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Employers Should Use the Neufeld Memo With Caution to Answer RFEs in H-1B IT Consultant Petitions

The IT consulting industry is currently experiencing major hurdles from the Government in employing H-1B nonimmigrant workers. IT consulting firms often have a difficult time locating skilled workers in the United States for occupations such as data architects and data analysts. With this shortage of workers, IT companies are seeking to hire skilled, foreign workers to fill the gaps within their companies and contribute to their overall success. Bringing skilled, foreign workers to the United States is not only beneficial to the employer, but it contributes an overall positive impact of innovation and economic opportunity within the United States. However, with the release of the Neufeld Memo, Immigration seems to be aiming to limit the number of H-1Bs IT consulting companies may obtain.

Employers seeking to employ an H-1B worker must establish that a valid employer-employee relationship exists between the employer and employee throughout the entire period the company employs the H-1B worker. Establishing this has raised problems in cases where immigration thinks IT consulting companies are placing workers at third-party worksites. This is frequently seen in computer consulting companies that contract with numerous outside companies to supply them with workers to fulfill staffing needs. Difficulty in proving a valid employer-employee relationship arises in these cases because it is the third-party company, not the IT consulting firm, that is the end-client of the H-1B worker. The IT consulting company must prove that they assert control over the worker despite the fact that the worker is placed into another’s employer’s business, and expected to become a part of that business’ regular operations. When the United States Citizenship and Immigration Services (“USCIS”) thinks there is insufficient evidence to establish a valid employer-employee relationship, they will issue a Request for Evidence (“RFE”) to the employer giving them the opportunity to submit additional evidence of their control over the worker. It is likely that employers will see an RFE in any case where the employee may be performing work in a different location than the employer. A sample of the type of RFEs that the USCIS is currently issuing in IT consulting cases can be found here.

It is important for IT consultants to work with experienced counsel when faced with answering an RFE. Additionally, the employer should look to guidance from the Government on how to answer the RFE in a way that sufficiently demonstrates their control over an IT employee placed at a third-party worksite. On January 8, 2010, the USCIS released a memorandum (“Neufeld Memo”) that provides guidance to IT consulting firms seeking to utilize skilled, foreign workers within their company. In short, the Neufeld Memo asserts that there must be more to the employer-employee relationship than just placing an employee on payroll or paying their wages. USCIS requires that the employer be able to establish that it has the right to control over when, where, and how a worker performs the job and the following factors will be considered to make a determination (with no one being decisive):

  1. 1. Does the petitioner supervise the beneficiary and is such supervision off-site or on-site?

  2. 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?

  3. 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?

  4. 4. Does the petitioner provide the tools or instrumentalities needed for the beneficiary to perform the duties of employment?

  5. 5. Does the petitioner hire, pay, and have the ability to fire the beneficiary?

  6. 6. Does the petitioner evaluate the work-product of the beneficiary, i.e. progress/performance reviews?

  7. 7. Does the petitioner claim the beneficiary for tax purposes?

  8. 8. Does the petitioner provide the beneficiary any employee benefits?

  9. 9. Does the beneficiary use proprietary information of the petitioner in order to perform the duties of employment?

  10. 10. Does the beneficiary produce an end-product that is directly linked to the petitioner’s line of business?

  11. 11. Does the petitioner have the ability to control the manner and means in which the work product of the beneficiary is accomplished?

An employer should not let the Neufeld Memo guide them in the wrong direction when answering an RFE. Employers should resist the urge to either ignore the Neufeld Memo or to provide USCIS everything USCIS’ RFE asks for, because evidence requested may be either irrelevant to an employer’s situation or USCIS is asking for evidence of two different employment situations, and providing it would prove contradictory points. Employers should work with their immigration counsel to determine what evidence actually is relevant to their employment situation before beginning to answer RFEs in these H-1B cases.

Jessica Haefele Corporate Immigration Attorney The Mdivani Law Firm, LLC

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