dismissed
H-1B
dismissed H-1B Case: Clothing Retail
Decision Summary
The appeal was dismissed because the petitioner failed to establish that a valid employer-employee relationship would exist. The Director concluded, and the AAO agreed, that the petitioner did not demonstrate it would be able to hire, pay, fire, supervise, or otherwise control the beneficiary's work, which is a core requirement for a U.S. employer under H-1B regulations.
Criteria Discussed
Employer-Employee Relationship
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U.S. Citizenship
and Immigration
Services
MATTER OF A-F-, LLC
APPEAL OF VERMONT SERVICE CENTER DECISION
Non-Precedent Decision of the
Administrative Appeals Office
DATE: JAN. 11, 2017
PETITION: FORM I-129, PETITION FOR A NONIMMIGRANT WORKER
The Petitioner, a clothing store, seeks to temporarily employ the Beneficiary as its chief financial
officer under the H -1 B nonimmigrant classification for specialty occupations. See Immigration and
Nationality Act (the Act) section 101(a)(15)(H)(i)(b), 8 U.S.C. § 1101(a)(l5)(H)(i)(b). The H-18
program allows a U.S. employer to temporarily employ a qualified foreign worker in a position that
requires both (a) the theoretical and practical application of a body of highly specialized knowledge
and (b) the attainment of a bachelor's or higher degree in the specific specialty (or its equivalent) as
a minimum prerequisite for entry into the position.
The Director, Vermont Service Center, denied the petitiOn. The Director concluded that the
Petitioner did not establish that it will engage the Beneficiary in an employer-employee relationship.
The matter is now before us on appeal. In its appeal, the Petitioner asserts that the Director erred in
denying the petition.
\
Upon de novo review, we will dismiss the appeal.
I. EMPLOYER-EMPLOYEE RELATIONSHIP
Upon review of the record in its totality and for the reasons set out below, we determine that the
Petitioner has not demonstrated that it meets the regulatory definition of a United States employer as
that term is defined at 8 C.F.R. § 214.2(h)(4)(ii). Specifically, the Petitioner has not established that
it will have "an employer-employee relationship with respect to employees under this part, as
indicated by the fact that it may hire, pay, fire, supervise, or otherwise control the work of any such
employee." Id.
A. Legal Framework
Section 101(a)(15)(H)(i)(b) of the Act defines an H-18 nonimmigrant, in pertinent part, as an
individual:
[S]ubject to section 2120)(2), who is coming temporarily to the United States to
perform services ... in a specialty occupation described in section 214(i)( 1) ... , who
Matter of A-F-, LLC
meets the requirements for the occupation specified in section 214(i)(2) ... , and with
respect to whom the Secretary of Labor determines and certifies to the [Secretary of
Homeland Security] that the intending employer has filed with the Secretary [of
Labor] an application under section 212(n)(1) ....
The term "United States employer" is defined in the Code of Federal Regulations at 8 C.F.R.
§ 214.2(h)( 4 )(ii) as follows:
United States employer means a person, firm, corporation, contractor, or other
association, or organization in the United States which:
(1) Engages a person to work within the United States;
(2) Has an employer-employee relationship with respect to employees
under this part, as indicated by the fact that it may hire, pay. fire.
supervise, or otherwise control the work of any such employee; and
(3) Has an Internal Revenue Service Tax identification number.
(Emphasis added); see Temporary Alien Workers Seeking Classification Under the Immigration and
Nationality Act 56 Fed. Reg. 61,111,61,121 (Dec. 2, 1991) (to be codified at 8 C.F.R. pt. 214).
