision minimizes the applicants' risk of any gaps in employment authorization. DHS/USCIS— • Streamlines the application and card issuance processes. • Enhances the ability to ensure all national security verification checks are completed. • Reduces duplication efforts. • Reduces opportunities for fraud and better accommodates increased security measures. Automatic Revocation With Respect to Approved Employment-Based Immigrant Visa Petitions Revises regulations so that a petition may remain valid despite withdrawal by the employer or termination of the employer's business after 180 days or more of approval, or 180 days or more after the associated application for adjustment of status has been filed Quantitative: • Not estimated. Qualitative: • Beneficiary retains priority date unless the petition is revoked for one of the reasons specified in final 8 CFR 204.5(e)(2). • Affords porting ability under INA 204(j) and extension of H-1B status pursuant to AC21 sections 104(c) and 106(a) and (b), as well as potential eligibility for the new compelling circumstances EAD. Period of Admission for Certain Nonimmigrant Classifications Nonimmigrants in certain high-skilled, nonimmigrant classifications may be granted grace periods of up to 10 days before and after their validity period, and a grace period upon cessation of employment on which the foreign national's classification was based, for up to 60 days or until the end of their authorized validity period, whichever is shorter, during each authorized validity period Quantitative: • Not estimated. Qualitative: Nonimmigrant Visa Holders—. • Assists the beneficiary in getting sufficiently settled such that he or she is immediately able to begin working upon the start of the petition validity period. • Provides time necessary to wrap up affairs to depart the country. • Allows the beneficiary to maintain nonimmigrant status when faced with a termination of employment to wrap up affairs, find new employment, or change to a different nonimmigrant classification. Portability of H-1B Status Calculating the H-1B Admission Period Exemptions Due to Lengthy Adjudication Delays Per Country Limitation Exemptions Employer Debarment and H-1B Whistleblower Provisions Updates, improves, and clarifies DHS regulations consistent with policy guidance Quantitative: • Not estimated. Qualitative: • Formalizes existing DHS policy in the regulations, which will give the public access to existing policy in one location. • Clarifies current DHS policy that there is no temporal limit on recapturing time. H-1B Licensing Requirements Expands the evidence USCIS will examine in cases where a state allows an individual without licensure to fully practice the relevant occupation under the supervision of licensed senior or supervisory personnel in that occupation to include evidence of compliance with state requirements. Additionally, USCIS is expanding the possible situations in which it may approve an H-1B petition even though the beneficiary cannot obtain a license for certain technical reasons Quantitative: • Not estimated. Qualitative: • Provides additional flexibilities in obtaining necessary licensure while still permitting H-1B employment during the pendency of state or local license applications. • Helps to relieve the circular predicament an H-1B beneficiary may encounter. • May minimally increase time burden for the petitioner to gather information and send it to USCIS. However, DHS anticipates that the benefits to the petitioner and beneficiary exceed the opportunity costs of time. • May increase opportunity costs of time for USCIS adjudicators to evaluate additional evidence in such types of cases. However, DHS does not anticipate that the opportunity costs of time will be so substantial as to warrant additional hiring of staff or cause significant adjudication delays. Exemptions to the H-1B Numerical Cap, Revised Definition of “Related or Affiliated Nonprofit Entity” in the ACWIA Fee Context, and Expanded Interpretation of “Governmental Research Organizations.” Codifies definition of “institution of higher education” and adds a broader definition of “related or affiliated nonprofit entity.” Also, revises the definition of “related or affiliated nonprofit entity” for purposes of the ACWIA fee to conform it to the new definition of the same term for H-1B numerical cap exemption. Expands the interpretation of “governmental research organizations” for purposes of the ACWIA fee and aligns definitions for H-1B cap and fee exemptions Quantitative: • Not estimated. Qualitative: • Clarifies the requirements for a nonprofit entity to establish that it is related to or affiliated with an institution of higher education. • Better reflects current operational realities for institutions of higher education and how they interact with, and sometimes rely on, nonprofit entities. • Clarifies the interpretation of governmental research organizations to include federal, state, and local governmental organizations. • May expand the numbers of petitioners that are cap exempt and thus allow certain employers greater access to H-1B workers. III. Background A. ACWIA and AC21 1. The American Competitiveness and Workforce Improvement Act of 1998 ACWIA was enacted on October 21, 1998. Among other things, ACWIA was intended to address shortages of workers in the U.S. high-technology sector. To increase the number of such workers in the United States, section 411 of ACWIA increased the annual numerical cap on H-1B visas from 65,000 to 115,000 in each of fiscal years (FY) 1999 and 2000, and to 107,500 in FY 2001. 8 See section 411 of ACWIA (amending INA 214(g)(1), codified at 8 U.S.C. 1184(g)(1)). The congressional statements accompanying ACWIA recognized that the continued competitiveness of the U.S. high-technology sector is “crucial for [U.S.] economic well-being as a nation, and for increased economic opportunity for American workers.” See 144 Cong. Rec. S12,741, S12,749 (daily ed. Oct. 21, 1998) (statement of Sen. Spencer Abraham); see also id. (“This issue is not only about shortages, it is about opportunities for innovation and expansion, since people with valuable skills, whatever their national origin, will always benefit our nation by creating more jobs for everyone.”) 9 8 Section 102(a) of AC21 further amended INA 214(g)(1) by increasing the annual numerical cap on H-1B visas to 195,000 for each of the fiscal years 2001, 2002, 2003. In fiscal year 2004 the annual H-1B numerical cap reverted to 65,000. 9 Senator Abraham drafted and sponsored the original Senate bill for ACWIA, then titled the American Competitiveness Act, S. 1723, 105th Cong. (1998), which passed the full Senate by a 78-20 margin on May 18, 1998. 