Radical Changes in Store for Existing Labor Certification Procedures

The U.S. Department of Labor (DOL) has long been planning to implement radical changes to current labor certification procedures.  After many false starts, this long awaited change is now a reality.  The DOL's new labor certification program, referred to as the "Program Electronic Review Management" or "PERM" program, has just been announced.  The DOL's PERM regulation was published in the Federal Register on Monday, December 27, 2004.  Up until the effective date of PERM (March 28, 2005), employers can continue to file applications for alien employment certification (AEC) under the Reduction in Recruitment (RIR) and non-RIR "standard"/supervised recruitment processes.

PERM may offer significant benefits to employers.  However, it may also provide a more stringent and expensive labor market test.  Employers considering filing an RIR or "standard" AEC must now file such an application before Thursday, March 24, 2005, to ensure receipt by the DOL on Friday, March 25, 2005, before PERM becomes effective, as its effective date of March 28, 2005 falls on a Monday.  While the DOL has traditionally honored a "mailed by" date, we believe that it is imperative that the AEC applications are actually received before the effective date, under these circumstances.

As of March 28, 2005, the DOL will no longer accept AEC applications unless they are filed pursuant to the PERM regulations. Although AECs filed under PERM may have significant advantages, the following are some reasons not to wait for PERM to come into effect:

1. Typically, a foreign national holding H-1B status may remain in the U.S. for a total of six years. An exception to this rule occurs if an AEC or a Form I-140 immigrant visa petition is filed at least 365 days before the end of the person's sixth year of H-1B stay.  Under those circumstances, the H-1B employer can continue to extend the individual's H-1B stay in one year increments while the employee's application is pending adjudication. If the employee's fifth year of H-1B status will expire anytime between now and July 2005, an employer should consider filing a "standard" AEC now. This is because the employer may not be able to gather sufficient evidence of recruitment that complies with PERM guidelines before the deadline by which it must file to preserve the employee's eligibility for future H-1B extensions beyond the 6 year limit.
2. If the employer is not currently able to recruit due to internal issues (e.g. corporate change, tight budget, insufficient human resources staff), then the employer should file a "standard" AEC now. PERM now mandates recruitment before filing. The only way to file without pre-recruitment is to file a non-RIR standard/supervised recruitment labor certification by March 24, 2005.
3. If an employer has just started an RIR program and will not have sufficient recruitment by the March 24, 2005 cut off date, it should consider filing a "standard" AEC and then later evaluate the recruitment to date to see what, if any, of the existing recruitment can be used to support re-filing under PERM.
4. If an employer has gathered documentation of unsuccessful recruitment of U.S. workers sufficient to support a RIR AEC filing, it should file as soon as possible, before the documentation of recruitment becomes dated, and also to avoid the additional recruitment and other new requirements imposed by PERM.

Please note that if you do want to file an AEC under the current RIR or "standard" non-RIR system, this must be treated as an urgent matter.

At this time, we suggest that employers decide between the following options:

1. File the AEC as a non-RIR or "standard" (supervised recruitment) AEC, simply to obtain a filing or "priority" date, and:
   • either continue to proceed with the "standard" AEC, or
   • withdraw and re-file the AEC application for the identical position under PERM, once the employer has recruitment sufficient under PERM;


2. File the AEC as an RIR  (assuming the employer has sufficient recruitment to support such a filing and no qualified U.S. workers have applied for the position), and:
   • Either continue to proceed with the RIR AEC or
   • Withdraw and re-file the AEC for the identical position under PERM, once the employer has recruitment sufficient under PERM;


3. Wait until PERM is implemented, and file under the PERM system. A brief overview of major changes includes:
   • PERM requires more overall recruitment.  Specifically, the PERM program requires two Sunday newspaper advertisements, (in some circumstances a trade journal ad can be placed instead of one of the Sunday ads).  In addition, three separate forms of additional recruitment will be required for professionals, such as website advertisements, on-campus recruiting, professional recruiters, etc. The employer must also place a job order with DOL.
   • In addition, the 5% variance for prevailing wage will be eliminated and a four level prevailing wage system will be implemented. PERM AECs will use a new application form system and can be filed electronically and by mail (but mail filings will be processed more slowly).
   • PERM AECs should be processed within a couple of months (a dramatic reduction of processing times from current processing times), or will be audited, in which case DOL can request detailed recruitment documentation. In addition, DOL may require that the employer undergo supervised recruitment.

Jackson & Hertogs will monitor the implementation of the PERM program in coming months, and advise clients on how to best take advantage of this new labor certification procedure.

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