The US Citizenship and Immigration Services (USCIS) has issued a policy memorandum clarifying the prohibition on multiple H-1B filings by “related entities (such as a parent company, subsidiary, or affiliate).”
Under USCIS regulations (8 C.F.R. § 214.2(h)(2)(i)(G)), an employer may not file more than one cap-subject H-1B for the same foreign national. The rule also prohibits related entities from filing for the same employee, and describes related entities as "...such as a parent company, subsidiary, or affiliate."
In a recent Administrative Appeals Office (AAO) decision, the US government decided that "related entities " includes companies that are not just related through common ownership or control. The AAO found that the words "such as" in the regulations meant that the examples following those words - "parent company, subsidiary, or affiliate" were just that - examples.
The AAO found that the Petitioner in Matter of S, Inc. was related to another company that filed a H-1B petition for the same employee even though both petitioners had different FEINs, locations,management, and ownership. USCIS construed related entities" as petitioners "...who submit multiple petitions for the same beneficiary for substantially the same job. Whether two jobs are “substantially the same” is an issue of fact that we determine based on the totality of the record. Some factors relevant to relatedness may include familial ties, proximity of locations, leadership structure, employment history, similar work assignments, and substantially similar supporting documentation."
In the instant case, the fact that both petitioners intended to place the foreign national in the same position for the same end client through the same mid-vendor caused the AAO to find that the petitioners were related. Given that there was no legitimate business need for two petitions, the H-1B approval was revoked.
If you have any questions about this case, or any H-1B or employment-based immigration matter, please contact Elaine Martin.
Elaine Martin has been practising US and global immigration law since 1997. She is an immigrant herself (from Ireland), so has a special understanding of the legal and emotional challenges involved in relocating to a new country.