sustained EB-3 Case: Printing

identifying data deleted to
preventclearlyunwarranted
inVasionofpersooalprivacy
PUBLICcopy
u.s. Department of Homeland Security
20 Mass . Ave. , N.\V., RITI. 3000
Washington , DC 20529
u.s.Citizenship
and Immigration
Services
FILE:
EAC 05 078 51935
Office: VERMONT SERVICE CENTER Date: NOV 0 2 ZIII
IN RE: Petitioner:
"Beneficiary :
PETITION: Immigrant petition for Alien Worker as a Skilled Worker or Professional pursuant to Section
203(b)(3) of the Immigration and Nationality Act, 8 U.S.C. § 1 153(b)(3)
ON BEHALF OF PETITIONER:
INSTRUCTIONS:
This is the decision of the Administrative Appeals Office in your case. All documents have been returned to
the office that originally decided your case. Any further inquiry must be made to that office. .
t-
Robert P. Wienlann, Chief
Administrative Appeals Office
www,uscis.gov
Page 2
DISCUSSION: The preference visa petition was denied by the Director, Vermont Service Center, and is
now before the Administrative Appeals Office (AAO) on appeal. The appeal will be sustained. The petition
will be approved.
The petitioner is a printing company. It seeks to employ the beneficiary permanently in the United States as
an assistant press operator, offset. As required by statute, the petition is accompanied by a Form ETA 750,
Application for Alien Employment Certification, approved by the United States Department of Labor (DOL).
The director determined that the petitioner had not established that it had the continuing ability to pay the
beneficiary the proffered wage beginning on the priority date of the visa petition. The director denied the
petition accordingly.
The record shows that the appeal is properly filed, timely and makes a specific allegation of error in law or
fact. The procedural history in this case is documented by the record and incorporated into the decision.
Further elaboration of the procedural history will be made only as necessary.
As set forth in the director's February 22, 2005 denial, the single issue in this case is whether or not the
petitioner has the ability to pay the proffered wage as of the priority date and continuing until the beneficiary
obtains lawful permanent residence.
Section 203(b)(3)(A)(i) of the Immigration and Nationality Act (the Act), 8 U.S.C. § 1] 53(b)(3)(A)(i),
provides for the granting of preference classification to qualified immigrants who are capable, at the time of
petitioning for classification under this paragraph, of performing skilled labor (requiring at least two years
training or experience), not of a temporary nature, for which qualified workers are not available in the United
States.
The regulation 8 C.F.R. § 204.5(g)(2) states in pertinent part:
Ability ofprospective employer to pay lvage. Any petition filed by or for an employment­
based immigrant which requires an offer of employment must be accompanied by evidence
that the prospective United States employer has the ability to pay the proffered wage. The
petitioner must demonstrate this ability at the time the priority date is established and
continuing until the beneficiary obtains lawful permanent residence. Evidence of this ability
shall be in the form of copies of annual reports, federal tax returns, or audited financial
statements.
The petitioner must demonstrate the continuing ability to pay the proffered wage beginning on the priority
date, which is the date the Form ETA 750, Application for Alien Employment Certification, was accepted for
processing by any office within the employment system of the DOL. See 8 C.F.R. § 204.5(d). The petitioner
must also demonstrate that, on the priority date, the beneficiary had the qualifications stated on its Form ETA
750, Application for Alien Employment Certification, as certified by the DOL and submitted with the instant
petition. Matter oj Wing's Tea House, 16 I&NDec. 158 (Act. Reg. Comm. 1977).
Here, the Form ETA 750 was accepted on December 6,1999. The proffered wage as stated on the Form ETA
750 is $20.90 per hour ($43,472.00 per year based on a 40 hour work week). The Form ETA 750 states that
the position requires two years of experience in the job offered.
The AAO takes a de novo look at issues raised in the denial of this petition. See Dor v. INS, 891 F.2d 997,
1002 n. 9 (2d Cir. 1989)(noting that the AAO reviews appeals on a de novo basis). The AAO considers all
Page 3
pertinent evidence in the record, including new evidence properly submitted upon appeal.' On appeal,
counsel submits a brief, the petitioner's previously submitted Supplemental Schedule to IRS Form 1120, U.S.
