UNAUTHORIZED EMPLOYMENT FOR H1-B VISA HOLDERS IN THE UNITED STATES
Before I commence on the substantive and the nitty-gritty of this work, it is imperative and of great importance to understand the nature of H-1B visa. The H-1B is a visa in the United States that allows U.S. employers to temporarily employ foreign workers in specialty occupations, occupations which require the application of specialized knowledge. The intent of H-1B provisions is to help the employers who cannot otherwise obtain the needed business skills and abilities from the U.S. workforce by authorizing the temporary employment of qualified individuals who are not otherwise authorized to work in the U.S.
The law establishes certain standards in order to protect similarly employed U.S. workforce from being adversely affected by the employment of the non-immigrant workers, as well as to protect the H-1B non-immigrant workers. Employers must attest to the Department of labour that they will pay wages to the H-1B nonimmigrant workers that are at least equal to the actual wage paid by the employer to other workers with similar experience and qualifications for the job in question, or the prevailing wage for the occupation in the area of intended employment.
From the above discussion, it now begs the question, what amounts to unauthorized employment in the scope of the holders of H-1B Visas? It is a common ground that employment is founded on an employer-employee relationship, where one individual known as the employee provides services or labor and is paid remuneration and/or wages for the amount of work done or the amount of hours billed. However, under this class of people holding the H-1B Visas, they are barred from engaging themselves in gainful employment, and accepting any kind of work or remuneration thereof for services rendered by him/her can result in a violation of visa status if done without work authorization. Therefore, the definition of employment for immigration purposes is in the federal regulations at 8 CFR 274a. 1 (h).
However, unauthorized employment may arise in other circumstances such as working beyond the period or scope of one’s employment authorization, and certainly, here in the United States, what constitutes a lawful work is more than working for an employer, there are various other instances which, by and large, is an immigrant engages him/herself, without understanding and appreciation of the law, can amount to the violation of his/her visa terms, which may have a very pernicious repercussions like deportation.
Some of the unauthorized employments one may engage in without application of his/her wits and which may have adverse ramifications includes: Being employed without Authorization; this is mostly prevalent in companies where one is employed without the proper authorization: Unauthorized Self-Employment; once you establish or run a business without the required approval from the authorities, whether on full-time or part-time basis, it will be considered to fall under the bracket of what amounts to unauthorized employment.
Another form of unauthorized employment is volunteering. Volunteering; in as much as one does not require a work permit to do voluntary jobs in the U.S. there are rules that govern volunteering. Volunteering is defined as ‘donating ones’ time with an organization primarily set up to provide charitable or humanitarian deeds without any form of compensation or remuneration.’ Since the American legal system is a conservative one, it has as its regulation that volunteering is generally not allowed in a position that should be filled by a paid worker, the justification for this being that there is need to safeguard against the exploitation of workers in the name of performing voluntary work and the egalitarian need to protect the jobs of United States citizens.
However, not all is doomed for H-1B Visa holders, there are instances where the law is flexible, one of those instances is where the H-1B Visa holder engages in certain passive investment with stipulations. In this, foreign nationals may invest passively in the United States without obtaining work authorization; they are allowed to make financial investments in order to generate capital gains. Such investments include buying stocks in a stock market, bonds, and any other form of savings that brings returns. However, the disclaimer is that, these investments should be passive because active investment such as day to day running of business or active forex trading could amount to unauthorized employment.
Another issue which remains unsolved but which is pertinent is the issue of the status of Internet Freelancing. The law in this area is still under contestation which may lead one to treading in murky waters. However, remote freelancing, to a larger extent, could be considered as a home business even if it is done via the internet, what one has to consider is a question of fact, whether under the H-1B Visa terms and conditions, that type of internet freelancing is allowed, if it is not allowed, one may be violating his/her visa terms which violates the Immigration law.
