• Valid Employer-Employee Relationships for H1B Petitions
  • October 19, 2015 | Author: Alexander Joseph Segal
  • Law Firm: The Law Offices of Grinberg & Segal, PLLC - New York Office
  • In order to have an H1B petition approved, the petitioner must demonstrate that a valid employer-employee relationship exists with the beneficiary. Regulations found in 8 C.F.R. § 214.2(h)(4)(ii)(2) state that the petitioner must “[have] an employer-employee relationship with respect to employees¿ as indicated by the fact that it may hire, pay, fire, supervise, or otherwise control the work of any such employee.” While this regulation provides some general indicators of a valid employer-employee relationship, there are many scenarios that may remain unclear if merely adjudicated based on the above regulation. In part for this reason, USCIS released an important memorandum by Donald Neufeld in 2010 titled “Determining Employer-Employee Relationship for Adjudication of H-1B Petitions, Including Third-Party Site Placements,” HQ 70/6.2.8, AD 10-24 (Jan 8, 2010), which provided comprehensive guidance to USCIS officers for assessing whether an H1B petition demonstrates that a valid employer-employee relationship exists between the petitioner and the beneficiary. By reviewing the key points of the memorandum, as we are about to do, H1B petitioning employers may develop an understanding of the types of evidence required in order to demonstrate that a valid employee-employer relationship exists with the beneficiary for the purpose of USCIS approving the petition.

    The memo listed eleven questions that USCIS officials should consider when evaluating an H1B petition in order to determine if a valid employer-employee relationship exists:
    • Question 1: Does the petitioner supervise the beneficiary and is such supervision off-site or on-site?
    • Question 2: If the supervision is off-site, how does the petitioner maintain such supervision, i.e. weekly calls, reporting back to main office routinely, or site visits by the petitioner?
    • Question 3: Does the petitioner have the right to control the work of the beneficiary on a day-to-day basis if such control is required?
    • Question 4: Does the petitioner provide the tools or instrumentalities needed for the beneficiary to perform the duties of employment?
    • Question 5: Does the petitioner hire, pay, and have the ability to fire the beneficiary?
    • Question 6: Does the petitioner evaluate the work-product of the beneficiary, i.e. progress/performance reviews?
    • Question 7: Does the petitioner claim the beneficiary for tax purposes?
    • Question 8: Does the petitioner provide the beneficiary any type of employee benefits?
    • Question 9: Does the beneficiary use proprietary information of the petitioner in order to perform the duties of employment?
    • Question 10: Does the beneficiary produce an end-product that is directly linked to the petitioner’s line of business?
    • Question 11: Does the petitioner have the ability to control the manner and means in which the work product of the beneficiary is accomplished?
    Ultimately, these questions are for discerning whether the petitioner has the right to control the beneficiary’s work and whether the petitioner will exercise its right to control the beneficiary’s work. Given that the great variety in the types of employers that may act as petitioners and the jobs that beneficiaries may fill, no single set of factors is determinative in all cases. In fact, the memo specifically instructs USCIS officers to weigh all of the possible factors in a given case. Depending on the specific nature and circumstances underlying an H1B petition, different questions will carry weight in a given case. In order to increase the likelihood that an H1B petition demonstrate the requisite employer-employee relationship to the satisfaction of USCIS, the petitioner should consult with an experienced immigration practitioner, who may evaluate the petition and then use his or her knowledge of how USCIS weighs different factors to help compile the most compelling evidence supporting that the required employer-employee relationship exists.

    Demonstrating an employer-employee relationship is generally more complicated when the petitioner plans to have the beneficiary at a third-party worksite. In these cases, it is imperative that the petitioner submit evidence that demonstrates that it, and not the third-party, will ultimately exercise control over the H1B beneficiary’s work. For example, if the beneficiary is working off-site with the client of the petitioner, a contract between the petitioner and client that clearly explains that the petitioner’s employees will be under the control of the petitioner, and not the client, would be compelling evidence for supporting the existence of an employer-employee relationship between the petitioner and beneficiary.

    The memo lists general evidence that may support the assertion that a valid employer-employee relationship exists for an initial H1B petition:
    • A complete itinerary of services or engagements that specifies the dates of each service or engagement, the names and addresses of the actual employers, and the names and addresses of the establishment, venues, or locations where the services will be performed for the period of time requested;
    • Copy of signed Employment Agreement between the petitioner and beneficiary detailing the terms and conditions of employment;
    • Copy of an employment offer letter that clearly describes the nature of the employer-employee relationship and the services to be performed by the beneficiary;
    • Copy of relevant portions of valid contracts between the petitioner and a client (in which the petitioner has entered into a business agreement for which the petitioner’s employees will be utilized) that establishes that while the petitioner’s employees are placed at the third-party worksite, the petitioner will continue to have the right to control its employees;
    • Copies of signed contractual agreements, statements of work, work orders, service agreements, and letters between the petitioner and the authorized officials of the ultimate end-client companies where the work will actually be performed by the beneficiary, which provide information such as a detailed description of the duties the beneficiary will perform, the qualifications that are required to perform the job duties, salary or wages paid, hours worked, benefits, a brief description of who will supervise the beneficiary and their duties, and any other related evidence;
    • Copy of position description or any other documentation that describes the skills required to perform the job offered, the source of the instrumentalities and tools needed to perform the job, the product to be developed or the service to be provided, the location where the beneficiary will perform the duties, the duration of the relationship between the petitioner and beneficiary, whether the petitioner has the right to assign additional duties, the extent of petitioner’s discretion over when and how long the beneficiary will work, the method of payment, the petitioner’s role in paying and hiring assistants to be utilized by the beneficiary, whether the work to be performed is part of the regular business of the petitioner, the provision of employee benefits, and the tax treatment of the beneficiary in relation to the petitioner;
    • A description of the performance review process; and/or
    • Copy of petitioner’s organizational chart, demonstrating beneficiary’s supervisory chain.
    No single piece of evidence is determinative. In fact, some of the evidence listed in the memo may be entirely inapplicable to many H1B petitions. In general, petitioners and immigration council should review the evidence that USCIS recommends, and determine which pieces of evidence are relevant for demonstrating that an employer-employee relationship exists in the given petition.

    In H1B extension petitions, the memo advises that it is he petitioner must demonstrate that a valid employer-employee relationship existed while the beneficiary was employed by the petitioner. The petitioner is recommended to submit pay records, payroll summaries, time sheets, work schedules, work produced by the beneficiary, performance reviews, or other evidence from the initial period of approved H1B status to demonstrate that a valid employer-employee relationship was maintained.

    If USCIS is not satisfied in evaluating an H1B petition that a valid employer-employee relationship exists, it may send the petitioner a Request for Evidence. The memo explains that the Request for Evidence must explain what the underlying issue is that prompted it and be tailored to request specific evidence from the petitioner that may alleviate USCIS’s concerns. In the event that an H1B petitioner receives a Request for Evidence, it should study it closely and consult with an experienced immigration attorney in order to expeditiously provide USCIS with the evidence it requires to find that a valid employer-employee relationship exists.

    Demonstrating a valid employer-employee relationship may be very straightforward in cases where the beneficiary will work onsite with the petitioner, or it may be very complicated in cases such as where the beneficiary will primarily at a third-party worksite or in special scenarios where the petitioner is an agent. However, regardless of whether the case is straightforward or complicated, this is one of the many areas of the H1B petition process where an experienced immigration attorney will be a tremendous help to an H1B petitioner.