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Several widely-publicized actions by the Securities Exchange Commission (SEC), and the inevitable litigation that has piled on in consequence, have pressure-tested the EB-5 ecosystem and found it defective. Simply stated, the system too likely and too often fails. Sadly, many EB-5 investors, after writing half-million-dollar or greater checks, ultimately have learned that no balances remain in their capital accounts and no green cards land or stay in their own and their family’s wallets.
Stripped of cash and cards, an unacceptable number of EB-5 investors find out that they have been fleeced. This calamity is not necessarily attributable to the ever-present moral hazard of failing to thoroughly investigate a proposed investment, and imprudently placing at-risk funds into an unsound business opportunity. Rather, the flaw lies in structural and process failures of malfeasant government officials and market participants to take care that EB-5 investors are adequately protected from errant or unscrupulous promoters, developers, regional-center principals and migration agents, and from sundry Ponzi schemers, garden-variety fraudsters and sophisticated con artists.
No EB-5 stakeholders and the ecosystem itself cannot continue to thrive if too many investors are defrauded of money and the promised permanent residency. Clearly, a healthy, sustainable EB-5 ecosystem cannot endure without meaningful investor protections and reliable safeguards that promote real job creation.
Why is this happening?
Culprit number one — thoughtless lawmakers. The successive Congresses that crafted and amended the EB-5 program surely must have known that some degree of fraud, waste, and abuse are the inevitable byproducts of all government programs. Yet, lawmakers never included investor protections in the enabling EB-5 legislation. Even more appalling, our legislators should have foreseen that foreign investors, many of whom lack rudimentary English fluency or business savvy, would at once be dazzled by the allure of a green card and likely unaware of the risk that the U.S. government’s own EB-5 program would be unsafe.
The Immigration Act of 1990, the law that ushered in the EB-5 program, and follow-on amendments, never authorized federal immigration administrators to debar from program participation blatantly out-of-compliance regional centers, developers, hucksters and their co-conspirators, or to protect investors from the harsh consequences of clearly foreseeable fraud and financial crimes. On the contrary, Congress knew from the outset that some deals will likely go south because scoundrels might hoodwink investors, or because other investments involve business plans with little likelihood of actual success.
Nonetheless, from inception, the law has provided that conditional residency would end and EB-5 investors brought before immigration judges in deportation proceedings if investments were not sustained — something that’s hard to do if one has been swindled — or the requisite jobs were not created.
Congress should also have known that securities law enforcers and immigration administrators would probably not quickly uncover the shenanigans hiding in some unregistered investments whose job-creating worthiness — by legislative design — would only be determined some two years hence.
Regrettably, Congress never provided for a real-time, on-the-scene watchdog to protect investors’ interests and make sure that promised actions supposedly leading to job creation for U.S. workers would actually happen.
Culprit number two — unaware and insensitive bureaucrats. As the SEC has acknowledged, it arrived several years late to the EB-5 program, having been oblivious for too many years to the Commission’s established statutory duty to protect investors in all securities transactions, including EB-5 deals. While SEC enforcement of EB-5 investments has fortunately intensified in the last few years and months, the Commission most often will likely play only an ex post facto enforcement role in punishing wrongdoers and trying to make investors whole once a deal has already failed or investors have been hurt, unless a whistleblower or grieving investor surfaces sooner.
So too have immigration administrators been derelict. Regulations of the legacy agency, the Immigration and Naturalization Service (INS), and the current Department of Homeland Security immigration components — U.S. Immigration & Customs Enforcement (ICE) and U.S. Citizenship and Immigration Services (USCIS) — offer defrauded investors no relief or even the possibility that discretion might be favorably exercised. To be sure, USCIS has tasked its Fraud Detection and National Security Directorate to make unannounced site visits to projects and regional centers and called for investor interviews when the issue of removing conditions on residency are to be ultimately adjudicated. These actions, however, have yet to occur in great numbers, may not be efficacious, or may just be too little too late.
Culprit number three — EB-5 market participants. The construction, lending and escrow industries — sectors especially active in EB-5 projects — have long been accustomed to the salutary, sentinel effect of meaningful oversight. Money doesn’t move from one contracting party to another unless predetermined and mutually agreed conditions are satisfied. The ever-present risk that funds or assets will be stolen, lost or wasted, or that desired outcomes might not be achieved, can be eliminated or mitigated if a real-time watchdog monitors contract compliance and fulfillment. The same safeguard could readily be applied for the protection of EB-5 investors and the assurance of job creation — but until now EB-5 market players seemed not to care. Instead, conflicts of interests continue to abound in the EB-5 industry and wrongdoers still go undetected until it’s too late.
What’s to be done?
All three culprits can expiate their sins if they act together or at least separately to introduce a new participant in the EB-5 ecosystem — the independent fiduciary — a person or firm that would represent the interests of investors in trying to assure the ultimate return of principal, the maximization of profits (once job creation at the requisite level has been confirmed by USCIS), and the ultimate prize — unconditional permanent residence.
An independent fiduciary would act much like a bank officer who decides whether agreed conditions have been satisfied before releasing progress payments of loan proceeds. The investors’ independent fiduciary could also perform:
an auditing function to confirm that required business and accounting records are maintained, and only permissible expenditures are paid,corporate secretary/treasurer functions to make timely disclosures to investors of financial activities, monitor fund administration and job creation/hiring, give notice of the time, date and methodology for investors to vote on corporate matters, and report any significant developments or material changes to the business plan,a watchdog function to confirm that insurance underwriter conditions are fulfilled and required permits and licenses are maintained; andan education and information function to explain to investors the role and activities of the independent fiduciary, and formally confirm to government officials how EB-5 program requirements are met when and as they are due.
Other loss mitigation safeguards could also be established. These include (a) the expanded availability and acquisition of EB-5 insurance to pay a form of indemnity (the return of the investment) if investor petitions are not approved or conditions on residence are not removed, (b) the addition of other traditional forms of insurance protection (e.g., fidelity bonds, and coverage for errors and omissions, business interruption, directors and officers liability and general liability), and (c) the use of letters of credit.
Without eliminating moral hazard, Congress could provide in the forthcoming integrity measures that a regional center’s or project developer’s engagement of an independent fiduciary, purchase of particular types of insurance, and/or arrangement for a letter of credit would serve as a good-faith prohibition against the denial or loss of lawful permanent resident status in cases where the SEC, ICE or USCIS determines that EB-5 investors have been defrauded.
USCIS could add similar protections in its (reportedly) soon-to-be-published EB-5 regulations. The agency could also specify by regulation or policy memorandum circumstances where the exercise of prosecutorial discretion should be exercised and of the full range of its parole authority and employment authorization are granted to defrauded but otherwise admissible EB-5 investors.
Market players should also have “skin in the game” of protecting EB-5 investors. They should require the engagement of independent fiduciaries and procurement of appropriate insurance coverages or letters of credit that reduce but do not eliminate all investment risk so that USCIS’s at-risk capital requirements are nonetheless satisfied. Market participants should also recognize that risk reduction will add costs but likely generate overriding cost savings that will redound to the benefit of primary lenders, project developers and regional centers while also attracting migration agents, investment advisors and the EB-5 investors themselves. Ultimately and ideally, only deals with fiduciary and insurance protections will be marketable.
* * *
Checks and balances — the brainchildren of the Founding Fathers — established our constitutional form of government that has endured for centuries. One of these features is the protection of minorities against majority power. So too will a new system of checks and balances protect vulnerable EB-5 investors likely reduce the prospect that investors will write very sizable checks but yield no balances in their capital accounts or place green cards in their wallets.
Updated 06-24-2016 at 12:48 PM by APaparelli
[Blogger’s Note: This post is submitted as a necessarily-lengthy formal comment to the November 20, 2015 draft guidance of U.S. Citizenship and Immigration Services, PM-602-0122, interpreting the phrase, “the same or [a] similar occupational classification” as used in the “increased job flexibility” provisions of Immigration and Nationality Act (INA) §§ 204(j) and 212(a)(5)(A)(iv). This comment incorporates by reference the content of all hyperlinked words and phrases below.
