What exactly does the new provision for 7^th Year Extensions mean for your employees?

On November 2, 2002, the President signed into law the "21st Century Department of Justice Appropriations Authorization Act" (H.R. 2215). The new law contains provisions GT drafted and lobbied for that would enable extensions beyond the ordinary six-year limit to H-1B holders with labor certifications that have been pending for more than one year prior to the end of their sixth year in H status. The previous regulations allowed for a 7^th year extension only in instances where the labor certification application had been pending for 365 days and the immigrant petition (Form I-140) had been filed with the INS service center.

What does this mean for employers and employees? The provision is intended to benefit those in H-1B status who have labor certification applications caught in extended agency backlogs. In the current economy, many large companies cannot file RIR (fast-track) labor certifications due to layoffs and hiring freezes. This has resulted in the increased filings of traditional labor certification applications, which take much longer to process than RIRs. These backlogs combined with the existing backlogs at most of the State Workforce Agency offices due to the voluminous filing of 245(i) applications in January 1998 and April 2001 created unreasonable waiting times in an already very artificial and tedious process.

The labor certification process is the first step in the permanent residence process and can take anywhere from one to four years, depending on the jurisdiction. Only after completing this process can a sponsoring employer and the foreign national proceed to the next two steps leading to employment authorization in the U.S. independent of an H-1B and finally to permanent resident status in the U.S. ("green card"). In the past, it was crucial for the H-1B applicant to get through the first step of obtaining certification from the Department of Labor and the second step of obtaining an INS approval of immigrant visa petition (Form I-140) prior to the 6^th year of H-1B status in order to file the adjustment application and apply for work authorization. With the backlogs at INS and the Department of Labor to get to this final stage it can take anywhere from two to four years or more, in which case many people would "max out" on their allotted H-1B time.

These backlogs were forcing employers and employees to consider various costly and unfavorable options such as transferring employees to an overseas office prior to the "maxing" out of the H-1B. Fortunately, this new regulation allows companies to petition for and obtain extensions in one year increments, beyond the six year limit, while the employee completes his permanent residence process. This is very beneficial as it allows individuals who are awaiting the processing of their green cards to avoid any gaps in employment authorization or being forced to leave the U.S.

With this new regulation, it is important for both employees and employers to consider whether or not it is feasible and in the best interest of both parties to file a traditional labor certification in order for the employee to take advantage of the 7^th year extension if required. This is particularly important for those who have less than 2 of the 6 years remaining on their H-1B. It is not expected that the processing times at the state workforce agencies to decrease over the next year. Therefore, we will continue to be faced with severe backlogs of the labor certification applications. Again, in order to take advantage of the 7^th year extension, the applicant's labor certification must be pending for at least 365 days at the time of filing for the extension. Therefore, one must consider filing the labor certification no later than the 5^th year of employee's H-1B status.

Taking such a step should be reviewed on a case by case basis, heavily considering the employer’s ability to attest to the lack of U.S. workers able to fill the position should the alien be forced to leave the U.S. GT is attempting to apprise employers when employees are nearing the 4^th year in H-1B status in order to ensure that there is sufficient time to consider if the permanent residence process should commence.

On a final note, if an application for a labor certification or adjustment of status or a petition for an immigrant visa petition is denied, the extended H-1B status ends at that point. Please contact your human resource rep or GT should you have any questions or clarifications regarding this regulation or how it affects your personal situation.

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