Is employer eligible to sponsor my EB-2/EB-3 green card? How to determine employer’s ability to pay?
Abstract: EB-2/EB-3 employment-based immigration is an important channel among many immigrations. After the first step of the PERM certification, the USCIS will review key points in the I-140 phase: Is the employer capable of paying the promised prevailing wage to the employee in between the submission of the PERM application and the final approval for the green card. This article will focus and detail on the employer’s ability to pay, proof of the employer’s ability to pay to help the applicants successfully obtain the green card.
Recently, many of our clients have inquired about the eligibility of the employers in sponsoring the EB-2/EB-3 green card. The answer to the question is, if the employers are not able to meet the legal requirement of the ability to pay, then the employers will not be qualified to apply for the green card on behalf of the employees.
A small takeaway: The three major steps of applying for the EB-2/EB-3 employment-based green card are: PERM, I-140 petition, and I-485 application. For detailed information on the three major steps of the employment-based green card application, please read our article “How to obtain an EB-2/EB-3 employment-based green card? Overview of the three major steps.”
1. What is the employer’s ability to pay?
The ability to pay is defined as an employer files for the I-140 petition, it has to prove its ability to pay the required prevailing wage (as required from the PERM petition) from the time PERM is filed to the approval of the green card.
The principle is simple: The employer promises to pay Ming the required annual salary of $70,000 as indicated in the PERM petition, by the time Ming’s green card is approved. However, if the employer only pays Ming an annual salary of $50,000 when it submits the PERM petition, meanwhile the employer’s net income and net current assets are negative, the USCIS will not have any reason to believe that the employer will be able to fulfill the promise of paying Ming an annual salary of $70,000. In other words, USCIS will not approve the I-140 petition.
2. How to prove the employer’s ability to pay?
Real Case 1: Ming is an accountant and his employer is submitting an EB-2 green card application on Ming’s behalf. In the certified PERM 9089, the promised minimum prevailing wage was $70,000. Ming’s annual salary was $80,000 by the time PERM was submitted in 2019. In the employer’s 2018 updated tax return, it shows a net income of $15,000 and net current asset as negative.
The employer can prove its ability to pay through the following three methods:
1) The employer’s net income is equivalent to or greater than the prevailing wage.
2) The employer’s net current asset is equivalent to or greater than the prevailing wage.
3) The employer has to submit evidence proving the relationship between the beneficiary and the employer is employer-employee based, and that the employer has already started paying the PERM beneficiary the required prevailing wage by the time of its PERM submission.
In real case 1, Ming’s annual salary was $80,000 and greater than the prevailing wage of $70,000. Therefore, the employer has met the requirement of the ability to pay.
Real Case 2: All the conditions stay the same, but Ming’s annual salary changed from $80,000 to $60,000.
An annual salary of $60,000, lower than the prevailing wage of $70,000. At the same time, the employer’s net income is $15,000, which is also lower than the prevailing wage of $70,000. Whether if it’s Ming’s annual salary or the employer’s net income/net current asset, none has met the requirement set by USCIS. However, USCIS does permit the employer to combine the indicated salary on the employee’s W-2 form with the company’s net income or net current asset, and if the total amount exceeds the prevailing wage, then this can also be used to prove the employer’s ability to pay the prevailing wage.
In real case 2, Ming has an annual salary of $60,000 plus the employer’s net income of $15,000, which comes out to be a total of $75,000 and exceeds $70,000. Therefore, the employer does meet the requirement of the ability to pay.
Real case 3: All the conditions stay the same, but Ming’s salary changed from $80,000 to $50,000.
In real case 3, Ming has an annual salary of $50,000 plus the employer’s net income of $15,000, which comes out to be a total of $65,000 and less than $70,000. Therefore, the employer does not meet the requirement of the ability to pay.
3. What evidence can be used to prove the company’s net income and net current asset?
We can see from the second part that the company’s net income and net current assets play a very important role in proving its ability to pay. However, not all financial reports can be used to prove the company’s net income and net current assets. As required by the USCIS, the employers can only choose from the three following documents as using it as the initial evidence:
1) The employer’s annual report
2) The employer’s federal tax return
3) The employer’s audited financial statements
Therefore, statements such as profit/loss, cash flow, balance sheet printed from the Quickbook can not constitute direct evidence.
4. Exceptions:
Size of the company: If Ming’s company has more than 100 employees, then the company can prove its ability to pay by submitting a letter signed by the company’s financial personnel stating that the company has the ability to pay the prevailing wage. This letter can be used in lieu of the financial statements mentioned above. Note: USCIS has the sole authoritative discretion on whether it will accept this evidence.
Miscellaneous provisions: If the company is unable to prove its ability to pay with the 2 formats mentioned above, the company can consult attorneys on using alternative evidence to prove its ability to pay the prevailing wage. The alternative evidence includes the company’s profit/loss statements, the company’s bank account statements, and the employer’s personal financial statements, etc. Note: USCIS has the sole authoritative discretion on whether if the provided evidence will be deemed acceptable In other words, USCIS has the right to reject the provided evidence.
It is worth noting that all employment-based green card applications require the employer to submit proof of its ability to pay when submitting the PERM petition (and not wait until the submission of I-140) until the time the applicant obtains the green card. That is, the review of the employer’s ability to pay will not be limited only to the stage of I-140. The USCIS officer has the right to request the employer to prove that it has maintained its ability to pay at the stage of I-485.
We wish everyone the best of luck with your green card application!
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Attorney Hui Zeng is a senior partner of Zeng Law Group, PLLC in New York. Attorney Zeng was named as the annual Rising Star for three consecutive years in 2017, 2018, and 2019 by Super Lawyers magazine of Reuters. Only about 2.5% of practicing lawyers in the U.S received this honor. Attorney Zeng was also selected as 2018 Leading Women Lawyers in NYC by Crain's New York magazine.
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