Startup Founder Immigration Changes in 2020 | Dear Sophie

Welcome to another installment of “Dear Sophie,” your source for expert answers to immigration questions relevant to the tech industry.

“Your inquiries are incredibly valuable in disseminating knowledge, empowering individuals globally to overcome geographical limitations and realize their aspirations,” states Sophie Alcorn, a seasoned immigration lawyer based in Silicon Valley. “Whether you’re involved in human resources, leading a company, or seeking employment in Silicon Valley, I welcome your questions for consideration in my next column.”

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Dear Sophie:

I currently hold F1 OPT status and am preparing to launch a startup alongside my two U.S.-based co-founders. What were the most significant immigration developments in 2020 that impact our situation?

—Ambitious in Albany

Dear Ambitious:

Congratulations on the formation of your startup. With the Electoral College’s decision, Joe Biden is scheduled to assume office on January 20, 2021. It will likely take several months for him to reverse many of the immigration policies enacted during the previous administration, so careful consideration of the current landscape is essential.

The year 2020 presented numerous challenges and rapid changes. Initial concerns arose in April following a statement from the former President regarding a potential suspension of immigration to the United States. Ultimately, the executive orders issued in April and June did not enact such a broad suspension, and immigration processes remained viable.

However, these restrictions remained in place through at least the end of 2020, imposing moratoriums on the issuance of green cards through U.S. Embassies and consulates, as well as impacting H-1B, H-2B, J-1, and L-1 work visas. The Department of State subsequently broadened the range of exceptions to these restrictions, allowing more individuals to qualify for immigration benefits.

A current challenge for many is the continued closure or reduced operational capacity of numerous embassies and consulates. Consequently, we advise our clients who are already present in the U.S. to prioritize maintaining their status by pursuing Extensions of Status, Changes of Status, and Adjustments of Status through USCIS within the country.

The H-1B visa may represent a valuable pathway for you as a founder. This visa is available through two avenues: the annual spring lottery (“cap-subject”) and an exemption from the lottery (“cap-exempt”). Registering your startup for the upcoming H-1B lottery in March 2021 is a straightforward process, requiring a nominal fee of $10 per candidate. If selected, your startup can then file a petition on your behalf. Should your startup not be selected, you can re-register in 2022.

Many recent graduates possess the qualifications and achievements necessary to pursue the O-1A visa, the EB-1A green card, or the EB-2 NIW green card – all excellent options for entrepreneurs. I have developed Extraordinary Ability Bootcamp to assist individuals in meeting the requirements for these visas and green cards.

I plan to publish further articles on H-1B visas in the coming weeks. This is due to recent proposed and adopted rules by the U.S. Department of Homeland Security (DHS), which oversees U.S. Citizenship and Immigration Services (USCIS), and the U.S. Department of Labor (DOL) that affect the H-1B process. Earlier this month, DHS proposed a rule to replace the random H-1B lottery with a system based on the highest salary offered. If implemented, this rule could potentially reduce the uncertainty associated with the lottery process by enabling your startup to offer you a Level 4 or Level 3 wage.

Certain other H-1B changes have been temporarily halted. In October, both DOL and DHS proposed new regulations impacting the H-1B process. DOL issued a rule that immediately increased the wages employers must pay to employees sponsored for H-1B, H-1B1, E-3, and H-2B visas, as well as certain green cards. However, these rules have recently been suspended through legal challenges.

If you are not selected in the H-1B lottery before your STEM OPT expires, alternative visa options suitable for startups are available. I discuss these in greater detail in a recent podcast. Some founders may qualify for a “cap-exempt” H-1B visa, allowing them to obtain a work visa at any time of year without participating in the lottery. This presents a unique opportunity; please contact me if you are interested.

To proceed with any immigration sponsorship through your startup, establishing a legal entity is necessary. I recommend reviewing my interview with Lindsey Mignano, founding partner of Smith Shapourian Mignano, a San Francisco-based corporate law firm specializing in startups. She provides valuable insights into best practices for startup incorporation and fundraising.

Once you have incorporated, established a bank account, and secured pre-seed or seed funding, you will likely begin hiring. It’s important to be aware of additional immigration changes relevant to this process:

If you are hiring candidates from outside the U.S. for H-1B or J-1 visas, your startup may consider joining plaintiff organizations, such as the U.S. Chamber of Commerce or TechNet, that filed a lawsuit challenging a June executive proclamation. In October, a federal judge ordered USCIS and the State Department to resume processing and issuing H-1B, H-2B, J-1, and L-1 visas to these organizations.

Dreamers can continue to obtain work permits, and USCIS is now accepting new applications for Deferred Action for Childhood Arrivals (DACA) status. A U.S. Supreme Court decision in June allowed the DACA program to continue, although the previous administration had significantly curtailed it in July. However, a federal judge in New York ruled in November that the administration had improperly limited DACA applications and renewals.

Obtaining green cards is expected to become easier in 2021. The public charge rule, which broadened the factors immigration officials consider when assessing an applicant’s potential reliance on government benefits, has been implemented and suspended multiple times this year. Immigration officials can use this assessment to deny visa or green card applications. This month, a federal judge prohibited the use of a wealth test for this purpose, effectively blocking the public charge rule. The incoming administration has proposed to end the Public Charge Rule.

I wish you the best of luck with your new venture! Please keep me informed of your progress.

Sincerely,

Sophie

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Sophie’s podcast, Immigration Law for Tech Startups, is available on all major podcast platforms. She is currently accepting applications for potential guests!