144 Cong. Rec. as S12,748-49 (daily ed. Oct. 21, 1998). He negotiated with the House of Representatives on a compromise ACWIA bill and was deputized to negotiate in talks between Congress and the White House to finalize the bill. ACWIA also included several measures intended to improve protections for U.S. and H-1B nonimmigrant workers. Section 413 of the ACWIA provided enhanced penalties for employer violations of Labor Condition Application (LCA) obligations as well as willful misrepresentations by employers in LCAs. See ACWIA 413 (creating INA 212(n)(2)(C), codified at 8 U.S.C. 1182(n)(2)(C)). Section 413 of ACWIA also made it a violation for an H-1B employer to retaliate against an employee for providing information to the employer or other persons, or for cooperating in an investigation, related to an employer's violation of its LCA attestations and obligations. Employers are prohibited from taking retaliatory action in such situations, including any action “to intimidate, threaten, restrain, coerce, blacklist, discharge, or in any other manner discriminate” against an employee for “disclos[ing] information to the employer, or to any other person, that the employee reasonably believes evidences [an LCA] violation, any rule or regulation pertaining to the statutory LCA attestation requirements, or for cooperating, or attempting to cooperate, in an investigation or proceeding pertaining to the employer's LCA compliance.” See INA 212(n)(2)(C)(iv), 8 U.S.C. 1182(n)(2)(C)(iv). Section 413 further required the development of a process to enable H-1B nonimmigrant workers who file complaints with DOL regarding illegal retaliation, and are otherwise eligible to remain and work in the United States, to seek other appropriate employment in the United States. See INA 212(n)(2)(C)(v), 8 U.S.C. 1182(n)(2)(C)(v). Section 414 of ACWIA imposed a temporary fee on certain H-1B employers to fund, among other things, job training of U.S. workers and scholarships in the science, technology, engineering, and mathematics (STEM) fields. See ACWIA 414 (creating INA 214(c)(9), codified at 8 U.S.C. 1184(c)(9)). Although initially scheduled to sunset, the ACWIA fee was eventually made permanent by the H-1B Visa Reform Act of 2004, enacted as part of the Consolidated Appropriations Act, 2005, Public Law 108-447, div. J, tit. IV. That later enactment also established the current fee amounts of $1,500 per qualifying petition, or $750 for employers with no more than 25 full-time equivalent employees employed in the United States (including employees employed by any affiliate or subsidiary of such employer). Congress in the interim had amended section 214(c)(9)(A) of the INA, 8 U.S.C. 1184(c)(9)(A), by specifying additional employers that are exempt from the ACWIA fee. See Act of Oct. 17, 2010, Public Law 106-311. Exempt employers include primary and secondary education institutions, certain institutions of higher education and related or affiliated nonprofit entities, nonprofit entities engaged in curriculum-related clinical training, and nonprofit research organizations or governmental research organizations. See INA 214(c)(9)(A), 8 U.S.C. 1184(c)(9)(A). 2. The American Competitiveness in the Twenty-First Century Act of 2000 AC21 was enacted on October 17, 2000. It made numerous changes to the INA designed to improve the U.S. economy in the short and long term. First, AC21 sought to improve economic growth and job creation by immediately increasing U.S. access to high-skilled workers. See S. Rep. No. 260, at 10 (“[A]rtificially limiting companies' ability to hire skilled foreign professionals will stymie our country's economic growth and thereby partially atrophy its creation of new jobs . . . American workers' interests are advanced, rather than impeded, by raising the H-1B cap”). Second, AC21 sought to improve the education and training of U.S. workers in high-skilled sectors, and thereby produce a U.S. workforce better equipped to fill the need in such sectors, through the funding of scholarships and high-skilled training programs. See section 111 of AC21. As noted by the accompanying Senate Report, foreign-born high-skilled individuals have played an important role in U.S. economic prosperity and the competitiveness of U.S. companies in numerous fields. Id. AC21 sought to provide such benefits by improving both the employment-based immigrant visa process and the H-1B specialty occupation worker program. i. AC21 Provisions Relating to Employment-Based Immigrant Visas AC21 contained several provisions designed to improve access to employment-based immigrant visas for certain workers. Section 104 of AC21, for example, sought to ameliorate the impact of the “per-country limitations,” which generally limit the number of immigrant visas that may be issued to the nationals of any one country to no more than 7 percent of the total number of immigrant visas. See INA 202(a)(2), 8 U.S.C. 1152(a)(2). Sections 104(a) and (b) of AC21 amended the INA to effectively waive application of the per-country limitations when such application would result in immigrant visas going unused in any quarter of the fiscal year. See AC21 104(a) and (b) (amending INA 202(a)(5), codified at 8 U.S.C. 1152(a)(5)); see also S. Rep. No. 260, 106th Cong., 2nd Sess. at 2. This provision recognized “the discriminatory effects of [the per-country limitations] on nationals from certain Asian Pacific nations,” specifically Chinese and Indian nationals, which “prevent[ed] an employer from hiring or sponsoring someone permanently simply because he or she is Chinese or Indian, even though the individual meets all other legal criteria.” See S. Rep. No. 260, at 22. Section 104(c) of AC21 was designed to further ameliorate the impact of the per-country limitations on H-1B nonimmigrant workers who are the beneficiaries of approved EB-1, EB-2, or EB-3 Form I-140 petitions. Specifically, section 104(c) of AC21 authorized the extension of H-1B status beyond the statutory 6-year maximum for such individuals if immigrant visas are not immediately available to them because the relevant preference category is already over-subscribed for that foreign national's country of birth. See AC21 104(c). In support of this provision, Congress noted that “these immigrants would otherwise be forced to return home at the conclusion of their allotted time in H-1B status, disrupting projects and American workers.” See S. Rep. No. 260, at 22. Section 104(c) “enables these foreign nationals to remain in H-1B status until they are able to receive an immigrant visa and adjust their status within the United States, thus limiting the disruption to American businesses.” Id. AC21 also sought to more generally ameliorate the impact of the lack of employment-based immigrant visas on the high-skilled beneficiaries of approved Form I-140 petitions. Sections 106(a) and (b) of AC21, as amended by section 11030A of the 21st Century Department of Justice Appropriations Authorization Act, Public Law 107-273 (2002), authorized the extension of H-1B status beyond the statutory 6-year maximum for H-1B nonimmigrant workers who are being sponsored for LPR status by U.S. employers and are subject to lengthy adjudication or processing delays. Specifically, these provisions exempted H-1B nonimmigrant workers from the 6-year limitation on H-1B status contained in INA 