bigstock-Passports-31148Employers filing for permanent residency on behalf of their employees must meet the financial ability test set forth in the regulations. In addition to examining whether a foreign national beneficiary meets the qualifications for the position in the I-140 Immigrant Petition For Alien Worker, the United States Citizenship and Immigration Services (USCIS) also scrutinizes the sponsoring employer’s ability to pay the foreign national the proffered wage. Though the sponsoring employer does not have to pay the foreign national the proffered wage until the foreign national has received their green card, the employer has the on-going burden of proving their ability to pay. This obligation begins when the foreign national’s priority date is established and ends only when the foreign national receives their green card, at which point in time the employer is responsible for actually paying the proffered wage. While the process has been criticized by courts as illogical and not an honest or accurate test of the employer financial ability, it remains today as the method by which employers financial ability is determined.

Pursuant to 8 CFR § 204.5(g)(2), an employer can prove its ability to pay through different methods, depending upon the size of the employer. All employers can, but those with fewer than 100 employers must, prove their ability to pay through Annual Reports, Federal Tax Returns and/or Audited Financial Statements (“initial evidence”). Employers with greater than 100 employees have the option of submitting a statement from the company’s financial officer attesting to the employer’s financial stability and ability to pay. This can be done in lieu of or in addition to submitting Annual Reports, Federal Tax Returns and/or Audited Financial Statements with discretion exercised by USCIS in accepting the financial officer’s statement.

The burden of initial evidence can be heavy for smaller petitioning companies, especially during turbulent economic times when financial statements and tax returns might not portray an accurate picture of the employer’s long-term ability to pay. Absent an acceptable company financial officer’s statement, the employer must show financial ability using the net income approach, or the net current assets approach. Employers must show that their net income or net current assets exceed the total shortage in offered wage compared to actual pay for the cumulative of all pending permanent residency petitioned employees. The impact of this rule can be very difficult to meet for employers absent proper and advanced planning with a competent immigration attorney.

USCIS has acknowledged that employers may submit secondary sources of information to supplement the required initial evidence, but that the USCIS will review such evidence in their sole and absolute discretion. This means that even if an employer submits additional, relevant evidence of its ability to pay, the USCIS may not give it much, or even any, consideration. However, regardless of whether the USCIS is required to review and consider supplemental evidence, it is always advisable to include additional favorable evidence with the petition. If for no other purpose, the evidence will be part of the record in the event an appeal is necessary.

Further, USCIS released guidance on May 4, 2004 regarding when the adjudicating officer should make a positive ability to pay determination. The guidance indicated that positive ability to pay determinations should be made when initial evidence shows the petitioning employer’s income is equal to or greater than the offered wage, the petitioning employer’s net current assets are equal to or greater than the offered wage, or if the petitioning employer is currently employing the foreign national and paying the offered wage.

The burden of initial evidence can be heavy for smaller petitioning companies, especially during turbulent economic times when financial statements and tax returns might not portray an accurate picture of the employer’s long-term ability to pay. Absent an acceptable company financial officer’s statement, the employer must show financial ability using the net income approach, or the net current assets approach. Employers must show that their net income or net current assets exceed the total shortage in offered wage compared to actual pay for the cumulative of all pending permanent residency petitioned employees. The impact of this rule can be very difficult to meet for employers absent proper and advanced planning with a competent immigration attorney.

Fortunately, in the years since the USCIS issued its guidance on ability to pay determinations, the Administrative Appeals Office (AAO) has shown a tendency to consider evidence outside of the traditional initial sources of evidence. This type of flexibility is encouraging in today’s economy, but it is incumbent upon the petitioning employer to have provided additional evidence with the original petition. As the AAO is only able to consider evidence already in the record, petitioning employers should help the USCIS and AAO decide in their favor by providing as much favorable information as possible.