[By email: email@example.com
[Attention: Hon. León Rodriguez, Director, U.S. Citizenship and Immigration Services
[SUBJECT: Comment of Angelo A. Paparelli to Draft Policy Memorandum PM-602-0122, “Determining Whether a New Job is in ‘the Same or a Similar Occupational Classification’ for Purposes of Job Portability, Immigration and Nationality Act (INA) §§ 204(j) and 212(a)(5)(A)(iv), ” as provided in Public Law 106-313, the American Competitiveness in the 21st Century Act (AC21).]
A frisson of fear coursed through me when I learned that U.S. Citizenship and Immigration Services (USCIS) would issue new policy guidance on “job flexibility” — the statutory right of some long-patient green card applicants to change jobs or careers within the same or a similar occupational classification. Congress introduced this limber possibility in the American Competitiveness in the 21st Century Act (AC21), S.2045 , at a time when the legacy agency, the Immigration and Naturalization Service (INS), still held sway over immigration-benefits decisions.
The better way — APA Notice-and-Comment Rulemaking. In lieu of USCIS policy guidance, my strong preference would have been that the successor immigration agency pursue notice-and-comment rulemaking under the Administrative Procedure Act (APA). I worried that the more relaxed exercise of issuing draft policy guidance and inviting public comments would become yet another sad episode in the continuing manifestation, particularly in the last ten years, of America’s new form of extra-constitutional government, the Administrative State. Increasingly, the Administrative State — a form of government by bureaucracy “under which [federal] administrative agencies are able to push policy toward their preferences rather than being wholly faithful to their legislative principals” — has become the unwelcome default mode of lawmaking and governance in this era of Congressional impasse.
The Road to Good Intentions. As USCIS forecasted in November 2014 (Item 4 in its list), the forthcoming interpretation would “[p]rovide clarity on adjustment [of status] portability [in order] to remove unnecessary restrictions on natural career progression and general job mobility [and] provide relief to workers facing lengthy adjustment delays.” (Emphasis added.) Despite these soothing words, I foresaw that an admittedly informal “flexibility” practice that had worked reasonably well under a generally relaxed interpretation announced in a series of five agency advisories, e.g., here and here, would ossify in the hands of the current crop of policy formulators at USCIS’s headquarters. Unfortunately, these fears have come home to roost. As this blog post and comment will show, the November 20, 2015 draft guidance, PM-602-0122, is as stiff and lacking in vitality as a corpse in rigor mortis.
The Pre-AC21 Status Quo. When Congress enacted AC21, it added two provisions promoting “job flexibility” for long-delayed adjustment of status (green card) applicants. In doing so, the House and Senate tipped their hats to Buddha’s fundamental Law of Impermanence, the precept that, over time, stuff happens. In other words, as William Gladstone, the noted British statesman, reportedly said, “justice delayed is justice denied.”
Congress knew when it passed AC21 that INS decisions on employment-based applications for adjustment of status, the benefit of gaining green card status while in the U.S., were taking far too long. In a predecessor bill to AC21, the “Immigration Services and Infrastructure Improvements Act of 2000″ (S. 2586), Senator Dianne Feinstein, its lead author, along with several other senators, acknowledged what immigration stakeholders of the era had long known:
[Section 2](a) Findings.–Congress makes the following findings:
. . .
(3) The processing times in the Immigration and Naturalization Service’s other immigration benefits [cases, i.e., other than naturalization applications] have been unacceptably long. Applicants for family- and employment-based visas are waiting as long as 3 to 4 years to obtain a visa or an adjustment to lawful permanent resident status.
(4) In California, the delays in processing adjustment of status applications have averaged 52 months. In Texas, the delays have averaged 69 months. Residents of New York have had to wait up to 28 months; in Florida, 26 months; in Illinois, 37 months; in Oregon, 31 months; and in Arizona, 49 months. Most other States have experienced unacceptably long processing and adjudication delays. (Emphasis added.)
Clearly, Congress recognized when including in AC21 a “Title II” (also entitled, the “Immigration Services and Infrastructure Improvements Act of 2000”) that agency processing delays were forcing indentured adjustment applicants to wait years longer than the targeted 180-day period in the new law’s job-portability provisions:
[Sec. 202](b) POLICY.—It is the sense of Congress that the processing of an immigration benefit application should be completed not later than 180 days after the initial filing of the application, . . .
SEC. 203. DEFINITIONS.
In this title:
(1) BACKLOG.—The term ‘‘backlog’’ means, with respect to an immigration benefit application, the period of time in excess of 180 days that such application has been pending before the Immigration and Naturalization Service.
(2) IMMIGRATION BENEFIT APPLICATION.—The term ‘‘immigration benefit application” [includes] any application . . . to . . . adjust . . . status . . . under the Immigration and Nationality Act. (Emphasis added.)
Thus, the 106th Congress that enacted AC21 clearly knew about inordinate green card delays when it provided “job flexibility” relief to beneficiaries whose adjustment of status applications had been “long pending” — meaning those remaining unadjudicated for more than 180 days. Thus, it allowed a worker (sponsored for a green card in any one of four employment-based immigrant visa preference categories) to change jobs or employers after the adjustment application had been pending more than six months. The only AC21 condition imposed, however, is that the new position must be in the “same or [a] similar occupational classification” as the one described in the employer’s labor certification application or immigrant visa petition.
Need for a Regulation. Undoubtedly, publishing a proposed USCIS regulation and allowing formal comment from stakeholders before finalizing the rule would be a welcome approach. To be sure, prior agency guidance left a few lingering ambiguities requiring clarification and did not establish procedures which could and should be formalized in the rulemaking process. For example, some adjustment applicants probably remained tethered unhappily to Employer #1 because they feared that USCIS might disagree about job similarity and refuse the long-awaited green card. Moreover, as I proposed in “‘Parting is Such Sweet Sorrow': Musings on Adjustment of Status Portability” (Musings), Employer #2 gets a windfall, the hiring of an incipient permanent resident already granted open-market authorization pending the adjudication of the adjustment application. But Employer #2 might still lose if costly training which it provided is wasted or its project engagements are impaired by an adverse USCIS adjudication on the same-or-similar-job issue. Even worse, Employer #1 — the firm that did the heavy trudging through the red tape and suffered the time required to traverse trap-laden Department of Labor (DOL) and USCIS rules, incurring legal fees and other costs en route — becomes collateral damage in the war for talent as it loses the services of the the porting worker.
The Equitable Solution — Cell Mitosis. APA rulemaking could thus provide necessary equitable relief to all three deserving parties (the adjustment applicant and Employer #1 on the one hand, and Employer # 2 on the other) by adopting some variant of the “cell mitosis” theory I proposed in Musings.
Just as cells dividing through mitosis inherit cellular DNA, pipeline immigration benefits could likewise be “inherited.” If mitosis principles were to be applied, the porting employee and Employer #2 would win because their cellular “inheritance” endows green card status, and in an increasingly overheated labor market, the employment of an in-demand worker. But Employer #2 should not lose everything, given that the DOL’s test of U.S. worker unavailability for the position in question had already been passed. Instead, Employer #2 could “inherit” (a) the earlier “priority date,” the place in the immigrant visa waiting line, which Employer #1 had reserved for the departing worker, and (b) the right to petition for a comparably qualified non-citizen candidate to fill the same, now-vacant job and to help the new hire and his or her immediate relatives gain green cards through adjustment of status. Thus, subject to any waiting period in the green-card queue and the same numerical limits of the immigrant visa quota, the porting employee, his or her equally qualified substitute, and Employers #1 and #2, would ultimately gain salutary immigration benefits. Why? Because they earned them under AC21 and a flexible, job-flexibility final regulation — a rule well within USCIS’s regulatory authority to prescribe.
To those at USCIS or elsewhere who might argue that Employer #2’s “inheritance,” as I’ve described it, would contravene the DOL regulation, 20 CFR § 656.12(a), prohibiting the “offer [of an approved labor certification] for sale, barter or purchase by individuals or entities,” this blogging promoter of applying mitosis principles in the immigration ecosphere would respond that that horse has already left the barn. In practical effect, AC21’s portability provisions already refute the DOL notion, also espoused in § 656.12(a), that an approved labor certification is not “an article of commerce.” The statutory and commercially-valuable right of adjustment portability effectively permits Employer #2 to “purchase” (though a “same or similar” job offer accepted by the porting worker) the intangible proprietary right to employ the individual as long as s/he has secured the interim adjustment benefit of a USCIS-issued Employment Authorization Card or another form of work permit.
