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New J-1 Program Requirements Mandate Annual Audits and Reports to Department of State

Maria del Carmen Ramos

Maria del Carmen Ramos

The devil is in the details.  J-1 program sponsors need to be aware of upcoming changes by the U.S. Department of State (DOS) to the J-1 program. Specifically, beginning January 5, 2015, J-1 program sponsors will be required to (i) undergo annual management reviews of their internal controls and of a statistically valid sampling of their J nonimmigrants files by independent auditors, and (ii) file annual reports with DOS.

As background, a J-1 nonimmigrant visa is for individuals approved to participate in work-and-study based exchange visitor programs. In order to obtain a J-1 visa, an employer must be designated by DOS as a J-1 visa program sponsor or initiate an application as a host company through an approved sponsor organization.

Previously only required of Au Pair sponsors, all J-1 program sponsors will now be subject to this expanded audit requirement. The only exception to this new requirement will be in cases where the program is fully funded by federal, state, and local governments. The reason for the exception presumably is because these programs are generally audited under other government requirements.

Most of the new requirements will take effect on January 5, 2015, with certain audit requirements being rolled out over a period of time.  For example, the new mandatory health insurance coverage requirements (i.e. increase in minimum coverage to $100,000 per accident or illness , J-2 dependents being required to be covered by qualifying insurance, and mandatory termination requirement of the exchange program where J nonimmigrant fails to secure the required coverage) will not become effective until May 15, 2015.

New Compliance Obligations

Under the new regulation, J-1 program sponsors will be required to (i) maintain a list of all domestic and foreign third-parties (i.e. host organizations, immigration law firms, recruiters) with whom they have written agreements covering J program conduct; and (ii) Responsible Officers (ROs) and Alternative Responsible Officers (AROs) must be familiar with J program regulations.  Additionally, to the extent that the program has an employment component, ROs and AROs will be required to also be aware of federal, state, and local laws, including but not limited to employment laws such as the Fair Labor Standards Act.

Moreover, the new regulation mandates that ROs and AROs undergo criminal background checks prior to being designated and performing the role of officers with the background checks being renewed every four years. Additionally, ROs and AROs must be employees of the J-1 program sponsor.  Under certain circumstances (and at its discretion), DOS may accept third-parties to fulfill the role of AROs.

Additional Administrative Obligations

The requirements under the new regulation will certainly increase the administrative obligations that ROs and AROs will face when overseeing a program. Below is a list of these additional administrative obligations:

  • All categories will have to ensure the J nonimmigrant is sufficiently proficient in English
  • Any changes to the J-1 nonimmigrant’s site activity must be reported within 10 business days.
  • Any changes to J-1 nonimmigrant’s residential address, telephone number or email address must be updated in SEVIS within 10 business days of being notified.

Likewise, there are new requirements that will affect the designation and re-designation of J-1 program sponsors. Specifically, DOS will continue to conduct on-site review of program sponsors to ensure and monitor program compliance, but will no longer require that program sponsors obtain and submit Dun and Bradstreet reports.  Re-designation of J-1 program sponsors will be issued with validity periods in 1-2 year increments on a case by case basis and at the discretion of DOS.  Finally, re-designation requests must be filed within 6 months and no later than 3 months after expiration.  The J program, however, may continue to operate until DOS issues a decision on the re-designation request.

As a result, compliance with these new J-1 program requirements most likely will present a sizeable administrative and financial burden to J-1 program sponsors.  J-1 program sponsors with questions should consult with an immigration attorney to determine how the new changes to the J-1 program affects them.

For more information, please contact Maria del Carmen Ramos at 813.227.2252 or mramos@slk-law.com.

 

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