In order to evade the ramifications that might fall an immigrant in the United States, it is highly advisable to the immigrant to look at the purpose of his/her visa. It is a common ground that the immigration laws prohibit a foreign national from engaging in activities that are not in consonance with the purpose of their visa. If the work that the law has given a leeway is considered to be central to the immigrant survival in the United States, that work or activity can be considered to be problematic. Since each visa is issued with specificity, one should strictly adhere to those purposes stipulated under the visa. And in order to avoid the problematic nature of violating visa terms, such investments and volunteering should remain in the peripheral.
There are some people who create something for sale, and since creativity is a creature of the mind, and that creativity may have a practical utility where the immigrant receives some stipends, it may be problematic if the immigrant does not obtain the necessary work permits, which may be a violation of his/her visa terms. The same may accrue where an immigrant works for a foreign company online while in the U.S. and the payments is done via a foreign bank, this may still be considered to be employment in the U.S.
With that background information, this particular part of the essay will deal with the various court decisions on the issue of the labour status of those immigrants who hold H-1B Visas. And since it is a trite and an application of jurisprudence wisdom, it is always important to start with those cases which are known as locus classicus cases. At the onset, there are two cases which I will discuss at length, followed by another cases of the same nature and lastly, I will tackle the emerging jurisprudence especially the decisions of the courts during President Trump’s administration, cases which has shaped and streamlined the status of H-1B Visa holders in the United States.
Bhakta v Immigration & Naturalization Service
The facts of this case are not to be disputed; Bhakta and his wife entered the United States in June 1973. They overstayed their visas, which led to deportation order which was affirmed after a deportation hearing in 1977. Before the deportation proceeding, Bhakta’s brother’s visa petition was approved, and Bhakta became a beneficiary of a fifth presence visa. On May 1, 1979, he filed a Motion to reopen deportation proceedings, in order to apply for a change to permanent residence status. However, his motion was denied on October 1, 1979 by the immigration judge on the basis that Bhakta was ineligible to adjust his status because he had engaged in unauthorized employment, since he had purchased the Freeway Motel in Anaheim California shortly after entering the country in 1973, and at the hearing of the motion, he was still operating the Motel.
In his defence, Bhakta contended that his self-employment did not amount to unauthorized employment for the purposes of the disqualification provisions of Section 1255(c). He argued that the disqualification provision was designed to prevent aliens from filling jobs for which there are citizens or authorized alien aspirants.
The court agreed with the assertions of Bhakta, and in reliance with the business investor provision, the INS recognized that certain types of activities for profits do not adversely affect employment opportunities for legitimate aspirants in the labor pool. And after analogizing the status of the work that Bhakta was doing, the court was of the view that:
“…Bhakta’s operation of his enterprise does not reduce the number of jobs for citizen or authorized alien workers. It would not serve the purposes of the statute to hold that Bhakta’s management of his investment is unauthorized employment…Bhakta is much more like a business investor than a laborer, in that he contributed to financial stability, fiscal courage, economic awareness, leadership business acumen and common sense to his enterprise.”
The court as per Judge Norris, the Circuit Judge, held that indeed, it was through Bhakta’s business acumen that he had even employed United States citizens and that he did not take any “job” from anyone.
WETTASINGHE v U.S. DEPARTMENT OF JUSTICE, IMMIGRATION & NATURALIZATION SERVICE
In February, 1979, Mr. Wettasinghe bought a fleet of six ice cream trucks. The trucks were leased to individuals for the purpose of selling ice cream on the streets. Wettasinghe purchased ice cream for the trucks and stocked them on a daily basis. He drove the trucks only if the driver was unavailable. In addition to rental charge, he received a percentage of the ice cream sales made by the lessees, he never sought permission from the INS. He argued that his engagements did not amount to what is known under the INA as unauthorized employment, he contended that his activities were just an investment, and since this did not fall under the purview of what students must do, he pleaded that he should not be deported.
In his arguments, Mr. Wettasinghe relied on the previous judicial decision in the case of Bhakta v INS where the court held that in the context of a status adjustment an investor-manager’s activities should not be considered unauthorized employment. The court further underscored that the provision forbidding adjustment of status to that of permanent resident alien for one who has engaged in unauthorized employment is intended to protect the American labor market from competition by non-resident aliens. Therefore, it was the position of the court in the Bhakta case that entrepreneurial investors do not compete with American labor, and in many cases, they actually provide jobs for Americans.