The Need for Transparency. An APA-compliant proposed rule would also make all stakeholder comments publicly accessible on Regulations.gov, and USCIS would be required to elucidate in writing its rationale for accepting some suggestions and eschewing others. This transparency is unlike the current USCIS practice which provides no access to public comments and no explanation of why stakeholder proposals to change draft guidance were accepted or rejected in the final policy. Regrettably, this behind-the-walls process of willful obscurantism is likely to apply to the finalized USCIS adjustment-portability policy once the comment period for the November 20, 2015 draft guidance (the Draft) expires on January 4, 2016.
What’s Wrong with the USCIS Draft Memorandum? As a partial remedy to the agency’s opaqueness in declining to publish stakeholder comments on job-flexibility, this blog lists several objections and suggest improvements to the Draft:
1. The Draft ignores AC-21’s legislative history of abhorrence to immigration case backlogs and the resulting need for job flexibility. As noted above, Congress clearly saw and tried to mitigate the interrelated problems of bureaucratic delays and the likelihood of changed circumstances. Delays in adjustment processing had grown unreasonably — up to as long as 69 months. To lessen the foreseeable risk that changed job circumstances would cause the loss of green-card eligibility, Congress enacted a law which — in the words of USCIS quoted above — would ” [(1)] provide clarity on adjustment [of status] portability[,] [(2)] remove unnecessary restrictions on natural career progression and general job mobility, [and] . . . [(3)] provide relief to workers facing lengthy adjustment delays.”
2. The Draft cherry-picks an especially strict definition of the word, “similar,” which AC21 left undefined. Although the USCIS cites Taniguchi v. Kan Pacific Saipan, Ltd., 132 S. Ct. 1997, 2002-03 (2012), for the principle that “when a term goes undefined in a statute, an agency ordinarily should ‘give the term its ordinary meaning,'” its proffered Draft violates the “ordinary meaning” principle. The Draft opts for the online version of a British dictionary, the Oxford English Dictionary (OEM), publicly inaccessible except by paid subscription, which apparently defines “similar” as “having a marked resemblance or likeness.” USCIS also cites the second definition of “similar” in the American online dictionary, Merriam-Webster.com (MW), to mean “alike in substance or essentials” — a definition clearly less restrictive than the OEM‘s “marked resemblance” formulation. The Draft does not explain, however, why it omitted MW‘s first definition of “similar,” to wit, “having characteristics in common : strictly comparable [emphasis added].” Perhaps the omission is an example of the Administrative State where agencies “push policy toward their preferences.” This stricter definition, however, would contravene the Supreme Court more recent application of the rules of statutory construction, Utility Air Regulatory Group v. EPA, a 2014 decision which restricted administrative-agency interpretations of statutes in the following words:
Under Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc., . . . we presume that when an agency-administered statute is ambiguous with respect to what it prescribes, Congress has empowered the agency to resolve the ambiguity. The question for a reviewing court is whether in doing so the agency has acted reasonably and thus has “stayed within the bounds of its statutory authority.” . . . .
Even under Chevron‘s deferential framework, agencies must operate “within the bounds of reasonable interpretation.” And reasonable statutory interpretation must account for both “the specific context in which … language is used” and “the broader context of the statute as a whole.” Robinson v. Shell Oil Co. A statutory “provision that may seem ambiguous in isolation is often clarified by the remainder of the statutory scheme … because only one of the permissible meanings produces a substantive effect that is compatible with the rest of the law.” Thus, an agency interpretation that is “[inconsistent] with the design and structure of the statute as a whole,” does not merit deference. (Citations omitted; emphasis added.)
Instead of requiring the stricter showing of “marked resemblance,” USCIS should give the phrase, the “same or similar occupational classification,” its ordinary meaning, namely that a job would be “similar” to another if the subject matter expertise required in each of the two jobs, or the stated duties, skills and qualifications, are fairly “comparable.” Thus, the Shakespearean comparison (“Shall I compare thee to a summer’s day?”) would not withstand a reasonable “comparability” analysis, but an engineer employed in a huge multinational enterprise who morphs in today’s gig economy into a self-employed engineering consultant or a professor of engineering seeking multiple teaching assignments, in most cases should (not the permissive “may” in the Draft) be accorded AC21 job-flexibility benefits.
3. The Draft misapplies and gives undue probative weight to the DOL’s Standard Occupational Classification (SOC) system — a complicated, arbitrary and abbreviated composite of occupational classifications not developed for the legislative purpose of AC21 job-flexibility analysis. Rather the Labor Department’s Bureau of Labor Statistics (BLS) intended the SOC to permit statistical analyses for use by “Federal statistical agencies to classify workers . . . for the purpose of collecting, calculating, or disseminating data.” As the BLS explains the SOC system, however, its shortcomings for immigration adjustment job-flexibility analysis becomes apparent:
All workers are classified into one of 840 detailed occupations according to their occupational definition. To facilitate classification, detailed occupations are combined to form 461 broad occupations, 97 minor groups, and 23 major groups. Detailed occupations in the SOC with similar job duties, and in some cases skills, education, and/or training, are grouped together.
Although the Draft treats the SOC like a veritable Code of Hammurabi, or revered totem (“this memorandum instructs [Immigration Services Officers] on how they may use the [DOL’s] . . .SOC . . . codes”), USCIS should not prescribe it as the exclusive source of job-similarity comparisons.
4. The Draft fails to offer reasonable alternatives to the SOC. USCIS should offer a variety of alternative ways in which job-similarity, with the SOC listed as merely one of other acceptable measure of comparability, can be established by the “preponderance of the evidence” standard of proof. For example, given that USCIS views the DOL as authoritative in the evaluation of job comparisons, then the AC21 flexibility analysis should also allow use of the Labor Department’s easily applied “substantially comparable” job or position test used in 20 CFR § 656.17(i)(5)(ii) of its PERM labor certification regulation:
A “substantially comparable” job or position means a job or position requiring performance of the same job duties more than 50 percent of the time. This requirement can be documented by furnishing position descriptions, the percentage of time spent on the various duties, organization charts, and payroll records.
The application of a “substantially comparable” or the equivalent “more than 50%” rule is already familiar to Immigration Service Officers who must routinely apply this test in many other visa categories. Consider the L-1A nonimmigrant and EB-1(3) tests for intracompany or multinational managers or executives whose employer must show that the foreign candidate has been and will be “primarily” engaged in managerial duties or executive responsibilities. Similarly, treaty-based E-1 visa applicants must show that the treaty national or entity is “principally”engaged in trade of goods or services between the treaty country and the United States. USCIS interprets the adverbs, “primarily” and “principally,” as requiring a greater than 50% bright-line test. Indeed, the “preponderance of the evidence” test applicable in virtually all immigration-benefits decisions is itself a “more than 50%” test. Furthermore, the “substantially comparable” test is much more easily and quickly decided than the abstruse SOC system. As 20 CFR § 656.17(i)(5)(ii) notes, the “substantially comparable” measure “can be documented by furnishing position descriptions, the percentage of time spent on the various duties, organization charts, and payroll records.”
5. The Draft expressly supersedes all job-flexibility discussions in five prior INS and USCIS advisories. By revoking prior guidance, the Draft makes it uncertain whether earlier pronouncements allowing self-employment as an approved basis for adjustment portability, holding that multinational managers or executives can port and/or disregarding as irrelevant any issue of whether Employer #2 can satisfy the otherwise applicable standard of “ability to pay” the wage stated in the labor certification or immigrant visa petition will reappear in the final job-flexibility policy guidance.
6. The Draft offers no explanation of procedures to tee-up the granting of a request for adjustment of status job-flexibility benefits. Given the Draft’s revocation of the prior adjustment portability policy memos, USCIS fails to say whether the usual way to invoke adjustment portability — the adjustment applicant’s submission, after having ported, of a letter from Employer #2 demonstrating job similarity — will continue to be required. The Draft also offers no clue whether USCIS will establish, before a porting occurs, a form-based process for the adjudication of a prospective change of job or employer. Clearly, USCIS should obviate the need for the current bet-the-green-card procedure whereby the adjudication of job similarity is only available after a change of job or employer has already occurred. Hence, the Draft’s lacunae of guidance on procedures and its dubious over-reliance on the SOC makes job moves by the adjustment applicant still the risky business it has always been.
