DHS Releases Amended F-1 Regulations Effective May 10, 2016
The F-1 Optional Practical Training (OPT) program provides foreign students one year of work authorization in their field of academic studies. The post-completion program not only provides foreign students with an opportunity to work for a limited period of time, but gives U.S. employers access to educated professionals. This program includes all areas of academic discipline, but graduates in science, technology, engineering, or mathematics (STEM) are granted additional time. This is because these professional areas are not only in short supply, but are also of pronounced importance to the competitiveness of U.S. businesses. Previously STEM graduates were entitled to a 17-month extension beyond the one year, if the following conditions were met:
the employer must be registered for E-verify;
the student on OPT must work a minimum of 20 hours per week;
the degree must be a qualifying degree from an accredited school based on the STEM designated degree program list; and
the student must currently be in an approved post-completion OPT period based on the STEM degree.
The U.S. Department of Homeland Security (DHS) has released amended regulations that extend the period of OPT eligibility for graduates in the STEM disciplines, but also impose certain responsibilities on university institutions, employers, and foreign students to ensure compliance.
Extension Period to Increase from 17 to 24 Months
The biggest single change in the new regulations is that F-1 STEM students will be able to extend OPT for an additional 24 months beyond the initial 12 months, replacing the previous regulation that allowed F-1 STEM students to receive a 17-month extension of OPT. Individuals already working on a STEM extension can apply for the additional 7 months under certain circumstances and must apply within a particular time-frame. In addition, F-1 STEM students can receive up to two periods of STEM extension, assuming that they graduate from multiple degree programs, and they can use a previous STEM degree to qualify. For example, if a student graduated with a qualifying degree in engineering but then obtained an MBA without ever applying for a STEM OPT extension, he/she could apply for the 24-month extension based on the prior degree. One clearly stated objective in extending this period of STEM eligibility is to give employers multiple opportunities to sponsor valued STEM professionals for H-1B status, rather than having these highly educated professionals depart the United States.
Reporting Requirements for F–1 Students and University Officials
When employing foreign students for F-1 STEM employment authorization, both employers and students have certain compliance responsibilities. First, there is a six month validation requirement, meaning that those students with STEM extension must not have a period of unemployment longer than 120 days under the 17-month STEM OPT (150 days of unemployment under the 24 month STEM OPT). Second, F-1 students on STEM extensions are required to complete an annual self-evaluation for designated school officials to review. Third, F-1 students on STEM extensions must report any change in employment status or material departure from the adopted Training Plan. This is in addition to the previous requirement that F-1 employers report similar changes regarding those on STEM extensions to the designated school officials within five business days, which remains in effect.
F–1 Employers Required to Complete Formal Training Plan with F–1 Student
The new regulations increase DHS oversight over the OPT program. In addition to the previous E-Verify requirement for STEM extensions, F-1 employers will be required to complete a formal Training Plan, Form I-983, and comply with new wage requirements. F-1 employers will be required to set out the terms and condition of employment, including the specific duties, hours and compensation.
As part of the Training Plan, F-1 employers will attest that the F-1 employee is paid a salary commensurate with similarly situated workers and that:
“(1) it has sufficient resources and trained personnel available to provide appropriate training in connection with the specified opportunity;
(2) the student will not replace a full- or part-time, temporary or permanent U.S. worker; and
(3) the opportunity will help the student attain his or her training objectives.”
DHS to Conduct On-site Visits
The new regulations state that DHS has discretion to conduct employer site visits to ensure F-1 employers meet the requirements of the OPT program. Generally, DHS will be required to provide notice 48 hours prior to the inspection, unless the visit is conducted in response to a complaint or evidence of noncompliance.
Cap-Gap Extension Language Clarified
DHS has revised the Cap-Gap extension regulation confirming that the extension for F-1 students with pending H-1B petitions and requests for change of status temporarily extends the OPT period until October 1, the beginning of the new fiscal year.
As always, please do not hesitate to contact Fredrikson & Byron’s Immigration Team with any questions or concerns.