January 4, 2005

PERM Regulations and Ability to Convert Existing Cases to PERM

PERM will come into effect as of March 28, 2005. Thereafter, PERM will be the only method allowed to file Labor Certification applications.

PERM will utilize an employer attestation and DOL (Department of Labor) verification and audit process. Under PERM employers MUST undertake advertising and recruitment efforts prior to the filing of any labor certification application. These applications will be filed in one of the two national processing centers. The adjudication period for each case will be approximately 60 days. However, if an application is audited by DOL, the processing time frame will increase beyond 60 days and to whatever period an Officer requires to request evidence and review the application.

CASE STRATEGY FOR LABOR CERTIFICATIONS THAT ARE CURRENTLY PENDING

Any Labor Certification Application filed under the current RIR and Regular process methods will continue to be processed under the existing systems until such time as any application is approved, denied, withdrawn and/or converted to PERM. If any employer chooses to convert an application from the existing process to PERM, the SAME PRIORITY DATE for the same case can be retained only if:

a. the State Workforce or Security Agency (SWA) has not mandated that a job order be placed (if an employer places the same without being requested to by the SWA - this is not deemed as having been mandated by the SWA);

b. advertising and recruitment efforts as required under PERM have been completed; and

c. the offered position is declared "identical" to that previously filed under the traditional process. ?Identical? has been defined by the DOL as an application having the SAME employer (one that possesses the same federal employment identification number), alien, job title, work location, duties, and minimum requirements, etc.

***Any employer re-filing a case under PERM will be required to withdraw the corresponding case that is pending under the existing labor certification system. After any such application is withdrawn it must be re-filed under PERM within 210 days of said withdrawal.

Any application converted to PERM that does not meet the ?identical? standard will be deemed a new application and will have a Priority Date as of the date it was received under the PERM process. The old Priority Date will be lost and cannot be used again for any purpose.

******IMPORTANT ANALYSIS ABOUT ABILITY TO CONVERT TO PERM******

Conversion to PERM may not be feasible for many previous filings thereby resulting in loss of old Priority Dates and issuance of new Priority Dates. Loss of previous Priority Dates is likely to be more devastating to nationals of India, China, and Philippines who are affected by retrogression in the EB3 category.

The requirement that the new application be ?identical? to the prior petition is problematic for several reasons. Namely, the DOL has changed the prevailing wage requirement to be the actual prevailing wage, instead of 95% of the same. Therefore, if the prevailing wage as listed in the prior application is not 100% of the CURRENT actual prevailing wage or higher, the application may not meet the identical standard. Additionally, there have been numerous changes in the ONet and SVP requirements which determine minimum requirements allowed for the position.

Example: A Software Engineer has now been reduced to an SVP of 7<8 which means the employer can list minimum requirements only as a Bachelor?s Degree and (2) two years of work experience. Any requirement above the DOL SVP codes will require a ?Business Necessity Letter? justification by the employer. (Expect Business Necessity letter applications to be audited ?especially in information technology positions). Accordingly, a previous application for a Software Engineer with a Bachelor?s degree and (3) three years experience will no longer meet the new minimum requirements THAT WOULD BE INCLUDED IN ANY APPLICATION FILED UNDER PERM. Therefore, there would be two inconsistent sets of job requirements, that are not identical. Thus, the conversion would fail, and result in a loss of the old the priority date. We are awaiting additional guidance from the DOL on the ?identical? standard discussed above, and will provide an update as and when such information is obtained.

Even in situations where loss of priority date is not an issue because a new filing could be done under PERM in an EB2 or other category unaffected by retrogression, a detailed analysis under the new and more rigorous requirements of PERM would have to be undertaken with regard to its potential impact to the employee and/or company if denied, before any such filing takes place.

The PERM Process

1. PERM Process Advertisements:

Prior to filing an application under PERM the employer is required to advertise on two Sundays in newspapers of general circulation as well as place a 30 day Work Order with the State Workforce Agency. The DOL also requires that for ?professional? positions, (DOL has specified a list of occupations that it deems to be ?Professional?) in addition to that specified above, the employer must undertake three (3) additional methods of advertising from a list of acceptable recruitment methods:

? internet job search websites
? job fairs
? employer?s web site
? trade or professional journals
? on-campus recruitment
? employee referral programs with incentives
? private employment firms
? campus placement offices
? local and ethnic newspapers
? radio and television advertising

The employer must also post the position via any and all in-house media whether electronic or printed, that it used for recruitment of similar positions within the organization. All of the additional steps must also take place within the six months preceding the filing of the application. It is no longer required that the different recruitment methods be undertaken over different months as long as one of the additional steps took place within 30 days preceding the filing.

