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Policy Limiting Staffing Companies’ H-1B Access May Be Scrapped

Jan. 23, 2019, 7:31 PM

A coalition of information technology staffing companies that rely on H-1B visas is moving forward with a lawsuit over an agency policy it says effectively bars them from the program.

A federal judge in New Jersey refused to throw out the case, a move that the Small and Medium Enterprise Consortium’s attorney is calling a win that could lead to the policy’s demise.

The U.S. Citizenship and Immigration Services policy at issue requires staffing companies seeking H-1B visas to give the agency the worker’s full itinerary for the duration of the three-year visa. That’s an impossible task, the companies say, because their business model requires that they have the flexibility to move workers around as needed.

Judge Madeline Cox Arleo of the U.S. District Court for the District of New Jersey Jan. 18 “tore apart” the USCIS’ arguments, Reston, Va., attorney Jonathan Wasden told Bloomberg Law Jan. 23. The USCIS had argued that the consortium waited too long to sue, couldn’t prove that its members were harmed by the policy, and that the policy isn’t a “final action” that can be the subject of a lawsuit.

The inference is that the USCIS isn’t “going to win on the merits” of the case, and it will have to go through a public notice and comment process to enact the policy, Wasden said.

The USCIS doesn’t comment on matters involving pending litigation, an agency spokesman told Bloomberg Law Jan. 23.

More Litigation

But even going through that process won’t save the agency from litigation, he said.

The Labor Department—which must approve employers’ labor condition applications before they can seek H-1B visas from the USCIS—already has gone through the process and allowed consulting companies to obtain the visas on the same terms as everyone else, he said.

The USCIS would have to explain why it’s treating consulting companies differently when the DOL doesn’t, Wasden said.

The Trump administration has been tightening the reins on H-1B visas, particularly their use in the information technology industry. In addition to issuing a series of new policies, the USCIS also has proposed a regulation to rework the visa lottery to increase the pool of H-1B workers with advanced degrees. The final version of the regulation is currently under review by the White House Office of Management and Budget.

The agency also is planning a regulation to redefine what qualifies as a “specialty occupation” for H-1B purposes in order to ensure that the visas go to the “best and the brightest.”

One of Two Lawsuits

A second lawsuit over the same H-1B policy, also filed by Wasden, says the USCIS illegally has been approving H-1B visas only for as long as the staffing companies can list definite assignments. In some cases, that’s meant an H-1B valid for only days or weeks at a time.

The policy remains in effect despite the consortium’s request in May to block its enforcement.

Some companies actually have had H-1B visas approved since the memo was issued in February 2018, Arleo said. That cuts against the argument that they will face immediate, irreparable harm if the policy isn’t blocked by the court, she said.

The case is Small & Medium Enter. Consortium, Inc. v. Nielsen, D.N.J., No. 2:18-cv-08672, order 1/18/19.

To contact the reporter on this story: Laura D. Francis in Washington at lfrancis@bloomberglaw.com

To contact the editors responsible for this story: Cynthia Harasty at charasty@bloomberglaw.com; Terence Hyland at thyland@bloomberglaw.com