214(g)(4), if 365 days or more have elapsed since the filing of a labor certification application (if such certification is required under INA 212(a)(5), 8 U.S.C. 1182(a)(5)), or a Form I-140 petition under INA 203(b), 8 U.S.C. 1153(b). These provisions were intended to allow such high-skilled individuals to remain in the United States as H-1B nonimmigrant workers, rather than being forced to leave the country and disrupt their employers due to a long-pending labor certification application or Form I-140 petition. See S. Rep. No. 260, at 23. Finally, to provide stability and flexibility to beneficiaries of approved Form I-140 petitions subject to immigrant visa backlogs and processing delays, AC21 also provided certain workers the improved ability to change jobs or employers without losing their positions in the immigrant visa queue. Specifically, section 106(c) of AC21 provides that certain Form I-140 petitions filed under the EB-1, EB-2, and EB-3 preference categories will remain valid with respect to a new qualifying job offer if the beneficiary changes jobs or employers, provided an application for adjustment of status has been filed and such application has been pending for 180 days or more. See AC21 106(c) (creating INA 204(j)). The new job offer must be in the same or a similar occupational classification as the job for which the original Form I-140 petition was filed. Id. ii. AC21 Provisions Seeking To Improve the H-1B Nonimmigrant Worker Classification As noted above, one of the principal purposes for the enactment of AC21 was to improve the country's access to high-skilled workers. AC21 therefore contains several additional provisions intended to expand and strengthen the H-1B program. a. Exemptions From the H-1B Numerical Cap Section 103 of AC21 amended the INA to create an exemption from the H-1B numerical cap for those H-1B nonimmigrant workers who are employed or offered employment at an institution of higher education, a nonprofit entity related or affiliated to such an institution, or a nonprofit research organization or governmental research organization. See INA 214(g)(5)(A) and (B); 8 U.S.C. 1184(g)(5)(A) and (B). Congress deemed such employment advantageous to the United States, based on the belief that increasing the number of high-skilled foreign nationals working at U.S. institutions of higher education would increase the number of Americans who will be ready to fill specialty occupation positions upon completion of their education. See S. Rep. No. 260, at 21-22. Congress reasoned that “by virtue of what they are doing, people working in universities are necessarily immediately contributing to educating Americans.” Id. at 21. Congress also recognized that U.S. institutions of higher education are on a different hiring cycle from other U.S. employers, and in years of high H-1B demand, these institutions would be unable to hire cap-subject H-1B nonimmigrant workers. Id. at 22. For purposes of this H-1B numerical cap exemption, the term “institution of higher education” is given the same meaning as that set forth in section 101(a) of the Higher Education Act of 1965, Public Law 89-329, 79 Stat. 1224 (1965), as amended (codified at 20 U.S.C. 1001(a) (“Higher Education Act”)). 10 See INA 214(g)(5)(A), 8 U.S.C. 1184(g)(5)(A). Due to the lack of statutory definitions, DHS defined the terms “related or affiliated nonprofit entity,” and “nonprofit research organization or governmental research organization” at 8 CFR 214.2(h)(19)(iii)(B) and (C), respectively, and adopted these definitions as a matter of interpretation in the cap exemption context. 11 10 Section 101(a) of the Higher Education Act of 1965, as amended, defines “institution of higher education” as an educational institution in any state that: (1) admits as regular students only persons having a certificate of graduation from a school providing secondary education, or the recognized equivalent of such a certificate, or persons who meet the requirements of [20 U.S.C. 1091(d)]; (2) is legally authorized within such state to provide a program of education beyond secondary education; (3) provides an educational program for which the institution awards a bachelor's degree or provides not less than a 2-year program that is acceptable for full credit toward such a degree, or awards a degree that is acceptable for admission to a graduate or professional degree program, subject to review and approval by the Secretary [of Education]; (4) is a public or other nonprofit institution; and (5) is accredited by a nationally recognized accrediting agency or association, or if not so accredited, is an institution that has been granted preaccreditation status by such an agency or association that has been recognized by the Secretary [of Education] for the granting of preaccreditation status, and the Secretary [of Education] has determined that there is satisfactory assurance that the institution will meet the accreditation standards of such an agency or association within a reasonable time. 11 See USCIS Memorandum from Michael Aytes, “Guidance Regarding Eligibility for Exemption from the H-1B Cap Based on § 103 of the American Competitiveness in the Twenty-First Century Act of 2000 (AC21) (Public Law 106-313)” (June 6, 2006) (“Aytes Memo June 2006”) at 2-4. b. Application of the H-1B Numerical Cap to Persons Previously Counted Section 103 of AC21 also amended the INA to ensure that H-1B nonimmigrant workers can change jobs or employers without again being counted against the H-1B cap. Specifically, section 103 provides that an individual who has been counted against the H-1B numerical cap within the 6 years prior to petition approval shall not be counted against the cap unless that individual would be eligible for a new 6-year period of authorized H-1B admission. See INA 214(g)(7), 8 U.S.C. 1184(g)(7). In addition, an individual previously in the United States in H-1B nonimmigrant status is eligible for a full 6 years of authorized admission as an H-1B nonimmigrant after residing and being physically present outside the United States for the immediate prior year. Id. Section 103 of AC21 also amended the INA to address cases in which an H-1B nonimmigrant worker seeks to change employment from a cap-exempt entity to a “cap-subject” entity. Section 103 provides that once employment ceases with respect to a cap-exempt entity, the H-1B nonimmigrant worker will be subject to the cap if not previously counted and no other exemptions from the cap apply. See INA 214(g)(6), 8 U.S.C. 1184(g)(6). c. H-1B Portability Section 105 of AC21 further improved the H-1B program by increasing job portability for H-1B nonimmigrant workers. Specifically, section 105 allows an H-1B nonimmigrant worker to begin concurrent or new H-1B employment upon the filing of a timely, nonfrivolous H-1B petition. See INA 214(n), 8 U.S.C. 1184(n). The H-1B nonimmigrant worker must have been lawfully admitted to the United States, must not have worked without authorization after the lawful admission, and must be in a period of stay authorized by the Secretary. 