Reduction in Recruitment Article
**Please note, RIR is no longer a processing option and this information is provided for reference only. For current Labor Certification procedures, please refer to our PERM Labor Certification section.**
Michael D. Patrick
New York Law Journal
May 14, 1998
One of the newest and most popular strategies available to U.S. employers seeking to hire foreign national talent is Reduction in Recruitment. It is not a benefits package and cannot be valued in terms of compensation. It is an expedited procedure available to certain qualifying U.S. organizations attempting to secure Lawful Permanent Resident (LPR) status, evidenced by a Green Card, for foreign national employees. No doubt, by now, employers in most industries where qualified professionals are in short supply have heard of RIR.
About one year ago we wrote an article for the Law Journal entitled Positive Changes in the Labor Certification Process in which we detailed the then-nascent RIR process.(1) We expressed confidence then that RIR signaled an injection of good sense into a process that had been called "a costly time-consuming paper shuffle" by the U.S. Department of Labor, the very agency charged with its implementation.(2)
In the past year, RIR has had a profound impact on the Green Card process throughout the United States, and it is increasingly becoming the primary method by which employers in short supply of technical or professional labor can secure LPR status for that labor. This article will report on the progress of RIR and its effect on the LPR process.
The fact is that there are certain skills in short supply in the U.S. labor market, particularly in the high-technology arena. Corporations in dire need of these skills are very limited from an immigration standpoint in their options for recruiting foreign nationals to fill these positions. The problem is that by most accounts we are enduring a great shortage of information technology (IT) professionals.
As a general matter, Senator John Warner, R.-Va., has declared the shortage of qualified computer professionals to be a "national security issue."(3) The Secretary of Commerce has declared that the shortages "could undermine U.S. innovation, productivity and competitiveness in the global market."(4) His office has warned that "the United States is 190,000 high technology positions low," meaning the country could use that many more computer professionals.(5) He further noted that United States student enrollment in computer science and related fields has dropped every year since 1986.(6)
Although the extent of and reasons for the current IT worker shortage are subjects of much debate, even most labor unions allow that, at least for now, the United States must rely on foreign nationals to fill countless IT positions. Major U.S. corporations are scouring India, the Philippines and other countries known for quality scientific academic programs for talent unavailable in the U.S.
Popular wisdom would have foreign nationals all too willing to enter the U.S. for any amount of time for work. Unfortunately for recruiters and U.S. employers, the reality is that without, at least, the hope of obtaining LPR status, most foreign national professionals will not subject their families to an uncertain future.
The problem is compounded by the fact that most foreign national professional employees enter the United States on H-1B temporary visas authorizing them to work for a maximum of six years. At the end of the six-year period, they are required to leave the country for at least one complete year. Moreover, in most cases, the only available route to LPR -- through "labor certification" -- can take more than four years. Since, as a general rule, most foreign nationals cannot find a U.S. employer to sponsor them until they have been in the U.S. for at least a year or two, with the increasing delays in the process, many foreign nationals will have difficulty obtaining LPR status before their nonimmigrant professional worker status (typically H-1B) expires.
The majority of all employment-based immigration cases involve a Department of Labor supervised recruitment effort aimed at determining if qualified U.S. workers are able, willing and qualified to fill a particular position. The process, known as the Alien Employment Certification Program or "Labor Certification," is mandated by federal statute and is conducted and regulated by the U.S. Labor Department.(7)
Specifically, Labor must certify that qualified U.S. workers are unavailable to fill a specific position and that employment of a qualified foreign national in that position will not harm the wages and working conditions of similarly employed U.S. workers. To carry out its program, the Labor Department contracts with each state Labor Department or State Employment Security Agency (SESA) for assistance in conducting the job evaluation and recruitment campaign.
The process is initiated when an employer submits an application to a SESA outlining an available position's duties, minimum requirements and offered wage. The SESA reviews the application to determine whether the holder of the offered position will be paid the prevailing or average wage of U.S. workers employed in the same locale. Additionally, the SESA scrutinizes the employer-stated requirements for the position to determine whether the requirements are the absolute minimum.
Of course, the foreign national's credentials are reviewed to ensure that he or she is qualified for the position. In almost every case, the SESA returns (remands) the application to the employer, requesting additional information and/or evidence. It is not uncommon for the Labor Department to challenge the application based on its view that the employer's requirements exceed those specified by Labor, that the salary offered is not within the prevailing wage found by Labor or that the employee does not have the requisite experience for the position offered.
Assuming the SESA accepts the employer's explanations and documentation submitted in response to the remand, it instructs the employer to place an advertisement in a publication that the SESA deems most likely to attract U.S. workers, and it invites applicants to apply directly to the SESA. For all labor certification employers, the entire SESA-monitored recruiting campaign is aimed less at hiring U.S. workers, and more at securing certification eligibility for the subject foreign national employee.
