New OPT STEM extension rules
Today, the U.S. Department of Homeland Security announced that the new rules regarding the “Optional Practical Training STEM extension” for international students in the U.S. on F-1 visas will be published in the Federal Register on Friday. The new rules are a result of a lawsuit against DHS that would result in an invalidation of the old rules. The new rules are “better” in some respects and “worse” in others. In this blog post I will review some of the most important changes and how they will affect international students.
Update 2016-03-09: A previous version of this post suggested that one could get two consecutive STEM extensions. Careful reading of the rule counters this, as does an explicit comment in the supplementary information: “DHS clarifies that the final rule, as with the proposed rule, does not allow students to obtain back-to-back STEM OPT extensions.”
Reasons for the STEM extension
The DHS is very clear in the rules and the accompanying comments that the goal of OPT is practical training for students, and not to bridge a gap in the U.S. labor force. They see practical training as a vital part of a good education, and providing OPT is a key mechanism in staying competitive in the international education market. Therefore, they basically disregarded any comments that talk about a shortage or overage in U.S. STEM workers. There is however a provision that employers can’t use a student on the STEM extension to replace a U.S. worker, and also that students need to be paid the same as other workers in similar positions. These requirements seem to be designed to assuage fears of “cheap foreign labor taking our jobs.”
Because the justification is practical training, you might ask why there is this specific extension for STEM workers, and not just a general length increase for all OPT. DHS clarifies this as follows:
[…] because of the specific nature of [STEM students’s] studies and fields and the increasing need for enhancement of STEM skill application outside of the classroom. DHS also found, as noted previously, that unlike post-degree training in many non-STEM fields, training in STEM fields often involves multi-year research projects as well as multi-year grants from institutions such as the NSF.
Many STEM OPT practical training opportunities are research related, as indicated by the fact that the employer that retains the most STEM OPT students is the University of California system and that two other universities are among the top six of such employers (Johns Hopkins University and Harvard University).
First up: some straightforward changes. The length of the STEM extension is now 2 full years instead of the 17 months under the old rule. The “cap-gap extension”—where OPT is automatically extended if the student has an approved petition for an H-1B visa—is maintained. Students are now allowed to be unemployed for a maximum total of 150 days during their initial OPT and their STEM extension.
Training Plan for STEM OPT Students
One of the big changes to the STEM extension is that students and employers now need to come up with a training plan in order to get the extension. Students must fill out a new Form I-983, “Training Plan for STEM OPT Students,” together with their employer and file that with their STEM extension request.
The new article 8 CFR 214.2(f)(10)(ii)(C)(7) says:
The training plan described in the Form I-983 […] form must identify goals for the STEM practical training opportunity, including specific knowledge, skills, or techniques that will be imparted to the student, and explain how those goals will be achieved through the work-based learning opportunity with the employer; describe a performance evaluation process; and describe methods of oversight and supervision.
The form is not available at the time of writing, but there is what seems to be a draft of the instructions accompanying the form. The relevant parts of the instructions basically echo the rule above.
At this time it’s not very clear how detailed the plan needs to be. Can applicants just write down some business lingo (e.g. “improving core competencies”) or do the goals need to be more substantial? Under the current rules, it seems that the “Designated School Official” (i.e. someone who works at your school’s international office) needs to gauge whether the proposed plan meets the regulatory requirements.
Once the extension is approved, students will need to evaluate themselves annually, according to the plan. Their employers will need to sign their evaluation as well.
There are just too many unknowns at this point to really know how this will affect the types of jobs international students will be able to get and how this will affect the amount of time they have to spend on things besides their normal job responsibilities.
While the actual rules text doesn’t seem to touch on this, the comments and clarifications accompanying the rules suggest that it might be harder to work in an “unusual” work arrangements, such as start-up companies:
There are several aspects of the STEM OPT extension that do not make it apt for certain types of arrangements, including multiple employer arrangements, sole proprietorships, employment through “temp” agencies, employment through consulting firm arrangements that provide labor for hire, and other relationships that do not constitute a bona fide employer-employee relationship.
One of these aspects seems to be that someone else at the same company you work for needs to sign your Form I-983:
[…] students cannot qualify for STEM OPT extensions unless they will be bona fide employees of the employer signing the Training Plan, and the employer that signs the Training Plan must be the same entity that employs the student and provides the practical training experience.
STEM OPT extensions may be employed by new “start-up” businesses so long as all regulatory requirements are met, including that the employer adheres to the training plan requirements, remains in good standing with E-Verify, will provide compensation to the STEM OPT student commensurate to that provided to similarly situated U.S. workers, and has the resources to comply with the proposed training plan.
[…] any ownership interest in the employer entity (such as stock options), [must be] commensurate with the compensation provided to other similarly situated U.S. workers.
So while the rules seem to prevent running a sole proprietorship under the STEM extension, it seems entirely feasible that another employee at your startup can fulfill all the supervisory training requirements. If you’re starting out on your own, you could use your first year of regular OPT to get your company off the ground, and hopefully by the time you need to file for the STEM extension you have a co-founder or such who can provided the necessary “training.”
I’m pretty positive in general about the new rules, and am of course glad that DHS acted swiftly to make new rules after the court decision in August. I’m somewhat concerned about the rules around the training plan, but we’ll see how that’s going to work out in practice. Everything else seems to be an improvement (big or small) upon the previous rules.