12 Employment authorization based on the pending petition continues until adjudication. See INA 214(n)(1), 8 U.S.C. 1184(n)(1). If the H-1B petition is denied, the employment authorization provided under this provision ceases. Id. Congress created H-1B portability to “allow an H-1B visa holder to change employers at the time a new employer files the initial paperwork, rather than having to wait for the new H-1B petition to be approved. This responds to concerns raised about the potential for exploitation of H-1B visa holders as a result of a specific U.S. employer's control over the employee's legal status.” See S. Rep. No. 260, at 22-23. 12 See USCIS Memorandum from Donald Neufeld, “Consolidation of Guidance Concerning Unlawful Presence for Purposes of Sections 212(a)(9)(B)(i) and 212(a)(9)(C)(i)(I) of the Act” (May 6, 2009) (“Neufeld May 2009 Memo”) (describing various “periods of authorized stay”), available at https://www.uscis.gov/sites/default/files/USCIS/Laws/Memoranda/Static_Files_Memoranda/2009/revision_redesign_AFM.PDF. B. Processing Applications for Employment Authorization Documents The Secretary of Homeland Security has broad authority to extend employment authorization to noncitizens in the United States. See, e.g., INA sections 103(a) and 274A(h)(3)(B), 8 U.S.C. 1103(a) and 1324a(h)(3)(B). DHS regulations at 8 CFR 274a.12(a), (b), and (c) describe three broad categories of foreign nationals authorized to work in the United States. Individuals in the first class, described at 8 CFR 274a.12(a), are authorized to work in the United States incident to their immigration status, without restriction as to the location of their employment or the type of employment they may accept. In many cases, their immigration status and attendant employment authorization is evidenced by the Arrival-Departure Record (Form I-94). Those individuals seeking to obtain an EAD that contains not only evidence of employment authorization, but also a photograph, typically must file a separate application with USCIS. See 8 CFR 274a.13(a). Individuals in the second class, described at 8 CFR 274a.12(b), are employment authorized incident to their nonimmigrant status, but each individual's employment authorization is valid only with a specific employer. Individuals in this second group do not file separate requests for evidence of employment authorization and are not generally issued EADs. These individuals instead obtain a Form I-94 indicating their nonimmigrant status and attendant employment authorization. Individuals in the third class, described at 8 CFR 274a.12(c), are required to apply for employment authorization and may begin working only if USCIS approves their application. This employment authorization is subject to the restrictions described in the regulations for the specific employment eligibility category. Generally, the approval of an EAD application by an individual described in 8 CFR 274a.12(c) is within the discretion of USCIS. There is no right to appeal the denial of an EAD application. See 8 CFR 274a.13(c). Individuals requesting an EAD must file Form I-765 with USCIS in accordance with the form instructions. See 8 CFR 274a.13. Under current regulations, if USCIS does not adjudicate the Form I-765 within 90 days from the date USCIS receives the application, the applicant will be granted an interim document evidencing employment authorization with a validity period not to exceed 240 days. See 8 CFR 274a.13(d). C. The Increasing Challenges Caused by Immigrant Visa Backlogs The final rule addresses in part some of the challenges that flow from the statutory limits on immigrant visas, consistent with existing DHS authorities. The number of employment-based immigrant visas statutorily allocated per year has remained unchanged since the passage of the Immigration Act of 1990. In the intervening 25 years, the country's economy has expanded dramatically. The size of the U.S. economy, as measured by U.S. gross domestic product (GDP), increased by about 83 percent since 1990, rising from $8.955 trillion in 1990 to $16.397 trillion in 2015. 13 Over the same period, GDP per capita increased by just over 42 percent, rising from $35,794 in 1990 to $50,970 in 2015. 14 The number of entities doing business in the United States increased by at least 24 percent during the same period. 15 Over the same period, employer demand for immigrant visas has increasingly outpaced supply in some categories and for some nationalities, resulting in growing waits for some sponsored employees to obtain their LPR status. Such delays have resulted in substantial inequalities and other hardships flowing from limits on the ability of sponsored workers to change employment to enhance their skills, to accept promotions, or to otherwise change their positions. Since AC21 was enacted in October of 2000, certain workers seeking LPR status in the United States have faced increasing challenges as a consequence of the escalating wait times for immigrant visas. Numerical limitations in the various employment-based preference categories, combined with the per-country limitations that further reduce visa availability to certain workers, has produced significant oversubscription in the EB-2 and EB-3 categories, particularly for individuals born in India and China. This oversubscription results in substantial delays in obtaining LPR status for many workers, especially for workers from oversubscribed countries who can face delays that extend for more than a decade. 16 13 U.S. Department of Commerce, Bureau of Economic Analysis, Table 1.1.6 Real Gross Domestic Product, Chained (2009) Dollars, https://www.bea.gov/iTable/index_nipa.cfm. 14 U.S. Department of Commerce, Bureau of Economic Analysis, Table 7.1 Selected Per Capita Product and Income Series and Chained (2009) Dollars, https://www.bea.gov/iTable/index_nipa.cfm. 15 Compare U.S. Census data collected in 1992 identifying over 4.61 million firms doing business in the United States, available at http://www.census.gov/prod/www/economic_census.html, with U.S. Census data collected in 2012 identifying over 5.72 million firms doing business, available at http://www.census.gov/econ/susb/. 16 According to the Visa Bulletin for November 2016, immigrant visas are currently issuable to all persons qualifying under the EB-1 preference category. The EB-2 category Application Final Action date cutoff is current for all countries except for China and India; the cutoff date for China is July 15, 2012 and the cutoff date for India is November 1, 2007, meaning nationals of these countries may have to wait 4 to 9 years for a visa to be authorized for issuance. The Application Final Action cut-off dates for nationals of most countries under the EB-3 preference category are set at July 1, 2016 (a wait of less than five months). But for EB-3 Indian nationals, the Application Final Action cutoff dates are set at March 8, 2005 (a wait of more than 10 years) and EB-3 cutoff dates for Chinese nationals are set at April 15, 2013 (a wait of more than 3 years). See Visa Bulletin for November 2016, https://travel.state.gov/content/visas/en/law-and-policy/bulletin/2017/visa-bulletin-for-november-2016.html. AC21 was enacted as a response to the long and growing delays for many beneficiaries of Form I-140 petitions, to ameliorate the detrimental impact of such delays on the U.S. economy, U.S. businesses, and affected workers themselves. Those delays, however, have grown substantially longer than those that existed at the time AC21 was passed. Although DHS has worked diligently to improve processing times during the intervening period, visa backlogs due to statutory numerical limits for many individuals seeking EB-2 and EB-3 classification have grown significantly for certain individuals. 