However, the court in this case disagreed with the Bhakta case decision in that in the present case, the petitioner was not seeking an adjustment of status, he was just opposing deportation based on the alleged violation of his student status. The court was of the view that the prohibition against unauthorized employment for students does not serve the same purpose as that relating to status adjustments. Further, the court held that aliens with student status are forbidden to work in order to insure those who seek entry into the country to pursue educational opportunities. The court relied on section 8 C.F.R. 214.2 (f)(6) which explicitly prohibited unauthorized self employment of students as well as employment by another.
With the forgoing, the court held that the purpose and language of the regulations pertaining to student employment and the facts of the case provided an ample evidence to support the finding of unauthorized employment, and the court affirmed the order of voluntary departure or deportation.
This decision however received criticisms from various scholars who question the validity of the decision on the basis that it was partly based on regulation 214.2(f)(6) which provided in pertinent part that a nonimmigrant student was in violation of his status whether he engages in off-campus employment or independent employment. The new regulations, it is posited by one scholar that they became effective on August 1, 1983, made no mention of “independent” employment.
ARZANG ALIMORADI v U.S. CITIZENSHIP & IMMIGRATION SERVICES, A BUREAU OF THE DEPARTMENT OF HOMELAND SECURITY
The plaintiff was a native and citizen of Iran, and on top of that, a distinguished scholar in the field of earthquake engineering and a PhD holder for that matter. He was a subject of approval for permanent residence in the U.S. since under 8 U.S.C. 1153 (b) (1) (B), he was an ‘Outstanding Professor and Researcher’ a credit that qualified him as a priority worker on top of the list to obtain that permanent resident status. He had engaged in earthquake research at several prestigious universities and had been the southern California back up person for a major northern California earthquake clearing procedure, where a clearinghouse was the focal point of coordinating post-earthquake investigations between researchers and organizations from around the globe in the aftermath of a major earthquake.
On January 3, 2005, Dr. Alimoradi joined the research and development department of John A. Martin & Associates as a senior research engineer, he was authorized to work in the United States at this time on an Optional Practical Training Visa, which was valid until January 2, 2006. In order to obtain the legal work status, he was required to apply for a H-1B Visa and file an I-129 petition for a nonimmigrant worker.
Further, Dr. Alimoradi was required to file a different application for employment for Employment Authorization, which he did not file, through a fault of his own as he had relied on the advice and expertise of a one Dr. Naeim, hence Dr. Alimoradi was unaware that the Labor Condition Application was insufficient, and that he needed instead to file an I-765 and to obtain a valid Employment Authorization Document.
It was from those facts that the USCIS sent Dr. Alimoradi an intent to deny his I-485 application on the ground that he had worked in the United States without authorization for more that 180 days. Dr. Alimoradi challenged that determination by the USCIS which had moved to dismiss.
The court after an analysis of the applicable law was of the view that by all accounts, Dr. Alimoradi was a talented and innovative researcher in the area of earthquake science, that his work would save a lot of lives and livelihoods of thousands of Americans in the event of a serious earthquake. The United States Government had certified Dr. Alimoradi as one of the crucial individuals who would help accomplish the task of preparing the U.S. from the adverse effects of earthquakes, hence, it would be ‘the very definition of arbitrary and capricious to hold him ineligible to remain in the U.S. because he inadvertently failed to file a second application for employment authorization even though the approved Labor Condition Application that he had already obtained.
The court further held that § 1255 provides more flexibility for priority workers than for regular individuals, and that its thrust was that it provides a special, unique exemption for priority workers, so long as they were not out of status for more than 180 days, hence it offers an extra exemption for priority workers not offered to regular applicants. Also it provides exemption for those individuals whose status lapses through a no fault of their own or for technical reasons. Therefore, from those grounds, the Defendants’ motion to dismiss was denied.
