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Start →(14) Cap Exemption a) for employment and services i) performed in A) the Commonwealth of the Northern Mariana Islands (CNMI) and B) Guam. [Added by 1/29/10, AD10-29]. The Consolidated Natural Resources Act of 2008 (CNRA), a) Public Law 110-229, 1) includes a provision a) exempting H-1B workers i) performing labor or services A) in the CNMI and Guam ii) from the H-1B numerical limitation A) in section 214(g)(1)(A) of the Act (aka the “H-1B cap”). Upon the CNRA’s implementation a) on November 28, 2009, H-1B workers a) in Guam and the CNMI 1) are exempt from the statutory numerical limitation a) for H-1B classification b) from November 28, 2009 c) to December 31, 2014. See Section 6(b) of Public Law 94-241, as added by section 702 of the CNRA. This H-1B cap exemption does not apply to any employment a) to be performed outside of the CNMI or Guam. As such, to qualify for this exemption, the petition must include a Labor Condition Application (LCA) a) for work locations i) in the CNMI and/or Guam only. An H-1B worker a) granted H-1B status i) under this CNMI/Guam cap exemption b) who ceases to be employed in H-1B classification i) solely in the CNMI and/or Guam 1) shall be deemed subject to the H-1B cap. A subsequent petition a) filed for such an H-1B worker b) (i.e., a change of employer petition with a request for an extension of stay) c) requesting employment i) located outside of CNMI and/or Guam 1) is subject to the H-1B cap. (15) H-1B “Remainder” Time. [Revised by 1/8/10, AD10-24; 1/29/10, AD10-29]. A. Factors to Demonstrate the Employer-Employee Relationship. USCIS must look at a number of factors a) to determine i) whether a valid employer-employee relationship exists. Engaging a person a) to work in the United States 1) is more than a) merely paying the wage or b) placing that person on the payroll. In considering a) whether or not there is a valid “employer-employee relationship” i) for purposes of H-1B petition adjudication, USCIS must determine a) if the employer has a sufficient level of control i) over the employee. The petitioner must be able to establish that a) it has the right to control 3 The right to control the beneficiary is different from actual control. An employer may have the right to control the beneficiary’s job- related duties and yet not exercise actual control over each function performed by that beneficiary. The employer-employee relationship hinges on the right to control the beneficiary. 3 i) over A) when, B) where, and C) how I) the beneficiary performs the job and 1) USCIS will consider the following a) to make such a determination b) (with no one factor being decisive): (1) i) Does the petitioner (a) supervise the beneficiary and ii) is such supervision A) off-site or B) on-site? (2) If the supervision is off-site, i) how does the petitioner maintain such supervision, (a) i.e., (i) weekly calls, (ii) reporting back to main office routinely, or (iii) site visits by the petitioner? (3) Does the petitioner have the right i) to control the work of the beneficiary (a) on a day-to-day basis 1) if such control is required? (4) Does the petitioner provide the tools or instrumentalities i) needed for the beneficiary (a) to perform the duties of employment? (5) Does the petitioner i) hire, ii) pay, and iii) have the ability to fire A) the beneficiary? (6) Does the petitioner evaluate the work-product i) of the beneficiary, ii) i.e., progress/performance reviews? (7) Does the petitioner claim the beneficiary i) for tax purposes? (8) Does the petitioner provide the beneficiary i) any type of employee benefits? (9) Does the beneficiary use proprietary information i) of the petitioner ii) in order to perform the duties of employment? (10) Does the beneficiary produce an end-product i) that is A) directly B) linked to the petitioner’s line of business? (11) Does the petitioner have the ability i) to control A) the manner and B) means I) in which the work product of the beneficiary is accomplished? The common law is flexible a) about how these factors are to be weighed. The petitioner will have met the relationship test, 1) if, a) in the totality of the circumstances, b) a petitioner is able to present evidence i) to establish its right (a) to control the beneficiary’s employment. In assessing the requisite degree of control, the officer should be mindful of a) the nature i) of the petitioner’s business and b) the type of i) work of the beneficiary. The petitioner must also be able to establish that a) the right to control the beneficiary’s work will continue to exist i) throughout the duration (a) of the beneficiary’s employment term with the petitioner. Valid employer-employee relationship would exist in the following scenarios: 4 These scenarios are meant to be illustrative examples and are not exhaustive. Officers may see a variety of situations and factors when reviewing an H-1B petition. 