Report Confirms Significant Increase in H-1B and L-1 RFE and Denial Rates

At a glance

• In the fourth quarter of fiscal year (FY) 2017, USCIS issued a request for evidence (RFE) in nearly 70% of the H-1B petitions filed with the agency. Fourth quarter RFEs nearly equaled the number issued in the first three quarters combined.
• L-1A and L-1B denials increased by 67% and 32% respectively between the first and fourth quarters of FY 2017. 

The situation

The Trump Administration’s Buy American, Hire American (BAHA) Executive Order and related policies have led to higher rates of requests for evidence and denials of H-1B and L-1 petitions, according to a report issued by the National Foundation for American Policy (NFAP). Analyzing data released by U.S. Citizenship and Immigration Services (USCIS), the report confirms that it has become increasingly difficult for high-skilled foreign workers to obtain work authorization in the United States. Notably, H-1B requests for evidence (RFEs) increased by almost 300% between the third (Q3) and fourth (Q4) quarters of fiscal year (FY) 2017, while H-1B denials increased by 41% in the same period, following implementation of the BAHA order. The report also highlights an increase in L-1A and L-1B petition denial rates. 

H-1B trends

USCIS data shows that employers have seen a surge in RFEs and denials for H-1B petitions. The number of RFEs issued by USCIS more than doubled between April and September 2017, rising from 28,711 in Q3 to 63,184 in Q4. Notably, the number of RFEs for Q4 almost equaled the total number of RFEs issued for the first three quarters of FY 2017 (63,599). Based on reports from employers, heightened scrutiny of H-1B filings has continued in FY 2018, which began in October 2017. 

H-1B RFE and denial rates for FY 2017 follow:

h-1b_.jpg

L-1B trends

Though RFE rates for L-1B petitions remained relatively consistent throughout FY 2017, there was an almost one-third increase in L-1B denials between Q1 and Q4 of 2017, from 21.7% to 28.7%. High denial rates have continued in FY 2018, with a 30.5% rate between October and December 2018, and a 29.2% rate between January and March 2018. The current denial trend is a marked increase from FY 2016, which had an overall L-1B denial rate of 24%. 

L-1B RFE and denial rates for FY 2017 follow:

l-1b.jpg

L-1A trends

Similarly, RFE rates for L-1A petitions remained relatively consistent throughout FY 2017, while denial rates saw a noticeable increase in Q2.  Overall L-1A denial rates increased by 67%, from 12.8% to 21.4% between Q1 and Q4 of FY 2017.

L-1A RFE and denial rates for FY 2017 follow:

l-1a.jpg

What this means for employers

The NFAP report confirms that, consistent with Buy American, Hire American priorities, USCIS has taken an increasingly restrictive approach to employment-based immigration, and employers face greater challenges in sponsoring high-skilled foreign nationals to work in the United States. Compounding the effects of these adjudication trends are recent USCIS policy memoranda related to unlawful presence and benefits adjudication practices that may further increase denial rates and in the event of a denial, require unprecedented enforcement actions against foreign nationals. Though it is not yet clear how the newly issued memos will be implemented in practice, the NFAP report confirms that RFE and denial rates were already on the rise, soon after the Administration’s priorities were announced.

This alert is for informational purposes only. If you have any questions, please contact the immigration professional with whom you work at Fragomen.