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Can Your Employer Afford You? How USCIS Tests “Ability to Pay” in I-140 Petitions

Perplexity ChatGPT Claude Gemini
Can Your Employer Afford You? How USCIS Tests “Ability to Pay” in I-140 Petitions

The road to a green card runs through a question that has nothing to do with their own résumé: can the sponsoring employer actually afford to pay them? U.S. Citizenship and Immigration Services (USCIS) asks that question in nearly every employer-sponsored case, and a company’s finances can sink a petition even when the worker is fully qualified. The rule is old, but the details of how USCIS applies it still catch employers off guard. Here, our EB-1A consultants have analyzed what factors contribute to this most important litmus test.

Where the test sits

In a usual employment-based green card case, the second of three stages is the employer’s Form I-140, Immigrant Petition for Alien Worker. At this stage, the sponsoring employer must demonstrate its ability to pay the wage offered. According to Murthy Law Firm, the requirement can be a challenging element in some petitions.

The measuring point is the “priority date.” In a PERM-based case, USCIS expects the employer to show it could pay the offered wage as of the date the labor certification was filed. Another practitioner describes the rule as running from whichever came first, the labor certification or the I-140, since some petitions have no labor certification.

Three ways an applicant can prove it

The easiest proof is the worker’s own paycheck. If the employer has paid the sponsored worker at least the offered wage since the priority date, W-2s and pay stubs generally settle the matter. Not required, but typically sufficient, Murthy notes. Lippes Mathias, citing the USCIS Policy Manual, says such evidence counts as “prima facie proof of the petitioner’s ability to pay the proffered wage”.

If the worker was paid less, or not at all, USCIS looks next at the company’s tax returns, annual reports or audited financial statements. The employer can show either net income or net current assets at least equal to the offered wage, or at least equal to the difference between the offered wage and what it actually paid.

Net current assets are current assets minus current liabilities, which is roughly the company’s working capital. Capitol Immigration Law Group notes that on a corporate return these are drawn from Schedule L. USCIS and the courts have consistently rejected gross income, regardless of amount, as relevant. Only net income counts, according to Olender Immigration. The agency’s standard operating procedure also describes audited financial statements as a reliable form of evidence.

The clock does not stop at the I-140

One surprise for employers is how long the obligation lasts. Murthy explains that the ATP requirement continues until the worker receives permanent resident status. USCIS usually raises the question at the I-140 stage, but it is technically permitted to ask for evidence later, when a case is at the I-485 stage.

A policy alert USCIS published on March 15, 2023 repeated and clarified how this works. BizLegalServices summarizes that the employer must keep net income or net current assets sufficient to cover the full offered wage every year until the worker has an approved I-485 or the petition is canceled. If a worker joins the company mid-year, the wage is prorated, and USCIS will need proof for only the remaining part of that year. The alert also says USCIS may confirm ability to pay in some cases even when current finances alone would not support the wage.

When a bad year can cost a petition

The test is unforgiving about weak years. Murthy warns that complications can arise if the employer suffers “a single bad year financially” within the period USCIS reviews. A company that earns a modest profit, but not quite enough to clearly cover the offered wage, can face problems and denials as well.

A USCIS Administrative Appeals Office decision shows how the numbers play out. It involved an offered wage of $156,520. The employer’s 2010 tax return showed a net loss of $6,801 and net current assets of $15,456. USCIS held that the company had not established its continuing ability to pay from the priority date onward.

Sponsoring many workers

Employers that file many petitions face an extra burden. Murthy says that when an employer has a large number of I-140s relative to its size and financial strength, USCIS commonly asks for its ability to pay all sponsored workers. The appeals office has taken the same view in non-precedent decisions: the petitioner must show it can pay the combined offered wages of all its pending beneficiaries. Petitions that were withdrawn or no longer pending are not counted.

Arguments that can help

Practitioners say there is room to argue when the numbers fall short. Capitol Immigration Law Group reports that its office has successfully combined the salary actually paid with net income or net current assets to show the wage could be met, even though USCIS guidance does not clearly spell this out. Another firm has used a parent company’s tax returns, showing positive net income and net current assets, to support a subsidiary’s petition. It also excluded amounts owed to affiliated companies from net current assets when calculating liquidity. Murthy adds that success in these cases depends on the facts and that uncertainty about the financial documents calls for review by an experienced immigration attorney.

A note on the sources

The Murthy article was first published on November 22, 2016, and the firm’s disclaimer says its information should not be presumed up to date. The 2023 policy alert and the practitioner guidance described above reflect later developments. The material here is general information and not legal advice.

Takeaway

Murthy’s advice is to deal with ability-to-pay issues up front, before filing rather than after a request for evidence. Employers should review their finances against the offered wage before filing, and keep paying, and documenting, the wage until the green card is in hand.

At GCEB1, our EB-1A experts regularly publish seasoned analysis and discussion to guide the aspirants better. Get in touch with us to get personalized mentorship on legal immigration. We wish you a safe and stress free immigration journey ahead.

Frequently Asked Questions

1. What is “ability to pay”?

It is the requirement that a sponsoring employer show it can pay the offered wage to the foreign worker.

2. When does the obligation begin?

Generally on the priority date, which is the labor certification filing date in PERM-based cases.

3. How can an employer prove it?

Through pay records showing the worker was paid the offered wage, or through tax returns, annual reports or audited financial statements.

4. What if the worker is already being paid the full wage?

W-2s and pay stubs showing that are typically sufficient proof.

5. What are net income and net current assets?

Net income is income after expenses. Net current assets are current assets minus current liabilities.

6. Does gross revenue count?

No. USCIS and the courts have rejected gross income as relevant.

7. How long does the requirement last?

Until the worker is granted permanent residence, according to Murthy Law Firm.

8. What if the employer sponsors many workers?

USCIS may ask for proof that it can pay all of them, not just one.

9. Can one bad year cause a denial?

Yes. Murthy says even a single bad year can create complications. Other arguments may still help.

Sources & further readings

 

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