Although "United States employer" is defined in the regulations at 8 C.F .R. § 214.2(h)( 4 )(ii), it is
noted that the terms "employee" and "employer-employee relationship" are not defined for purposes
ofthe H-lB visa classification. Section 10l(a)(l5)(H)(i)(b) of the Act indicates that an individual
coming to the United States to perform services in a specialty occupation will have an "intending
employer" who will file a Labor Condition Application with the Secretary of Labor pursuant to
section 212(n)(l) of the Act, 8 U.S.C. § 1182(n)(1). The intending employer is described as offering
full-time or part-time "employment" to the H-lB "employee." Subsections 212(n)(1)(A)(i) and
212(n)(2)(C)(vii) of the Act, 8 U.S.C. § 1182(n)(l)(A)(i), (2)(C)(vii). Further, the regulations
indicate that "United States employers" must file a Form I-129, Petition for a Nonimmigrant
Worker, in order to classify individuals as H-lB temporary "employees." 8 C.F.R. § 214.2(h)(l),
(2)(i)(A). Finally, the definition of "United States employer" indicates in its second prong that the
Petitioner must have an "employer-employee relationship" with the "employees under this part," i.e.,
the H-lB beneficiary, and that this relationship be evidenced by the employer's ability to "hire, pay,
fire, supervise, or otherwise control the work of any such employee." 8 C.F .R. § 214.2(h)( 4 )(ii)
(defining the term "United States employer").
Neither the former Immigration and Naturalization Service (INS) nor U.S. Citizenship and
Immigration Services (USCIS) defined the terms "employee" or "employer-employee relationship"
by regulation for purposes of the H -1 B visa classification, even though the regulation describes
H-1 B beneficiaries as being "employees" who must have an "employer-employee relationship" with
2
Matter of A-F-. LLC
a "United States employer." Id. Therefore, for purposesofthe H-1B visa classification, these terms
are undefined.
The United States Supreme Court has determined that where federal law fails to clearly define the
term "employee," courts should conclude that the term was "intended to describe the conventional
master-servant relationship as understood by common-law agency doctrine." Nationwide Mut. Ins.
Co. v. Darden, 503 U.S. 318, 322-23 (1992) (quoting Cmty. for Creative Non-Violence v. Reid, 490
U.S. 730 (1989)). The Supreme Court stated:
"In determining whether a hired party is an employee under the general
common law of agency, we consider the hiring party's right to control the manner
and means by which the product is accomplished. Among the other factors relevant
to this inquiry are the skill required; the source of the instrumentalities and tools;
the location of the work; the duration of the relationship between the parties;
whether the hiring party has the right to assign additional projects to the hired party;
the extent of the hired party's discretion over when and how long to work; the
method of payment; the hired party's role in hiring and paying assistants; whether
the work is part of the regular business of the hiring party; whether the hiring party
is in business; the provision of employee benefits; and the tax treatment of the hired
party."
Id.; see also Clackamas Gastroenterology Assocs., P.C v. Wells, 538 U.S. 440,445 (2003) (quoting
Darden, 503 U.S. at 323). As the common-law test contains "no shorthand formula or magic phrase
that can be applied to find the answer, ... all of the incidents of the relationship must be assessed
and weighed with no one factor being decisive." Darden, 503 U.S. at 324 (quoting NLRB v. United
Ins. Co. of Am., 390 U.S. 254, 258 (1968)).
In this matter, the Act does not exhibit a legislative intent to extend the definition of "employer" in
section 101(a)(15)(H)(i)(b) of the Act, "employment" in section 212(n)(1)(A)(i) of the Act, or
"employee" in section 212(n)(2)(C)(vii) of the Act beyond the traditional common law definitions.
See generally 136 Cong. Rec. S 17106 (daily ed. Oct. 26, 1990); 136 Cong. Rec. H12358 (daily ed.
Oct. 27, 1990). On the contrary, in the context of the H-1B visa classification, the regulations define
the term "United States employer" to be even more restrictive than the common law agency
definition. 1
1 While the Darden court considered only the definition of"employee" under the Employee Retirement Income Security
Act of 1974 (ERISA), 29 U.S.C. § 1002(6), and did not address the definition of "employer," courts have generally
refused to extend the common law agency definition to ERISA 's use of employer because "the definition of 'employer'
in ERISA, unlike the definition of 'employee,' clearly indicates legislative intent to extend the definition beyond the
traditional common law definition." See, e.g., Bowers v. Andrew Weir Shipping, Ltd., 810 F. Supp. 522 (S.D.N.Y.
1992).
However, in this matter, the Act does not exhibit a legislative intent to extend the definition of "employer" in section
I 0 I (a)(I5)(H)(i)(b) of the Act, "employment" in section 212(n)( I )(A)(i) of the Act, or "employee" in section
3
Matter of A-F-, LLC
Specifically, the regulatory definition of"United States employer" requires H-1B employers to have
a tax identification number, to engage a person to work within the United States, and to have an
"employer-employee relationship" with the H-lB "employee." 8 C.F.R. § 214.2(h)(4)(ii).
