The Codification Of The H-1B Deference Policy: A Landmark Regulatory Shift In U.S. Immigration

[Editor2]

Understanding the H-1B Deference Policy and Its Implications​

The U.S. immigration system is dynamic, with evolving policies that significantly impact employers seeking temporary nonimmigrant visas for foreign national talent. Among these policies, the deference policy has played a crucial role in streamlining visa extensions. Recently, the Biden Administration codified this policy under the H-1B modernization rule, effective January 17, 2025. This move ensures greater stability and predictability for employers and visa holders, while also setting the stage for potential future changes.

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What Is the Deference Policy?​

Initially introduced in 2004, the deference policy guided U.S. Citizenship and Immigration Services (USCIS) to prioritize consistency in decision-making. When adjudicating extension petitions involving the same parties and unchanged employment terms, USCIS officers were instructed to defer to prior approvals unless material changes were evident. This approach minimized delays and administrative burdens, allowing employers and employees to navigate extensions with confidence.

For U.S. employers, this policy offered transparency and expedited the approval process, enabling USCIS officers to allocate resources to complex or new petitions. However, the policy was not without limitations, as it required adherence to consistent employment conditions and eligibility criteria.

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The Rescission and Its Consequences​

In 2017, the deference policy was rescinded, disrupting the streamlined process that many employers had come to rely on. Without deference to prior approvals, USCIS began issuing more Requests for Evidence (RFEs), requiring additional documentation for extensions. This led to significant delays and increased costs for employers.

Statistics highlight the dramatic impact of this change:

• The H-1B RFE rate more than doubled, peaking at 40.2% in fiscal year 2019.
• Denial rates for H-1B extensions also doubled during this period.

The resulting unpredictability placed substantial burdens on U.S. employers and foreign nationals, complicating the extension process and increasing legal costs.

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Reinstatement and Codification of the Deference Policy​

In April 2021, USCIS reinstated the deference policy, restoring some predictability to visa adjudications. RFE and denial rates dropped significantly, with the H-1B RFE rate falling to 8.6%. This reinstatement provided relief to employers seeking extensions for employees under the same visa classification and employment terms.

Building on this progress, the deference policy was codified as regulation in December 2024 under the H-1B modernization rule. Codification ensures that USCIS adjudicators must apply the deference standard when reviewing extensions, provided there are no material errors, changes, or adverse new information.

Key aspects of the codified rule include:

• Requirement for USCIS to defer to prior approvals when circumstances remain unchanged.
• Conditions under which deference may be denied, such as material changes or errors in prior approvals.
• Mandating adjudicators to provide specific reasons if deference is not granted.

Importantly, the codification adds a regulatory layer that makes rescinding the policy more challenging, as any changes would require a formal rulemaking process involving public notice and comment periods.

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Implications for Employers and Foreign Nationals​

The codification of the deference policy offers enhanced predictability and stability for employers and employees navigating the U.S. immigration system. Employers should act promptly to benefit from this regulatory certainty, particularly under the current administration.

To mitigate risks, employers are encouraged to:

1. Begin preparing extension petitions at least six months before the current visa expiration.
2. Work closely with immigration attorneys to ensure compliance with eligibility requirements.
3. Stay informed about potential policy shifts under future administrations.

While codification provides a measure of protection, the possibility of future rescission means that proactive planning remains essential.

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Pros and Cons Summary​

Pros:

• Increased predictability and transparency for visa extensions.
• Reduced administrative burden and faster processing.
• Greater focus of USCIS resources on complex cases.
• Regulatory protection against abrupt policy reversals.

Cons:

• Limited flexibility in cases with material changes or errors.
• Potential for future policy rescission, requiring employers to remain vigilant.
• Continued reliance on legal expertise to navigate the intricacies of immigration processes.

By understanding and leveraging the codified deference policy, U.S. employers and foreign nationals can navigate the visa extension process with greater confidence and efficiency.