2. Prevailing Wages:

Another important change under PERM is that employers MUST obtain prevailing wage determinations (PWD) prior to filing applications and must offer to pay 100% of the prevailing wage upon granting of permanent resident status. Previously, employers had a 5% flexibility which has now been removed.

An employer may consider bonuses, commissions, allowances etc. in determining prevailing wages. However, the DOL requires that such amounts MUST be guaranteed and be payable over a fixed period of time whether monthly, semi-monthly or other. (The end result being that these discretionary sums can only be included if they no longer remain discretionary).

SWAs will provide a validity period for prevailing wage determinations of between 90 days and one year. The Labor Certification Application must be filed during this validity period. The DOL will also be creating a 4 tier prevailing wage level as opposed to the existing two levels. DOL is expected to publish the new prevailing wages by January 15, 2005.

If the employer disputes the wage finding PERM provides specific guidelines on how to address these disputes. If the employer disagrees with the skill level or the job classification assigned to the job opportunity, or if the SWA does not accept the wage survey provided by the employer OR if there ?are other legitimate bases for such a review,? the employer may submit supplemental information (one time only) to the SWA for consideration.

If the SWA still does not agree with the employer?s position, then it must inform the employer of the reasons for its decision. The employer has the option at that point in time to either Appeal (within 30 days of the SWA decision) or file a new wage determination application. The Appeal would be reviewed by a DOL Certifying Officer who could either affirm or modify the wage OR return the application to the SWA for further action. An Appeal can be made to the Board of Labor Certification Appeals (BALCA) within 30 days of the decision of the Certifying Officer.

A new PWD can be filed anytime which would result in a new review period.

As before, the prevailing wage is required to be paid only AFTER permanent resident status is granted to the alien.

Analysis:

Since a prevailing wage determination is required before every labor certification filing under PERM, there may be delays due to SWA?s being over loaded with PWD?s due to no increase in funding to hire additional staff. Furthermore, there are no time frames provided for SWA?s to return PWD?s. Should there be a dispute which requires review, processing times can stretch endlessly for obtaining PWD?s.

3. Recruitment Reports:

Employers will now be required to maintain detailed recruitment reports that mirror more closely those reports needed under supervised recruitment. The more general reports as used under the RIR process will no longer be acceptable. The reports will need to detail the recruitment steps undertaken; number of responses received; number of applicants hired; and number of US workers rejected, specifying the lawful job related reasons for such rejections. The Certifying Officer has the discretion to request resumes for review. The evidence underlying these recruitment reports must be maintained by the employer in a public inspection file for (5) five years following the filing of any Labor Certification case.

The recruitment report must be signed and certified by the employer.

Additionally, if the employer has had layoffs in the 6 months preceding the filing in the area of employment, then the employer must document that it considered the potentially qualified laid off employees for the position for which the application is now being filed and the reasons for not re-hiring the laid off workers for this position.

As per the previous process, recruitment must be conducted by the employer?s representative who NORMALLY interviews or considers applicants for the position being filed for. Neither the Attorney nor the Alien are allowed to participate in the recruitment process.

If the Alien owns a part of the employer's business, or is related to the employer, or if the alien is one of a small number of employees, the employer must be able to document that there is a bona fide job opportunity available to all U.S. workers.

Analysis:

The DOL has raised the bar in an employer?s ability to determine whether a US worker meets the minimum qualifications. For example: if a US worker lacks a skill that may be acquired by that worker within a reasonable period of time through on-the-job training, then rejecting that worker for lack of that skill is no longer acceptable. However, the DOL has not defined what constitutes ?a reasonable period of time? and instead states that it varies by occupation. Therefore, this provision is wide open for differing interpretations and is likely to be most problematic for the computer industry positions which tend to require knowledge and experience of varying computer skills, tools, and languages.

This requirement also places an additional burden on employers to document that that they contacted and notified laid off workers of the job opportunity and document as in a recruitment report if any such workers were re-hired or basis for rejection or non acceptance of position. Again, this documentation must be retained in the public inspection file.

The Certifying Officer has additional discretion to order supervised recruitment subsequent to the filing, based on labor market information or industry layoffs in that area.

4. Audit:

Any Labor Certification application may be audited. Audits will be performed randomly for quality control purposes and also when certain triggers that identify problematic filings (DOL has not provided and nor does it intend to provide a list of criteria that will trigger an audit). Furthermore, they can modify the criteria as and when they deem appropriate.

If an application is selected for an audit, the employer will receive written notification of same. The employer has 30 days to respond to the Audit letter with all supporting documentation pertaining to that Labor Certification filing. A one time extension of an additional 30 days may be provided by the Certifying Officer to respond (under extenuating or extraordinary circumstances). The Certifying Officer also has the discretion and authority to request additional information or documentation as needed prior to making a final determination.