* * * * *
President Obama and USCIS deserve praise for their desire to help adjustment applicants change jobs or employers more freely. Unfortunately, however, the agency’s chosen vehicle of movement — an unduly cramped interpretation of AC21’s job flexibility provisions, coupled with its unwarranted fixation on the SOC — will freeze in place AC21’s intended beneficiaries and thereby impair the virtuous economic goal of enhanced worker mobility. The USCIS should scrap the Draft and publish a proposed job flexibility regulation.
Updated 12-15-2015 at 03:03 PM by APaparelli
Two hundred days ago President Obama stoked the hopes of immigration advocates with his announcement of wide-ranging executive actions to try — as far as his authority would carry him — to change America’s broken immigration system for the better.
Generating most of the media fanfare and Republican outrage were his plans to expand eligibility for the DACA program and create a new DAPA program for the undocumented parents of citizens and green card holders. Expanded DACA and the new DAPA programs now seem dead on arrival unless the Fifth Circuit or the Supreme Court lifts an injunction by a federal judge in Texas. Time will tell whether the President has developed (as the New York Times editors urge) a Plan C, which may or may not end the detention of immigrant families and children, or lead to the publication of proposed regulations allowing notice and comment on expanded DACA and the new DAPA programs, as the Center for Human Rights and Constitutional Law has proposed.
On the legal immigration front, last November the President also offered hope, and he promised change — but so far hopes have been dashed, and the only change observed has been of the chump variety. What has become of his November 21, 2014 Presidential Memorandum (“Modernizing and Streamlining the U.S. Immigrant Visa System for the 21st Century“) which instructed the Secretaries of Homeland Security and State to report back to him by March 15, 2015 on recommendations to improve the legal immigration system? So far, certainly not the publication of the required report, and beyond that almost nothing else.
Immigration stakeholders heard the President proclaim at the March 23, 2015 SelectUSA Investment Summit that the new L-1B guidance memo on specialized knowledge would “[allow] corporations to temporarily move workers from a foreign office to a U.S. office in a faster, simpler way [that] could benefit hundreds of thousands of nonimmigrant workers and their employers.” Yet the L-1B guidance — long in gestation and butt ugly at birth — will only provide bureaucrats with more grounds to issue burdensome requests for evidence and ultimately say “no” in additional ways.
More inflated Obama Administration rhetoric spewed forth on April 15, 2015. That’s when the State Department’s Catherine A. Novelli, Under Secretary for Economic Growth, Energy, and the Environment, at a conference on “Deepening the U.S.-India Commercial Partnership” — with tongue firmly in cheek — proclaimed:
Indian companies are world class and strong, and do not need government protection from outside competition. . . . Indian-owned companies have invested over $11 billion in the U.S. and employ over 44,000 people here. These Indian companies have proven their ability to thrive in the United States, one of the most competitive markets in the world. . . .
The United States and India each have strong comparative advantages that become stronger when we work together. The United States and India have shared values and a shared commitment to democracy. Together, we are partners in upholding an international, rules-based order that ensures global peace, security, and prosperity. We want to seize this moment and bring to fruition the unrealized potential that still exists between our economies, for the betterment of the lives of both our citizens.
Since her speech, proponents of employment-based immigration reforms have seen what the Obama Administration apparently means when it proposes to uphold “an international, rules-based order that ensures global . . . prosperity.” The actions of the Administration’s immigration bureaucrats have recently offered their version of “rules-based” order — actions which hurt U.S. and Indian companies alike, to wit:
The release of the poorly reasoned precedent decision, Matter of Simeio Solutions, LLC, 26 I&N Dec. 542 (AAO, Apr. 9, 2015), which witnessed the USCIS Administrative Appeals Office’s foray into foreign turf, viz., the Labor Department’s H-1B regulations, to require that employers file amended petitions with USCIS each time an H-1B worker moves to a worksite located in a different metropolitan area. The AAO took this action even though it acknowledged that prior USCIS guidance distributed widely through an immigration stakeholder association expressly stated that no new filings would be necessary.The USCIS pronouncement on May 21, transformed into a draft on May 27, that Simeio Solutions would be applied retroactively, even though precedent decisions by regulation, 8 CFR § 103.3(c)(“Service precedent decisions”), provide “for publication as precedent in future proceedings . . . (emphasis added).” With these May 21-May 27 actions, USCIS offered to grant an amnesty against the taking of “adverse action” against H-1B employers and workers for prior worksite changes, as long as amended petitions are filed by August 19, even though USCIS has not stated how far back in time its retroactive application of Simeio Solutions would go — an announcement sure to upend the summer vacation plans of company HR personnel and their immigration counsel.On the heels of its retroactive application of Simeio Solutions, USCIS in a further surprise announced the suspension on May 26 of expedited adjudication of H-1B petitions under the USCIS Premium Processing Service purportedly because of the wholly foreseeable increase in applications for H-4 spousal work permits — a workflow the agency had been planning since May, 2014.The AAO’s recent release under the Freedom of Information Act of a 41-page non-precedent decision holding on a variety of newly articulated but nonetheless spurious theories that the position of management analyst is not an H-1B specialty occupation and the proposed H-1B beneficiary is not qualified serve in the proffered position. Immigration observers ask why the AAO would take 41 pages to deny H-1B eligibility in a non-precedent case. The probable answer is that it wanted to float new grounds for USCIS adjudicators to use as a script, much like the non-precedent 2008 L-1B GST case, with which to deny ever more H-1B petitions.The failure of the USCIS EB-5 Immigrant Investor Program Office (IPO) over several months, despite repeated requests, to offer clarifying guidance on whether and under what circumstances the redeployment of EB-5 investor capital may be allowed under the regional center program where projects have long ago been completed, the requisite jobs have been created, but investor petitions seeking removal of conditions on residency cannot be filed or approved because immigrant visa retrogression affecting huge numbers of Mainland-China born investors delayed the initial grant of conditional residency. Equally or perhaps even more egregious is the IPO’s reversal of prior interpretations and its current interpretation that when a prospective EB-5 investor takes out a loan and uses those funds as a cash investment into an EB-5 project is treated a prohibited contribution of debt rather than an investment of capital. Apparently, cash is king in the investment world, except in the never-never-land of USCIS’s EB-5 IPO.
Meantime, as President Obama makes plans for his presidential library, he apparently seems focused not at all, or to put it charitably, not enough, on the passive-aggressive actions of immigration bureaucrats who seem to be playing out the clock in the apparent hope that his presidency will end before these laudable initiatives ever are allowed to occur:
Updated 06-08-2015 at 03:27 PM by APaparelli
Social media flamed with expressions of outrage, relief and tepid optimism ever since President Obama announced on March 23, 2015 the release of long-awaited policy guidance on a key temporary worker visa category:
Today, I’m pleased to announce a new action I’m also taking to make it easier for global companies who are present here today to launch and invest in the U.S. My administration is going to reform the L-1B visa category, which allows corporations to temporarily move workers from a foreign office to a U.S. office in a faster, simpler way. And this could benefit hundreds of thousands of nonimmigrant workers and their employers; that, in turn, will benefit our entire economy and spur additional investment. (Applause.) [Bolding added.]
For visual learners, here he is a video for streaming to one’s smartphone or browser (the passage above begins at 9:40):
Released the next day by U.S. Citizenship and Immigration Services (USCIS), the L-1B policy guidance, published in draft form with a request for feedback accepted until May 8, will take effect on August 31.
Outrage burned from the usual quarters, namely, folks on the right who oppose every immigration initiative the President has floated, including NumbersUSA (“American Tech Workers Would Compete With Hundreds of Thousands of New Guest Workers Under Obama’s L-1B Visa Proposal“); Freedom Outpost (“Obama Continues Loosening the Reins on Illegal Aliens in the US“); Byron York, Chief Political Correspondent for the Washington Examiner, a Fox News contributor, and author of The Vast Left Wing Conspiracy (“Did you know Obama just took new executive action on immigration?”); and the Daily Caller (“Obama Announces Unilateral Action To Bring In More Guest Workers“).
