USCIS Settles Lawsuit Over Employer-Employee Relationship and Itineraries, Will Rescind 2018 Memo Requiring Itinerary and Contracts for Third Party Worksites

May 27, 2020 

Earlier this month, the USCIS settled a long-pending lawsuit filed by ITServe Alliance, Inc. which said the USCIS’ narrow interpretation of an “employer-employee” relationship, which has resulted in an increase in H-1B Requests for Evidence (RFEs) and denials, was not supported by law or regulation. 

The settlement provides that: 

• Within 90 days the USCIS will rescind its 2018 Contract and Itinerary Memorandum  
• Within 90 days the USCIS will re-open and re-adjudicate the H-1B petitions that were in litigation relating to the narrowed definition of “employer-employee relationship” and the 3 year itinerary requirement 

An article from the National Law Review provides background: 

“H-1B visa sponsorship requires a valid employer-employee relationship between the sponsoring employer and the H-1B employee. USCIS regulations define an employer-employee relationship as the ability of a company to ‘hire, pay, fire, supervise, or otherwise control the work of any such employee.…’ USCIS has added restrictions to this definition, which has led to both denials of H-1B petitions, as well as to shortened approvals of H-1B petitions. In one noteworthy example, USCIS approved an H-1B petition for a single day of validity. 

This more restrictive policy regulating offsite H-1B employment came to light in a January 8, 2010 memorandum where USCIS asserted the authority to deny H-1B petitions based on a restrictive reading of the definition of an ‘employer-employee relationship,’ especially when an H-1B visa holder performed work at an off-site location. USCIS’s interpretation of ‘employer-employee relationship’ has become even narrower under the current administration, with substantive changes in a February 2018 memo titled, ‘Contracts and Itineraries Requirements for H-1B Petitions Involving Third-Party Worksites.’ This memo required a specific itinerary of the dates and locations of employment, as well as proof that the employment relationship will continue to exist for the entire requested H-1B validity period.”  

This settlement is good news for H-1B employers who place employees at third party sites, and for all H-1B employers since the USCIS has been unable to distinguish between onsite work and offsite placement, issuing RFEs on the “employer-employee relationship” issue indiscriminately.   

The settlement does not prohibit the USCIS from issuing regulations or future policy  statements regarding H-1B eligibility. In fact, President Trump’s April 22 Proclamation Suspending Entry of Immigrants for 60 days required government agencies to review nonimmigrant visa programs in light of COVID-19’s effect on the U.S. economy and make recommendations for change. It therefore seems likely that the Trump Administration will be introducing more changes in the near future.  

Weaver Schlenger will follow all developments closely and continue to provide updates on our website.