THE H-1B CAP

How the Cap Functions

In 1990, Congress mandated that a cap be placed on the number of H-1B’s issued in any fiscal year. Congress set the cap at 195,000 for FY 2001-2003, and reduced the number to 65,000 for FY 2004 (which ran from October 1, 2003 to September 30, 2004) and following years.

The government’s fiscal year runs from October 1 to September 30. In FY 2004, the annual cap was reached mid-February 2004, before half the fiscal year had passed. In FY 2005, the annual cap was reached on October 1, 2004, the same day the fiscal year started. In a decided trend, the FY 2006 H-1B cap was reached in August 2005, over a month before the fiscal year started!

Because H-1B numbers are snatched up so quickly, H-1B numbers are not available most of the time. The only people who get H-1B petitions approved for first-time employment are those who are ready to file as soon as the new cap opens up. H-1B petitions cannot be filed earlier than 6 months prior to the employment start date. The earliest possible filing date is April 1. The earliest employment start date permitted is October 1.

Coping with the Cap: Employer Strategies

Given the speed with which the cap is reached, and the ability to file H-1B petitions as early as April 1, it is expected that the H-1B cap will continue to be reached every year before the fiscal year begins. H-1B employers will need to synchronize their hiring practices with the H-1B cap rules, and should be ready to file new H-1B petitions on or shortly after April 1.

Some H-1B petitions are not counted against the cap. First, only H-1B holders, and not their dependent family members, are counted against the cap. Second, any H-1B nonimmigrant who was already counted against the cap in the last six years will not be counted against the cap unless he would be eligible for a full 6 years of H-1B status at the time the petition is filed. Where multiple petitions are approved for 1 alien, the alien shall be counted only once. Third, any H-1B petition filed by an institution of higher education will not be counted against the cap. And finally, H-1B petitions filed by nonprofit research organizations or governmental research organizations are not counted against the cap.