Corporation Income Tax Return, for 1999, a letter dated April 18, 2005 from the petitioner indicating that a
former employee, left employment with the petitioner in January 2000, the petitioner's
payroll records for for 1999, the beneficiary's previously submitted IRS Form W-2, Wage and
Tax Statement, issued by the petitioner for 2002, and the beneficiary's IRS Forms W-2,Wage and Tax
Statements, issued by the petitioner for 2003 and 2004. Relevant evidence in the record includes the
petitioner's IRS Forms 1120, U.S. Corporation Income Tax Returns, for fiscal years 1999, 2000 and 2001,
and the beneficiary's IRS Form W-2, Wage and Tax Statement, issued by the petitioner for 2001. The record
does not contain any other evidence relevant to the petitioner's ability to pay the wage.
The evidence in the record of proceeding shows that the petitioner is structured as a C corporation. On the
petition, the petitioner claimed to have been established in 1974. According to the tax returns in the record,
the petitioner's fiscal year begins on June 1 and ends on May 31. On the Form ETA 750B, signed by the
beneficiary on December 4, 1999, the beneficiary claimed to have worked for the petitioner as an assistant
press operator from January 1999 to the date he signed the FormET A 750B.
On appeal, counsel asserts that the salary o~who left employment with the petitioner in
January 2000, is available to pay the proffered wage. Counsel asserts that the petitioner's outside printing
costs of $18,882.00 in 1999 are available to pay the proffered wage, as the petitioner has moved its printing
in-house. Counsel states that the petitioner's gross sales, cost of labor, depreciation expense and retained
earnings should be considered in the determination of the petitioner's ability to pay the proffered wage.
Counsel also asserts that the petitioner's net income was $30,379.00 in 2002 and $29,189.00 in 2003 and,
therefore, the petitioner had sufficient net income to pay the difference between the wages actually paid to the
beneficiary and the proffered wage. Counsel asserts that the petitioner operated its business at a profit in
excess of $6,742.85 in 2004 and, therefore, the petitioner had the ability to pay the difference between the
wages actually paid to the beneficiary and the proffered wage. Finally, counsel cites Matter ofSonegawa, 12
I&N Dec. 612 (BIA 1967), for the proposition that the petitioner may establish its ability to pay the proffered
wage if its expectations of continued increase in business and profits are reasonable.
The petitioner must establish that its job offer to the beneficiary is a realistic one. Because the filing of an
ETA 750 labor certification application establishes a priority date for any immigrant petition later based on the
ETA 750, the petitioner must establish that the job offer was realistic as of the priority date and that the offer
remained realistic for each year thereafter, until the beneficiary obtains lawful permanent residence. The
petitioner's ability to pay the proffered wage is an essential element in evaluating whether ajob offer is realistic.
See Matter of Great Wall, 16 I&N Dec. 142 (Acting Reg. Comm. 1977). See also 8 C.F.R. § 204.5(g)(2). In
evaluating whether a job offer is realistic, Citizenship and Immigration Services (CIS) requires the petitioner to
demonstrate financial resources sufficient to pay the beneficiary's proffered wages, although the totality of the
circumstances affecting the petitioning business will be considered if the evidence warrants such consideration.
See Matter ofSonegawa, 12 I&N Dec. 612 (Reg. Comm. 1967).
In determining the petitioner's ability to pay the proffered wage during a given period, CIS will first examine
whether the petitioner employed and paid the beneficiary during that period. If the petitioner establishes by
1 The submission of additional evidence on appeal is allowed by the instructions to the Form 1-290B, which
are incorporated into the regulations by the regulation at 8 C.F.R. § 103.2(a)(1). The record in the instant case
provides no reason to 'preclude consideration of any of the documents newly submitted on appeal. See Matter
ofSoriano, 19I&NDec. 764 (BIA 1988).