17 DHS recognizes the resulting realities confronting individuals seeking employment-based permanent residence who, due to immigrant visa unavailability, are required to wait many years for visas to become available before they can file applications for adjustment of status or seek immigrant visas abroad and become LPRs. In many instances, these individuals are in the United States in a nonimmigrant, employer-specific temporary worker category ( e.g., H-1B or L-1 visa classification) and may be unable to accept promotions or otherwise change jobs or employers without abandoning their existing efforts—including great investments of time and money—to become permanent residents. Their employment opportunities may be limited to their original job duties with the U.S. employer that sponsored their temporary admission to the United States, despite the fact that they may have gained professional experience that would otherwise allow them to progress substantially in their careers. 17 According to the Visa Bulletin for October 2000 (the month AC21 was enacted), visa availability was current for all persons qualifying under the EB-1 preference category. The EB-2 category was current for all countries except for China and India. The EB-2 cut-off dates were March 8, 1999 for persons chargeable to China (a wait of 19 months) and November 1, 1999 for persons chargeable to India (a wait of 11 months). The EB-3 category likewise was current for all countries except for China and India, with a cut-off date of March 15, 1998 for individuals charged to China (a wait of 31 months) and February 8, 1997 for individuals charged to India (a wait of 44 months). See http://dosfan.lib.uic.edu/ERC/visa_bulletin/2000-10bulletin.html. Many individuals subject to the immigrant visa backlogs confront the choice between remaining employed in a specific job under the same terms and conditions originally offered to them, or abandoning the pursuit of an immigrant visa altogether if they do not have another Form I-140 petition filed on their behalf. When such a worker changes employers or jobs—including a change to an identical job with a different employer or to a new but related job for the same employer—the worker is typically subject to uncertainty as to whether USCIS will approve his or her application for LPR status based on the change. Moreover, these individuals must consider whether such changes would involve expensive additional immigration processes, greatly discouraging them. Indeed, under current regulations, some changes in employment could result in the loss of nonimmigrant status, loss of the ability to change to another nonimmigrant status, loss of an approved immigrant visa, loss of the ability to obtain an immigrant visa or adjust to LPR status, or the need for the affected worker and his or her family to immediately depart the United States. As a result, these employees often suffer through many years of effective career stagnation, as they are largely dependent on current employers for immigration status and are substantially restricted in their ability to change employers or even accept promotions from, or make lateral movements within, their current employers. Simply put, many workers in the immigrant visa process are not free to consider all available employment and career development opportunities. This effectively prevents U.S. employers from treating them like the high-potential individuals the employer hired them to be, thus restricting productivity and the promise they offer to our nation's economy. The lack of predictability and flexibility for such workers may also prevent them from otherwise investing in and contributing to the local, regional, and national economy or fully integrating into American society. IV. Discussion of Comments A. Overview of the Comments During the 60-day public comment period, DHS received 27,979 comments offering a wide variety of opinions and recommendations on the NPRM and related forms. A range of entities and individuals submitted comments, including nonimmigrants seeking to become LPRs, U.S. workers, schools and universities, employers, labor organizations, professional organizations, advocacy groups, law firms and attorneys, and nonprofit organizations. Many commenters expressed support for the rulemaking, in whole or in part. Supporters of the proposed rule agreed that it would help the United States attract and retain high-skilled foreign workers and would provide some relief to nonimmigrants and their families during their transition to LPR status. In particular, these commenters approved of the proposals to retain priority dates for the beneficiaries of immigrant visa petitions; provide grace periods of up to 60 days for certain high-skilled nonimmigrant workers to enhance job portability; extend grace periods of up to 10 days for certain high-skilled nonimmigrant workers so that they may more easily change or extend their nonimmigrant status; and codify guidance on counting previously exempt workers under nonimmigrant visa caps, as well as policies determining admission periods for such workers. Some commenters who generally supported the proposals also suggested changes to certain provisions. Other commenters opposed the proposed rule for different reasons. Some commenters who opposed the proposed rule questioned DHS's legal authority to promulgate some of the regulatory changes contained therein. A substantial number of other commenters, however, objected to the proposed rule because they believed many proposed changes should and could be more expansive. Such commenters, for example, believed that the rule should have substantially broadened the criteria for obtaining independent employment authorization for beneficiaries of immigrant visa petitions, rather than limiting such a benefit to cases involving compelling circumstances. Many commenters who opposed the rule were intending immigrants who described their personal experiences to illustrate how they would have been helped by the additional changes they requested. Some commenters argued that the proposed rule did nothing more than codify existing policies and that DHS could have gone further under existing statutory authorities. A number of other comments were opposed to the