Memo on two companies seeking H-1B visa for same person raises questions

The federal immigration service has adopted a policy memorandum seeking to clarify rules for companies and affiliates applying for multiple high-skilled work visas on behalf of the same person.

Business immigration attorneys said that while the case the memo stemmed from had a narrow fact pattern, it created more questions than it answered and its impact wasn't fully known, especially in light of today being the first day of the H-1B filing season.

The case was adopted by the Administrative Appeals Office of U.S. Citizenship and Immigration Services and concerned a software development and consulting firm that applied for an H-1B visa for a programmer analyst. The appeals office denied the visa because another company, which it found to be a "related entity" to the first company through a subcontractor agreement, impermissibly filed an application for the same person.

The decision interpreted the "related entity" language broadly and said that it could apply to relationships beyond parent companies, subsidiaries or affiliates. "Matter of S- Inc. clarifies that the term 'related entities' includes petitioners, whether or not related through corporate ownership and control," the appeals office wrote. Matter of S- Inc., Adopted Decision 2018-02 (AAO Mar. 23, 2018).

"What gives me and probably many other immigration lawyers some concern is that it still leaves open to interpretation what a related entity is in this meaning," said Gregory Wald, a business immigration attorney and partner at Squire Patton Boggs in San Francisco.

"The government should be able to determine what a related entity is," Wald added. "If it's not just related based on ownership and it's based on companies that have some kind of contractual relation to each other, like presumably these did in this case then the regulation should say that."

"I could see the service wanting to make sure people aren't gaming the system but this could be very over broad," said John C. Lemacks II, a business immigration attorney and partner at Tafapolsky Smith Mehlman LLP in Los Angeles.

He agreed that the case covered a specific set of facts and said that as far as the opening of the H-1B filing deadline for the 85,000 annual work visas, the impact of the decision was unclear. "It's overbroad and it could potentially capture two unwitting petitioners who file for the same employee and the same job classification and same area," Lemacks said. "They've opened it up to say it is not just limited to what the [regulations] say."

Related entities can file multiple applications for the same person provided there is a legitimate business interest involved, and some lawyers said the memorandum helped explain when this was permitted.

"It's a helpful clarification of a rule that the immigration service put in place when demand for these H-1B visas started outstripping supply," said William Stock, a business immigration lawyer and a partner at Klasko Immigration Law Partners LLP in Philadelphia.

Attorneys said that while they did not handle many of these types of cases, if any at all, the decision could be aimed at stemming the practice of multiple applications by certain consulting and information technology companies.

"It does take away an advantage that consulting companies might otherwise have had over the company that ultimately wants to use this person's services," Stock said.