6th Circuit Appeals Court rules that employers must pay H-1B visa costs; not as clear on physican waivers

By Heather Drabek Prendergast

Yesterday, the U.S. Court of Appeals for the Sixth Circuit issued its decision in Kutty v. DOL, No. 11–6120 (6th Cir. 08/20/2014) and affirmed the lower court’s ruling, which held the employer liable for the costs of obtaining H-1B visas an J-1 waivers (under the Conrad 30 program). 

The Sixth Circuit found that the Administrative Review Board’s (“ARB”) determination that the costs of obtaining H-1B visas – including attorneys’ fees – are business expenses within the meaning of the regulation was a reasonable interpretation of the regulation.  20 C.F.R. § 655.731(c)(9)(iii)(C).  The court also found that the regulation is not inconsistent with the statute.  8 U.S.C. § 1182(n)(2)(C)(i)(II).  In affirming the lower court’s ruling, the Sixth Circuit took a narrow view when it upheld the inclusion of J-1 waiver costs as business expenses.

We note that we understand the ARB’s decision on the J1 waiver expenses to be based on the facts of this case and the propriety of the remedy based on those facts, and not a determination that the Administrator has the discretion to treat J1 waiver expenses as business expenses of the employer in every case, regardless of the facts.  We will not assume that the ARB would so decide, and leave that question to a case in which it is properly presented.

Kutty p. 10-11.  The decision in Kutty is binding throughout the jurisdiction of the Sixth Circuit (Ohio, Michigan, Kentucky, and Tennessee).  Given the court’s ruling, we recommend that employers – particularly those located within the jurisdiction of the Sixth Circuit – pay the costs of obtaining H-1B visas and J-1 waivers.


Link to Kutty:  http://aila.org/content/default.aspx?docid=49842

About David Leopold
Past President American Immigration Lawyers Association (AILA), In-the-Trenches practicing immigration Attorney, Blogger, Activist, Photographer, Educator, World Traveler. All opinions are my own.

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