We were barely done rejoicing the reduction in H-1B/L1 fee from $2,000 to zero earlier this year on September 30, 2015, but Congress has put an end to the celebrations with a nice penalty.

In 2010, the H1B and L1 fee was increased to $2,000 which ended on September 30, 2015. Then on December 18, 2015, both houses of Congress passed an appropriations budget buried in which was a line that doubled the earlier fee for H1B and L1. And without much fanfare or noise, President Obama signed the appropriations bill and made it into law on December 18, 2015.

The money generated from this special fee, expected to be more than a billion dollars per annum, will be used to fund border protection, health screenings and treatment of the first 9/11 responders, and to modernize the Bio-metrics entry and exit tracking system.

Here is the summary of the new provisions:

1. The new supplemental fee will be $4,000 for H-1B visas, and $4,500 for L-1 visas.
2. The new fee will apply to H-1B and L-1 employers who have more than 50 employees of which 50% are on non-immigrant status, i.e., on H-1B or L-1 status.
3. This new fee will apply for initial H-1 and L-1 filings And for extensions
4. The effective Date of New Increased Filing Fees shall be December 18, 2015.
5. The new increased fee will remain in effect for ten years till September 30, 2025.
6. This is in addition to the regular filing fees of $325, and USCIS Anti-Fraud Fee of $500.
7. And, in addition to the ACWIA Education & Training Fee of $1,500 ($750 for employers with less than 25 employees).
8. The optional priority processing fee remains unchanged at $1,225.

This is obviously an appalling news for IT service companies, and you will have to discuss this with your business development professionals to see how some of this extra expense can be shared with your valuable customers. To add to the seriousness of the issue, and to the need for the discussion with your customers, Congress has made it clear that the doubling of the fees will remain law for the next ten years.

With a quota of 85,000 for the H-1B visas, and USCIS receiving three times as many applications, it gave the legislators enough hint that the demand can tolerate the doubling of the fees. The initial $2,000 fee in 2010 had no apparent impact on the demand for visas, which has been rising.

Large U.S. based companies will not be affected by these fee increases since their non-immigrant work force in the U.S. is less than 50% of their total employees. Small businesses with less than 50 employees will not be affected as well. Medium sized businesses with over 50 employees whose work force is over 50% non-immigrant will have to pay the higher fee. And, large non-U.S. based consulting companies with a majority of their work force on non-immigrant visas will be adversely affected.

If there is any good news in all these USCIS fee increases, it is that at first the Washington DC grapevine was suggesting that Congress is set to increase the H-1B and L-1 fees by $10,000.

Please note: In our practice, H-1B or L-1 petitions qualifying under this regulation that were filed on December 18, 2015 are receiving RFEs, requesting the additional fee.