Page 4
documentary evidence that it employed the beneficiary at a salary equal to or greater than the proffered wage,
the evidence will be considered prima facie proof of the petitioner's ability to pay the proffered wage. In the
instant case, the beneficiary's IRSFormsW-2, Wage and Tax Statements, for 2001, 2002, 2003 and 2004
show compensation received from the petitioner, as shown in the table below.
• In 2001, the Form W-2 stated compensation of$6,682.50.
• In 2002, the Form W-2 stated compensation of$26,130.00.
• In 2003, the Form W-2 stated compensation of$29,216.46.
• In 2004, the Form W-2 stated compensation of $35,326.40.
Therefore, for the years 2001, 2002, 2003 and 2004, the petitioner has not established that it employed and
paid the beneficiary the full proffered wage, but it did establish that it paid partial wages each year.' Since the
proffered wage is $43,472.00 per year, the petitioner must establish that it can pay the difference between the
wages actually paid to the beneficiary and the proffered wage, which is $36,789.50, $17,342.00, $14,255.54
and $8,145.60 in 2001, 2002, 2003 and 2004, respectively.
If the petitioner does not establish that it employed and paid the beneficiary an amount at least equal to the
proffered wage during that period, CIS will next examine the net income figure reflected on the petitioner's
federal income tax return, without consideration of depreciation or other expenses. Reliance on federal
income tax returns as a basis for determining a petitioner's ability to pay the proffered wage is well
established by judicial precedent. Elatos Restaurant Corp. v. Sava, 632 F. SUpPa 1049, 1054 (S.D.N.Y. 1986)
(citing Tongatapu Woodcraft Hawaii, Ltd v. Feldman, 736 F.2d 1305 (9th Cir. 1984)); see also Chi-Feng
Chang v. Thornburgh, 719 F. SUppa 532 (N.D. Texas 1989); K.C.P. Food Co., Inc. v. Sava, 623 F. Supp. 1080
(S.D.N.Y. 1985); Ubeda v. Palmer, 539 F. SUppa 647 (N.D. Ill. 1982), aff'd, 703 F.2d 571 (7th Cir. 1983).
Reliance on the petitioner's gross sales and profits and wage expense is misplaced. Showing that the
petitioner's gross sales and profits exceeded the proffered wage is insufficient. Similarly, showing that the
petitioner paid wages in excess of the proffered wage is insufficient.'
2 The petitioner's fiscal year runs from June 1 to May 31, and the beneficiary's IRS Forms W-2 cover the
period from January 1 to December 31 of each calendar year. The record does not indicate if the beneficiary
earned his wages for 2001, 2002, 2003 and 2004 during the petitioner's fiscal years or during the calendar
years. For this appeal, we will credit the petitioner with having paid the beneficiary the wages stated on each
IRS Form W-2 in each fiscal year.
3 In general, wages already paid to others are not available to prove the ability to pay the wage proffered to
the beneficiary at the priority date of the petition and continuing to the present.H .owever, where the
petitioner has established that the beneficiary will be replacing another worker performing the duties of the
proffered position, the wages already paid to that employee may be shown to be available to prove the ability
to pay the wage proffered to the beneficiary at the priority date of. the petition and con~ sent.
In this case, the record does not establish that the etitioner has replaced or will replace _ with
the beneficiary. The record indicates that earned $20.50 per hour as lead pressman at the end
of 1999. The petitioner asserts that e he company in January 2000 and consequently, his
position became available. However, the beneficiary claims to have worked for the petitioner since January
1999 as an assistant ressman, and the record contains no evidence that the petitioner has replaced or will
replace with the beneficiary. Moreover, the record contains no evidence that the position of
lead pressman mvo yes the same duties as those set forth in the Form .ETA 750 for the position of assistant
press operator, offset. If performed duties other than those listed on the Form ETA 750, then
the beneficiary could not have replaced him.
In K.C.P. Food Co., Inc. v. Sava, 623 F. Supp. at 1084, the court held that the Immigration and Naturalization
Service, now CIS, had properly relied on the petitioner's net income figure, as stated on the petitioner's
corporate income tax returns, rather than the petitioner's gross income, The court specifically rejected the
argument that the Service should have considered income before expenses were paid rather than net income.
