In a huge win for IT Consulting companies, a Federal Judge has now ruled that USCIS can no longer use its policy memos to continue denying H-1B petitions.

In the last few years, the number of RFEs and denials have skyrocketed, largely due to additional requirements placed on H-1B Employers when filing petitions. Although there have been no significant changes in the law or regulations USCIS has required its officers to adjudicate cases in accordance with a number of policy memos, specifically targeted at IT companies, who place their employees at third-party locations.

U.S. District Judge Rosemary M. Collyer handed down the decision in ITServe Alliance, Inc. v L. Francis Cissna, on March 10, 2020. This lawsuit was the result of 33 separate lawsuits that were filed in the District of Columbia challenging USCIS’s authority to deny petitions based on the improper interpretations of the Employer/employee relationship, specific work rule and itinerary requirements.

The key aspects of the decision are as follows:

USCIS can no longer rely on its 2018 Contracts and Itineraries memo which requires Employers to demonstrate evidence of a specific and non-speculative qualifying work assignment for the entire time requested on an H1B petition. This means that Employers should no longer have to submit copies of contracts and work orders showing available work for 3 years;

USCIS can no longer rely on its 2010 Employer/employee relationship memo (Neufield memo) to determine whether there is a valid Employer/employee relationship. Therefore, as long as an Employer hires, pays, fires or otherwise controls the H-1B employee’s work an Employer should be able to establish a valid Employer/employee relationship;

USCIS’s itinerary requirement is no longer enforceable. USCIS has been insisting that Employer’s submit a detailed itinerary with each H-1B petition filed that sets out the specific dates and places where an employee will work for the entire time requested on the H-1B petition. However, this is inconsistent with the anti-benching provision passed as part of the American Competitiveness and Workforce Improvement Act of 1998, which specifically allows an employer to keep an H-1B employee during any “non-productive” periods as long as the employee is paid.

USCIS can issue H-1B approvals for less than 3 years, but they must provide a legitimate reason for any decision to deny, in whole or in part, an H-1B petition. This reason cannot be because an Employer cannot show available work for 3 years. Similarly, if an Employer has demonstrated that they hire, pay, fire or otherwise control an employee, USCIS cannot deny a petition for lack of a valid Employer/employee relationship. This means if USCIS issues a partial approval, for say 6 months, they should also issue a separate decision explaining why the remaining 2 years and 6 months was denied.

Why the Judge sided with ITServe Alliance

In finding that USCIS can no longer rely on its policy memos the Judge found that USCIS had exceeded the law and was required in engage in formal rulemaking. USCIS’s policy memos are supposed to be an interpretation of the existing law and should not create new requirements. However, the policy memos issued by USCIS in 2010 and 2018 attempted to do just that. In adjudicating H-1B petitions USCIS required evidence of actual control to demonstrate a valid Employer/employee relationship and evidence of a specific work assignment for the entire 3 years. Nothing in the Immigration and Nationality Act or the implementing regulations contain such requirements and USCIS cannot introduce these new requirements without first going through notice and comment rulemaking.

What next?

Just because we have a favorable decision does not mean that USCIS is going to abide by it and stop using their policy memos to adjudicate cases unfairly. They always have the option to appeal this decision. Until there is a nationwide injunction, then we recommend filing cases with the same documentation as you have been providing previously i.e. a detailed itinerary, vendor letters, client letters, MSAs, Work Orders and Statements of Work. Furthermore, these documents will still be helpful in establishing that the position is a specialty occupation.

Even if USCIS stops using these memos will they find another way to deny applications. I hate to be pessimistic, but this is part of Trump’s overall plan to reduce Immigration. Remember this decision does not deal with specialty occupation specifically, so we expect USCIS to continue to deny cases based on a position not qualifying as a specialty occupation. Furthermore, USCIS is likely to think of other creative ways to deny petitions.

If you have received partial approval or denial as a direct result of one of the above issues you can file a Federal Lawsuit in DC to challenge that decision. Judge Collyer stated that DC is the proper venue for such cases and this decision is binding in that District.

This decision represents an incredible win for IT Consulting companies and is another example of how USCIS is attempting to operate outside of the law. Although this is a great result, I firmly believe that we will need to continue filing lawsuits against USCIS to overcome unjust results and hold them accountable. This is just the start.

For any questions relating to the recent decision in ITServe Alliance, Inc. v L. Francis Cissna, please contact our Senior Immigration Attorney, Chris Prescott at cprescott@patellegal.com