Questions & Answers: USCIS Issues Guidance Memorandum on Establishing the "Employee-Employer Relationship" in H-1B Petitions

Posted On: August 4, 2011

Introduction
U.S. Citizenship and Immigration Services (USCIS) issued updated guidance to adjudication officers to clarify what constitutes a valid employer-employee relationship to qualify for the H-1B ‘specialty occupation’ classification. The memorandum clarifies such relationships, particularly as it pertains to independent contractors, self-employed beneficiaries, and beneficiaries placed at third-party worksites. The memorandum is titled: “Determining Employer-Employee Relationship for Adjudication of H-1B Petitions, Including Third-Party Site Placements: Additions to Officer’s Field Manual (AFM) Chapter 31.3(g)(15)(AFM Update AD 10-24).” In addition to clarifying the requirements for a valid employer-employee relationship, the memorandum also discusses the types of evidence petitioners may provide to establish that an employer-employee relationship exists and will continue to exist with the beneficiary throughout the duration of the requested H-1B validity period.


Questions & Answers
Q: Does this memorandum change any of the requirements to establish eligibility for an H-1B petition?

A: No. This memorandum does not change any of the requirements for an H-1B petition. The H-1B regulations currently require that a United States employer establish that it has an employer-employee relations with respect to the beneficiary, as indicated by the fact that it may hire, pay, fire, supervise or otherwise control the work of any such employee. In addition to demonstrating that a valid employer-employee relationship will exist between the petitioner and the beneficiary, the petitioner must continue to comply with all of the requirements for an H-1B petition including:

- establishing that the beneficiary is coming to the United States temporarily to work in a specialty occupation;
- demonstrating that the beneficiary is qualified to perform services in the specialty occupation; and
- filing of a Labor Condition Application (LCA) specific to each location where the beneficiary will perform services.


Q: What factors does USCIS consider when evaluating the employer-employee relationship?

A: As stated in the memorandum, USCIS will evaluate whether the petitioner has the “right to control” the beneficiary’s employment, such as when, where and how the beneficiary performs the job. Please see the memorandum in the links in the upper right hand of this page for a list of factors that USCIS will review when determining whether the petitioner has the right to control the beneficiary. Please note that no one factor is decisive and adjudicators will review the totality of the circumstances when making a determination as to whether the employer-employee relationship exists.


Q: What types of evidence can I provide to demonstrate that I have a valid employer-employee relationship with the beneficiary?

A: You may demonstrate that you have a valid employer-employee relationship with the beneficiary by submitting the types of evidence outlined in the memorandum or similar probative types of evidence.


Q: What if I cannot submit the evidence listed in the memorandum?

A: The documents listed in the memorandum are only examples of evidence that establish the petitioner’s right to control the beneficiary’s employment. Unless a document is required by the regulations, i.e. an itinerary, you may provide similarly probative documents. You may submit a combination of any documents that sufficiently establish that the required relationship between you and the beneficiary exists. You should explain how the documents you are providing establish the relationship. Adjudicators will review and weigh all the evidence submitted to determine whether a qualifying employer-employee relationship has been established.


Q: What if I receive or have received an RFE requesting that I submit a particular type of evidence and I do not have the exact type of document listed in the RFE?

A: If the type of evidence requested in the RFE is not a document that is required by regulations, you may submit other similar probative evidence that addresses the issue(s) raised in the RFE. You should explain how the documents you are providing address the deficiency(ies) raised in the RFE. Adjudicators will review and weigh all evidence based on the totality of the circumstances. Please note that you cannot submit similar evidence in place of documents required by regulation.


Q: Will my petition be denied if I cannot establish that the qualifying employer-employee relationship will exist?

A: If you do not initially provide sufficient evidence of an employer-employee relationship for the duration of the requested validity period, you may be given an opportunity to correct the deficiency in response to a request for evidence (RFE). Your petition will be denied if you do not provide sufficiently probative evidence that the qualifying employer-employee relationship will exist for any time period.


Q: What if I can only establish that the qualifying employer-employee relationship will exist for a portion of the requested validity period?

A: If you do not initially provide sufficient evidence of an employer-employee relationship for the duration of the requested validity period, you may be given an opportunity to correct the deficiency in response to a request for evidence (RFE). Your petition may still be approved if you provide evidence that a qualifying employer-employee relationship will exist for a portion of the requested validity period (as long as all other requirements are met), however, USCIS will limit a petition’s validity to the time period of qualifying employment established by the evidence.


Q: What happens if I am filing a petition requesting a “Continuation of previously approved employment without change” or “Change in previously approved employment” and an extension of stay for the beneficiary in H-1B classification, but I did not maintain a valid employer-employee relationship with the beneficiary during the validity of the previous petition?

A: Your extension petition will be denied if USCIS determines that you did not maintain a valid employer-employee relationship with the beneficiary throughout the validity period of the previous petition. The only exception is if there is a compelling reason to approve the new petition (e.g. you are able to demonstrate that you did not meet all of the terms and conditions through no fault of your own). Such exceptions would be limited and made on a case-by-case basis.


Q: What if I am filing a petition requesting a “Change of Employer” and an extension of stay for the beneficiary’s H-1B classification? Would my petition be adjudicated under the section of the memorandum that deals with extension petitions?

A: No. The section of the memorandum that covers extension petitions applies solely to petitions filed by the same employer to extend H-1B status without a material change in the original terms of employment. All other petitions will be adjudicated in accordance with the section of the memorandum that covers initial petitions.


Q: I am a petitioner who will be employing the beneficiary to perform services in more than one work location. Do I need to submit an itinerary in support of my petition?

A: Yes. You will need to submit a complete itinerary of services or engagements, as described in the memo, in order to comply with 8 CFR 214.2(h)(2)(i)(B) if you are employing the beneficiary to perform services in more than one work location. Furthermore, you must comply with Department of Labor regulations requiring that you file an LCA specific to each work location for the beneficiary.


Q: The memorandum provides an example of when a beneficiary, who is the sole owner of the petitioner, would not establish a valid employer-employee relationship. Are there any examples of when a beneficiary, who is the sole owner of the petitioner, may be able to establish a valid employer-employee relationship?

A. Yes. In footnotes 9 and 10 of the memorandum, USCIS indicates that while a corporation may be a separate legal entity from its stockholders or sole owner, it may be difficult for that corporation to establish the requisite employer-employee relationship for purposes of an H-1B petition. However, if the facts show that there is a right to control by the petitioner over the employment of the beneficiary, then a valid employer-employee relationship may be established. For example, if the petitioner provides evidence that there is a separate Board of Directors which has the ability to hire, fire, pay, supervise or otherwise control the beneficiary, the petitioner may be able to establish an employer-employee relationship with the beneficiary.


Q: What happens if I do not submit evidence of the employer-employee relationship with my initial petition?

A: If you do not initially provide sufficient evidence of an employer-employee relationship for the duration of the requested validity period, you will be given an opportunity to correct the deficiency in response to a request for evidence (RFE). However, failure to provide this information with the initial submission will delay processing of your petition.


For more information on USCIS and its programs, call 1-800-375-5283.

Information Provided by: United States Citizenship and Immigration Services (USCIS) Published Jan. 13, 2010; revised Aug. 2, 2011