proposed rule based on generalized concerns about its impact on the U.S. economy. Some commenters were concerned that this rule may facilitate the displacement of American workers in certain sectors of the U.S. economy, such as in the information technology sector. Other commenters were concerned that the rule could facilitate the displacement of U.S. workers and a decrease in wages for U.S. citizen workers. One commenter opposing the proposed rule advocated for developing U.S. citizens' employment skills to enable them to have more employment opportunities. Others submitted comments related to the potential for fraud or to perceived irregularities in the rulemaking process. Commenters, for example, expressed concern that this rule could increase the potential for fraud and abuse, particularly by employers seeking to take advantage of the immigration system. Commenters also expressed concern that the substance of the rulemaking was unduly affected by a former lobbyist. Other commenters were concerned that provisions in the proposed rule would provide greater financial benefits to immigration attorneys and to USCIS than to the foreign workers who are the subject of the rule. Finally, DHS received a number of comments that were beyond the scope of this rulemaking. For example, several commenters asked DHS to include provisions creating new immigration benefits for inventors, researchers, and founders of start-up enterprises, a proposal that was not raised in the NPRM and some of which is the subject of a different rulemaking. 18 Other commenters focused on the U.S. political climate without addressing the proposed rule. Similarly, some submitted comments on the merits of other commenters' views without providing their own views on the proposal itself. 18 See International Entrepreneur Rule, 81 FR 60129 (Aug. 31, 2016). DHS has reviewed all of the public comments received in response to the proposed rule and thanks the public for its extensive input during this process. In the discussion below, DHS summarizes and responds to all relevant comments that were timely submitted on the NPRM, which are grouped by subject area. B. Authority of DHS To Administer and Enforce Immigration Laws 1. Description of DHS's Legal Authority As discussed at length in section II.B. above, the authority of the Secretary for these regulatory amendments is found in various sections of the INA, ACWIA, AC21, and the HSA. General authority for issuing the final rule is found in section 103(a) of the INA, 8 U.S.C. 1103(a), which authorizes the Secretary to administer and enforce the immigration and nationality laws, as well as section 102 of the HSA, 6 U.S.C. 112, which vests all of the functions of DHS in the Secretary and authorizes the Secretary to issue regulations. Other sections of the INA, together with ACWIA and AC21, provide specific statutory authority for multiple provisions of the final rule as detailed in section III.A of this preamble. DHS notes that, to the extent some of the commenters' requests for changes require action from Congress or other Departments, the Department lacks the authority to adopt these changes. DHS believes that this final rule improves upon existing policies and provides additional flexibilities consistent with DHS's existing authority to administer the U.S. immigration system under the relevant statutes passed by Congress. 2. Public Comments and Responses Comment. Many commenters opposed the rule based on what they perceived to be insufficient legal authority supporting the proposed changes. Many of these commenters asserted that the provisions in this rule were tantamount to new immigration legislation and that the rule thus effected an “unconstitutional” circumvention of Congress' role to establish the immigration laws. A few commenters claimed that only certain discrete proposals included in this rule are beyond DHS's legal authority. Response. DHS maintains that each proposed revision in this rule is fully within DHS's statutory authority. Section 103(a) of the INA, 8 U.S.C. 1103(a), expressly vests the Secretary with broad authority to administer and enforce the immigration laws, including by establishing regulations or prescribing such forms as necessary to carry out this authority. Additionally, section 102 of the HSA 6 U.S.C. 112, vests all of the functions of DHS in the Secretary and authorizes the Secretary to issue regulations. This rulemaking reflects the lawful exercise of statutory authority delegated by Congress. In the preamble to this final rule, DHS has identified the statutory authorities for all of the revisions being made, including various provisions of the INA, the HSA, ACWIA and AC21. Through this rulemaking, DHS is exercising its authority to promulgate regulations as necessary to properly implement and administer existing immigration laws. As such, this final rule will improve processes for U.S. employers seeking to sponsor and retain immigrant and nonimmigrant workers; provide greater stability and job flexibility for such workers; and increase transparency and consistency in the application of DHS policy related to affected classifications. Comment. Several commenters questioned the general basis for various immigration actions taken by the Executive Branch related to businesses and high-skilled workers. These commenters believed that the Executive Branch has exceeded its role by taking it upon itself to “achieve something that [C]ongress has failed to do.” Response. As noted above, DHS has the requisite legal authority to issue this final rule. In enacting the INA, ACWIA, AC21, and the HSA, Congress accorded DHS the responsibility for implementing and administering these laws. Consistent with that authority, DHS is promulgating this final rule to further define and clarify existing statutory requirements. With this final rule, DHS is also responding to a specific directive from the Secretary to strengthen and improve various employment-based visa programs within the Department's existing legal authority, 19 including to “consider amending its regulations to ensure that approved, longstanding visa petitions remain valid in certain cases where the beneficiaries seek to change jobs or employers.” 