The court in Chi-Feng Chang further noted:
Plaintiffs also contend the depreciation amounts on the 1985 and 1986 returns are non-cash
deductions. Plaintiffs thus request that the court sua sponte add back to net cash the
depreciation expense charged for the year. Plaintiffs cite no legal authority for this
proposition. This argument has likewise been presented before and rejected. See Elatos, 632
F. Supp. at 1054. [CIS] and judicial precedent support the use of tax returns and the net
income figures in determining petitioner's ability to pay. Plaintiffs' argument that these
figures should be revised by the court by adding back depreciation is without support.
(Emphasis in original.) Chi-Feng at 537.
For a C corporation, CIS considers net income to be the figure shown on Line 28 of the Form 1120, U.S.
Corporation InC0111eTax Return. The record before the director closed on January 3, 2004. The petitioner's
tax returns demonstrate its net income for fiscal years 1999, 2000 and 2001, as shown in the table below.
• For fiscal year 1999, the Form 1120 stated net income of $9,886.00.
• For fiscal year 2000, the Form 1120 stated net income of$27,963.00.
• For fiscal year 2001, the Form 1120 stated net income of$19,202.00.
Therefore, for fiscal years 1999 and 2000, the petitioner did not have sufficient net income to pay the
proffered wage. For fiscal year 2001, the petitioner did not have sufficient net income to pay the difference
between the wages actually paid to the beneficiary and the proffered wage."
If the net income the petitioner demonstrates it had available during that period, if any, added to the wages
paid to the beneficiary during the period, if any, do not equal the amount of the proffered wage or more, CIS
will review the petitioner's assets. Net current assets are the difference between the petitioner's current assets
and current liabilities." A corporation's year-end current assets are shown on Schedule L, lines 1 through 6
4 On appeal, counsel asserts that the petitioner's net income was $30,379.00 in fiscal year 2002 and
$29,189.00 in fiscal year 2003 and, therefore, the petitioner had sufficient net income to pay the difference
between the wages actually paid to the beneficiary and the proffered wage. Counsel also asserts that the
petitioner operated its business at a profit in excess of $6,742.85 in fiscal year 2004 and, therefore, the
petitioner had the ability to pay the difference between the wages actually paid to the beneficiary and the
proffered wage. However, the record does not contain the petitioner's fiscal year 2002, 2003 or 2004 federal
income tax returns. Therefore, the petitioner's net income and net current assets may not be analyzed against
the difference between the wages actually paid to the beneficiary and the proffered wage in fiscal years 2002,
2003 or 2004.
5 According to Barron's Dictionary ofAccounting Terms 117 (3 rd ed. 2000), "current assets" consist of items
having (in most cases) a life of one year or less, such as cash, marketable securities, inventory and prepaid
expenses. "Current liabilities" are obligations payable (in most cases) within one year, such accounts
payable, short-term notes payable, and accrued expenses (such as taxes and salaries). Id. at 118.
and include cash-on-hand. Its year-end current liabilities are shown on lines 16 through 18. If the total of a
corporation's end-of-year net current assets and the wages paid to the beneficiary (if any) are equal to or
greater than the proffered wage, the petitioner is expected to be able to pay the proffered wage using those net
current assets. The petitioner's tax returns demonstrate its end-of-year net current assets for fiscal years 1999,
2000 and 2001, as shown in the table below.
• For fiscal year 1999, the Form 1120 stated net current assets of -$274, 171.00.
• For fiscal year 2000, the Form 1120 stated net current assets of $10,108.00.
• For fiscal year 2001, the Form 1120 stated net current assets of -$24,769.00.
Therefore, for fiscal years 1999 and 2000, the petitioner did not have sufficient net current assets to pay the
proffered wage. For fiscal year 2001, the petitioner did not have sufficient net current assets to pay the
difference between the wages actually paid to the beneficiary and the proffered wage.
