For many foreign nationals, securing an H-1B visa is a crucial step in pursuing employment in the U.S. However, the annual H-1B visa cap limits the number of visas available, leading to a highly competitive lottery process. Certain employers are exempt from this cap, offering greater opportunities to secure an H-1B visa. These employers, often referred to as “cap-exempt,” are eligible to file H-1B petitions at any time without being limited by the fiscal year’s numerical cap.
What Is an H-1B Cap-Exempt Institution?
Under the American Competitiveness in the Twenty-First Century Act (AC21), codified at INA § 214(g)(5)(A)-(B), certain organizations are exempt from the H-1B cap. Under this provision, the following types of petitioners are exempt:
- Institutions of higher education;
- Nonprofit entities related to or affiliated with an institution of higher education;
- Nonprofit research organizations; and
- Governmental research organizations.
These institutions can file H-1B petitions at any time of the year, bypassing the competitive lottery process and hiring international talent without worrying about cap limitations.
Defining “Institution of Higher Education”
According to the USCIS, an “institution of higher education” follows the definition provided by the Higher Education Act of 1965. This refers to accredited post-secondary educational institutions such as colleges and universities, which offer degree programs. Employers like universities or community colleges are thus eligible to petition for H-1B workers without being subject to the annual cap.
Nonprofit Entities and Their Affiliations
Nonprofit entities can also qualify for cap exemption, but only if they are related to or affiliated with an institution of higher education. USCIS clarified that the relationship must be formal and substantial, often requiring a shared purpose, ownership, or funding relationship. The affiliated nonprofit must operate in conjunction with the institution, such as a university-run hospital or a nonprofit research center, and contribute to its mission, including the nonprofit entity’s training of the academic institution’s students.
Nonprofit and Governmental Research Organizations
Nonprofit research organizations and governmental research organizations are also exempt from the H-1B cap. Nonprofit research organizations must be primarily engaged in research and operate as tax-exempt under the Internal Revenue Code. Similarly, governmental research organizations are typically state or federal entities focused on scientific or academic research.
Working at Cap-Exempt Institution
An H-1B worker is not required to be directly employed by a cap-exempt institution to benefit from the H-1B cap exemption, which allows for some flexibility with third-party contractors such as staffing agencies, to work at a qualifying institution.
Benefits of the H-1B Cap-Exempt Route
For employers and foreign workers, the cap-exempt H-1B pathway offers several advantages:
- Year-Round Filing: Cap-exempt institutions can file H-1B petitions at any time without having to worry about lottery deadlines.
- No Numerical Limits: Cap-exempt institutions are not subject to the numerical limits imposed by the annual H-1B visa lottery.
Please contact Attorney Monique Kornfeld at mkornfeld@mhkimmigration.com for further information about or assistance with an H-1B for a cap-exempt