The Good, The “Not-So Bad” & The Ugly

On January 17, 2025, the Department of Homeland Security’s (“DHS”) H-2 Modernization Final Rule and USCIS’s new Form I-129 went into effect with regard to both the H-2A and H-2B programs. USCIS has also published updated Instructions for Form I-129 that H-2 employers should review and familiarize themselves with prior to filing their petitions. Importantly, USCIS recently published an alert advising H-2 stakeholders that “[t]here is no grace period for the revised edition of Form I-129 because this revised edition is necessary for USCIS to apply the final rules.” 

According to DHS, the Final Rule is intended to address three major areas: (1) improving program efficiency; (2) strengthening worker protections and increasing program integrity; and (3) enhancing worker flexibility. Summarized below are the key provisions of the Final Rule that all H-2 employers need to be aware of to ensure their continued compliance with program rules moving forward. 

📣 Be sure to also register for our upcoming webinar on January 23, 2025, at 10:00 a.m. (PST), during which Seso’s in-house legal team will provide an in-depth overview of DHS’s new Final Rule and best practices for employers to ensure continued compliance. Click this link to register.

Immediate Impact for Employers:

• Effective January 17, 2025, the new Form I-129 must now be used when filing with USCIS. We recommend familiarizing yourself with both the updated form and its instructions as soon as possible. 

• Written contracts with third-party recruiters and facilitators prohibiting illegal fee collections from workers are insufficient to avoid liability. Employers need to begin documenting additional measures they have taken to prevent prohibited fee collections from taking place. 

• Because USCIS now has the discretion to deny petitions if an employer has violations of H-2A program rules and related labor and employment laws within the last three years, employers should begin gathering documentation demonstrating their commitment to compliance, including corrective actions that have been implemented to ensure similar violations do not reoccur in the future.

The Good: Beneficial Changes for Both H-2 Employers & Workers

The following rule changes are generally expected to benefit employers and workers alike by reducing inefficiencies within the H-2 programs and reducing barriers to legal migration:

• Affording employers greater flexibility and portability for workers by allowing workers to immediately start working for a new employer upon filing an extension of stay petition rather than requiring them to wait until the petition is approved.

• Clarifying that workers will not be considered to have failed to maintain status simply due to seeking to become a permanent U.S. resident.

• Adding a new grace period of up to 60 days following a cessation of employment during which workers may seek new qualifying employment or prepare for departure from the U.S. without violating their current status or accruing unlawful presence.

• Extending the existing 30-day grace period following the revocation of a petition to up to 60 days. 

• Affirming that workers remain in status for up to 10 days before the petition’s validity period and up to 30 days following the expiration of that period.

• Removing the requirement that USCIS may only approve petitions for workers of countries designated as eligible to participate in the H-2 programs. 

• Simplifying the rules regarding the effect of a departure from the U.S. on the 3-year maximum period of stay for workers by providing a uniform period of absence from the U.S. (at least 60 days) to reset the 3-year clock.

The “Not-So Bad”: Increased Program Integrity & Worker Protections Measures

While DHS characterized a number of rule changes as novel to the H-2 programs, the vast majority simply reflect best practices that employers who have made continued compliance an operational priority have already incorporated into the policies and procedures, including: 

• Strengthening the longstanding prohibitions against charging illegal fees from workers by imposing a heightened standard of liability, requirement to conduct due diligence, and more severe penalties on petitioners who are determined to have violated these prohibitions. 

  • Importantly, H-2A employers working with third-party facilitators can no longer merely rely upon a written contract prohibiting the collection of fees alone to avoid liability. Instead, employers must be able to produce additional documentary evidence of the “on-going, good faith, reasonable efforts” they took to discover and prevent the collection of prohibited fees throughout the recruitment, hiring, and employment processes. As an example, DHS suggests inquiring and requesting documentation from a recruiter regarding their past practices and payment structure to ensure no revenue is derived from workers. 

  • Introduces mandatory denial periods for petitioners determined to have violated these prohibitions, including a one-year “debarment” followed by an additional three-years of “probation,” during which an approval is contingent upon a showing of full reimbursement for all beneficiaries of a petition. 

• Extending whistleblower protections to H-2 workers that were previously only afforded to H-1B workers. 