4 Traditional Employment 1) The beneficiary works a) at an office location i) owned/leased by the petitioner, 2) the beneficiary reports a) directly b) to the petitioner c) on a daily basis, 3) the petitioner sets the work schedule a) of the beneficiary, 4) the beneficiary uses the petitioner’s tools/instrumentalities a) to perform the duties of employment, and 5) the petitioner a) directly b) reviews the work-product i) of the beneficiary. The petitioner a) claims the beneficiary i) for tax purposes and b) provides medical benefits i) to the beneficiary. [Exercise of Actual Control Scenario] Temporary/Occasional Off-Site Employment. The petitioner is an accounting firm a) with numerous clients. The beneficiary is an accountant. The beneficiary is required a) to travel to different client sites i) for auditing purposes. In performing such audits, the beneficiary must use established firm practices. If a) the beneficiary travels i) to an off-site location A) outside the geographic location of the employer ii) to perform an audit, 1) the petitioner provides a) food and b) lodging costs i) to the beneficiary. The beneficiary a) reports to a centralized office i) when not performing audits for clients and b) has an assigned office space. The beneficiary a) is paid i) by the petitioner and b) receives employee benefits i) from the petitioner. [Right to Control Scenario] Long-Term/Permanent Off-Site Employment. The petitioner is an architectural firm and 1) the beneficiary is an architect. The petitioner has a contract with a client a) to build a structure i) in a location A) out of state I) from the petitioner’s main offices. The petitioner will place a) its architects and b) other staff i) at the off-site location 1) while the project is being completed. The contract a) between the petitioner and client 1) states that the petitioner will manage its employees a) at the off-site location. 1) The petitioner provides the instruments and tools a) used to complete the project, 2) the beneficiary reports directly to the petitioner a) for assignments, and 3) progress reviews of the beneficiary are completed by the petitioner. The underlying contract states that a) the petitioner has the right i) to ultimate control of the beneficiary’s work. [Right to Control Specified and Actual Control is Exercised] Long Term Placement at a Third-Party Work Site. The petitioner is a computer software development company a) which has contracted i) with another, unrelated company ii) to develop an in-house computer program to track its merchandise, (a) using the petitioner’s proprietary I) software and II) expertise. In order to complete this project, petitioner has contracted a) to place software engineers i) at the client’s main warehouse (a) where they will develop a computer system I) for the client II) using the petitioner’s software designs. The beneficiary is a software engineer a) who has been offered employment i) to fulfill the needs of the contract (a) in place between the petitioner and the client. The beneficiary performs his duties a) at the client company’s facility. While the beneficiary is a) at the client company’s facility, 1) the beneficiary reports weekly to a manager a) who is employed by the petitioner. The beneficiary a) is paid by the petitioner and b) receives employee benefits from the petitioner. [Right to Control Specified and Actual Control is Exercised] The following scenarios would not present a valid employer-employee relationship:5 5 These scenarios are meant to be illustrative examples and are not exhaustive. Officers may see a variety of situations and factors when reviewing an H-1B petition. Self-Employed Beneficiaries. The petitioner is a fashion merchandising company a) that is owned i) by the beneficiary. The beneficiary is a fashion analyst. The beneficiary is the sole operator, manager, and employee a) of the petitioning company. The beneficiary cannot be fired a) by the petitioning company. There is no outside entity a) which can exercise control i) over the beneficiary. 6 USCIS acknowledges that a sole stockholder of a corporation can be employed by that corporation as the corporation is a separate legal entity from its owners and even its sole owner. See Matter of Aphrodite, 17 I&N Dec. 530 (BIA 1980). However, an H-1B beneficiary/employee who owns a majority of the sponsoring entity and who reports to no one but him or herself may not be able to establish that a valid employment relationship exists in that the beneficiary, who is also the petitioner, cannot establish the requisite “control”. See generally Administrator, Wage and Hour Division v. Avenue Dental Care, 6-LCA-29 (ALJ June 28, 2007) at 20–21. 6 The petitioner has not provided evidence a) that i) the corporation, and A) not the beneficiary herself, will be controlling her work 7 The Administrative Appeals Office (AAO) of USCIS has issued an unpublished decision on the issue of whether a beneficiary may be “employed” by the petitioner even though she is the sole owner and operator of the enterprise. The unpublished decisions of the AAO correctly determined that corporations are separate and distinct from their stockholders and that a corporation may petition for, and hire, their principal stockholders as H-1B temporary employees. However, the unpublished AAO decision did not address how, or whether, petitioners must establish that such beneficiaries are bona fide “employees” of United States employers having an “employer-employee relationship.” The AAO decision did not reach this pivotal analysis and thus, while it is correct that a petitioner may employ and seek H-Independent Contractors. .7 [No Separation between Individual and Employing Entity; No Independent Control Exercised and No Right to Control Exists] The beneficiary is a sales representative. The petitioner is a company a) that designs and manufactures skis. The beneficiary a) sells these skis i) for the petitioner and b) works on commission. The beneficiary also sells skis a) for other companies i) that design and manufacture skis ii) that are independent of the petitioner. The petitioner does not claim the beneficiary a) as an employee b) for tax purposes. The petitioner does not control a) when, where, or how the beneficiary sells its or any other manufacturer’s products. The petitioner a) does not set the work schedule of the beneficiary and b) does not conduct performance