PURDUE UNIVERSITY et al v EUGENE SCALIA together with STELLER IT, INC., et al v EUGENE SCALIA (In his official capacity as Secretary, Department of labor, et al
The plaintiffs in the two consolidated cases are a group of academic institutions and companies in the healthcare, immigration and technology related sectors that employ foreign nationals throughout the United States. The lawsuits challenged the lawfulness of the Department of Labor Interim Final Regulation entitled Strengthening Wage Protections for the Temporary and Permanent Employment of Certain Aliens in the United States issued on October 8, 2020 which the DOL asserted that the prevailing wage levels were not advancing the purposes of the INA’s wage provisions because, under the existing wage levels, artificially low prevailing wage provide an opportunity for employers to hire and retain foreign workers at wages well below what their U.S. counterparts…make, which creates an incentive-entirely at odds with the statutory scheme to prefer foreign workers to U.S. workers, and the plaintiffs were of the view that the Interim Regulation was issued without the due notice and comment, and because notice-and-comment procedure are vital to ensuring informed agency decisions.
The court, as per Judge Emmet G. Sullivan held that the Department of Labor had not shown that providing advance notice and comment would be impracticable as the defendant had alluded, also the court was of the view that the Department of Labor had not shown that providing advance notice and comment would be contrary to the public interest, hence the Judge granted the Plaintiffs motion for partial summary judgment.
SERENITY INFO TECH, INC., WHIZ GLOBAL., LLC, KESHAV CONSULTING SOLUTIONS, INC., SMARTWORKS, LLC, v KENNETH T. CUCCINELLI, Senior Official Performing the Duties of the Director, U.S. Citizenship and Immigration Services,
Plaintiffs were all companies which petitioned for H-1B visas, H-1B visas are non-immigrant visas for temporary workers who come to the United States to perform services in a specialty occupation. The issue was on the basis of what was known as “Employer-Employee Memo” or the “2010 Guidance Memo” or simply the “Neufeld Memo”. The Neufeld Memo stated and listed eleven factors for determining whether an employer-employee relationship exists between the petitioner and the beneficiary of the visa where the beneficiary will be working at a third party work site placement.
Later, in 2018, the USCIS departed from the prior guidance and issued the 2018 policy Memo entitled “Contracts and Itineraries Requirements for H-1B Petitions Involving Third –Party Worksites”, the 2018 Memo did not supersede the Neufeld Memo but was “intended to be read together with and as a complement to third policy. The plaintiffs however asserted that the 2018 policy Memo departed from the Neufeld Memo because under the earlier memo, the agency affirmed that the employer-employee relationship hinges on the right to control the beneficiary not actual control.
Under the Neufeld Memo, the USCIS asserted the authority to deny H-1B petitions based on a potentially restrictive understanding of what constituted an employer-employee relationship, including when an H-1B visa holder performed work at a customer’s location. The issue was whether the memos and policies issued by the USCIS were unlawful.
The court started by addressing the issue of Employer-Employee relationship, and underscored that, it was in 2018 that the USCIS started denying H-1B petitions under the theory that the contractor did not meet the definition of an employer when the employee performed work at a third parties place of work be it a customer. Justice Totenberg held that Employer-Employee relationship was not ambiguous in context where he held that:
“In purporting to strictly interpret the term “employer-employee” relationship set forth in the regulation, the Agency has obliterated the regulation’s clear flexibility. Because the regulation’s definition of employer-employee relationship is not ambiguous, the interpretation advanced by the Agency cannot stand.”
The court reached the conclusion that, because the challenged denials were based upon the determination of law, and the Agency had misconceived the law, the proper remedy is remand to the Agency. The court gave the Agency 30 days to reconsider its earlier decision.
IT Serve Alliance v L. Francis Cissna
This case was based on similar facts as that of Serenity, the presiding Judge was Rosemary M. Collyner and she ruled that Key U.S. Citizenship and Immigration Services memos and policies were unlawful.
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