Others heaved sighs of relief or cautious optimism — the American Immigration Lawyers Association (“Welcome Changes to Business Visas but Implementation Means Everything” and “the memo’s guidance may ‘be solid ground work for consistency in adjudications,'” quoting Robert Deasy, AILA’s Deputy Director of Programs, as reported in an otherwise oppositionist article by Patrick Thibodeau of Computerworld); the Council for Global Immigration, through Justin Storch, its Manager of Agency Liaison (“We are hopeful that the memo will provide some clarification for both employers and adjudicators so the denial rates will decrease“), and the U.S. Chamber of Commerce, through Randel K. Johnson, its Senior Vice President of Labor, Immigration, and Employee Benefits (“We are particularly pleased to see the guidance proposal reiterate that the burden of proof is the preponderance of the evidence standard and that the agency must give deference to its prior decisions“).
Frankly, after waiting years for new guidance on L-1B eligibility, I’m deeply disappointed. Here’s my take on this poorly reasoned, and inartfully articulated rehash of long-accepted principles now burdened with a perverse array of contradictory, extra-legal and impractical notions:
Cherry-Picked Definitions of “Special Knowledge” and “Advanced Knowledge or Expertise.”
The phrase, “specialized knowledge” is defined virtually identically in the Immigration and Nationality Act and USCIS regulations as “special knowledge possessed by an individual of the petitioning organization’s product, service, research, equipment, techniques, management, or other interests and its application in international markets, or, an advanced level of knowledge or expertise in the organization’s processes and procedures (bolding added).” The L-1B guidance memo purports to adopt dictionary definitions of the words, “special” and “advanced,” but then contorts the adopted definitions to make them more onerous than common parlance would require.
According to the guidance , dictionaries define “special” as “surpassing the usual,” “distinct among others of a kind,” “distinguished by some unusual quality,” “uncommon,” or “noteworthy.” The memo then adopts its own definition of “special knowledge” as “knowledge of the petitioning employer’s product, service, research, equipment, techniques, management, or other interests and its applications in international markets that is demonstrably distinct or uncommon in comparison to that generally found in the particular industry or within the petitioning employer (bolding and italics in original, underlining added).” USCIS does not explain the insertion of the word, “demonstrably.” The word is gratuitous, given that elsewhere the memo confirms that the standard of proof on the petitioning employer is by the “preponderance of the evidence” or a “more probable than not” standard. The only reason for sticking “demonstrably” before “distinct or uncommon” is to give adjudicators with a mind to issue a Request for Evidence (RFE) or deny the L-1B petition a chance to continue with that proclivity (I can foresee it now, “Petitioner’s evidence was distinct and uncommon, but not demonstrably so”).
Moreover, the agency does not explain the justification for using the more difficult definition of “advanced” knowledge or expertise — which, as USCIS notes in the memo, dictionaries variously define. One of the linked definitions of “advanced” is “being beyond the elementary or introductory.” Given that the President expects the new guidance memo to “benefit hundreds of thousands of nonimmigrant workers,” adoption of the easier standard, “being beyond the elementary or introductory,” would best satisfy this presidential expectation.
Also troublesome, the memo provides an inconsistent, alternative definition of “advanced”: “greatly developed or further along in progress, complexity and understanding.” “Further along” (which likewise would better comport with the President’s expectations) seems a less difficult standard to prove than “greatly developed.” Moreover, USCIS should treat knowledge that is further along in any one of the three alternative requirements “progress,” “complexity” or “understanding.” Here too the agency may give unsympathetic or “just say no” adjudicators a way of denying the L-1B petition by emphasizing that the advanced knowledge is not “greatly developed” or “further along in progress, complexity and understanding.” (Bolding added.)
A Mandate to Make Irrelevant, Impossible or Unnecessarily Strict Comparisons.
The policy memo ignores the statutory definition of “special” knowledge by instructing adjudicators to compare the beneficiary not only with other workers in the same L-1 qualifying organization (which is proper because the category, after all, is expressly dubbed the “intracompany transferee”) but also a comparison of other workers in the same industry. The memo states:
Demonstrating whether knowledge is “special” or “advanced” inherently requires a comparison of the beneficiary’s knowledge against that of others. The petitioner bears the burden of establishing such a favorable comparison. Because “special knowledge” concerns knowledge of the petitioning organization’s products or services and its application in international markets, the petitioner may meet its burden through evidence that the beneficiary has knowledge that is demonstrably distinct or uncommon in comparison to the knowledge of other similarly employed workers in the particular industry or within the petitioning organization. Alternatively, because “advanced knowledge” concerns knowledge of a company’s processes and procedures, the petitioner may meet its burden through evidence that the beneficiary has knowledge or expertise that is greatly developed or more complex in comparison to other workers in the petitioning employer’s operations. (Bolding added.)
The only reference in the statutory definition of “special knowledge” to actions outside the company is the allusion to knowledge of the petitioning employer’s product, service, research, equipment, techniques, management, or other interests and its applications in international markets.” (Bolding added.) Nothing in this definition makes it “inherent” that USCIS must compare workers in the particular industry. Rather, requiring a comparison of workers in the same industry will merely saddle petitioners with the nearly impossible challenge of providing inaccessible or nonexistent evidence. How can one company in an industry (the petitioner) gain access to data about the level of knowledge held by its competitors’ employees of the petitioner’s “product, service, research, equipment, techniques, management, or other interests.” Any company with valuable trade secrets or intellectual property will take affirmative steps to make sure that no outsider has access to such highly coveted and valuable documents or data. Companies routinely require all employees to sign non-disclosure/non-use agreements at the outset of employment, and keep their prized IP under wraps. There is no way in virtually all cases that others in the same industry could possibly access it. This is a fool’s errand, and USCIS has no business forcing L-1B petitioners to chase the nonexistent or unattainable.
One Hand Giveth, While the Other Taketh Away.
The USCIS memo offers the welcome reaffirmation of prior policy that specialized knowledge need not be proprietary, subject to patent or copyright protection, or “narrowly held” within the petitioner’s organization. It also seems to debunk the myth (bereft of support in statute, regulation or legislation) perpetrated by the State Department that “[If] everyone is specialized, then no one is.” Readers of the memo are warmed by the following excerpt:
Multiple employees within a company may have obtained the experience, training, or education necessary to possess the same type of specialized knowledge. Some companies may use technologies or techniques that are so advanced or complex that nearly all employees working on the relevant products or services possess specialized knowledge. The mere existence of other employees with similar knowledge should not, in and of itself, be a ground for denial.
That warmth quickly turns into a chill, however, when in the very next paragraph the memo authorizes adjudicators to consider irrelevant factors which flatly contradict and neuter the “not-necessarily-narrowly-held” acknowledgement. These factors (bolded below) are extra-legal and clearly beyond the reach of permissible interpretation of statute, regulations, and legislative history:
[O]fficers generally should carefully consider the organization’s need to transfer the beneficiary to the United States. The officer may consider, for example, the need for another individual with similar specialized knowledge in the organization’s U.S. operations and the difficulty in transferring or teaching the relevant knowledge to an individual other than the beneficiary. The officer should also consider . . .whether the salary to be paid to the beneficiary is comparable to similarly situated peers in such U.S. operations. Where many employees within the organization’s U.S. operations share the beneficiary’s knowledge, yet the beneficiary will be paid substantially less than those similarly situated employees, this may indicate that the beneficiary lacks the requisite specialized knowledge. As described infra, however, there may be valid business reasons for the wage discrepancy, but justification for the [wage] variance generally should be evaluated in light of the skills, experience, and other factors pertinent to the entire spectrum of employees in the U.S. operations who possess the requisite specialized knowledge. (Bolding supplied.)
The “need” of the petitioner to transfer a specialized-knowledge worker is a factor that can only be interpreted subjectively. Which business needs are to be considered worthy and which must be rejected as unnecessary? In a hotly competitive industry where customer loyalty is hard to achieve and maintain, is a customer’s emphatic preference for speedier fulfillment of a contract a sufficient “need” to transfer another L-1B worker? Is greater profit? Is avoidance of staff burnout? Is the obligation to cut payroll to avoid bankruptcy a sufficient need? The memo doesn’t say. Instead it leaves the decision to the unguided discretion of adjudicators who would be authorized to tell businesses that their needs are not meritorious.