20 These executive actions do not impinge on Congress's legislative role. 19 See Memo from Jeh Charles Johnson, Secretary of Homeland Security, “Policies Supporting U.S. High-Skilled Business and Workers” (Nov. 20, 2014)(Secretary Johnson Nov. 20, 2014 memo), available at http://www.dhs.gov/sites/default/files/publications/14_1120_memo_business_actions.pdf. 20 Id. Comment. Commenters stated that this rule would effectively increase the number of immigrant visas issued in excess of their respective annual caps. These commenters also expressed concern that the rule would increase the number of H-1B workers who would be cap-exempt. Specifically, commenters stated that this rule circumvents overall caps on authorized visas through a two-step process: (1) Authorizing an unlimited number of individuals to seek permanent residence in excess of the cap on immigrant visas; and (2) giving these individuals (and their spouses and children) employment authorization while they wait for their immigrant visas to become available. For example, one commenter stated that the rule would “nullify[ ] Americans' statutory protections against job-threatening flows of excess foreign labor.” Other commenters believed that the perceived increase in the number of visas that would be issued under this rule reflects the Administration's favoring of skilled immigrant workers over natural-born U.S. citizens. One commenter claimed that the proposal to allow an H-1B worker whose employer has applied for LPR status on the worker's behalf to stay and work in the United States beyond the 6-year limit violates the Constitution, including by “waiv[ing] federal law without action of the Congress of the United States.” Additionally, one commenter expressed concern that the proposed changes would allow foreign workers in the United States on expired H-1B visas to extend their stay indefinitely by applying for employment-based LPR status. The commenter stated that this was an impermissible change because Congress is responsible for setting the annual limits on H-1B visas. Response. DHS is not modifying immigrant or nonimmigrant numerical limits set forth in the INA and is not changing the classes of foreign workers who qualify for employment-based immigrant or nonimmigrant visas. Contrary to commenters' statements, the provisions contained in this rule reflect a clear congressional mandate with respect to H-1B beneficiaries who are pursuing LPR status, but face long waits due to backlogs resulting from the statutory limits on immigrant visas or certain other adjudication or processing delays. Through the enactment of AC21, Congress authorized these individuals to remain in the United States beyond their initial 6-year period of authorized admission. See AC21 104(c) and 106(a) and (b). Finally, with regard to the concerns about this rule increasing the number of H-1B visas that are exempt from the annual limit, DHS notes that, for the most part, this regulation codifies longstanding policy and practice implementing the relevant provisions of AC21. This rule generally codifies already existing policy interpretations identifying which employers are cap-exempt under the H-1B program and DHS also includes revised definitions of “related or affiliated nonprofit entity” and “governmental research organizations” to clarify certain terms and to avoid confusion. See IV, part J. In particular, although the revised definitions may expand the number of petitioners that are cap-exempt, DHS believes that the changes improve current policy by better reflecting current operational realities for institutions of higher education and governmental research organizations, and are consistent with the exemption enacted by Congress. In addition, DHS added a provision that will protect against indefinite H-1B extensions under section 106(a) of AC21. See 8 CFR 214.2(h)(13)(iii)(D)( 10 ). Additionally, DHS is not providing compelling circumstances employment authorization to an unlimited number of foreign workers and their dependents while they wait for immigrant visas to become available. Rather, DHS is allowing certain high-skilled nonimmigrant workers and their dependents, who are all on the path to LPR status, to apply for independent and temporary employment authorization if they meet certain criteria, including demonstrating that the workers need such employment authorization due to compelling circumstances. While some of the dependents of these individuals may not have been part of the workforce at the time they receive such employment authorization, they would eventually become part of the workforce even without this separate employment authorization as they are already on the path to permanent residence. See Section IV, part F of this preamble for a discussion of compelling circumstances employment authorization. C. Immigration Fraud and National Security Concerns 1. Description of Final Rule and Changes From the NPRM DHS's core responsibilities include enhancing homeland security and preventing terrorism, enforcing and administering the immigration laws, and ensuring the integrity of the immigration system. 21 When drafting this rule, DHS carefully considered the impact of the proposed regulatory provisions on the safety and security of our nation and the integrity of the immigration system. DHS believes that the regulations as proposed appropriately address these concerns and further believes that this final rule will not compromise its vigilance. 21 See https://www.dhs.gov/our-mission. 2. Public Comments and Responses Comment. Several commenters raised concerns about terrorism stemming from foreign nationals in various immigration statuses, and the adequacy of background checks for those seeking to acquire immigration status. Response. DHS takes its core mission to safeguard the homeland extremely seriously, and it has a number of mechanisms in place to detect fraud and security threats. Individuals requesting immigration benefits from USCIS are subject to a variety of background and security checks, which vary depending on the benefit. USCIS created the Fraud Detection and National Security Directorate (FDNS) in part to investigate whether individuals or organizations filing for immigration benefits pose a threat to national security, public safety, or the integrity of the immigration system. FDNS officers resolve background check information and other concerns that surface during the processing of immigration benefit applications and petitions. Resolution of specific questions related to an application or petition often requires communication with law enforcement or intelligence agencies to make sure that the information pertains to the applicant or petitioner and to determine whether the information would have an impact on his or her eligibility for the benefit. FDNS officers also check various databases and public information, as well as conduct other administrative inquiries, including pre- and post-adjudication site visits, to verify information provided on, and in support of, applications and petitions. FDNS uses the Fraud Detection and National Security Data System (FDNS-DS) to identify fraud and track potential patterns. In addition, FDNS routinely works with U.S. Immigration and Customs Enforcement (ICE), U.S. Customs and Border Protection (CBP), and other law enforcement and intelligence agencies, consistent with all relevant policies on information sharing and referrals. 