THE AMERICAN COMPETITIVENESS IN THE TWENTY FIRST CENTURY ACT OF (AC21)
Congress passed AC21 in October 2000, after the high tech boom of the 1990s and before September 11, 2001. AC21 reflects the openness to immigration during those years, and we are now left with its benefits. Unfortunately, no regulations have ever been implemented to interpret AC21’s provisions. All we have as guidance are administrative memoranda leaked from USCIS. Therefore AC21 should be interpreted conservatively in light of the possible negative consequences of interpreting it more liberally than USCIS does. Before taking advantage of AC21’s provisions, each person should carefully evaluate the possible pros and cons of doing so. This article is an overview of AC21’s provisions, and covers many of the pros and cons associated with invoking its benefits. However, this article should not be considered a substitute for legal advice in any particular situation.
Benefits for H-1B Nonimmigrants
AC21 contains several provisions pertaining to H-1B nonimmigrants. First, Section 102 of the act created a temporary increase in the number of H-1Bs that could be issued under the H-1B cap during Fiscal Years 1999 to 2003. This provision was never extended, and the H-1B cap was reduced for Fiscal Year 2004 to the original number of 65,000 H-1Bs per year. It is unknown whether Congress will increase the number of H-1Bs that can be issued in future fiscal years. For the time being, we are stuck with the 65,000 cap.
Portability for H-1B Nonimmigrants
Second, section 105 of AC21 increased the portability of H-1B status. Generally, when an employer files and H-1B petition on behalf of an alien, the alien cannot start working for the employer until after the H-1B petition has been approved. However, this provision of AC21 permits a person to accept new H-1B employment “upon the filing by the prospective employer of a new [H-1B] petition.” However, this provision only applies to aliens who meet the following conditions:
1. The alien must have previously been issued an H-1B visa or otherwise provided H-1B nonimmigrant status. Examples of aliens who could be “provided” H-1B status without being issued a visa are (1) Canadian citizens, since they are exempt from the visa requirement; and (2) aliens who were in the U.S. in another nonimmigrant status and later changed status to H-1B and never left the U.S. after being granted the change of status, and therefore never needed a visa to re-enter.
2. The alien must have been lawfully admitted into the United States. This requirement excludes any aliens who entered the U.S. without inspection, or who were paroled into the U.S. rather than admitted.
3. The alien’s prospective employer must have filed a nonfrivolous petition for new employment before the date of expiration of the period of stay authorized by the Attorney General. This is actually two requirements. First, the prospective H-1B employer must be filing a “nonfrivolous” H-1B petition. According to a January 29, 2001 INS memo, a frivolous petition is one that has no basis in law or fact. For example, an alien who has already reached the 6 year maximum for H-1B status, and who is not eligible for a 7th year extension cannot start working for the new H-1B petitioner under this provision, because the petition cannot be approved as a matter of law. Another example of a frivolous H-1B filing is one that is subject to the cap but filed after the cap has been reached for that fiscal year. An alien cannot invoke AC21 portability to start working for the petitioner on the basis of such a petition, because the petition has no basis in law or fact. Any employment performed for the new employer in this kind of situation could be considered unauthorized employment.
This section also requires that the prospective H-1B employer must file the new H-1B petition prior to the expiration of the alien’s current status. This means that an alien who is already out of status cannot start working for a prospective H-1B employer under AC21 portability provisions. For example, say in May 2002, XYZ Corporation petitioned for Edgar to come to the United States in H-1B status. His H-1B was approved with an October 1, 2002 start date, and is valid for 3 years, or until September 30, 2005. Edgar started working for his employer on October 1, 2002 and remains employed.
After working for XYZ for awhile, Edgar realized that there were better employment opportunities available to him, and soon found a new company, Abra Cadabra, Inc., to sponsor him for a new H-1B at a similar job for a substantially higher wage. If Abra Cadabra files a new H-1B petition requesting an extension of stay on or before September 30, 2005 (the date that Edgar’s current H status expires), then Edgar can go to work for Abra Cadabra upon the filing of the new petition under AC21’s portability rules. If, however, Abra Cadabra files the new H-1B petition even one day after September 30, 2005, Edgar cannot “port” to his new employer because the new petition will not have been filed prior to the expiration of his current status. In addition, the new petition is not approvable as an extension of stay. Rather, Edgar will have to leave the United States and re-enter, showing the new H-1B approval notice once the H petition is approved, so that he can receive a new I-94 card authorizing his current status. If Edgar’s old H visa has expired and Edgar is not visa-exempt as a Canadian citizen, then he will have to get a new visa from a U.S. consulate abroad before he can re-enter the U.S. and work for Abra Cadabra.
