Most employment based green cards follow 3 steps. The first step for the employer is to obtain a PERM labor certification from the Department of Labor. Next, the employer submits Form I-140, Immigrant Petition for Alien Worker, to the U.S. Citizenship and Immigration Services (USCIS). The employee then applies for permanent residence by filing Form I-485 to adjust status in the United States or by consular processing overseas
Many employers face challenges at the I-140 stage because they must show USCIS that they can pay the salary specified in the labor certification. Though this may seem simple, it often requires careful planning, especially for small or fast growing companies.
What the Rule Requires
8 C.F.R. § 204.5(g)(2) requires an employer filing an I-140 with a job offer to show that it can pay the proffered wage. This demonstration begins at the priority date, in PERM cases, the date the labor certification is filed, and continues until the employee becomes a permanent resident.
The regulation provides three types of evidence for each year at issue:
- Annual reports.
- Federal tax returns.
- Audited financial statements.
If you have 100 or more employees, you may provide a statement from a financial officer certifying your ability to pay. However, USCIS may request more documentation if it still has concerns.
How USCIS Evaluates Ability to Pay
USCIS typically considers the evidence in a certain order.
First are the wages actually paid. If your employee has worked for you and been paid at least the amount listed on the proffered wage since the priority date, you most likely meet this requirement. Your employees’ W-2s would be strong evidence.
If the employee isn’t paid the full amount, or any amount, employers need to show that the company’s net income on its tax return is sufficient to cover the unpaid wages.
Net Current Assets. As above, employers must show that the company’s net current assets can cover the unpaid wages. Net current assets are current assets minus current liabilities.
There are many other circumstances under which USCIS may find that a company can meet the ability to pay requirements even if it does not meet the above criteria. As stated in Matter of Sonegawa, USCIS can look at the business’s history and whether the company is growing, and maybe that one year was just an outlier.
Things to Remember
This obligation continues throughout the case. It can take many years to receive permanent residency if the employee’s country of origin has long backlogs. Your company must show it can pay from the priority date until your employee receives permanent residency. Just because you have a good year when you file your petition does not mean you can underperform for years after.
USCIS will usually allow the employer to rebut the claim that the company couldn’t pay via an RFE or NOID response. You should not rely on this approach; always submit the best petition you can. Furthermore, USCIS can revoke its approval later if evidence shows your company could not have paid the offered wage, as long as it has a good and substantial reason.
USCIS typically matches the employee’s W-2s with the company’s tax returns and reviews wages and taxes together. Ensure that your records are consistent.
The more workers you sponsor, the greater the requirements. If your company files more than one I-140 form, USCIS may ask for evidence that you will be able to pay the total of the wages proposed for all beneficiaries whose petitions are pending or approved during the same time period. This calculation usually excludes petitions that have been withdrawn or denied and employees who have adjusted to permanent residency.
Planning Ahead
It is easier to avoid ability to pay problems than to solve them. Before filing, review your tax returns for the year in which the priority date falls and for years after. And consider how many other I-140s your company has already filed. If your company isn’t sure it can pay, or needs help with an RFE, our attorneys at ILBSG can review your case and help strengthen your petition.
As always, ILBSG actively monitors ongoing U.S. immigration news. If you have questions about any U.S. immigration related issue, contact us. Working with an experienced attorney ensures you get the right advice based on the most recent laws. In an ever-evolving immigration policy landscape, it’s particularly critical you get the right advice.