22 22 Individuals may report suspicious activity to ICE Homeland Security Investigations at www.ice.gov/webform/hsi-tip-form or at (866) 347-2423. Comment. DHS received several comments concerning alleged fraud in the EB-1, H-1B, and L-1 visa programs, including falsification of worker qualifications and other misuses. These commenters requested that additional measures be taken to combat fraud. Response. DHS continually seeks to strengthen its abilities to detect and combat immigration-related fraud. Possible consequences for fraud already include detention and removal, inadmissibility to the United States, ineligibility for naturalization and other benefits, and criminal prosecution. See, e.g., INA 101(f), 204(c), 212(a)(2) and (a)(6), 236(c), 237(a)(1)(A) and (G), (a)(2) and (a)(3), 316(a), 318, 8 U.S.C. 1101(f), 1154(c), 1182(a)(2) and (a)(6), 1226(c), 1227(a)(1)(A) and (G), (a)(2) and (a)(3), 1427(a), 1429. USCIS adjudicators receive training to recognize potential fraud indicators across all benefit types and the guidelines for referring cases of suspected fraud for further investigation. Additionally, as provided under section 214(c)(12) of the INA, 8 U.S.C. 1184(c)(12), a Fraud Prevention and Detection Fee must be paid by an employer petitioning for a beneficiary's initial grant of H-1B or L nonimmigrant classification, as well as for a beneficiary who is changing employers within these classifications. The INA requires fees deposited into the Fraud Prevention and Detection Account to be divided into thirds, and allocated to DHS, DOL, and DOS. See INA 286(v); 8 U.S.C. 1356(v). DHS uses its portion of the fees to support activities related to preventing and detecting fraud in the delivery of all immigration benefit types. 23 23 Further information about USCIS use and collection of fees can be found in March 2015 Congressional testimony available at https://www.uscis.gov/tools/resources-congress/presentations-and-reports/oversight-us-citizenship-and-immigration-services-ensuring-agency-priorities-comply-law-senate-committee-judiciary-subcommittee-immigration-and-national-interest-march-2015. Additionally, FDNS currently combats fraud and abuse across all benefit types—including the EB-1, EB-2, EB-3, H-1B, and L-1 programs—by developing and maintaining efficient and effective anti-fraud and screening programs, leading information sharing and collaboration activities, and supporting the law enforcement and intelligence communities. As mentioned above, FDNS's primary mission is to determine whether individuals or organizations requesting immigration benefits pose a threat to national security, public safety, or the integrity of the nation's immigration system. USCIS verifies information and combats immigration fraud using various tools, including the Administrative Site Visit and Verification Program (ASVVP), under which FDNS conducts compliance review site visits for petitions in the H-1B, L-1, and religious worker programs. USCIS also conducts checks of various USCIS and other databases, including the FDNS-DS and the Validation Instrument for Business Enterprises (VIBE). USCIS has formed a partnership with ICE, under which FDNS pursues administrative inquiries into most application and petition fraud and ICE conducts criminal investigations into major fraud conspiracies. Individuals with information regarding fraud and abuse in the immigration benefits system are encouraged to contact FDNS at reportfraudtips@uscis.dhs.gov , by mail at 111 Massachusetts Ave. NW., Ste. 7002, Mail Stop 2280, Washington, DC 20529-2280, or call (202) 529-2280. DHS believes that existing rules and measures collectively provide adequate tools to detect and combat fraud and abuse, and that this rulemaking does not require new or additional protections. Accordingly, DHS has not made any changes in response to these comments. D. Petitions for Employment-Based Immigrants and Priority Date Retention 1. Description of Final Rule and Changes From the NPRM The final rule clarifies when priority dates are established for employment-based immigrants and expands the ability of beneficiaries of approved Form I-140 petitions in the EB-1, EB-2, and EB-3 categories to retain their priority dates for use with subsequently filed Form I-140 petitions. First, the final rule fills a hole in current regulations. Existing regulations establish that the priority date of an employment-based immigrant visa petition accompanied by a labor certification is established when the labor certification is accepted for processing by DOL. Those regulations, however, do not indicate when the priority date is established for an employment-based petition that is not accompanied by a labor certification. To provide further clarity, this final rule provides, generally, that the priority date of a Form I-140 petition that does not require a labor certification is the date such petition is properly filed with USCIS. See final 8 CFR 204.5(d). Second, the final rule disallows retention of the priority date of an approved Form I-140 petition if the approval of the petition is revoked because of fraud, willful misrepresentation of a material fact, the invalidation or revocation of a labor certification, or material error. See final 8 CFR 204.5(e). Third, the final rule amends existing automatic revocation regulations to prevent Form I-140 petitions that have been approved for 180 days or more from being automatically revoked based solely on the withdrawal of the petition by the petitioner or the termination of the petitioner's business. See final 8 CFR 205.1(a)(3)(iii)(C) and (D). In response to comments, the final rule also prevents automatic revocation of approved petitions that are withdrawn or where the business terminates 180 days after an associated adjustment of status application is filed. See id. These approved petitions will continue to be valid for priority date retention purposes, unless approval is revoked on other grounds specified in final 8 CFR 204.5(e)(2). 24 They also generally will remain valid for various other purposes under immigration laws including: (1) Job portability under INA section 204(j); (2) extensions of status for certain H-1B nonimmigrant workers under sections 104(c) and 106(a) and (b) of AC21; and (3) eligibility for employment authorization in compelling circumstances under final 8 CFR 204.5(p). 24 The four grounds are (i) fraud, or a willful misrepresentation of a material fact; (ii) revocation by the Department of Labor of the approved permanent labor certification that accompanied the petition; (iii) invalidation by USCIS or the Department of State of the permanent labor certification that accompanied the petition; and (iv) a determination by USCIS that petition approval was based on a material error. In addition, the final rule clarifies that an approved Form I-140 petition that is subject to withdrawal or business termination cannot on its own serve as a bona fide employment offer related to the petition. See final 8 CFR 205.1(a)(3)(iii)(C) and (D). To obtain an immigrant visa or adjust status, beneficiaries of these petitions must have either new Form I-140 petitions filed on their behalf, or, if eligible for job portability under section 204(j) of the INA, new offers of employme [Text truncated at 120,000 characters. The full text is on the page linked above.] --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/fr%3A2016-27540. Public record. Not legal advice.