Department of Homeland Security Finalizes New H-1B Regulations: Updates, Flexibilities and Restrictions for Employers and Employees

Category: Client Alerts
Date: Dec. 23, 2024
Title: Department of Homeland Security Finalizes New H-1B Regulations: Updates, Flexibilities and Restrictions for Employers and Employees

On Dec. 18, 2024, the Department of Homeland Security (DHS) finalized new H-1B regulations with changes that will impact both employers and employees. While the regulations will introduce significant benefits and flexibilities, they will also narrow eligibility standards and impose stricter documentation requirements.

The most significant positive change is that the regulations codify a “deference” policy for adjudicating petition extensions (and not just for H-1Bs). Specifically, this means that when USCIS adjudicates any petition extension (including an extension of E, H, L, O, P or TN status) involving the same parties and underlying facts as the original filing, USCIS will give deference to its prior determination of the petitioner’s or beneficiary’s eligibility (but for a material error, a material change, or new adverse information). Previously, USCIS’s showing deference to earlier approvals was grounded in an agency policy memorandum, which was very easy to withdraw (as was done during the last Trump administration).

Some other notable revisions to the H-1B visa program include:

Expansion of H-1B cap exemptions for nonprofit and governmental research organizations: DHS will no longer require nonprofit and governmental research organizations to prove that research is their “primary mission” to qualify for cap exemption. Instead, to do so, they need only to show that research is one of their “fundamental activities.”
Automatic extension of F-1 status of students who are beneficiaries of approved H-1B petitions (and requests for change of status): Under the new regulations, F-1 students will receive automatic extensions of their student visa status and any Optional Practical Training employment authorization through the earlier of the requested start date on the approved petition or April 1 of the fiscal year such H-1B status is being requested to prevent lapses in lawful status.

Unfortunately, the new regulations are not all positive. The most negative change is the revision of the definition of “Specialty Occupation.” Specifically, DHS has narrowed the regulatory definition of “specialty occupation,” necessitating that each and every qualifying degree field for a role must be “directly related” to the duties of the position. The new rule clarifies that “directly related” means there is a “logical connection” between the degree and the job’s duties. We believe that USCIS officers will use this new definition as a reason to issue requests for evidence (RFE) when adjudicating H-1B petitions.

The Congressional Review Act (CRA) provides a streamlined pathway for Congress to overturn any new rules issued by federal agencies. While the CRA can be used any time that Congress is in session, it is most frequently used when there is a change in administration and majority control. It would not surprise us if the new Congress (at the recommendation of the Trump administration) uses the CRA to overturn these new regulations.

The effective date of these new regulations is shortly before the presidential inauguration, on Jan. 20, 2025. If you have any questions, please do not hesitate to call a member of our Business Immigration Group.