• Clarifying existing requirements for employers to consent and comply with USCIS compliance reviews/audits and allows for the denial or revocation of a petition if investigators are unable to verify material information stated in a petition due to a perceived misrepresentation or lack of cooperation by the employer.

The Ugly: Guilty Until Proven Innocent Standard May Increase Delays & Denials

Despite the multitude of concerns raised by employers during the rulemaking process, the Final Rule significantly expands USCIS’ authority to deny petitions filed by H-2 employers based on certain mandatory and discretionary grounds, including past violations of H-2A and H-2B program rules or any other labor and employment-related law that is relevant to the H-2 programs. In doing so, employers should be prepared to experience a significant increase in the issuance of RFEs, NOIDs, NOIRs, and denials moving forward. The rule changes pertaining to adjudicative process are as follows:

Grounds for Mandatory Denials

USCIS is now required to deny a H-2 petition filed on or after January 17, 2025, by an employer (or its successor in interest) that has been the subject of: 

• A final administrative determination by DOL debarring the employer if the petition is filed during the debarment period, or if the debarment occurs during the pendency of the petition, and the final administrative determination debarring the petitioner is made on or after January 17, 2025;

• A final USCIS denial or revocation decision made on a prior H-2A or H-2B petition filed on or after January 17, 2025, that includes a finding of fraud or willful misrepresentation of a material fact during the pendency of the petition or within 3 years prior to filing the petition; or 

• A final determination of violation(s) under section 274(a) of the INA (“Bringing in and Harboring Certain Aliens,” “Criminal Penalties”) made on or after January 17, 2025, and during the pendency of the petition or within 3 years prior to filing the petition. 

Grounds for Discretionary Denials

USCIS also now has the discretion to deny any H-2 petition filed by an employer (or its successor in interest) that has been the subject of one or more of the following actions during the pendency of the petition or within 3 years prior to filing the petition, if USCIS determines that the underlying violation(s) calls into question the employer’s intention and/or ability to comply with H-2A or H-2B program requirements: 

• A final administrative determination by DOL regarding a prior H-2A or H-2B TLC application that includes: 

  • Revocation of an approved TLC application; 

  • Debarment if the debarment period has concluded prior to filing the petition; or 

  • Any other administrative sanction or remedy including assessment of CMPs as described in those parts. 

• A final USCIS decision revoking the approval of a prior petition that includes one or more of the following findings: 

  • The beneficiary was not employed by the employer in the capacity specified in the petition; 

  • The statement of facts contained in the petition or on the application for a TLC application was not true and correct, or was inaccurate; or

  • The employer violated terms and conditions of the approved petition. 

• Any Federal, state, or local final administrative or judicial determination that the H-2 employer violated any applicable employment-related laws or regulations, including health and safety laws or regulations.

New Adjudication Procedure for Discretionary Denials

If the H-2 employer has been the subject of one of the above determinations, the employer is now required to demonstrate to USCIS that the underlying violation(s) does not call into question its intent and ability to comply with H-2 program requirements by producing evidence that addresses the following non-exhaustive list of factors: 

• The recency and number of violation(s);

• The egregiousness of the violation(s), including how many workers were affected, and whether it involved a risk to the health or safety of workers; 

• Overall history or pattern of prior violation(s); 

• The severity or monetary amount of any penalties imposed; 

• Whether the final determination, decision, or conviction included a finding of willfulness; 

• The extent to which the violator achieved a financial gain due to the violation(s), or the potential financial loss or potential financial injury to the workers; 

• Timely compliance with all penalties and remedies ordered under the final determination(s), decision(s), or conviction(s); and 

• Other corrective actions taken by the petitioner or its successor in interest to cure its violation(s) or prevent future violations. 

Silver lining for Employers: If the H-2 employer successfully demonstrate its ability and commitment to compliance with H-2A or H-2B program requirements, USCIS has advised that it will not issue a NOID with regard to future petitions based on the same violation(s) absent new evidence coming to light or USCIS concluding that its prior determination was in error. 

While the Final Rule is intentionally ambiguous with regard to the types of evidence it will rely upon in terms of relevant past violations, USCIS will likely rely upon DOL enforcement data, debarment lists, publicly available information from federal, state, and local courts and agencies, and articles from media outlets when exercising its discretionary authority to deny a petition. 

Employers with questions or concerns about DHS’s Final Rule or the new Form I-129 should contact their assigned Seso Customer Service Manager and H-2A Case Manager.