Accordingly, the term "United States employer" not only requires H-1 B employers and employees to
have an "employer-employee relationship" as understood by common-law agency doctrine, it
imposes additional requirements of having a tax identification number and to employ persons in the
United States. The lack of an express expansion of the definition regarding the terms "employee" or
"employer-employee relationship" combined with the agency's otherwise generally circular
definition of United States employer in 8 C.F.R. § 214.2(h)(4)(ii) indicates that the regulations do
not intend to extend the definition beyond "the traditional common law definition" or, more
importantly, that construing these terms in this manner would thwart congressional design or lead to
absurd results. Cf Darden, 503 U.S. at 318-19?
Accordingly, in the absence of an express congressional intent toimpose broader definitions, both
the "conventional master-servant relationship as understood by common-law agency doctrine" and
the Darden construction test apply to the terms "employee" and "employer-employee relationship"
as used in section 101(a)(l5)(H)(i)(b) ofthe Act, section 212(n) of the Act, and 8 C.F.R. § 214.2(h).3
Therefore, in considering whether or not one will be an "employee" in an "employer-employee
relationship" with a "United States employer" for purposes of H-1 B nonimmigrant petitions, USCIS
must focus on the common-law touchstone of "control." Clackamas, 538 U.S. at 450; see also
8 C.F.R. § 214.2(h)(4)(ii) (defining a "United States employer" as one who "has an employer
employee relationship with respect to employees under this part, as indicated by the fact that it may
hire, pay, fire, supervise, or otherwise control the work of any such employee .... " (emphasis
added)).
The factors indicating that a worker is or will be an "employee" of an "employer" are clearly
delineated in both the Darden and Clackamas decisions. Darden, 503 U.S. at 323-24; Clackamas,
538 U.S. at 445; see also Restatement (Second) of Agency § 220(2) (1958). Such indicia of control
include when, where, and how a worker performs the job; the continuity of the worker's relationship
212(n)(2)(C)(vii) of the Act beyond the traditional common law definitions. Instead, in the context of the H-1 B visa
classification, the term "United States employer" was defined in the regulations to be even more restrictive than the
common law agency definition. A federal agency's interpretation of a statute whose administration is entrusted to it is to
be accepted unless Congress has spoken directly on the issue. See Chevron, U.S.A .. Inc. v. Natural Res. Def Council,
Inc., 467 U.S. 837,844-45 (1984).
2 To the extent the regulations are ambiguous with regard to the terms "employee" or "employer-employee relationship,"
the agency's interpretation of these terms should be found to be controlling unless "'plainly erroneous or inconsistent
with the regulation."' Auer v. Robbins, 519 U.S. 452, 461 (1997) (citing Robertson v. Methow Valley Citizens Council,
490 U.S. 332, 359 ( 1989) (quoting Bowles v. Seminole Rock & Sand Co., 325 U.S. 4 I 0, 414 ( 1945)).
3 That said, there are instances in the Act where Congress may have intended a broader application of the term
"employer" than what is encompassed in the conventional master-servant relationship. See, e.g., section 214(c)(2)(F) of
the Act, 8 U .S.C. § 1184( c)(2)(F) (referring to "unaffiliated employers" supervising and controlling L-1 B intracompany
transferees having specialized knowledge); section 274A of the Act, 8 U .S.C. § l324a (referring to the employment of
unauthorized individuals).
4
Matter C?f A-F-, LLC
with the employer; the tax treatment of the worker; the provision of employee benefits; and whether
the work performed by the worker is part of the employer's regular business. See Clackamas, 538
U.S. at 445; see also EEOC Compl. Man. at § 2-III(A)(l) (adopting a materially identical test and
indicating that said test was based on the Darden decision); Defensor v. Meissner, 201 F.3d 384, 388
(5th Cir. 2000) (determining that hospitals, as the recipients of beneficiaries' services, are the "true
employers" of H-lB nurses under 8 C.F.R. § 214.2(h), even though a medical contract service
agency is the petitioner, because the hospitals ultimately hire, pay, fire, supervise, or otherwise
control the work of the beneficiaries).