Moreover, the deck in the entire process is heavily stacked in the SESA's favor because, under the rules, any U.S. worker who meets the employer's absolute minimum requirements is considered "qualified" even if the foreign national is more qualified or preferred by the employer. Once the recruitment process is complete and the employer presumably articulates why none of the applicants met the minimum requirements the application is forwarded by the SESA to the appropriate Regional Office of the U.S. Labor Department. The Regional Certifying Officer is the decision-making authority on the labor certification application.
Unfortunately, the labor certification process as it now exists is wholly inconsistent with employers' real-world recruiting efforts. Further, the regulations were promulgated under the assumption that the process would be relatively quick. In fact, it was envisioned that employers would fill permanent labor shortage positions with foreign nationals without the interim step of obtaining a temporary work visa. In practice, all of the U.S. Labor Department Regional Offices have backlogs ranging from 2 -1/2 to four years.
This entire process and its delays can be overwhelming for an employer that has an immediate and critical need to fill a permanent position. While some employers can make interim use of the temporary workers (usually H-1B) category, most find it thoroughly destabilizing to have to rely on a work force or key individuals that might become unavailable after six or less years. Moreover, not all employees remain in essentially the same position for more than a two-year period. A significant change in the terms of an employment offer invalidates a labor certification application.
The ironic result is that foreign nationals can navigate almost the entire green-card certification process only to have permanent residence denied at the moment of approval because they have changed positions or performed so successfully that they have been promoted to distinctively different positions. In the end, the entire process, almost doomed at inception by regulations inconsistent with a true testing of the labor market, is rendered virtually paralyzed by an overwhelming backlog caused by a seemingly deliberate lack of federal funding.
Prospects for comprehensive legislative change are mired in the historical debate of protectionism of the U.S. worker versus business's desire to compete in a global economy with the best resources available. The debate is charged with emotion and always receives significant media exposure. "Sham System," cries the headline of a recent Wall Street Journal article commenting on the labor certification program.8 Lost in the debate is the fact that at least half of all labor certifications are denied and that the entire labor certification program only accounts for about 25,000 new hires a year.
Total employment-based immigration is capped by 1990 legislation at 140,000, a number that has yet to be reached in a given year. To place these numbers into perspective, every year in the U.S. there are 50 million new hires.9 And yet, labor unions, politicians and the media devote substantial amounts of time studying and debating the merits of the labor certification program while the system itself crumbles under overload and grossly insufficient resources.
In a welcome move, on Oct. 1, 1996, the Labor Department appeared to acknowledge the bulk of employer concerns when it released General Administrative Letter 1-97. The GAL, acknowledging that "prospects for legislative changes is speculative, at best, and modification of the regulations could take many months to effectuate," offered employers an alternative to the current system.
While not actually changing any existing regulations, the GAL recognized that there are certain employment positions for which employers conduct systematic recruitment efforts resulting in little or no qualified U.S. worker response. In these instances, reasoned a seemingly reformed Labor Department, employers should not have to jump through all of the hoops associated with the traditional labor certification process. Moreover, the GAL reaffirmed the Labor Department's goal of expediting and encouraging a reduction in the recruitment process of these cases.
Reduction in Recruitment (RIR) is a method by which an employer can avoid a SESA-monitored recruitment campaign by submitting evidence of the employer's unsuccessful real-world recruitment efforts before the filing of the labor certification. As mentioned, this process was already established in the regulations and had technically been in effect for more than seven years when the GAL was released.
Unfortunately, while there were some Regional Labor Department Offices that had implemented this process, a majority actively discouraged employers from attempting to file RIR cases or simply did not approve any cases filed in this manner. The GAL therefore, in effect, created a new RIR process and commanded the Regional Labor Department Offices to implement an expedited system for RIR cases. Eighteen months later, RIR is indeed up and running, but its kinks currently outweigh its usefulness for most employers.
A successful RIR application contains "real world" print ads that establish a "pattern of recruitment" over the six months before a labor certification filing. Notwithstanding that the GAL has been in effect for more than 18 months, employers have yet to be given any concrete guidance as to what constitutes a "real world" ad and how much recruitment constitutes a "pattern."
Additionally, in RIR all of the standard labor certification requirements must still be satisfied, including meeting the prevailing wage and establishing bona fide minimum requirements. Beyond that, the Regional Offices currently disagree over many of the remaining RIR requirements.
In some regions, an essential component to successful RIR is establishing that a documented shortage exists for a particular skill set. Moreover, some Regional Offices require an employer to give a comprehensive accounting of the ultimate disposition of every applicant who was interviewed for an available position. Still, others request documentation regarding an employer's efforts to train U.S. workers. In short, the rules shift from region to region, and it is difficult to fully understand them in advance of submission, as they seem to continue to evolve.
