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Old 02-05-2010, 10:25 AM
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Post Employer-Employee relationship

News of the January 8, 2010 release of the U.S. Citizenship and Immigration Services (USCIS) memo, "Determining Employer-Employee Relationship for Adjudication of H1B Petitions, Including Third-Party Placements," spread quickly within the IT consulting community.
Eleven Factors to Determine Employer Relationship
The memo lists eleven factors to be weighed in the determination of whether there is a genuine employer-employee relationship. No single factor is supposed to be required; the factors are supposed to be weighed by the USCIS in making a determination. Since the memo is fairly recent, it is too early to discuss any trends in the adjudication of H1Bs under this standard.
Employers Should Strategize to Address Matters Preemptively
Employers need to carefully plan a strategy in advance for effectively responding to the factors raised in the memo. It is unwise to wait for a request for evidence (RFE) and react. Employers need to consider how these factors relate to their businesses, and how they would document RFE responses asking for such proof. They may want to formalize some of their existing procedures. There are times when daily business and operations are conducted somewhat informally. This makes it difficult to prove what has occurred, and creates problems when trying to respond to RFEs.
Supervision and Regular Reviews of Employee / Consultant
The type of analysis and strategy discussed can be applied, for example, to the second factor listed in the memo. This factor for consideration asks, if the supervision of the H1B beneficiary is done off-site, then, how does the employer / petitioner maintain such supervision? The memo gives the examples of weekly calls, reporting back to the main office routinely, or site visits by the petitioner. The answer depends upon the particular company's operations. However, those companies that conduct weekly calls or have routine reporting systems might not be able to document the practice, if it has not been established as policy. They may wish to improve systems for documenting contact requirements, dates of calls, content of calls, and any follow up or outcome.
The same type of analysis applies to many of the other factors in the memo. Companies need to determine how their practices align with this memo and make sure they have any required documentation. Some companies may need to refine or augment their current procedures with respect to off-site employees.
Employers Need to Consider Employees' Fears
Consulting company employers should be aware that their consultants / employees are concerned about their ability to obtain H1B extensions. Steps need to be taken to enhance the chances of success under the new memo, thereby engendering the confidence of their employees. Of course, at this early date, it is impossible for anyone to make assurances of the likelihood of success. It is possible, however, to potentially increase the chances of satisfying the employer-employee requirements, as currently interpreted.
Since this is an evolving area, some employers are choosing to file H1B extensions early. H1B petitions can be filed six months in advance of the expiration date, which would end the uncertainty on the part of the employee, assuming that the H1B extension is approved. If it is not approved, both the employer and employee have a few months to consider and implement possible alternatives.
-- Murthy Law
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