It is important to note, however, that the factors listed in Darden and Clackamas are not exhaustive
and must be evaluated on a case-by-case basis. Other aspects of the relationship between the parties
relevant to control may affect the determination of whether an employer-employee relationship
exists. Furthermore, not all or even a majority of the listed criteria need be met; however, the fact
finder must weigh and compare a combination of the factors in analyzing the facts of each individual
case. The determination must be based on all of the circumstances in the relationship between the
parties, regardless of whether the parties refer to it as an employee or as an independent contractor
relationship. See Clackamas, 538 U.S. at 448-49; EEOC Compl. Man. at§ 2-III(A)(l).
Furthermore, when examining the factors relevant to determining control, USCIS must assess and
weigh each actual factor itself as it exists or will exist and not the claimed employer's right to
influence or change that factor, unless specifically provided for by the common-law test. See
Darden, 503 U.S. at 323-24. For example, while the assignment of additional projects is dependent
on who has the right to assign them, it is the actual source of the instrumentalities and tools that
must be examined, and not who has the right to provide the tools required to complete an assigned
project. See id. at 323.
Lastly, the "mere existence of a document styled 'employment agreement"' shall not lead inexorably
to the conclusion that the worker is an employee. Clackamas, 538 U.S. at 450. "Rather, ... the
answer to whether [an individual] is an employee depends on 'all of the incidents of the relationship
... with no one factor being decisive."' !d. at 451 (quoting Darden, 503 U.S. at 324).
B. Analysis
Applying the Darden and Clackamas tests to this matter, we find that the evidence of record does
not sufficiently establish that the Petitioner will be a "United States employer" having an "employer
employee relationship" with the Beneficiary as an H-1 B temporary "employee." Specifically, we
find that the record of proceedings does not contain sufficient, consistent, and credible
documentation confirming and describing the Petitioner's corporate structure and business
operations. Therefore, the key element in this matter, which is who exercises control over the
Beneficiary, has not been substantiated.
First, the record of proceedings contains incomplete and inconsistent information regarding the
Petitioner's ownership. In its initial letter of support, the Petitioner stated that it is owned by
5
(b)(6)
Matter of A-F-, LLC
[the Beneficiary], and
The Petitioner also outlined the terms of the Beneficiary's employment in the proffered position and
stated that he will work on a three-year term, his job title will be chief financial officer, and the
Petitioner will be his actual employer, responsible for paying,
hiring, firing, and controlling the
Beneficiary's employment. The Petitioner also submitted an "Offer of Employment" letter to the
Beneficiary, dated March 16, 2016, offering the Beneficiary employment at the Petitioner as a chief
financial officer, stating that he will be expected to work 40 hours per week and must agree to
observe all policies and practices governing the conduct of the Petitioner's business and employees.
The offer of employment letter also includes a brief list of duties for which the Beneficiary will be
responsible as chief financial officer.
In response to the Director's request for evidence (RFE), the Petitioner specifically stated that "[the
Beneficiary] is a part owner of [the Petitioner], but not employee" and asserted that it is "owned by
as a 40% owner, [the Beneficiary] as a 40% owner, and
as a 20% owner." The Petitioner went on to state that the Beneficiary will be "seen and
treated as an employee of [the Petitioner] regardless of his ownership interests. From
October 1, 2016, to September 8, 2019, will be able to remove him as an
employee if needed, is] responsible for his supervision as the only superior, and
[he is] solely responsible for his pay." The Petitioner also stated that the Beneficiary will report
directly to and will be under his control.
The Petitioner submitted its business plan, containing inconsistent information about the
Beneficiary's role and position. The business plan specifically states the following at different
sections:
1.0 Our Company
The founders of the company are [the Beneficiary] who will serve as President of the
company and will be involved in the day to day activities of the company,
who will serve, as Vice-President ofthe company and will be involved in
the day to day activities of the company and who will
finance the venture and be a silent partner.
2.0 Company Overview
Ownership: [The Beneficiary], President
Vice President
Partner
(b)(6)
I '
Matter of A-F-. LLC
2.1 Start-up Summary
I
.... [The Beneficiary] will serve as President of the company,
will be the Vice-President and will be a Silent Partner and
provide the initial funding for the company, including the purchase price of the store
building.