More information on maintenance of nonimmigrant status is available on our site.
4. Subsequent to the alien’s lawful admission, he must not have been employed without authorization in the United States before the filing of the new H-1B petition by the prospective employer. This means any alien who has engaged in any unauthorized employment since his or her last admission to the U.S. is ineligible for AC21 portability. Unauthorized employment includes the following:
(a) Working for an employer other than the petitioner of an employment-based nonimmigrant petition. That is, if an alien enters the U.S. in H-1B, L-1, O, P, E, or some other status for which employment is authorized, the alien is required to work exclusively for the employer who filed the petition sponsoring his or her nonimmigrant admission to the U.S. For example, if Angelica enters the U.S. on an H-1B visa petitioned for by Zinkoid, Inc., and after working for them for a time decides to go to work for Ozine Products, Inc. across the street instead, she violates her status the moment she quits working for Zinkoid, and she engages in unauthorized employment from the moment she starts working for Ozine Products.
(b) Working multiple jobs while only one petition has been approved on the alien’s behalf. If in our example above, Angelica decides that while she continues to work Full Time at Zinkoid, she would like to pick up some extra hours working at Ozine Products on the weekend, she has also engaged in unauthorized employment. (Note, however, that Angelica could work for both Ozine and Zinkoid at the same time, but only if both employers filed H-1B petitions on her behalf and both were approved).
(c) Working past the date on which one’s status expired. Say Angelica from our example above kept working exclusively for the H-1B petitioner, Zinkoid, from the date she entered the U.S. in H-1B status. She maintains her status throughout the 3 years authorized by USCIS. Then, at the conclusion of those 3 years, Zinkoid never files a petition to extend her stay in H-1B status. However, they keep her on the payroll and she continues to work for them in the same capacity as before. Any employment that Angelica engages in after her I-94 has expired is considered unauthorized employment.
(d) Working while in a nonimmigrant status that does not authorize employment, and while one does not have an Employment Authorization Document. Some nonimmigrant statuses, such as H, E, L, O, R, and P authorize the beneficiary alien to work in the United States pursuant to their status. Aliens who enter in these categories are not required to obtain an EAD; simply having the status authorizes them to work. However, other nonimmigrant statuses, such as B1/B2, or F-1 (with few exceptions), do not allow the beneficiary to engage in any employment. Any alien who works in the U.S. while in either of these statuses has engaged in unauthorized employment.
Other nonimmigrant statuses, such as the dependent spouses of E or L nonimmigrants, or V-visa holders, are authorized to accept employment, but only after obtaining an Employment Authorization Document (EAD). Aliens in these statuses who work prior to obtaining EAD, or after the EAD expires, have engaged in unauthorized employment.
This list is not exhaustive.
If all of these requirements are met, then an alien can go to work for a new H-1B petitioner as soon as that employer properly files a new, nonfrivolous H-1B petition on his or her behalf. An H-1B petition is considered properly filed when USCIS has received it with the proper filing fee and with no forms (with signature) or initial evidence missing. The best evidence that an H-1B petition has been properly filed is an I-797 Receipt Notice from USCIS. However, one can also track a package to make sure it was delivered to USCIS and if one knows that the petition was properly filed, one can assume this constitutes proper receipt by USCIS.
The alien’s use of AC21 portability creates an issue for the employer required to maintain I-9 documentation. Again, there are no AC21 regulations at the present time and it could be a considerable period of time before the Department of Homeland Security issues regulations relating to this provision. When regulations are issued they could very well ignore the issue of how the I-9 is to be prepared.
In filling out new I-9s pursuant to AC21’s H-1B portability provision, the following should be attached to the I-9:
1. A copy of section 105 of AC21
2. Proof of filing of the H-1B petition A copy of proof of receipt from the courier service as well as a copy of the check submitted should be sufficient initially with a copy of the fee receipt from USCIS attached as soon as received.
3. Proof that the alien was previously accorded H-1B status. A copy of an H-1B approval notice for a petition previously approved on the alien’s behalf, or a copy of the alien’s previous I-94 card indicating previously held H-1B status will suffice.
Our sample filled out I-9 form shows how to complete the form for an alien who is using AC21’s H-1B portability provisions.
