The cornerstone of TPP’s cap-exempt status is rooted in Section §214(g)(5) of the INA¹. This statute explicitly excludes certain categories of employers from the annual H-1B visa cap, pivotal for cap-exempt organizations such as TPP. The statute’s language excludes institutions of higher education, non-profit entities affiliated with higher education institutions (where TPP sits), non-profit research organizations, and governmental research organizations. TPP’s alignment with this provision is clear through its collaborative initiatives and partnerships with our partnered institutions of higher education, thereby meeting the statutory criteria for cap exemption.

TPP’s Status Under the Internal Revenue Code

TPP’s classification as a 501(c)(3) non-profit organization under the Internal Revenue Code solidifies our stance as a public service entity committed to educational advancement. This status is instrumental in reinforcing our eligibility for cap-exempt H-1B petitions. Being a 501(c)(3) entity, TPP is inherently aligned with public and quasi-public objectives, with our primary focus on educational efforts. This classification synergizes with the regulatory framework established for cap-exempt H-1B petitions, as stipulated by the USCIS.

Nonprofit Affiliation With Higher Education Institutions

TPP’s strategy to establish itself as a cap-exempt entity under H-1B regulations hinges on demonstrating a robust affiliation with higher education institutions. This affiliation is manifested through various collaborative endeavors that directly contribute to the educational missions of these institutions. Our key strategies include:

Matter of Simeio Solutions, LLC (2015)

This case serves as a vital precedent for organizations like TPP in terms of compliance with H-1B regulations. The United States Citizenship and Immigration Services (USCIS) clarified the need for filing amended H-1B petitions when there is a material change in employment, including changes in the beneficiary’s work location. As a cap-exempt entity, TPP adheres strictly to these guidelines, ensuring compliance with all regulatory changes. This case law is intended to be formally integrated into immigration regulations via the October 2023 proposed rule.

ITServe Alliance v. Cissna (2018)

This significant ruling impacted IT consulting companies and by extension, all H-1B petitioners, such as cap-exempt organizations like TPP. This case emphasized the scrutiny of USCIS in approving H-1B petitions, particularly those involving third-party worksites. TPP’s model, while distinct, draws lessons from this case in maintaining rigorous adherence to USCIS policies.

Innova Solutions, Inc. v. Baran (2017)

This case highlights the importance of establishing that a beneficiary’s job qualifies as a specialty occupation, especially when third-party worksite placements are involved. TPP’s strategy involves a careful emphasis on job duties and qualifications, for both the cap-exempt as well as the concurrent case, to ensure strict compliance with this criteria.

Defensor v. Meissner (2000)

Defensor v. Meissner serves as a caution against any attempts to circumvent the H-1B cap through inappropriate means. TPP’s approach is grounded in vigilant adherence to legal standards, avoiding any semblance of cap circumvention or misuse of the H-1B program. The government has re-emphasized this position in the latest proposed regulation (October 2023) where it seeks to establish an accessible and more transparent H-1B visa lottery. The Parachute Project welcomes the government’s proposed regulations as it clarifies and further establishes the legitimacy of the cap-exempt H-1B as it relates to nonprofits affiliated with higher education establishments, such as ours.

Concurrent H-1B Employment Regulations (2017)

• USCIS published regulations effective January 17, 2017, which modernize and improve aspects of certain employment-based nonimmigrant and immigrant visa programs. These regulations enable U.S. employers to hire and retain foreign workers waiting to become lawful permanent residents under approved employment-based immigrant visa petitions​​.

• The 2017 regulations include provisions for cap-exempt H-1B nonimmigrants regarding portability, allowing them to start concurrent employment with their full-time employer upon filing a non-frivolous H-1B petition or as of the requested start date. You can click here to read more about the specific portability rules relating to concurrent employment leveraged by TPP.^​5

• Definition of “related or affiliated nonprofit entity” for cap exemption purposes was clarified, including various conditions under which a nonprofit entity can be considered affiliated with an institution of higher education for cap exemption​​. Follow this link to see the references where the relevant definitions were updated as well as the related sections of the government code.

Proposed October 2023 H-1B Rule

• On October 23, 2023, the Department of Homeland Security (DHS) issued a Notice of Proposed Rulemaking that would significantly modify the H-1B visa program. This proposal aims to modernize the H-1B specialty occupation worker program by streamlining eligibility requirements for cap-exempt organizations and employees, improving program efficiency, providing greater benefits and flexibilities, and strengthening integrity measures​​.

• The proposed rule expands the definition of employers and H-1B workers exempt from the H-1B quota, revising the definition of an exempt ‘‘nonprofit research organization’’ and ‘‘governmental research organization,’’ and altering criteria for cap exemption eligibility for certain H-1B beneficiaries​​. Click here to read the specific provisions modernizing cap-exempt eligibility, which TPP expects to leverage upon rule approval.

• The USCIS proposal (click here to see the proposed rule published in the Federal Register) includes amendments to the definition of specialty occupation, changes to the regulation for determining whether a position qualifies as a specialty occupation, and codification of policies related to H1B amendments for new work locations and other policies detailed in existing U.S. Department of Labor (DOL) regulations​​. These changes have been generally followed and accepted by the Agency after establishment of the case law cited above and will now be formally codified into regulations.

Prohibition on Beneficiary Payment of Legal and USCIS Filing Fees

Regulatory Mandate: Under 8 C.F.R. § 214.2(h)(4)(iii)(C), the Department of Labor (DOL) strictly requires that employers remain responsible for all costs associated with the preparation and filing of H-1B petitions, which includes legal fees. This regulation is in place to ensure that U.S. workers are not disadvantaged and that H-1B nonimmigrant workers are treated fairly. The specific text of the government regulations, which outline the employer’s liability for certain H-1B visa fees and the prohibition on reimbursement from the beneficiary can be read here.

Third-Party Payment of H-1B Legal and USCIS Filing Fees

• Regulatory Framework: While direct beneficiaries of cap-exempt visas are prohibited from paying these fees, the DOL allows third parties to cover these expenses. However, it is critical that these payments are not reimbursed by the H-1B employee, maintaining the integrity of the H-1B program.

• Interim Final Rule on H-1B (8 CFR 214.2(h)(2)(i)(G)): This rule clarifies that third parties may pay the H-1B legal and USCIS filing fees as long as there is no reimbursement to the H-1B employee. Here you can read the Interim Final Rule on H-1B (8 CFR 214.2(h)(2)(i)(G)), which clarifies that third parties may pay the H-1B legal and USCIS filing fees as long as there is no reimbursement by the H-1B employee.

• TPP’s adherence to these DOL regulations underscores our commitment to legal compliance and ethical standards in the H-1B visa program. By ensuring that all legal and filing fees are appropriately managed, TPP maintains its integrity as a cap-exempt H-1B sponsor.