Likewise, unworkable and unlawful is the requirement in the memo that adjudicators compare the wages of “similarly situated peers” with the proposed wage of the L-1B beneficiary. How much of a wage variance is required to be “substantial” and how “similar” must other peers be to the L-1B transferee in knowledge, expertise, duties, seniority, performance rating or other factors of subjectively perceived similarity? Again the guidance doesn’t say — but leaves a door wide open for adjudicators to apply inconsistent, subjective standards to reject L-1B petitions at their individual whim (for we all know that there is virtually no supervisory review of draft denials).
Moreover, unlike the H-1B work visa category and its mandate that employers pay the “required wage” (the local prevailing or actual wage at the job site, whichever is higher), there is no legal basis under the L-1 category for USCIS to require submission of evidence of wages paid (indeed, the memo acknowledges that high salaries are not required) or to evaluate their sufficiency. These subjectively determined dictates considered in relation to other workers — the business’s need for the L-1B worker, and the adequacy of wages paid — will force petitioners down rabbit holes of burden, delay, cost and distraction. USCIS should delete these factors.
Confounded Conflation. The USCIS memo provides a laundry list of evidence that may be submitted to establish specialized knowledge. The list is illustrative but not exhaustive. Unfortunately, it does not distinguish which items on the list would constitute proof of the alternative forms of specialized knowledge, i.e., “special knowledge” or an “advanced level of knowledge or expertise”). By conflating the two alternative definitions, the agency blurs the adjudicator’s field of vision. For example, conflation occurs in the following excerpt, the memo’s ill-advised definition of “special knowledge,” which (as noted above) requires a comparison of the knowledge held by other workers in the same company AND in the particular industry, whereas “advanced knowledge or expertise” quite properly requires no such comparison to others in the same industry:
Evidence that the alien is qualified to contribute to the U.S. operation’s knowledge of foreign operating conditions as a result of knowledge not generally found in the industry or the petitioning organization’s U.S. operations.(Bolding added.)
This incautious wording raises the specter that adjudicators when considering the “advanced,” alternative definition of specialized knowledge will require a comparison of workers in the same industry, even though such a demand cannot be not supported by the definition of that term in the memo.
May Morphs into Must. One of the most disturbing aspects of memo is the USCIS’s list of factors to prove specialized knowledge and the evidence the memo suggests might be probative. For example, as my colleague, Austin Fragomen, observed in a recent webinar hosted by the Council for Global Immigration, “how do you show that the beneficiary’s work is particularly relevant to the company’s competitiveness in the marketplace? . . . [Why do we need] a microeconomic analysis of the impact of that one employee”? He’s right: The only part of the statutory and regulatory definition of specialized knowledge that refers to external factors is the sub-definition for “special” knowledge, but that only asks essentially whether the beneficiary has special knowledge of the petitioner’s “product, service offering or ‘secret sauce’ [my phrasing]” and “its application in international markets.” Even more troubling is the daunting list of types of allegedly probative evidence that a petitioner may be asked to submit. Imagine the forest of trees converted to paper that will be consumed in assembling initially to accompany the L-1B petition or responding to an adjudicator’s RFE that may (but likely now must) include:Documentation of training, work experience, or education establishing the number of years the individual has been utilizing or developing the claimed specialized knowledge as an employee of the organization or in the industry;Evidence of the impact, if any, the transfer of the individual would have on the organization’s U.S. operations;Evidence that the alien is qualified to contribute to the U.S. operation’s knowledge of foreign operating conditions as a result of knowledge not generally found in the industry or the petitioning organization’s U.S. operations;Contracts, statements of work, or other documentation that shows that the beneficiary possesses knowledge that is particularly beneficial to the organization’s competitiveness in the marketplace;Evidence, such as correspondence or reports, establishing that the beneficiary has been employed abroad in a capacity involving assignments that have significantly enhanced the organization’s productivity, competitiveness, image, or financial position;Personnel or in-house training records that establish that the beneficiary’s claimed specialized knowledge normally can be gained only through prior experience or training with that employer;Curricula and training manuals for internal training courses, financial documents, or other evidence that may demonstrate that the beneficiary possesses knowledge of a product or process that cannot be transferred or taught to another individual without significant economic cost or inconvenience;Evidence of patents, trademarks, licenses, or contracts awarded to the organization based on the beneficiary’s work, or similar evidence that the beneficiary has knowledge of a process or a product that either is sophisticated or complex, or of a highly technical nature, although not necessarily proprietary or unique to the petitioning organization; andPayroll documents, federal or state wage statements, resumes, organizational charts, or similar evidence documenting the positions held and the wages paid to the beneficiary and parallel employees in the organization.
How will this list — which seems likely to require concurrent violations of the spirit if not the letter of the Environmental Protection Act and the Paperwork Reduction Act — fulfill the President’s March 23rd description of the L-1B category as allowing “corporations to temporarily move workers from a foreign office to a U.S. office in a faster, simpler way (bolding supplied)”? Simply put, the memo’s laundry list makes an L-1B petition neither fast nor simple. Instead, it gives adjudicators a license to prolong the dreadful status quo.
Show Us, Don’t Just Tell Us. The existing policy guidance on specialized knowledge, the 1994 Puleo Memo, which the new L-1B memo expressly revokes, offered helpful examples of quotidian fact patterns:
A specific example of a situation involving specialized knowledge would be if a foreign firm in the business of purchasing used automobiles for the purpose of repairing and reselling them, some for export to the United States, petitions for an alien to come to the United States as a staff officer. The beneficiary has knowledge of the firm’s operational procedures, e.g., knowledge of the expenses the firm would entail in order to repair the car as well in selling the car. The beneficiary has knowledge of the firm’s cost structure for various activities which serves as a basis for determining the proper price to be paid for the vehicle. The beneficiary also has knowledge of various United States customs laws and EPA regulations in order to determine what modifications must be made to import the vehicles into the United States. In this case it can be concluded that the alien has advanced knowledge of the firm’s procedures because a substantial amount of time would be required for the foreign or United States employer to teach another employee the firm’s procedures. Although it can be argued that a good portion of what the beneficiary knows is general knowledge, i.e., customs and EPA regulations, the combination of the procedures which the beneficiary has knowledge of renders him essential to the firm. Specifically, the firm would have a difficult time training another employee to assume these duties because of the interrelationship of the beneficiary’s general knowledge with the firm’s method of doing business. The beneficiary therefore possess[es] specialized knowledge. . .
processing certain shellfish desires to petition for a beneficiary to work in the United States in order to catch and process the shellfish. The beneficiary learned the process from his employment from an unrelated firm but has been utilizing that knowledge for the foreign firm for the past year. However, the knowledge required to process the shellfish is unknown in the United States. In this instance, the beneficiary possesses specialized knowledge since his knowledge of processing the shellfish must be considered advanced.
The common theme which runs through these examples is that the knowledge which the beneficiary possesses, whether it is knowledge of a process or a product, would be difficult to impart to another individual without significant economic inconvenience to the United States or foreign firm. The knowledge-is not generally known and is of some complexity.
Regrettably, the L-1B draft memo is prolix in its verbiage but devoid of any helpful examples by which to guide adjudicators and stakeholders in understanding what constitutes specialized knowledge in the real world.
Where Are Your Compatriots? The new L-1B memo creates a measure of predictability and reliability when petitioners seek to extend the status of a foreign worker whom USCIS previously found to satisfy the requirements for specialized knowledge. In the following prescribed situation the memo declares that USCIS officers should not readjudicate the previously established underlying facts unless gross error in the prior determination or material changes are identified:
In matters relating to an extension of L-1B status involving the same parties (i.e., the same petitioning organization and beneficiary employee) and the same underlying facts, USCIS officers should give deference to the prior determination by USCIS approving L-1B classification [except in cases involving work at third-party locations].
The memo offers no indication that USCIS has consulted and achieved buy-in on the memo’s pronouncements from the two other federal agencies which must decide whether specialized knowledge has been proven in a particular case, whether in a previously approved petition or a new request, namely, the U.S. Department of State (when deciding blanket L-1B visa applications) and U.S. Customs & Border Protection (when considering applications for admission to the U.S. in L-1B status). Presumably, the three deciders of L-1B eligibility ought to have engaged in interagency discussions of the subject before the memo’s release. In any case, when the memo is released in final form, USCIS should expressly note that all three units are in agreement with the ultimate product.