Senior-level Labor Department officials acknowledged in discussions that the RIR program was particularly designed for large U.S. corporations who until now have had to engage in costly labor certification recruitment when, in fact, their own, more extensive recruitment had demonstrated true labor unavailability. This redundancy could be avoided by RIR, or so it was thought. Unfortunately, the U.S. Labor Department Regional Offices' interpretation of the GAL actually makes it more, not less, difficult for a large organization to succeed with RIR. As indicated, some Regional Offices require a comprehensive accounting of the recruitment results of each candidate.
In actuality, major corporations regularly interview hundreds of workers each month. In their view, the software requirements alone to track interviewed applicants could cost more than their current recruitment efforts. Moreover, as "real world" ads have yet to be defined -- other than the Labor Department's amorphous instruction, "whatever is normal to the industry" -- many employers are now placing RIR ads. These are one step below the level of detail required for traditional labor certifications yet one step above the actual ads an employer wishes to place. Notwithstanding these difficulties, RIR has created new opportunities to secure LPR for certain foreign national employees.
RIR Case Study
What follows is a hypothetical case history that attempts to show some of the benefits and difficulties in the RIR process. ABC is a relatively new organization employing 350 professional software consultants. For the past year, it has been attempting to recruit foreign nationals qualified to implement a particular cutting-edge enterprise resource planning software package, labeled BPR, originally developed in Austria. ABC has placed 12 ads in the past year offering opportunities for BPR Consultants.
About six months ago, after 11 of the ads were placed, the human resources department decided that because of the low response to the print ads (often costing upward of $20,000 per ad), it was going to put all future recruiting efforts into Internet ads, employee referral bonus programs and contracting with recruiting agencies. Since then, the company has seen a marked improvement in both the frequency and quality of the applicants. It thus decided to forgo its traditional print ad campaign in favor of alternate recruitment methods, and only one ad was placed during the ensuing six months.
Although ABC has in its view exhausted all practicable methods available to attract qualified U.S. workers, it has remained unsuccessful in recruiting sufficient talent and, as a result, several of its consulting projects are on hold or have been lost, pending its ability to provide staffing.
At the same time, ABC happens upon Mr. Data, a foreign national here on a temporary H-1B work visa, who is recognized for his ability with BPR. He had been working for a company that is closing, and is considering his options. Needless to say, Mr. Data's skills are in great demand, and he can choose from several potential employers. However, as he has used up three years of his six-year H-1B eligibility, Mr. Data agrees to work for ABC on the condition that the company file his labor certification application immediately as an RIR.
The RIR application is prepared, and the efforts of ABC's prior recruitment activity are provided to the SESA. Of course, in preparing its RIR application, ABC has only a general sense of what the particular Labor Department Regional Office handling the application might desire. Originally, in late 1996 and early 1997, many of the SESAs reviewed the implementation guidelines from their respective Regional Offices, summarized them and made them available to employers. Unfortunately, this practice ceased after the SESAs realized they could not keep up with the new and "final" guidelines that the Regional Offices kept sending them.
In fact, by mid-1997 many SESAs stopped reviewing RIRs for any deficiencies and others decided to send pre-printed assessment notices to employers advising them which particular cases would probably not be certified, for failure to meet the RIR guidelines.
Earnest employers, frustrated by this rigidness, would contact the Regional U.S. Labor Department to find out what was wrong only to be told that the central U.S. Labor Department Office in Washington, D.C., had prohibited the Regional Labor Department Offices from providing firm guidelines. Moreover, some employers found -- to their chagrin -- that contacting the Labor Department Central Office produced general guidelines that would then be considered inapplicable by particular Regional Offices.
Unfortunately, these practices (of inconsistency and lack of clarity) continue without any apparent sense that efforts are being made (or will be made) to improve consistency between the Regional Labor Departments and the Central Office. In fairness to the Certifying Officers, however, the regulations afford them great discretion in determining whether an employer has sufficiently tested the labor market.(10) Therefore, discrepancies from one region to another are inherent to the system.
Continuing with our case study, ABC files its RIR application for the position of "BPR Senior Manager," and a few months later (the timing can range from one week to eight months, depending on the relevant SESA's backlog) receives from the SESA an assessment notice advising it of several deficiencies in the application. First, claims the SESA, one print ad does not establish a "pattern of recruitment." Here, of course, ABC had used other forms of recruitment, but the SESA focused principally on the dearth of print ads. In our experience, this is all too common.
