The Codification of the Deference Policy in the H-1B Modernization Regulation: A Final Act by the Biden Administration

U.S. immigration law is continuously evolving, with policies and regulations shaping the path for U.S. employers seeking temporary nonimmigrant visas for their foreign national talent to enable them to work in the United States.

One significant policy that has impacted the adjudication of temporary nonimmigrant visa petitions is the deference policy, which, among other initiatives, was recently codified as regulation in the H-1B modernization rule, set to take effect on January 17, 2025.  

What is the USCIS Deference Policy?

The deference policy was proposed in 2004 as an attempt to streamline the adjudication process for certain nonimmigrant visa petitions. The 2004 policy guided U.S. Citizenship and Immigration Services (USCIS) to give deference to prior approval when adjudicating subsequent visa petitions by the same parties, provided that there were no material changes in the terms and conditions of employment.

In other words, if USCIS had approved a temporary nonimmigrant visa petition in H-1B, L-1, O-1, E-1, E-2, E-3, TN, or other temporary visa classification, at the extension stage, USCIS was instructed to “defer” to that prior approval. This meant that in most cases, the extension would simply be approved because USCIS had already thoroughly vetted eligibility. 

The deference policy helped to simplify the process for U.S. employers and their foreign national employees who sought extensions of their temporary visa status, thus speeding up the overall process.  It provided transparency and predictability to U.S. employers while also enabling USCIS officers to focus their efforts and resources on new and complex visa petitions or those with substantial changes.

The Rescission of the USCIS Deference Policy

In 2017, the deference policy was rescinded, which had a significant impact on the adjudication process. Without deference to previous approvals, USCIS officers issued more Requests for Evidence (RFEs), requiring supplemental documents for visa petitions.  

In addition to the rise in the RFE rate, the rescission of deference contributed to a higher rate of denials, including in cases involving extensions by the same parties, which USCIS had already thoroughly vetted. This is confirmed by the RFE and denial rates reported by USCIS for this time period.

For instance, according to the USCIS H-1B employer data hub, the H-1B RFE rate more than doubled in a five-year span hitting an all-time high of 40.2% in fiscal year 2019, spurred by the rescission of the deference policy in 2017. Similarly, denials of H-1B extensions also more than doubled.

As a result, U.S. sponsoring employers were burdened with lengthy delays and increased cost. For the first time since 2004, U.S. employers who had previously relied on the relatively straightforward process of extending nonimmigrant visa petitions suddenly found themselves caught in an increasingly complex and unpredictable immigration climate.   

In  April 2021, USCIS reinstated the deference policy. According to its policy manual, any deviation from a prior visa petition approval required supervisory review.  Consequently, since 2021 the RFE and denial rates have declined significantly.  By way of example, according to the latest data available, the H-1B RFE rate is at a low of 8.6%. The policy shift once again improved predictability and transparency for U.S. employers and foreign national employees seeking extensions of the same visa classification for which they were previously approved. 

The Codification of the Deference Policy Under the H-1B Modernization Rule

In December 2024, the deference policy was finally codified as regulation under the H-1B modernization rule, set to take effect on January 17, 2025.  The codification of the deference policy requires USCIS adjudicating officers to apply the deference standard to nonimmigrant visa extensions for temporary visa classifications sought by the same parties and the same underlying facts.

USCIS need not give deference if there was a material error involved in a prior approval, there has been a material change in circumstances or eligibility requirements, or there is new material information that adversely impacts eligibility. As with longstanding policy, if a USCIS adjudicator determines that deference should not be granted, they must articulate the specific reason for not deferring. Under the final rule, USCIS will also consider, but not defer to previous eligibility determinations on petitions or applications made by the U.S. Customs and Border Protection or the U.S. Department of State.  

The codification of the deference policy marks a significant regulatory step. By codifying the policy as regulation, any future rescission would require undergoing the formal rulemaking process, which includes providing stakeholders with a notice and comment period that would not be required if the policy were not codified.

Takeaways

The codification of the deference policy provides greater transparency and predictability to U.S. employers and their current foreign national employees. It is possible for the incoming administration to once again seek to rescind the policy.

However, because rescission would have to undergo the rulemaking process, which requires time, U.S. employers now have a window of opportunity and should work closely with their immigration attorneys to prepare and file eligible extensions as quickly as possible.

 Generally, an extension of a temporary visa can be filed with USCIS six months prior to current expiration. Prioritizing the preparation and filing of extensions will ultimately help mitigate risk of RFE and denials should the policy be rescinded.

Need to know more?

Fragomen’s client alert provides a detailed summary of the H-1B modernization regulation. For questions about how the H-1B modernization regulation or the deference policy might affect your specific case, please contact Partner F. Joseph Paldino at [email protected] and Counsel Eda Derhemi at [email protected].

This blog was published on January 19, 2025, and due to the circumstances, there are frequent changes. To keep up to date with all the latest updates on global immigration, please subscribe to our alerts and follow us on LinkedIn, X, Facebook and Instagram.