Upon review, the Certifying Officer may approve or deny the filing. If denied, the employer will be notified of the reasons.

The Certifying Officer also has the option to order supervised recruiting, at the end of which the employer will be required to submit a detailed recruitment report outlining the lawful job-related reasons why each US worker, who applied for the position, was rejected. The Certifying Officer can then either certify or deny the labor certification application.

If an application is denied, the Certifying Officer has the discretion and authority to require supervised recruitment for up to (2) two years for any future filings done by that employer.

Analysis:

The Certifying Officer also has the discretion to order further supervised recruitment of the employer BEYOND the two year period. Failure to respond to an Audit Letter or an incomplete or inadequate response will result in the denial of the application as well as commencement of possible discretionary supervised recruitment for a period the Certifying Officer deems appropriate.

The 30 day response period is likely to be adhered to strictly. The DOL?s reasoning is that the employer should have gathered and collated all the required documentation prior to the filing. Therefore it should not take longer than 30 days to now provide it to the DOL.

Now, more than ever, maintaining the proper and complete documentation for the required period of time (5 years) is going to be critical for all employers filing Labor Certification applications

5. Validity and Revocation of a Labor Certification

Once approved, a Labor Certification is valid indefinitely.

On the other hand, an approved application may be denied by the DOL or DHS (Department of Homeland Security) or a relevant Court at any time if a determination is made by any of these agencies that fraud or willful misrepresentation of a material fact existed in any Labor Certification case.

The Labor Certification may also be revoked if the Certifying Officer determines that it was ?not justified?. In this situation, the employer will receive a Intent to Revoke notice stating the reasons for same. The Employer has 30 days within which to respond. Thereafter, the Certifying Officer must inform the employer within 30 days whether the application will be revoked or not. If revoked, the employer may file an Appeal.

Analysis:

Technically, and although the Labor Certfication may be revoked at ?anytime,? it is expected that it will probably not be subject to revocation beyond (5) five years from the date of the approval. This is due to the fact that supporting documentation must only be maintained for (5) five years. However, and revocation may even occur after granting of permanent resident status, clarification from the DOL on this issue is required.

6. Minimum Requirements:

The DOL generally defines the minimum job requirements for any position within a specific geographic area. The minimum requirements are those that are considered by the DOL to be normally required for satisfactory performance of the job duties. The DOL assigns each position a specific SVP (Specific Vocational Preparation) level which lists the minimum amount of education and work experience required.

The SVP levels are determinative of the vocational requirements for the offered position in any Labor Certification application. Any requirement beyond the minimum requirements as proscribed by the subject SVP level, requires a Business Necessity Justification from the employer. The DOL has now modified the SVP levels and reduced them for many positions to reduce displacement of US workers.

PERM has also modified the statement of alternative minimum requirements in a Labor Certification filing. That is, the primary and alternative requirements must be substantially similar to each other and the applicant must be able to perform both in a reasonable manner. If the alien does not qualify for the position based on the primary job requirements but qualifies only based on the alternative requirements, the alternative requirements will be considered unduly restrictive and tailored to the alien?s qualifications, resulting in a denial. However, if the employer states that any suitable combination of education, training or experience are acceptable, and the alien qualifies under these criteria it will not automatically result in a denial or audit.

Analysis:

The lowering of the SVP levels is especially problematic because it has pushed many previous EB2 positions into the EB3 category. Furthermore, the decreased minimum requirements means that many more US workers may potentially qualify for the position. Keeping in mind, the raised bar regarding on-the-job training for a reasonable period of time, it may be impossible to lawfully reject US workers. Unfortunately, the DOL?s standards do not reflect the real world standards. The DOL?s objective is to ensure that no US worker gets displaced or is unfairly prejudiced due to the hiring on an alien worker. Thus, their standard is the lowest possible level of qualification required to perform the job, whereas employers seek the most highly qualified workers.

Additionally, the change in the SVP levels is likely to impact filings of many EB2 positions and this will affect nationals of China, India and Philippines who are faced with Retrogression of visa numbers.

CONCLUSION

This broad overview of some of the requirements of the PERM process are provided for informational purposes only, and should not be construed as legal advice.

PERM seeks to streamline the current processing methods and to do away with the lengthy wait periods (2-5 years in some states) to obtain Labor Certification. PERM will result in a substantial overhaul of the existing labor certification system and many questions remained unanswered and clarifications are required. We will continue to closely monitor the PERM program and will provide insight and analysis as the program unfolds and is implemented. The issues discussed above are only some of the many changes being implemented under PERM.

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