Currently the immigration regulations define an employer-employee relationship as indicated by the fact that an employer may “hire, pay, supervise, or otherwise control the work of any such employee.” 8. C.F.R. (h)(4)(ii).
In an 2020 memorandum following the DC District Court judgment in ITserve Alliance Inc. v. Cissna, 443 F.Supp.3d 14 (2020), USCIS clarified that a petitioner may establish an employee-employer relationship if it meets at least one of the “hire,” “pay,” “fire,” “supervise,” or “otherwise control the work of” factors in that definition and need not meet all of these factors.
This newer standard replaced earlier policy guidance, including an older 2018 USCIS policy guidance and a 2010 memorandum called the Neufeld Memo, which had imposed more stringent requirements petitioners needed to meet to qualify as an employer to hire a worker under the H1B visa.
A question particularly of interest for entrepreneurs is whether a company can file an H1B petition for a beneficiary who has ownership of the petitioning company. In some cases this may not work. For example, if the beneficiary is the sole owner, operator, manager, and employee, cannot be fired by the petitioning company, and there is no outside entity exercising any control over the beneficiary’s work, this will not constitute an employee-employer relationship. On the other hand, if a separate Board of Directors exists that has the ability to hire, fire, pay, supervise, or otherwise control the beneficiary’s work, this may qualify as an employer-employee relationship.
Determining whether the required employer-employee relationship exists is a fact-specific inquiry. H1B visas is a category that is heavily regulated and is complex to navigate, so the assessment and advice of experienced counsel can be invaluable.
