In a recent guidance memo, U.S. Citizenship and Immigration Services (USCIS) has appreciably altered its definition of what constitutes a valid employer-employee relationship as it relates to H-1B workers and imposes new rules on the types of activities in which H-1B workers can engage. The memo will have a significant impact on certain new H-1B petitions and certain extensions.
Under the new rules, workers who are placed at third-party worksites will no longer qualify for H-1B visas as employees. Nor will independent contractors, such as sales representatives. And, agents as petitioners will not be able to qualify as H-1B employers. The memo also departs from long-standing precedent to conclude that persons with a substantial interest in a petitioning company, in most cases, cannot qualify as a beneficiary of an H-1B visa. This means that co-owners of a business may not be able to obtain an H-1B. The guidance memo also requires that the petitioner establish that the employer-employee relationship exists throughout the requested H-1B validity period.