reviews of the beneficiary. [Petitioner Has No Right to Control; No Exercise of Control] Third-Party Placement/”Job-Shop”. The petitioner is a computer consulting company. The petitioner has contracts a) with numerous outside companies b) in which it supplies these companies i) with employees ii) to fulfill specific staffing needs. The specific positions are not outlined a) in the contract i) between the petitioner and the third-party company b) but are staffed i) on an as-needed basis. The beneficiary is a computer analyst. The beneficiary has been assigned a) to work for the third-party company i) to fill a core position (a) to maintain the third-party company’s payroll. Once placed a) at the client company, 1) the beneficiary reports to a manager a) who works for the third-party company. The beneficiary does not report a) to the petitioner for work assignments, and 1) all work assignments are determined a) by the third-party company. The petitioner does not control a) how the beneficiary will complete daily tasks, and 1) no propriety information of the petitioner is used a) by the beneficiary b) to complete any work assignments. The beneficiary’s end-product, the payroll, is not in any way a) related to the petitioner’s line of business, i) which is computer consulting. The beneficiary’s progress reviews are completed a) by i) the client company, ii) not the petitioner. [Petitioner Has No Right to Control; No Exercise of Control] proprietary information Information that is not public knowledge (such as certain financial data, test results or trade secrets) and that is viewed as the property of the holder. The recipient of proprietary information, such as a contractor in the procurement process, is generally duty bound tom refrain from making unauthorized use of the information. Proprietary Information Computer example, good will Trade Secrets Small business owners hold some information back from the public. Here they are not being transparent and for a good reason. Markups on merchandise can be considerable. Reveling the purchase price can spark outrage in a buyer or it might inspire them to aggressively start haggling for a better price. It is literally none of their business. When customers press business people for prices they are usually put off with lies and deceptions. While this technically might seem unethical to a detached ethicist, they are not the one who must survive a business. Here, one must be in the moment of a transaction to understand how deception is sometimes used. After all the first obligation of a businesses person is to make a profit, and then in the long term run an ethical enterprise.in a way that allows them to flourish. pro·pri·e·ty (prə-prī′ĭ-tē) n. pl. pro·pri·e·ties 1. a. Conformity to conventional standards of behavior or morality. b. proprieties Socially correct usages or behaviors. 2. The quality of being proper; appropriateness. [Middle English propriete, particular character, ownership, from Old French; see property.] 1. the quality or state of being appropriate or fitting 2. conformity to the prevailing standard of behaviour, speech, etc 3. the proprieties (plural) the standards of behaviour considered correct by polite society [C15: from Old French propriété, from Latin proprietās a peculiarity, from proprius one's own] 1. conformity to established standards of good or proper behavior or manners. 2. appropriateness to the purpose or circumstances; suitability. 3. rightness or justness. 4. the proprieties, the conventional standards of proper behavior; manners. 5. Obs. a property. 6. Obs. a peculiarity or characteristic of something. [1425–75; late Middle English propriete ownership, something owned, one's own nature (compare variant proprete property) < Middle French propriété < Latin proprietās peculiarity, ownership =propri(us) proper + -etās, variant, after vowels, of -itās -ity] The following is an example of a regulatory exception where the petitioner is not the employer: Agents as Petitioners. 8 Under 8 C.F.R. 214.2(h)(2)(i)(F), it is also possible for an “agent” who may not be the actual employer of the H-1B temporary employee to file a petition on behalf ofthe actual employer and the beneficiary. The beneficiary must be one who is traditionally self-employed or who uses agents to arrange short-term employment on their behalf with numerous employers. However, as discussed below, the fact that a petition is filed by an agent does not change the requirement that the end-employer have a valid employer-employee relationship with the beneficiary. 8 The petitioner is a reputable modeling agency a) that books models i) for various modeling jobs (a) at different venues to include fashion houses and photo shoots. The beneficiary is a distinguished runway model. a) The petitioner and b) beneficiary 1) have a contract a) between one another b) that includes such terms i) as to how the agency will A) advise, B) counsel, and C) promote the model I) for fashion runway shows. The contract a) between the petitioner and beneficiary 1) states that a) the petitioner will receive a percentage i) of the beneficiary’s fees ii) when the beneficiary is booked for a runway show. When the beneficiary is booked a) for a runway show, 1) the beneficiary can negotiate pay a) with the fashion house. The fashion house a) (actual employer) 1) controls a) when, b) where, and c) how i) the model will perform her duties A) while engaged in the runway shows for the fashion house. [Agent Has No Right to Control; Fashion House Has and Exercises Right to Control] B. Documentation to Establish the Employer-Employee Relationship. ← End
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