The business plan also included an organizational chart for the Petitioner , illustrated as follows:
d/b/a
/
I
[The Beneficiary J
coo 40% CEO/Manager - 40% Pmtner/Jnvestor - 20%
H Retail Sales Clerk I
Full-Time
I-- Retail Sales Clerk 2
Part-Time
~
Retail Clerk 3
Part-Time
On appeal, the Petitioner did not submit any additional evidence detailing its ownership or the
Beneficiary's role and position at the company. The Petitioner submitted a brief outlining the
evidence previously submitted and restating the information previously stated in its letters of
support. The Petitioner did not submit any corroborating evidence as to its actual ownership, such as
its articles of organization , a stock purchase agreement, stock certificate , or stock ledger. A
petitioner's unsupported statements are of very limited weight and normally will be insufficient to
carry its burden of proof , particularly when supporting documentary evidence would reasonably be
available. See Matter ofSoffici, 22 I&N Dec. 158, 165 (Comm'r 1998) (citing Matter of Treqsure
Craft of Cal., 14 I&N Dec. 190 (Reg'l Comm'r 1972)); see also .Matter ofChawathe, 25 I&N Dec.
369, 376 (AAO 2010). The Petitioner must support its assertions with relevant, probative , and
credible evidence. See Matter ofChawath e, 25 I&N Dec. at 376_
Moreover, the business plan raises additional concerns about the Beneficiary's actual role and
position at the Petitioner. Although the Petitioner claimed in its letters that the Beneficiary , as the
..,
(b)(6)
Matter of A-F-, LLC
chief financial officer, will be treated as an employee of the company who can be fired at any time
by the business plan states that the Beneficiary is the president of the company
and superior to who is identified on the business plan as the vice president.
Also, another discrepancy found in the business plan pertains to the Petitioner's organizational chart
which identifies the Beneficiary, not as the president or chief financial officer, but as the "COO"
with "40%" ownership. The Beneficiary is depicted as being on the same level as
identified as the CEO/Manager, also with 40% ownership. The Petitioner has not
provided any explanation for these discrepancies, nor has the Petitioner provided sufficient evidence
to demonstrate that the Beneficiary will be an employee of the company. "[I]t is incumbent upon the
petitioner to resolve the inconsistencies by independent objective evidence." Matter of Ho, 19 I&N
Dec. 582, 591 (BIA 1988). Any attempt to explain or reconcile such inconsistencies will not suffice
unless the petitioner submits competent objective evidence pointing to where the truth lies. !d. at
591-92. "Doubt cast on any aspect ofthe petitioner's proofmay, of course, lead to a reevaluation of
the reliability and sufficiency of the remaining evidence offered in support of the visa petition."
Matter of Ho, 19 I&N Dec. 582, 591 (BIA 1988).
Furthermore, the Petitioner has not provided pertinent information about such
as where he is physically located, what position he actually holds, what duties he performs, the
nature of the Petitioner's compensation to him, and how he monitors and supervises the
Beneficiary's work. Thus, even if were the Petitioner's owner/manager in title,
the Petitioner still has not sufficiently substantiated its assertions regarding his supervision and
control over the Beneficiary.
Therefore, in considering all of the inconsistencies and deficiencies in the record, and without full
disclosure of all relevant facts, we cannot find that the Petitioner has met its burden of establishing
that it has an employer-employee relationship with the Beneficiary.
II. SPECIALTY OCCUPATION
As the Petitioner did not establish an employer-employee relationship with the Beneficiary, we need
not fully address other issues evident in the record. That said, we will enter an additional basis for
denial, i.e., that the evidence of record does not est~blish that the proffered position qualifies as a
specialty occupation.4
In the H-1 B petition, the Petitioner stated that the Beneficiary will serve as its "chief financial
officer." In response to the RFE, the Petitioner described the job duties for the position, in part, as
follows:
4 In reviewing a matter de novo, we may identify additional issues not addressed below in the Director's decision. See
Spencer Enterprises, Inc. v. United States, 229 F. Supp. 2d 102!5, 1043 (E.D. Cal. 2001), affd, 345 F.3d 683 (9th Cir.
2003) ("The AAO may deny an application
or petition on a ground not identified QY the Service Center.").
