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Special Requirements:  Are you H-1B Dependent?

Employers are required to determine their H-1B dependency status each time an LCA, Labor Condition Application, is used to support any H-1B petition.  Failure to comply with the provisions of the LCA, or misrepresentation on the LCA could result in a number of consequences for each violation.  Please see the related article “LCA Violations and Consequences.”

As a result of such potential consequences, employers should accurately state on the LCA whether it is in dependent or non-dependent status.  Whether or not an employer is considered to be H-1B dependent is determined by comparing the total number of full-time employees an employer has in the U.S. to the total number of H-1B employees, without regard to the H-1B’s full or part-time status.  The typical “snap shot” test to determine H-1B dependency covers the following three standards:  (1) An employer with 25 or fewer full time equivalent employees of which 7 or more are H-1B employees, (2) an employer with 26 to 50 full-time employees of which more than 12 are H-1B employees is also considered to be H-1B dependent and (3) an employer with 51 or more full-time employees of which at least 15% are H-1B employees, are all considered to be H-1B dependent.

A full-time employee is one that actually works full time, or in other words works at least 40 hours per week, unless the employer can demonstrate that a lower number of hours are considered to be full-time in its regular course of business, though the Department of Labor has stated that the total weekly hours may never be less than 35 hours per week for a full-time employee.   Keep in mind that bona fide independent contractors and consultants are not counted as employees.  Furthermore, the count of employees of an employer should be based upon the most recent records of the employer before filing the LCA.  The Department of Labor will accept the employer’s designation of persons as “employees,” provided that such persons are consistently treated as “employees” for all purposes.

For the majority of employers it will be clear whether or not the employer is dependent or non-dependent.  For example, if 50 out of 100 employees are H-1B workers or if 1 out of 100 employees is an H-1B worker, then there would be no need to conduct the snap shot test.  However, when an employer has borderline H-1B dependency status, the “snap-shot” test is appropriate to use to determine whether further calculation of the status is needed.  It is only when a borderline employer does not meet the “snap-shot” test, but still maintains that it is not H-1B dependent, that a recorded and dated calculation of the employer’s part-time employees becomes necessary. 

Employers with part time workers can determine how many part-time employees equal a full-time employee by one of two methods.  They may count each part-time worker as ½ of a full-time employee, or they may total the hours worked by all part-time workers in the pay period and divide that total by the employer’s standard hours for full-time employment.  If a record of the hours worked are not kept, a reasonable approximation, such as a standard work schedule may be sufficient.

If you are concerned that you may be an H-1B dependent employer, Shihab & Associates Co., LPA can assist you in determining your companies H-1B dependency status.  Our skilled and experienced attorneys can assist you in all your business immigration needs, while ensuring that your company is in compliance with federal regulations.