No Disparate Treatment or Impact Tolerated. Another glaring omission is a much-needed admonition by USCIS that all L-1B petitions must be decided impartially, i.e., without regard to the national origin or citizenship status of the beneficiary or the country of corporate headquarters or incorporation. Sadly, a recent study published by the National Foundation For American Policy reveals that the denial rate for Indian citizens topped out at 56% in 2014 although the denial rate for beneficiaries hailing from all other countries was a mere 13%. Indeed, given the gravity and proliferation of the problem of anti-Indian bias, an admonition is not enough. USCIS should make clear that adjudicators’ L-1B decisions (grants, denials, RFEs and revocations) will be individually tabulated, not only by the country of the beneficiary’s nationality but also by the degree to which their adverse decisions reflect non-compliance with whatever USCIS headquarters’ interpretation of L-1B eligibility criteria, standard of proof or degree of boilerplate, kitchen-sink demands for additional evidence. Reprobate behavior must then be the subject of discipline, including termination of employment for the most recalcitrant and unrepenting.
On that score, notwithstanding the President’s lofty expectations concerning the “hundreds of thousands” of L-1B visa holders who will achieve temporary work visa status “in a faster, simpler way,” the leadership of DHS and USCIS must make sure these laudable expectations are not sabotaged by “get to no” adjudicators who “grouse” (my word) or “whine” (Sen. Harry Reid’s phrasing) to Sen. Chuck Grassley, as they did in their unjust effort to smear the good name and reputation of former Director of USCIS, Alejandro Mayorkas (now, Deputy Secretary of Homeland Security), as depicted in the recent hatchet job of a DHS Office of Inspector General report on a small number of EB-5 case adjudications. Without constant oversight, these USCIS first-line adjudicators will remain as obstreperous as ever, much like the insubordinate U.S. Immigration and Customs agents who sued the Obama Administration over its deferred-action and prosecutorial-discretion policies but who’ve justly received their comeuppance from the Fifth Circuit Federal Court of Appeals.
So that’s my take on the USCIS’s draft L-1B policy memo. Be sure to share your view, not just in the comments section below. Submit your timely your feedback to USCIS at Public.Engagement@uscis.dhs.gov.
Updated 04-09-2015 at 03:29 PM by APaparelli
Terabytes of text have already been generated in the course of extolling or excoriating President Obama for his November 20 Executive Actions on Immigration. The prolific foaming of bloviating mouths has mostly been prompted by the promise of deferred action and work permits for undocumented immigrants under the DACA and DAPA programs. Surprisingly, however, his equally profound measures to improve the legal immigration system have been lost in the GOP’s ongoing Sturm und Drang over what they dub “Executive Amnesty.”
Among these legal immigration reforms, an almost overlooked November 21, 2014 Presidential Memorandum (“Modernizing and Streamlining the U.S. Immigrant Visa System for the 21st Century“) invited the submission of individual and stakeholder recommendations to improve legal immigration. If the Obama Administration were to embrace the best of the recommendations submitted in response, many good things would flow from this crowd-sourcing initiative. Without involving or seeking the consent of Congress, the Administration could readily adopt a plethora of path-breaking innovations to our legal immigration system which would profoundly improve how this country welcomes and benefits from foreign strivers, entrepreneurs, scientists, students, investors and other worthy contributors.
As my colleagues, Gary Endelman and Cyrus Mehta put it recently:
At the end of the day, immigration policy is not only, or even primarily, about the immigrants but about how the United States can attract and retain the best and the brightest regardless of nationality who wish to join us in writing the next chapter of our ongoing national story. There are two ways to achieve progress. Congress can change the law, which it persists in refusing to do, or the President can interpret the existing law in new ways, which he has done.
The November 14 memorandum directed the Secretaries of Homeland Security and State to solicit proposals from stakeholders and the public to modernize the legal immigration and visa system. The Secretaries of DHS and DOS would then evaluate the proposals so submitted in consultation with several Cabinet members (the Attorney General, and the Secretaries of Agriculture, Commerce, Labor, and Education), and other federal officials (the Director of the Office of Management and Budget, the Director of the National Economic Council, the Assistant to the President for Homeland Security and Counterterrorism, the Director of the Domestic Policy Council, and the Director of the Office of Science and Technology Policy). The official invitation to submit ideas took the form of a December 30 Notice of Request for Information, which allowed the submission of up to 30 pages of commentary by January 29. The comment period has closed, and the proposals are now posted online for all to see.
Some of the most thoughtful suggestions, accompanied in many cases by convincing citation to legal authority, came from members of the Alliance of Business Immigration Lawyers (ABIL); members of the American Immigration Lawyers Association (AILA); a collection of 16 business-immigration stakeholder organizations (the 16); two individuals, attorney Nicole Kersey of Kersey Immigration Compliance (KIC), and Don Crocetti, managing member of Immigration Integrity Group, LLC (IIG) who formerly served as Chief of the Fraud Detection and Nationality Security Directorate (FDNS) of U.S. Citizenship and Immigration Services (USCIS); the American Immigration Council (the Council); the Society for Human Resource Management through its strategic affiliate, the Council for Global Immigration (CFGI); the U.S. Chamber of Commerce (the Chamber); the International Medical Graduate Taskforce (IMGT); the Center for American Progress (CAP) and the Global Workers Justice Alliance (GWJA).
Here are just a few of the many recommendations (accessible through the hyperlinks in the preceding paragraph) which I believe would comprehensively transform and improve America’s decrepit immigration system:
Improve access to justice. ABIL, AILA and the Council urged the Department of State (DOS or State) and U.S. Customs & Border Protection (CBP) to grant every individual interviewed by a federal immigration official the right to the representation of an attorney (either in person or by electronic means, but still at no cost to the government). The right to counsel would extend to (a) visa applicants who are interviewed by a consular officer, (b) applicants seeking admission to the U.S. during secondary or deferred inspection who are interviewed by a CBP officer, and (c) petitioners seeking immigration benefits who are interviewed in the course of FDNS site visits by USCIS investigators. ABIL also urged State and DHS to create a pilot system of binding review of decisions by consular officers to refuse certain categories of visas (all immigrant visas and nonimmigrant refusals under the E-1 treaty trader, E-2 treaty investor, E-3 Australian specialty occupation worker, H-1B specialty occupation, L-1 intracompany transferee and O-1 extraordinary ability visa categories).
Develop a single body of “immigration common law” and revitalize the advisory opinion process. ABILproposed the creation of a single administrative tribunal to hear appeals from decisions and adjudications by all federal immigration agencies, thereby consolidating the work of multiple federal appellate panels and reducing the complexity and inconsistency of precedent and non-precedent immigration law decisions. ABIL also proposed that State publish all of its now-secret Advisory Opinions which guide consular officers in visa determinations and that USCIS adopt a published IRS-style private letter ruling process whereby the party seeking written guidance on the legal consequences of a particular set of facts would receive a binding interpretation but other stakeholders might benefit from the agency’s non-binding guidance in analogous circumstances.
Prohibit relitigating prior USCIS decisions granting employment-based immigration benefits. The 16, the Chamber, AILA and CFGI proposed that USCIS give “binding deference” to the agency’s previous grants of employment authorization whenever a petition seeking extension of the employer’s petition and of the worker’s nonimmigrant status involves the same employer, same employee, and same job duties, unless an adjudicator can establish, and articulate with specificity, fraud or clear gross error. Such a change would necessarily reduce the burdensome and frequent requests for additional evidence (RFEs) and introduce a welcome measure of reliability, consistency and predictability to the process of extending the work permission of nonimmigrant employees. To make this change, USCIS would need to adopt IIG’s proposal to speedily transition away from its “antiquated paper environment, supported primarily by legacy INS [Immigration and Naturalization Service] mainframe systems and databases with little to no interface or advance search or analytics capabilities” and instead it must “automate” “all USCIS systems and filing processes”.