Matter of A-F-, LLC
As the Chief Financial Officer, [the Beneficiary] would be responsible for analysis
and forecast of financial responsibilities and risks; internal and external financial
reporting and budget drive revenue, maintain and report operations to parent
company, oversee yearly and long-term budgets. The breakdown of time for these
duties are as follow:
• analysis and forecast of financial responsibilities and risks - 30%
• internal and external financial reporting and budget reporting forecasting - 20%
• assure monthly and yearly reporting- 10%
• preparing budgets and reports to drive revenue- 20%
• maintain and report operations to parent company - 5%
• oversee yearly and long-term budgets - 5%
• additional financial planning and decision making - 10%
In its initial letter of support, the Petitioner stated that the minimum entry requirement for the
proffered position is at least a Master's degree and at least two years managing and overseeing the
financing of a clothing corporation.
Upon review of the record in its totality and for the reasons set out below, we determine that the
Petitioner has not demonstrated that the proffered position qualifies as a specialty occupation. First,
we find that the Petitioner did not indicate what specific specialty it considers for entry into the
proffered position in reference to the required master's degree. The Petitioner simply stated that it
requires a master's degree and two years of experience, but did not identify a field of study as a
requirement for entry into the proffered position. A petitioner must demonstrate that the proffered
position requires a precise and specific course of study that relates directly and closely to the
position in question. There must be a close correlation between the required specialized studies and
the position; thus, the mete requirement of a degree, without further specification, does not establish
the position as a specialty occupation. C.f Matter of Michael Hertz Assocs., 19 I&N Dec. 558, 560
(Comm'r 1988). Again, the Petitioner asserts that its minimum requirement for the proffered
position is only a master's degree, without further requiring that that degree be in any specific
specialty. Without more, the Petitioner's statement alone indicates that the proffered position is not
in fact a specialty occupation. The Director's decision must therefore be affirmed and the appeal
dismissed on this basis alone.
Second, we find that there are significant discrepancies in the record of proceedings with regard to
the position proffered to the Beneficiary. The Petitioner stated on the Form I-129 and in the support
letter that the Beneficiary would be working as the Petitioner's CFO. In the support letter, the
Petitioner stated that the Beneficiary would be p~rforming duties such as "analysis and forecast of
financial responsibilities and risks" and "preparing budgets and reports to drive revenue." However,
in response to the RFE, the Petitioner submitted a business plan which states on pages 3 and 4 that
the Beneficiary would serve as the president. Later, on page 9, the business plan states that the
Beneficiary would serve as the "COO." Such discrepancies in the job titles undermine the
Petitioner's claims regarding the duties that the Beneficiary will perform. Upon review of the
totality of the record, the Petitioner has not established the substantive nature of the work to be
9
Matter of A-F-, LLC
performed by the Beneficiary, which therefore precludes a finding that the proffered pos1t1on
satisfies any criterion at 8 CF.R. § 214.2(h)(4)(iii)(A), because it is the substantive nature of that work
that determines (1) the normal minimum educational requirement for entry into the particular position,
which is the focus of criterion 1; (2) industry positions which are parallel to the proffered position and
thus appropriate for review for a common degree requirement, under the first alternate prong of
criterion 2; (3) the level of complexity or uniqueness of the proffered position, which is the focus of the
second alternate prong of criterion 2; (4) the factual justification for a petitioner normally requiring a
degree or its equivalent, when that is an issue under criterion 3; and (5) the degree of specialization and
complexity of the specific duties, which is the focus of criterion 4. 7
Accordingly, as the Petitioner has not established that it has satisfied any of the criteria at 8 C.F.R. §
214.2(h)(4)(iii)(A), it cannot be found that the proffered position qualifies for classification as a
specialty occupation. The appeal will be dismissed and the petition denied for this additional reason.
III. CONCLUSION
The petition will be denied and the appeal dismissed for the above stated reasons, with each
considered as an independent and alternative basis for the decision. The burden is on the Petitioner
to show eligibility for the immigration benefit sought. Section 291 of the Act, 8 U.S.C § 1361.
Here, that burden has not been met.
ORDER: The appeal is dismissed.
Cite as Matter of A-F-, LLC, ID# 205620 (AAO Jan. 11, 2017)
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