We live in a global economy. Many domestic businesses operate in one or more foreign countries. Alternatively, sometimes foreign businesses wish to open an office or factory in the United States. These businesses frequently have the need to transfer employees with specialized knowledge from their foreign offices to work in their U.S. offices. These “specialized knowledge” employees are typically required to obtain an L-1B visa to do so.
Unfortunately, according to information obtained and compiled by the National Foundation for American Policy (NFAP), denial rates for L-1B visa petitions continued to increase during FY 2014. NFAP’s report (.pdf) analyzed data going back to FY 2006. According to the report L-1B denial rates have increased seven out of the last eight years, peaking with FY 2014’s 35% denial rate. The increased denial rates have been accompanied by elevated rates of costly “Requests for Evidence” or RFEs. In FY 2014, 45% of all L-1B petitions received an RFE.
The report analyzed the denial rates of the top eight countries of origin of the employees (India, Canada, Britain, China, Japan, Germany, France, and Mexico). Employees from India had the highest number of petitions (25,296) and, strangely, the highest (by far) denial rate (56%). Conversely, employees from Canada had the second highest number of petitions (10,692) and the lowest denial rate (4%). Excluding India, the denial rates for all other countries averaged 13%.
Also, strangely, L-1B extension applications, i.e., employees that already had their initial L-1B application approved, were more likely to have their extension application denied than employees filing their initial L-1B application. This is strange, and as the report notes, “counterintuitive,” because the employees seeking to extend their L-1B status have already been living and working in the U.S. for three years based on their previously approved initial L-1B application. This circumstance notwithstanding, in FY 2014 41% of extensions were denied compared to 32% of initial applications.
It is stranger still that the report does not – or, more likely, cannot – identify a reason behind the increased denials and other unusual circumstances revealed by the data. Denials have steadily increased while the regulatory standard for determining “specialized knowledge” has remained exactly the same. One practitioner quoted in the report states that USCIS has failed to give the immigration community “even an inkling of its expectations or the reasons for its behavior.” As the report notes, the more cumbersome USCIS makes the L-1B process, the more likely it is that companies will choose to keep work overseas that could be done domestically or to generally skip investing in the United States altogether. Also, the more cumbersome USCIS makes the L-1B process, the more companies are incentivized to try to fit their employee with specialized knowledge into another visa category like the H-1B visa category, increasing the strain on an already overburdened and dysfunctional immigration system.