Thus, from the date the FormET A 750 was accepted for processing by the DOL, the petitioner had not
established that it had the continuing ability to pay the beneficiary the proffered wage as of the priority date
through an examination of wages paid to the beneficiary, or its net income or net current assets.
On appeal, counsel recommends the use of retained earnings to pay the proffered wage. Retained earnings are
the total of a company's net earnings since its inception, minus any payments to its stockholders. That is, this
year's retained earnings are last year's retained earnings plus this year's net income. Adding retained
earnings to net income and/or net current assets is therefore duplicative. Therefore, CIS looks at each
particular year's net income, rather than the cumulative total of the previous years' net incomes represented
by the line item of retained earnings.
However, as noted by counsel on appeal, CIS may consider the overall magnitude of the petitioner's business
activities in its determination of the petitioner's ability to pay the proffered wage. See Matter of Sonegawa,
12 I&N Dec. 612 (BIA 1967). The petitioning entity in Sonegawa had been in business for over 11 years and
routinely earned a gross annual income of about $100,000. During the year in which the petition was filed in
that case, the petitioner changed business locations and paid .rent on both the old and new locations for five
months. There were large moving costs and also a period of time when the petitioner was unable to do
regular business. The Regional Commissioner determined that the petitioner's prospects for a resumption of
successful business operations were well established. The petitioner was a fashion designer whose work had
been featured in Time and Look magazines. Her clients included Miss Universe, movie actresses, and society
matrons. The petitioner's clients had been included in the lists of the best-dressed California women. The
petitioner lectured on fashion design at design and fashion show's throughout the United States and at colleges
and universities in California. The Regional Commissioner's determination in Sonegawa was based in part
on the petitioner's sound business reputation and outstanding reputation as a couturiere. As in Sonegawa, CIS
may, at its discretion, consider evidence relevant to the petitioner's financial ability that falls outside of a
petitioner's net income and net current assets. CIS may consider such factors as the number of years the
petitioner has been doing business, the established historical growth of the petitioner's business, the overall
number of employees, the occurrence of any uncharacteristic business expenditures or losses, the petitioner's
reputation within its industry, whether the beneficiary is replacing a former employee or an outsourced
service, or any other evidence that CIS deems relevant to the petitioner's ability to pay the proffered wage."
6 Counsel asserts that the petitioner's outside printing costs of $18,882.00 in fiscal year 1999 are available to
pay the proffered wage, as the petitioner has moved its printing in-house. However, the petitioner is a
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In the instant case, the petitioner has been in business since 1974. While the record does not establish the
petitioner's overall number of employees, the petitioner's tax returns show that it paid substantial costs for
labor in each relevant year.' The petitioner also had substantial gross receipts in each relevant year, with
receipts of $4,807,625.00 in fiscal year 1999, $4,950,718.00 in fiscal year 2000 and $5,896,133.00 in fiscal
year 2001. Thus, assessing the totality of the circumstances in this individual case, it is concluded that the
petitioner has proven its financial strength and viability and has shown its ability to pay the proffered wage.
The evidence submitted establishes that the petitioner had the continuing ability to pay the proffered wage
beginning on the priority date.
The burden of proof in these proceedings rests solely with the petitioner. Section 291 of the Act, 8 U.S.C.
§ 1361. The petitioner has met that burden.
ORDER: The appeal is sustained. The petition is approved.
printing company, and the petitioner provided no explanation as to why it had to outsource its printing in
fiscal year 1999. The assertions of counsel do not constitute evidence. Matter of Obaigbena, 19 I&NDec. 533,
534 (BIA 1988); Matter ofRamirez-Sanchez, 17 I&N Dec. 503, 506 (BIA 1980). Therefore, this office is not
persuaded by counsel's argument that the beneficiary is replacing an outsourced service.
7 The petitioner paid $59,400.00 in salaries and wages and $919,982.00 in costs of labor in fiscal year 1999.
The petitioner paid $58,900.00 in salaries and wages and $911,554.00 in costs of labor in fiscal year 2000.
The petitioner paid $57,200.00 in salaries and wages and $1,057 ,053.00 in costs of labor in fiscal year 2001.