Hasten the issuance of work visas, immigrant visas, green cards, work authorization and international travel permission. Many commenters (including ABIL, AILA, CFGI and the 16) proposed that State and USCIS adopt a range of proposals which, in various ways, would (a) count only the principal worker and not the dependents when reporting and applying the cutoff date on available immigrant visas as announced in State’s Visa Bulletin, (b) recapture the hundreds of thousands of immigrant visas from prior years that were unused and thus squandered because of inadequacies in the way green-card quotas were allocated between DOS and USCIS, (c) allow for much earlier acceptance of employment-based applications for adjustment of status, thereby hastening the issuance of Employment Authorization Documents (EADs) and Advance Parole travel authorization, and (d) plug gaps in the grant of employment authorization by extending it for longer periods or on an interim basis to more categories, e.g., persons in U visa status, applicants for renewal of EADs, and persons holding employment-based work-visa status in nonimmigrant categories omitted by the 240-day period of interim employment authorization allowed in the Form I-9 (Employment Eligibility Verification) regulations. GWJA also urged that USCIS, upon approving an immigrant visa petition, automatically forward the notice of appearance (Form G-28) to State’s National Visa Center so that prolonged delays now experienced in the recognition of attorney representation would be eliminated.
Clarify and liberalize the rules on immigration successorship in interest. ABIL proposed that DHS and DOS adopt a successor in interest principle that would (a) expand the range of situations in which corporate restructurings are recognized for immigration purposes, thereby allowing uninterrupted employment authorization and the preservation of pipeline employment-based immigrant visa and adjustment of status benefits, and (b) dispense with current USCIS interpretations whereby immigration successorship requires an “assumption of all or some liabilities, whether they be solely immigration-related liabilities or liabilities associated with the occupational classifications of the particular beneficiaries affected by the change in corporate circumstances.”
Adopt improvements to promote investment, entrepreneurship, job creation and business innovation. Many of the commenters suggested changes to spur investments, business activity, innovation and job creation. CFGI proposed the creation of a “Robust Trusted Employer Program” which would allow faster and more streamlined approvals of requests for immigration benefits submitted by “any employer that can demonstrate a track record of compliance with applicable [immigration] laws.” ABIL urged the Obama Administration to “create an agency to support and protect the economic benefits of immigration within the Department of Commerce or another cabinet department.” AILA and ABIL proposed that DHS “create explicit immigration protections and benefits for small businesses,” e.g., by (a) rescinding the Neufeld Memorandum (which effectively abolished the distinction, long recognized in precedent decisions that, for immigration purposes, a corporation is to be considered distinct from its owners), (b) clarifying that the customary attributes of start-ups and small businesses are not necessarily indicia of fraud, and (c) adopting in formal policy guidance and ultimately in regulations the formal recognition that the characteristics of start-ups as set forth in USCIS’s Entrepreneur in Residence training materials are acceptable examples of legitimate forms of business operations and activities. ABIL and AILA also proposed numerous improvements that should be implemented by USCIS’s EB-5 Immigrant Investment Program Office (IPO) in order to promote the IPO’s announced goals of enhanced transparency of eligibility criteria, speedier case processing and the safeguarding of EB-5 program integrity.
Enhance immigrant and nonimmigrant protections and promote immigration integrity. A number of commenters suggested that DHS and DOS should ease eligibility requirements or offer enhanced benefits to individuals seeking or holding a particular visa status. IIG offered a range of suggestions to improve the lot of foreign medical graduates (FMGs) including, among other proposals, H-1B cap gap relief for FMGs, clarification that J-2 dependents of FMGs are not subject to the two-year, home-country, physical-presence requirement applicable to J-1 FMGs, and clearer and more expansive interpretations of (a) “affiliated or related” parties eligible for exemption from the annual H-1B quota, and (b) requirements for the physician national interest waiver. GWJA also suggested several improvements, including, for example, enhanced protections available to individuals who have applied for or hold U visa status, job “portability” benefits for H-2B workers, greater age-out protections for dependents in VAWA cases, and an obligation undertaken by DOS to provide more explicit statements of the actual grounds for a visa refusal and not merely uninformative citation to the general ineligibility ground of denial found at Immigration and Nationality Act (INA) § 214(b). CAP urged DHS and DOS to improve transparency and reporting of data on LGBT individuals who seek or hold refugee admission or asylum status. Don Crocetti of IIG suggested that USCIS automate immigration case processing and build “a person and organization centric data system complete with electronic filing and web-based interviews” — a system which “contains advanced and ‘Big Data’ analytics to support a proactive anti-fraud operation.”
Freeze I-9 and worksite enforcement until USCIS has decided all DACA/DAPA applications for work permission. Nicole Kersey of KIC, along with ABIL, proposed that the DHS Secretary cause U. S. Immigration and Customs Enforcement (ICE) to suspend and defer, on a temporary basis, worksite investigations and enforcement of certain employer-sanctions provisions of the Immigration Reform and Control Act (relating to the maintenance of Forms I-9 and the duty of employers to refrain from knowingly hiring or continuing to employ unauthorized workers). The temporary freeze would end, they proposed, once USCIS certifies that it has decided all applications for work permission under the DACA and DAPA program. The purpose of the proposed deferral of ICE enforcement, Ms. Kersey and ABIL explained, would be to avoid actions that might undermine the President’s goals of maintaining family unity in mixed-status households and encouraging eligible DACA and DAPA applicants to “get right with the law” and “come out of the shadow.” These laudable Presidential purposes, the proponents maintained, would be jeopardized if ICE — by virtue of a worksite enforcement action — were to impose a duty on employers to fire unauthorized workers who may ultimately receive employment permission.
Improve Federal Immigration IT Infrastructure. AILA suggested several IT enhancements, including USCIS acceptance of online payment of filing fees, standardization of web-published protocols and response times to email queries submitted to consular officers at posts worldwide, and permitting additional functionality in the “myUSCIS” Case Status Online query system by allowing access to the actual RFE or notices of intent to revoke or deny a petition issued rather than merely viewing a report that an RFE or notice has been issued (which must then await delivery by snail mail). In addition, ABIL and AILA suggested that — in the words of the AILA comment — “As USCIS continues to develop ELIS [the USCIS Electronic Immigration System] and expand its functionality to other forms and uses, it would be in the agency’s best interest to reach out to vendors and large-scale users, including AILA, for regular usability testing and feedback.” ABIL proposed a variety of additional IT suggestions:
DHS (USCIS and CBP) DOL (the Office of Foreign Labor Certification (OFLC)) and DOS (the Bureau of Consular Affairs [BCA]) should work to achieve interoperability for users so that employers, petitioners and applicants for immigration benefits, lawyers, law firms and organizational stakeholders such as universities need not be forced to re-enter the same data into disparate, siloed systems;All possible questions in online forms that function as a database, such as the BCA’s DS-160, where distinct questions appear as determined based on earlier answers to prior questions, should be published and available in full with a cross-referencing of questions and answers by visa category so that the public, as contemplated by the Paperwork Reduction Act, can know in advance what information to assemble.All electronic forms should provide the opportunity to expand on or clarify an answer to any question on the form in data fields permitting unlimited entry of text, since many questions cannot be answered truthfully and fully with, for example, a simple “yes” or “no” reply. Many such questions require the application of fact to law and thus require an answer that is consistent with applicable law. As currently configured, these forms invite a later accusation by federal immigration authorities of, inter alia, a willful, material misrepresentation under INA § 212(a)(6)(C), a falsely made document under INA § 274C(f), or a false statement under 18 U.S.C. § 1001;The attorney for an employer (with authorization of the subject individual employee or family member) should be allowed to access and download the electronic I-94. As the CBP e-I-94 system now is configured, only the applicant for admission who is ultimately admitted, or his or her attorney, can access the database and retrieve the I-94. Many large corporations centralize the management of their foreign employee’s maintenance of immigration status through counsel. Without access to the e-I-94 system by corporate counsel, this process is severely impeded and the prospect of an inadvertent violation of the unlawful-presence 3- and 10-year bars could occur; andOnline visa application[s] and [USCIS] immigration forms should allow the user to move from one screen to the next without completion of all relevant data requested in the screen. Often, some but not all information is not presently available. The online systems should also allow saving, downloading, and emailing partially completed forms so that information already provided need not be required to be re-entered again.
* * * Since other commenters’ proposals were not summarized, and additional comments of the submitters identified above may have been given unintentional short shrift, I encourage all immigration stakeholders to spend as much time as possible reading the full set of comments and then, using all forms of social and traditional media, to focus public attention on the innumerable ways that DHS, DOS and the several agencies that administer federal immigration laws can optimize our nation’s legal immigration system. It is broken; so let’s make the Administration fix it.