Will denial rates for fresh H-1B petitions fare better under Biden Administration?

The denial rates for fresh H-1B in the third quarter of FY20 has come down compared to Q3 FY19 figures, according to a recent analysis by the US policy think tank the National Foundation for American Research (NFAP).

The analysis was based on the United States Immigration and Citizenship Services (USCIS) employer data for the year. According to the report, denial rate in Q3 FY20 (April-June) was 7 percent compared to 10 percent for the same period in FY19.

The USCIS follows October to September for its fiscal year. Indians and Indian IT service providers account for the majority of these petitions.

Even for the first two quarters in FY20, the number of denial rates were less than what it was in FY19. Look at this data.

In Q1 and Q2 FY20, denial rates were 30 percent and 27 percent compared to 32 percent and 27 percent respectively for the same period last year.

Though the denials have come down marginally in the first three quarters of FY20 compared to FY19, it is still high compared to previous years.

Denial rates for fresh H-1B petitions have increased from 6 percent in FY15 to 21 percent in FY19 and FY20. The jump in denials during Trump administration years from FY18 is even more noticeable. It increased from 10 percent in FY16, to 24 percent in FY18.

This was in part the result of the memo that was introduced in 2018, where the administration brought in additional requirements for employees deployed in third party worksites including detailed work itineraries.

In addition to increased denial rates, the USCIS also reduced the tenure of H-1B visas from typical three years to as less as a couple of months. These affected the Indian service providers the most.

This was overturned in March 2020 by a US court, a huge win for IT firms. So in Q4 FY20, immigration attorneys expect these approval rates to fare better.

Will things be better under the Biden administration?

Not clear yet. Stuart Anderson, Executive Director, NFAP pointed out in his NFAP report in a Forbes article, "Companies are eager to learn whether the Biden administration’s policies will result in lower denial rates for H-1B petitions. The numbers will tell the tale."

However there are good reasons to believe that things would be better.

In addition to the judgement overturning the 2019 memo, a key rule that tightened the H-1B visa process announced by the Department of Homeland Security is now done away with by a US court early this month. The regulations limited the ability to qualify for H-1B. It also restricted the H-1B tenure to one year for those deployed in third party sites from three.

Having done away with these, it should reduce the uncertainty around the approval rates to some extent for fresh H-1B petitions, at least for senior techies coming into the US.

Because another rule that aims to do away with the lottery system and make it wage-based instead could pose challenges, especially for fresh graduates and those with fewer years of experience. The rule is currently under comment period.

President-Elect Joe Biden in his election agenda said that he would remove caps for graduates from Science, Technology, Engineering and Mathematics field and will increase visas for highly skilled foreign workers. Though promising, it is yet to be seen how successful his administration would be in implementing the same.

So, it is going to be a wait and watch to find out how H-1B approval rates for fresh petitions would fare under Biden.