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7 ways to deal with the H-1B cap 

H-1B cap reached? What now?  

On July 25, 2000, the INS announced that it had reached the H-1B cap and reached the limit of 115,000 H-1B visas for this fiscal year. Where does this leave employers? What options are available? Who can work and when? The following seven guidelines will help employers and foreign nationals sort through the implications of this announcement. 

1. No new initial H-1Bs will be granted until after October 1, 2000. Foreign nationals outside the U.S. or who are in the U.S. in a different status who seek to change to H-1B status will have to wait until after 10/1/00, the start of the new fiscal year, to obtain them.  
   
   

2. Employers must wait to hire these particular foreign nationals. Until the H-1B is approved, the employer cannot hire the person unless the foreign national has work authorization based on a different status authorizing him to work. For example, a F-1 student on Optional Practical Training who has a valid work permit may work for the employer while waiting for the change of status to H-1B petition to be approved after October 1, 2000. However, if the work permit expires before the approval date of the H-1B, he must stop working immediately. 
   
   

3. Foreign nationals already possessing H-1B status and are transferring H-1B sponsorship or seeking concurrent employment can work before 10/1/00.  H-1B transfer petitions and petitions seeking concurrent employment for a second H-1B sponsor are not subject to the cap and are continuing to be processed at INS service centers. A person already on a H-1B seeking to transfer the H-1B sponsorship can have his transfer petition approved before 10/1/00 and begin working as soon as he receives approval.  He cannot commence working for the second employer until explicitly receiving approval from the INS. 
   
   

4. F-1 and J-1 foreign nationals may legally continue to stay in the U.S. If the change of status petition was submitted while the foreign national was still in valid F-1 or J-1 status, the INS will permit her to stay and wait for the approval of the H-1B petition. However, she cannot work until after receiving H-1B approval. 
   
   

5. The foreign national can be kept on payroll as long as she’s not providing services.  To be paid and provide services constitutes “work” which is prohibited until receiving H-1B approval. A company can place a foreign national on paid leave when the person’s work authorization expires. Since the person is not providing services, it can be argued that no work is being done, and it is less likely that the INS will consider this to be violation of work authorization regulations. The advantage to this is it avoids requiring the person from having to go through the new hire paperwork process once he receives the H-1b approval. It is often utilized near the end of September when the H-1B has an approval with a 10/1/00 start date. Caution is urged: this is a position that may be disputed in an investigation by the INS, and companies doing this to hold on to key individuals should consult with immigration counsel. 
   
   

6. The foreign national may provide services, but not receive compensation or be on payroll. This is possible, but scrutinized by the INS since it is highly unlikely that a person will work without pay. The INS will examine whether compensation was later provided in a disguised form. If this is the case, the INS may consider the foreign national to have illegally worked without authorization. In this case, the company can also be in trouble for hiring an employee who does not have proper work authorization. Since this is arguable stance, companies pursuing this route should consult an immigration attorney to ensure that they are in compliance with the law. 
   
   

7. Employees outside the U.S. with H-1B approval notices can enter the U.S. up to ten days prior to the start date. If a foreign national has a start date of 10/1/00, he may enter as early as September 21, 2000 to find a place live and settle into life in the U.S. However, he may not begin working until the actual start date listed on the H-1B approval notice.