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Potential Litigation Regarding When ACWIA Fee Is Required To Be Paid In H-1B Petition Filings

The American Competitiveness and Workforce Improvement Act

(ACWIA) was signed into law on October 21, 1998, and contained

several provisions affecting the employment of H-1B workers. The

law increased the annual cap on new H-1B visas issued each year,

and required U.S. employers to make several attestations regarding

wages and benefits offered to the H-1B worker, as well as increased

penalties for Labor Condition Application (LCA) violations.

ACWIA also required employers to pay a special education and

training fee in addition to the normal H-1B petition filing fee in

certain circumstances.  The funds collected from this special

education and training fee are used by the U.S. Department of Labor

(DOL) to train U.S. workers. It is this special education or

training fee (or ACWIA fee as it has come to be known) that is a

point of controversy, and may be litigated in the future with

respect to when it is required to be paid by a sponsoring H-1B

employer.

Under the law, an H-1B employer (with certain exceptions) that

employs 26 or more workers, and is filing an initial H-1B petition

for a foreign national, is required to pay a special education and

training fee (or ACWIA fee) of $1,500.00 (or $750.00 if the H-1B

employer employs 25 or fewer workers).  Section 214(c)(9)

states the following:

1. initially to grant analien nonimmigrant status

   described in Section101(a)(15)(H)(i(b);

2. to extend the stay of analien having such status (unless the employer previously obtained

   an extension for such alien)

   <em>;or

3. To obtain authorization for analien having such status to change

   employers

The H-1B and H-1B1 Data Collection and Filing Fee Exemption

Supplement of the Petition for Nonimmigrant Worker (Form I-129) on

Pages 21 and 22, provides a series of questions the employer is

required to answer in order for the U.S. Citizenship and

Immigration Services (USCIS) to determine if the ACWIA fee is

applicable.  This supplement  has a question that states

the following:

A “Yes” response to this question avoids the

sponsoring employer from having to pay the ACWIA fee again.

Sponsoring employers that initially file a “change of

employer” petition, unlike sponsoring employers that file a

petition for new employment or concurrent employment, may request

an extension of stay in their “change of employer”

petition filing.  As a result, based on how the above question

is phrased on The H-1B and H-1B1 Data Collection and Filing Fee

Exemption Supplement, a sponsoring employer that files a

“change of employer” petition and includes an extension

of stay request in the petition,  and then files a subsequent

petition in the future to extend the H-1B status of the worker,

would not be required to pay the ACWIA fee again, as compared to a

sponsoring employer that filed an initial petition for new

employment or concurrent employment without an extension of stay

request.  Consequently, the issue is whether Section 214(c)(9)

of the INA and the question on the H-1B and H-1B1 Data Collection

and Filing Fee Exemption should be interpreted in a manner to

require a sponsoring employer that initially files a “change

of employer” petition with an extension of stay request, to

pay the ACWIA fee a second time when filing a subsequent petition

for that H-1B worker with an extension of stay request.

USCIS has not been clear in its interpretation, and/or

consistent in its processing of H-1B petitions with respect to when

the ACWIA fee needs to be paid a second time by a sponsoring

employer.  As  result, some sponsoring employers who

filed a change of employer petition with an extension of stay

request, and the file a subsequent petition to extend the stay of

the foreign national have answered the above question with a

“Yes” response, and have had their H-1B petitions

rejected, because the ACWIA fee was not included in the subsequent

petition filing.  Other sponsoring employers that filed

similar “change of employer” petitions and then filed

subsequent petitions to extend the stay of the H-1B worker, and

that did not include the ACWIA fee, had their H-1B petitions

accepted for processing.  In other cases, USCIS even returned

the check covering the ACWIA fee when it was included by some

employers (who initially filed “change of employer”

petitions with extension of stay requests) and then filed

subsequent petitions with extension of stay requests.

As a result of this inconsistent treatment by USCIS, there are

reports of some employers possibly pursuing litigation, if 1) it

filed an H-1B “change of employer” petition with an

extension of status request, and had a subsequent petition for that

H-1B worker requesting an extension of stay rejected, because of

failure to include the ACWIA fee; or 2) it filed an H-1B

“change of employer” petition with an extension of stay

request, and later filed a subsequent petition for that H-1B worker

requesting an extension of stay, and included the ACWIA filing fee,

but the petition was processed without the ACWIA fee being

refunded.  Since the amount of money requested by the USCIS in

connection with the ACWIA fee is rather significant ($1,500.00, or

$750 if employ 25 or fewer workers), resolving this issue is

important for H-1B employers from a cost perspective.

The content of this article is intended to provide a general

guide to the subject matter. Specialist advice should be sought

about your specific circumstances.