One issue that might come up for aliens who use H-1B portability is the question of whether they can travel outside the United States (1) after he/she has started to work for the new H-1B employer but (2) before the H-1B petition for the new employer has been approved. The answer to this question depends on whether the alien’s previous period of stay in H status has expired, and whether the employer filed the new petition requesting an extension of stay or a change of status.
If the alien’s previous period of stay in H status for the old employer has expired, then when he leaves the U.S. he will not be permitted to return to the U.S. However, if his underlying I-94 card from the first employer is still valid, then he may be able to travel outside the U.S.
An employer would request an extension of stay if at the time the H-1B petition is filed, the alien is currently in H-1B status with a different employer. If this is the case, then it is important to note that any alien, regardless of whether he/she has used portability or not, is permitted to travel while an application for an extension of stay is pending. However, if the extension application is approved while the alien is outside of the United States, then the “last action rule” followed by USCIS dictates that his admission to the U.S. cancels out the approved extension of stay. This means that either (1) the employer file a new extension of stay petition with USCIS on the alien’s behalf, or (2) the alien depart again from the U.S. and return again using the new H-1B approval notice. If the latter option is chosen, the alien may need to get a new H-1B visa from a consulate if he is not visa exempt or if he does not currently have a valid H-1B visa in his passport. The same is true for an alien who has ported to a new employer under AC21’s provisions.
An INS memo addressed this issue, stating that an H-1B applicant for admission who is no longer working for the original petitioner is still admissible at a port of entry under AC21, so long as the applicant is admissible, has a valid passport and H visa, and can establish that he was previously issued H-1B status and a new H-1B petition has been filed on his behalf (e.g. by presenting a copy of the receipt notice).
It is possible for an alien to qualify for AC21’s H-1B portability provisions even if he/she is currently in a different nonimmigrant status. For example, an alien could have been in H-1B status a few years ago, subsequently changed to L-1 status, and then a prospective employer could file a new H-1B petition on the alien’s behalf. In that situation, the alien could feasibly meet all of the H-1B portability provisions, and the employer would file a change of status (rather than an extension of stay) application on behalf. If this is done, the alien cannot travel while the change of status is pending. This is true for any alien, regardless of whether he is using AC21’s portability provisions. However, traveling in this situation could raise additional problems for porting aliens. The change of status application will be considered abandoned from the moment the alien leaves the country. The petition could still be approved, and the change of status may even be approved if USCIS does not realize the alien has departed at this point. However, if the alien comes back and starts working again for the new employer under portability, any employment occurring after the alien’s return from abroad will be considered unauthorized employment. If it later comes to the attention of USCIS that the alien made the departure while the change of status was pending, and that the alien had engaged in unauthorized employment prior to approval of the change of status application, the alien could have problems with future extensions or changes of status, or at the time of adjusting his status to permanent resident.
Seventh Year Extension of H-1B Status
Third, AC21 also creates the possibility for aliens to extend their stay in H-1B status beyond the traditional 6-year maximum. Most H-1B holders are admitted for an initial period of 3 years and are eligible for one 3-year extension of stay, for a maximum period of 6 years in H-1B status. However, sections 104(c) and 106(a) of AC21 permits H-1B holders to extend their nonimmigrant status in past the 7th year.
1. Extensions in One Year Increments Under AC21 106(a)
Section 106(a) of AC21 permits extensions of H-1B status past the 6th year in one-year increments if 365 days have elapsed since either:
(1) a labor certification was filed on the alien’s behalf;or
(2) a labor certification application is not required and an immigrant petition was filed on the alien’s behalf under 204(b).
These extensions are permitted in one-year increments until a final decision is made on the alien’s lawful permanent residence.
Certain types of I-140 petitions require that a labor certification application be filed with the Department of Labor (e.g. for skilled or unskilled labor), while others, such as Multinational Manager petitions or National Interest Waiver petitions, do not. I-360 petitions for Religious Workers do not require labor certifications either. Aliens who are currently in H-1B nonimmigrant status, and on whose behalf an I-360 Religious Worker immigrant petition has been filed can take advantage of the 7th (and subsequent)- year extension provision of AC21 if all other conditions are met.
Additional issues may arise for the dependent (H-4) family members of aliens who extend their H-1B status for 7th and subsequent years under AC21. Generally, an alien’s eligibility for dependent status hinges on whether the principal status holder is maintaining status. Therefore, according to a June 19, 2002 INS memo, where an H-1B nonimmigrant extends his stay past the traditional 6-year maximum, his dependent family members may also extend their stay.
