February - 2014 - issue > Attorney Viewpoint

U.S. Immigration Strategies to Address Increased Scrutiny of L-1 Petitions Filed by IT Consulting Companies

Scott J. FitzGerald , Molly A. Carey
Monday, February 10, 2014
Scott J. FitzGerald , Molly A. Carey
In recent years, global companies seeking to transfer key personnel to the U.S. have faced increasing scrutiny from U.S. Citizenship and Immigration Services (USCIS) and U.S. Consulates abroad. Specifically, denial rates, particularly for L-1B applications filed by information technology consulting companies on behalf of Indian employees to be placed at third-party client sites in the U.S., have dramatically increased in the past few years. This has resulted in costly delays for companies who require the expeditious transfer of employees to the U.S. to complete important client projects. This environment is fueled by the U.S. Government initiatives to keep skilled workers outside of the U.S., in an apparent effort to protect U.S. jobs. The high rate of denials and Requests for Evidence (RFEs), whereby the company must provide additional information before the application can be adjudicated, are, in fact, causing some companies to move the work outside of the U.S., to avoid the need to utilize the U.S. immigration system.

The L-1B visa classification enables a U.S. employer to transfer a professional employee with "specialized knowledge" from one of its affiliated foreign offices to the U.S. According to applicable U.S. immigration regulations, "specialized knowledge" means either special knowledge of the petitioning company's product, service, research, equipment, techniques, management or other interests and its application in international markets, or an advanced level of knowledge or expertise in the company's processes and procedures. Despite repeated requests from L-1B employers and immigration practitioners, there is little available guidance from USCIS regarding what constitutes "specialized knowledge" and how an employer can evidence it in an L-1B petition or application. The dramatic increase in the rate of denials of L-1B petitions over the past few years reflects USCIS's increasingly narrow interpretation of the regulatory definition of specialized knowledge.

Denial rates for initial and extension L-1B "specialized knowledge" petitions filed at USCIS, for example, rose from 7percent in FY2007 to 27percent in FY2011. It should also be noted that in FY2011, 63 percent of all L-1B petitions filed at USCIS received an RFE, which require the preparation and filing of time-consuming responses, and further delay employers' ability to fulfill contracts with clients. Some IT consulting companies currently report RFE rates as high as 74 percent.

There is also widespread concern that L-1B petitions filed on behalf of Indian visa applicants have been specifically singled out by USCIS and Department of State. USCIS denial rates for Indian beneficiaries increased from 2.8 percent in FY2008 to 22.5 percent in FY2009. Denial rates for beneficiaries from France, Germany, Japan and the U.K., on the other hand, rose within the range of 4.1 percent to 5.9 percent in FY2009. This increase in denials and RFEs has occurred despite the lack of any change in the legal standard for adjudicating such petitions.

Certain companies, particularly large multinational companies, are eligible for Blanket certification, which allows their employees to apply for a Blanket L-1 visa directly at a U.S. Consulate abroad, bypassing the need to file a petition with USCIS. Consular officers may grant L classification for "clearly approvable" applications. A gain, there is little guidance available to companies that clarifies what "clearly approvable" is in the context of "specialized knowledge." The U.S. Embassy and Consulates in India appear uncomfortable with this "clearly approvable" standard, and senior State Department officials in India have confirmed that the ability of the visa applicant to articulate his or her "specialized knowledge" during the visa interview is weighed significantly more heavily than the paper application. The denial rate at U.S. Consulates, however, is even higher than those filed at USCIS. In FY2013, U.S. Consulates denied 29 percent of L-1 visa applications filed. Anecdotal evidence suggests a current denial rate of over 40 percent for L-1 Blanket visa applications filed by IT consulting companies involving third-party placement.

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