Monday, August 17, 2015

On Wednesday, August 12, 2015, the US District Court for the District of Columbia ruled that the US Department of Homeland Security (“DHS”) did not follow required procedures when it promulgated regulations allowing for certain extensions of F-1 Optional Practical Training (“OPT”) employment authorization. However, in a compromise move, the Court vacated the DHS regulation and all subsequent amendments (“vacatur”), but ordered that the vacatur be stayed for six months to February 12, 2016, to allow DHS time to submit the rule again with appropriate notice and comment. There is no immediate impact on STEM or “cap-gap” OPT extensions.

Background

On April 8, 2008, the Department of Homeland Security (DHS) published an Interim Final Rule (IFR) in the Federal Register titled, Extending Period of Optional Practical Training by 17 Months for F-1 Nonimmigrant Students With STEM Degrees and Expanding Cap gap Relief for All F-1 Students With Pending H-1B Petitions (2008 Rule).

This rule extended eligibility for OPT employment authorization for 17 months for graduates from US educational institutions with degrees in science, technology, engineering or mathematics (“STEM”) fields provided their employer is enrolled in E-Verify. The impact of this new rule was to allow a period of OPT employment authorization for qualified foreign nationals for 29 months – the initial 12 months of OPT plus the additional 17 months for those with qualifying STEM degrees and E-Verify registered employers. This rule included the so-called H-1B “cap-gap” extension for F-1s with OPT to extend OPT employment authorization with the filing and eventual acceptance of a cap-subject H-1B petition. This rule was implemented with a comment period, but as an interim final rule under an emergency exception to the usual 60-day full notice and comment period as outlined in the Administrative Procedures Act (“APA”).

In March 2014, the Washington Alliance of Technology Workers filed suit in the United States District Court for the District of Columbia alleging DHS acted arbitrarily and capriciously in promulgating the 2008 rule without first subjecting it to a notice and comment period in violation of the Administrative Procedures Act. DHS argued that in this particular situation, notice and comment requirements could be bypassed under 5 U.S.C. § 553(b), which allows an agency to dispense with the notice-and-comment requirement “when the agency for good cause finds (and incorporates the finding and a brief statement of reasons therefor in the rules issued) that notice and public procedure thereon are impracticable, unnecessary, or contrary to the public interest.” DHS promulgated the rule in 2008 just before the filing period for H-1B visas opened. The timing, they argued, gave rise to an economic emergency of such a degree as to trigger the good cause exemption in 553(b).

Decision

After significant discussion of the standing of the Plaintiffs (Washington Alliance of Technology Workers) to bring suit and the appropriate level of deference that should be given DHS as the government agency vested with the authority over immigration issues, U.S. District Judge Ellen Segal Huvelle concluded that no deference should be afforded DHS with regard to the emergency exception to normal notice and comment. The Court ruled that DHS’s stated reasons for the emergency exception were too general and not specific enough to constitute an emergency. Therefore, the agency acted improperly in promulgating the OPT extension rule without notice and comment from the public.

However, Judge Huvelle decided that immediately vacating the new rule “would be seriously disruptive” to not only thousands of F-1s in the US with currently valid employment authorization who would have to scramble to depart the US, but also to employers if STEM employees have to suddenly leave their employment.

Impact

The judge’s decision jeopardizes the current STEM OPT program, but does not invalidate the employment authorization for current STEM extension holders, nor does it preclude an individual from applying for and being granted a STEM extension up until February 12, 2016. With the six month vacatur, DHS should have sufficient time to issue the rule again for notice and comment and finalization prior to February 12, 2016. If DHS follows the Court’s direction, there should continue to be no impact on STEM or “cap-gap” OPT extensions. We will continue to monitor this important development and provide updates as new information becomes available.