New report shows L-1 denial rates increasing

The denial rate for L-1B petitions for intracompany transfers of highly skilled employees has risen to an all-time high of 35 percent for fiscal year 2014, according to data from U.S. Citizenship and Immigration Services. The L-1B denial rate has increased dramatically over the past decade from only 6 percent in fiscal 2006. The statistics were published in a new policy brief released by the National Foundation for American Policy.

The report also confirms that USCIS is denying extension petitions at a higher rate than initial petitions. In fiscal 2014, USCIS denied 41 percent of extension applications for L-1B status, compared with 32 percent of initial petitions for L-1B status. This finding is very surprising, since individuals who extend status have typically already worked in the U.S. with approved L-1B status for three years and are simply seeking to continue that work.

The report also shows the relative denial rates for various foreign nationals. Indian nationals experienced the highest L-1B denial rates at 56 percent from fiscal 2012 through fiscal 2014, compared with an average denial rate of 13 percent over the same period for the rest of the world. The next highest rate of L-1B denial is for Chinese nationals at a rate of 22 percent. This means that Indian nationals are being denied L-1B petitions at more than four times the rate of the worldwide average and more than twice as often as nationals from the country with the next highest denial rate.

The rate that USCIS issued Requests for Evidence also remained high during fiscal 2014 at 45 percent. This reflects another steep rise in numbers over the past decade from 9 percent in fiscal 2005 and fiscal 2006; however, it does represent a drop-off from a spike of 63 percent RFE issuance in fiscal 2011. The data also confirm that Indian nationals experience a higher rate of RFEs than the average, with 65 percent of their L-1B petitions receiving an RFE.

BAL Analysis: Employers justifiably complain that high L-1 denial rates negatively affect their job growth, innovation, and production within the U.S., often forcing them to file under other visa categories that might not be as good a fit or transferring employees elsewhere. In response, since 2012, USCIS has planned to issue guidance on specialized knowledge employees who use L-1B petitions, but it has yet to be released. USCIS Director Leon Rodriguez recently remarked that the L-1B guidance remains a high priority, especially in light of President Barack Obama’s push for business relief via executive action, but no clear timeline for its publication has been set.

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Lynden Melmed
Partner
Washington D.C.
DIRECT 202.842.5830 | EMAIL lmelmed@bal.com

Christiana Kern
Legislative Analyst
DIRECT 202.842.5831 | EMAIL ckern@bal.com

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