The U.S. government could start to run out of money within weeks unless Congress can agree on a deal to raise the debt ceiling. If the debt ceiling is breached, this would cause a financial crisis in the U.S., which would have an immediate impact on the federal government’s operations. While we are hopeful it will not come to that point, it is important to understand the immigration implications of a debt default, partial, or full government shutdown so you can prepare for and minimize any impact, regardless of what happens. In a situation like this, it’s better safe than sorry.

While a partial or full government shutdown happens when Congress doesn’t pass a federal funding bill, a debt ceiling crisis occurs if lawmakers don’t approve legislation to lift the debt limit and the U.S. runs out of money to pay its current obligations. If the government cannot afford to pay its federal workers, some agencies might limit operations or shut down completely.

This article explains the immigration-related implications for various agencies and components of the U.S. immigration system, offering practical solutions to offset any impact in the event of a government shutdown or reduced operations.

Impact on USCIS

In general, there is little impact on USCIS during a government shutdown, since USCIS is fee funded. USCIS’ funding is not dependent on annual appropriations from Congress and, therefore, it is largely unaffected by any government shutdown. USCIS will continue processing petitions and applications during a shutdown, without interruption. However, some other aspects of immigration are affected. This can impact petitions filed with USCIS, as explained below.

Impact on Department of Labor: FLAG and PERM

In the event of a government shutdown, the Department of Labor (“DOL”) does not operate. This means that the FLAG and PERM systems are inaccessible. When FLAG is shut down, you cannot file the required Labor Condition Applications (“LCAs”) for H-1Bs, H-1B1s, or E-3 petitions. This means if you do not already have an LCA filed and certified before FLAG shuts down, you will not be able to file those petitions with USCIS until the government reopens. To minimize any impact, make sure to identify and anticipate your upcoming LCA needs and go ahead and get those filed and certified.

When the PERM System is shut down, employers cannot file prevailing wage determinations (“PWDs”) or PERM labor certifications. These steps are required for most employment-based green card processing. The DOL is already experiencing lengthy processing times for both PWDs and PERM applications, meaning a government shutdown would exacerbate an already frustrating situation for many. If you have completed the required recruitment for filing a PERM, don’t delay in submitting the PERM application. If the PERM system shuts down and the recruitment expires before you submit the application, this will result in a loss of both time and money.

Impact on E-Verify

During a government shutdown, the E-verify program is unavailable. This means that during a shutdown, you will not be able to enroll in E-verify, create an E-verify case, view or take action on any case, or otherwise use the program in any way. Anything that requires access to an E-verify account will not be possible during a government shutdown.

Participation in the E-verify program is voluntary for most employers, but others may be required by state law or federal regulation to use E-verify. For example, employers seeking to employ F-1 students with STEM OPT must enroll in E-verify. Certain states also require E-verify. In the past, during government shutdowns, there have been some accommodations made with E-verify. For example, E-verify has suspended the “three-day rule” and extended the time period for resolving Tentative Nonconfirmations (TNCs). If the government shuts down, we can expect some similar accommodations may be made. Importantly, any interruption of the E-verify program does not impact the Form I-9 obligations.

Impact on Department of Justice – Immigration Courts

During previous government shutdowns, immigration courts have been closed, except for hearings scheduled for immigrants in detention. For other kinds of cases, such as political asylum cases or non-emergency deportations cases, you can safely anticipate cancellations during a shutdown.  During the 2019 partial shutdown, for example, almost 43,000 immigration court hearings were cancelled. When hearings are rescheduled, it is often for 2-3 years out, as we saw during both the 2013 and 2019 shutdowns. Many people already wait years for their asylum hearings, so cancellations in this area can be devastating and extend an already painfully long process.

Impact on the Department of State

Visa and passport operations are fee-funded, so there is no interruption to these services during a government shutdown. While consulates should not shut down, they may be affected if there is inadequate funding. If the current funds are exhausted, consular services could be reduced or halted for non-emergency visa services and non-U.S. citizen services. Because consulates are still struggling with lengthy delays and extreme backlogs due to the Covid-19-related closures, any interruption to the consulates’ normal operations would compound an already difficult and frustrating situation.

Impact on Customs and Border Protection (“CBP”)

CBP officers are considered essential workers. As such, operations at the ports of entry continue even in the event of a government shutdown. Application processing, however, can be affected. This means those seeking to apply for an immigration benefit at a port of entry or pre-clearance facility would need to confirm the operational status of that location before appearing to apply. This includes TN applications for Canadian nationals.

Impact on Immigration and Customs Enforcement (“ICE”)

During a government shutdown, ICE continues its enforcement and removal operations. Like CBP, ICE is considered “necessary for the preservation of the safety of human life or the protection of property” and would be required to continue working.

For F-1 foreign students, there may be a concern over the ICE Student and Exchange Visitor Program (“SEVP”) and Student and Exchange Visitor Information System (“SEVIS”). However, since SEVP and SEVIS are fee-funded, these operations continue even in a shutdown.

ILBSG’s Recommendations to Prepare for a Government Shutdown

While USCIS will largely be unaffected by any government shutdown due to the debt ceiling issue, other components of the immigration system are affected. As such, it’s best to prepare accordingly to minimize any impact. Particularly for petitions which require an LCA, it is important to identify your upcoming immigration needs and file as early as possible.

This means if you have an H-1B employee with a nearing expiration date, it is prudent to start the H-1B extension process as early as possible to minimize any delay should the FLAG system shut down. To avoid any lapse in work authorization, make sure to identify H-1B employees with upcoming expiration dates and file the LCA as early as possible. Even if you are not yet ready to file the H-1B extension petition, having the LCA filed and certified will make sure you can file the petition with USCIS when you are ready, regardless of whether the government is operating or shut down.

You should also file any upcoming H-1B amendments and transfer petitions sooner than later. If the government shuts down due to the debt ceiling being reached and you cannot file an LCA, your H-1B employees will not be able to materially change anything about their employment (change projects, work location, title, etc.) until the government reopens and an LCA can be certified.

For FY 2024 H-1B cap cases, it would also be wise to go ahead and start the process, so that you can have an LCA filed and certified for when you are ready to file the petition. As long as we have a certified LCA, we can file the petitions with USCIS even during a government shutdown.

For PERM, make sure to check the expiration date for recruitment and prevailing wage determinations and file the applications wherever possible, to avoid having to redo the process and incur additional expenses in the event the system becomes inaccessible and the filing windows are missed.

Conclusion

While there is no way to know what will happen with the current debt ceiling negotiations, the best thing to do is to prepare ahead and mitigate any potential consequences of a government shutdown. A government shutdown entails federal agency disruptions and would likely increase the processing times for most immigration-related cases. To the extent possible, we recommend identifying your upcoming immigration needs and filing as early as you can. If you have questions or need assistance with any immigration-related matter, reach out to an ILBSG attorney today. We are closely monitoring this situation and we are prepared to assist our clients with any challenges that arise.

CBP Debt Ceiling Government Shutdown ICE Immigration Courts USCIS