2. Extensions in Three Year Increments Under AC21 104(c)
Section 104(c) of AC21 permits extensions of H-1B status past the 6th year in three-year increments where:
(1) An I-140 petition has been approved on the beneficiary's behalf; and
(2) The beneficiary is unable to obtain permanent residence because a visa number is unavailable.
These extensions are permitted in three-year increments until the alien's application for adjustment of status has been processed and a decision made thereon.
Benefits for Adjustment of Status Applicants
Section 106 of AC21 also provides portability provisions for adjustment of status (I-485) applicants for permanent residence. This section states that it applies to aliens on whose behalf immigrant petitions have been filed under § 204(a)(1)(D) of the Immigration and Nationality Act of 2000 (or 204(a)(1)(F) in the current INA), which includes the following types of I-140 petitions:
1. INA § 203(b)(1)(B)- Outstanding Professors and Researchers;
2. INA § 203(b)(1)(C)- Multinational Executives and Managers;
3. INA § 203(b)(2)- Members of the Professions Holding Advanced Degrees or Aliens of Exceptional Ability; and
4. INA § 203(b)(3)- Skilled workers, professional workers,and other workers.
Note that aliens on whose behalf an I-360 Religious Worker petition (found in INA § 203(b)(4)) has been filed, are not listed. Therefore, AC21 portability provisions do not apply to them. However, there are other provisions permitting limited flexibility in employment for Religious Workers.
AC21 states the following:
A petition under section (a)(1)(D) for an individual whose application for adjustment of status pursuant to 245 has been filed and remained unadjudicated for 180 days or more shall remain valid with respect to a new job if the individual changes jobs or employers if the new job is in the same or a similar occupational classification as the job for which the petition was filed.
This means that if an I-140 petition has been filed on the alien’s behalf and the alien’s adjustment of status application has been pending over 180 days, he can go to work for a new employer, so long as the job is similar to the job listed in the I-140 petition. When an alien uses this portability provision, he should notify USCIS in writing of the new employment, and demonstrate that the new employment is in the same or a similar occupational classification.
Note, however, that AC21 was passed in 2000, which was prior to the rule allowing the concurrent filing of I-140 petitions with I-485 adjustment of status applications. Therefore AC21 assumes in this rule that the alien’s I-140 petition would have been approved prior to the filing of his adjustment of status application. The question arises, now that we have both AC21 portability and concurrent filing, whether the following scenario is permissible:
1. Alien’s employer files I-140 petition on his behalf and he concurrently files an I-485 application;
2. Both the I-140 and I-485 remain pending over 180 days.
3. After the 180 day mark, while both the I-140 and the I-485 are still pending, the alien goes to work for a new employer.
Is it permissible for an alien to “port” to a new employer before his I-140 petition has been approved with the old employer? What if the old employer withdraws the I-140 petition because it is angry that the alien left employment there? Would the alien be out of luck? Would the I-485 application also be denied because there is no I-140 petition to base it on?
USCIS issued a memo in August 2003 that addresses these questions to some extent. It states that where an I-140 petition has already been approved and 180 days have passed since the alien’s I-485 was filed, there is no problem with porting. Even if the approved I-140 is subsequently revoked because the previous employer withdraws it, the I-140 still remains valid under AC21 and the alien can safely port.
The memo also states that if an alien’s I-140 form is revoked or withdrawn before the alien’s I-485 application has been pending 180 days, the alien is ineligible to port and his I-485 will be denied.
What the August 2003 memo does not address is what happens when an alien ports prior to approval of the I-140 petition but after the alien’s adjustment of status has been pending for 180 days. A February 28, 2003 USCIS memo does state that where a concurrently filed I-140 petition is denied, the accompanying I-485 (and any EAD or AP applications submitted with the application) should also be denied. One must assume that the withdrawal of a concurrently filed I-140 petition would yield a similar result. Therefore, in the absence of direct guidance on this issue, it is most prudent for aliens not to port until after BOTH of the following have happened:
(1) The I-140 has been approved; AND
(2) 180 days have passed since the I-485 was filed. It is possible that the I-140 petitioner will be angered by the fact that the alien has gone to work for a new employer. The employer could then withdraw the I-140 petition before it has been approved. If this occurs, then it is extremely likely that USCIS will also deny the I-485 application.