Thus, although the Labor Department does consider alternate recruitment methods -- Internet postings, job fairs, head hunters -- an employer must generally provide a series of print ads as a threshold for RIR certification. Second, says the SESA, the print ad does not sufficiently relate to the subject position because the ad only mentions the need for "BPR Consultants" and does mention "Senior Managers." Finally, as BPR was developed in Austria, the SESA declares its belief that prior BPR experience is a "restrictive requirement," in that U.S. workers presumably could not have obtained it in the U.S.
Faced with these objections by the SESA, the employer (ABC) now has the option of withdrawing the application, offering to conduct further recruitment efforts or answering the request for more information and asking that the application be forwarded to the Certifying Officer. If the Certifying Officer believes sufficient recruitment has not been conducted, the case will be sent back to the SESA for more and will be placed at the back of the processing line. If the Certifying Officer accepts the RIR request, certification is then granted and total processing time will range from two to 14 months (still a fraction of the traditional labor certification process processing time).
As the above case study demonstrates, there are still problems with the implementation of the RIR program, both at the state (SESA) and federal (Labor Department) levels. Moreover, although RIR is deemed an expedited procedure, even cases that go through smoothly can take more than a year. Most employers, however, have found RIR to be a stabilizing process in the midst of an increasingly unworkable system.
As evidenced by the strides made as a result of the re-born RIR procedure, a fair argument can be made that some form of the current labor certification process can be salvaged. As an initial matter, however, funding for the program should not be dependent on political whim, nor should it be delayed during the invariably endless congressional debates over all topics immigration.
Rather, much like applications filed with the Immigration and Naturalization Service, we recommend that the Labor Department switch to a fee-based system. In our experience, employers would be extremely eager to pay (even a significant fee, like $1,000) for a workable labor certification process, rather than be forced to accept a "free" procedure that ultimately costs more in lost labor, stalled projects, attorneys' fees, in-house coordination and an endless series of follow-up status queries.
Second, we believe that the initial momentum brought about by the October 1996 re-birth of the RIR program should not be allowed to be stifled by the all-too-usual bureaucratic adherence to a virtually unworkable set of rules. Specifically, the RIR requirements for proving recruitment should be more in line with real-world recruitment. Even the regulations provide that an employer may use sources for RIR including, but "not limited to, advertising." For example, with high-tech industry positions, employers should be allowed to submit Internet ads in lieu of the print ads currently required. Finally, the recruitment reporting requirements should not be so onerous as to bar large corporations from the program in certain jurisdictions.
In the past year, hundreds of employers have benefited significantly from the RIR process. By all indications, the tendency has been for Labor Department Regional Offices to grow more lenient in RIR processing and for the Central Office in Washington, D.C., to continue to exert pressure on all of the Regional Offices to certify greater numbers and types of cases through RIR. This is a welcome trend that should continue. Labor Department's new mission should be to expand the RIR program and establish firm, relatively consistent requirements upon which employers may rely.
- (1) Michael D. Patrick, "Positive Changes in the Labor Certification Process, New York Law Journal, Jan. 27, 1997.
- (2) 17 Immigration Law Report 8 (April 15, 1998) citing Inspector General, Department of Labor Report (Department of Labor Permanent Labor Certification Audit) 1997.
- (3) George Leopold, "U.S. Needs 95,000 New Info Workers Per Year," Electronic Engineering Times, Oct. 2, 1997, quoting Senator Warner.
- (4) Sharon Michaels, "Commerce Department Issues Warning on IT Talent Shortages," Computerworld Sept. 30, 1997, citing U.S. Commerce Department Study, "America's New Deficit: The Shortages of Information Technology Workers."
- (5) Rochelle Garner & David Weldon, "The Numbers Game," Computerworld, Jan. 26, 1998, citing, a study by the Information Technology Association of America, which actually placed the number at 346,000 in an updated report.
- (6) Of course, these numbers and findings are contested. For more information See, Jeri Clausing, "Use of Work Visas by Technology Companies Is Under Fire," The New York Times, April 20, 1998.
- (7) See generally, INA §212 (a)(5)(B), 8 USC §1182 (a)(5)(A); 20 CFR §656.1-656.40 (1998).
- (8) Barry Newman, "Sham System: Foreigners Seeking U.S. Work Visas Often Land in Hell Instead," The Wall Street Journal, April 23, 1998.
- (9) Steven C. Bell, "DOL's Audit of Permanent Labor Certification Program: An Analysis," April 15, 1998.
- (10) See, 20 CFR 656.21.
Michael D. Patrick is a member of Fragomen, Del Rey & Bernsen. Jonathan C. Adams, an associate at the firm, assisted in the preparation of this article.
**Please note, RIR is no longer a processing option and this information is provided for reference only. For current Labor Certification procedures, please refer to our PERM Labor Certification section.**