Must-Know Facts About H-1B Cap-Exempt Employers
Breaking Update: A new policy has introduced a $100,000 fee for new H-1B petitions. While this change will affect many employers and foreign professionals, there are important exclusions and strategies available. At Green Card Link, its immigration attorneys explain what you need to know and how to best navigate these changes.
The H-1B cap-exempt employer category plays a critical role in helping highly skilled foreign professionals secure work authorization without being subject to the lottery. Institutions that fall under this category include colleges and universities, nonprofit research organizations, and government research entities. These employers enjoy a key advantage—they are not limited by annual numerical quotas or forced to compete against large corporations for the limited number of visas available.
Unlike the general H-1B program, which is capped at 65,000 visas per year (plus 20,000 for advanced degree holders), the H-1B cap-exempt route has no fixed quota. In this guide, our immigration attorneys at Green Card Link provide an in-depth look at H-1B cap exemptions, eligibility, employer types, and strategies to improve your chances of success.
What Are Cap-Exempt Employers?
Each year, USCIS conducts the H-1B lottery to randomly select 85,000 registrations:
- 65,000 under the regular cap
- 20,000 under the master’s cap (for advanced U.S. degree holders)
However, cap-exempt employers do not have to compete in this process. This means they can file H-1B petitions year-round without being restricted by lottery deadlines or annual caps.
USCIS Recognizes the Following as H-1B Cap-Exempt Employers:
- Accredited institutions of higher education (colleges or universities)
- Nonprofit organizations affiliated with a higher education institution
- Nonprofit research organizations
- Government research organizations
In addition, certain foreign nationals who previously held H-1B status within the past six years and have not exhausted their maximum stay may qualify for cap-exempt petitions when changing employers. However, applicants must prove their lawful status within that timeframe.
Example of Cap-Exempt Eligibility
Consider an applicant who worked on H-1B status between 2013 and 2016. Because more than six years have passed without maintaining H-1B status, they would not qualify for a cap-exempt petition and would need to enter the lottery again.
H-1B Lottery Overview
Due to high demand, USCIS relies on a lottery system to distribute the limited annual H-1B visas. Here’s how the 85,000 slots break down:
- 65,000 visas under the regular cap
- 20,000 visas under the advanced degree exemption
- 6,800 visas reserved under the H-1B1 program (Chile and Singapore)
Petitions not selected are returned with refunded filing fees. Because of this uncertainty, many foreign professionals strategically seek employment with cap-exempt employers to avoid the lottery altogether.
Higher Education Institutions (Cap-Exempt)
To qualify, the institution must:
- Be accredited and authorized by the state
- Admit students who have completed secondary education
- Operate as a public or nonprofit institution
- Award bachelor’s or higher degrees
These institutions often include universities, affiliated hospitals, and research centers.
Nonprofit Organizations Affiliated with Higher Education
To qualify for cap exemption, the nonprofit must:
- Be a legally recognized nonprofit entity
- Have a formal affiliation agreement with a college or university
- Share ownership, board control, or a direct connection with the institution
Note: General nonprofits (such as community service, policy, or arts organizations) typically do not qualify unless formally affiliated with higher education institutions.
Nonprofit and Government Research Organizations
Cap-exempt status also applies to:
- Nonprofit research organizations conducting applied or basic research
- Government research entities focused on advancing knowledge in sciences, social sciences, or humanities
USCIS defines basic research as advancing knowledge without commercial objectives, while applied research focuses on practical outcomes and innovations.
Cap-Exempt Employers and Job Roles
Cap-exempt employment is not limited to teaching or academic positions. For example:
- Universities often hire in IT, finance, and administration
- Medical centers affiliated with universities frequently sponsor healthcare professionals
- Research labs recruit scientists, analysts, and technical staff
At Green Card Link, its immigration attorneys regularly assist professionals in identifying and applying for these opportunities.
USCIS Clarifications on Cap Exemptions
Even if you are not directly employed by a qualifying cap-exempt institution, you may still qualify if your work directly supports the mission of such an employer. However, proving this connection can be complex, and petitions may trigger a Request for Evidence (RFE).
Client Success Story
Our immigration attorneys at Green Card Link successfully represented a foreign professional with multiple advanced degrees hired by a nonprofit organization. Although USCIS initially issued an RFE questioning whether the position qualified as a specialty occupation, our team documented how the applicant’s daily responsibilities required specialized expertise. The petition was ultimately approved, allowing the client to begin work in the U.S.
Finding the Right H-1B Cap-Exempt Employer
Searching for cap-exempt opportunities requires caution. Applicants should rely on verified H-1B employer databases and ensure the organization meets USCIS definitions. Simply claiming to be “cap-exempt” is not enough—documentation and compliance are key.
At Green Card Link, its immigration attorneys help professionals assess eligibility, prepare strong petitions, and connect with legitimate H-1B cap-exempt employers.
Benefits of H-1B Cap-Exempt Filing
When it comes to the H-1B visa, many applicants worry about quotas and deadlines. Fortunately, if you qualify for a cap-exempt employer, you are not restricted by these limits. This option provides significant advantages, especially for professionals going through the H-1B process for the first time. By working for a cap-exempt employer, you can avoid the annual lottery and filing deadlines while also retaining the ability to later transfer to another cap-exempt organization.
What Does H-1B Cap-Exempt Mean?
If you are already on H-1B status, you won’t be counted against the cap again. This means you can extend your stay in the U.S., change the terms of your employment, or transfer to another employer more easily.
However, if you are employed by a cap-exempt organization and later want to move to a cap-subject employer, you must wait for the next H-1B lottery. You cannot begin working for the new employer until the petition is approved. This is why it’s important to carefully plan your career path when moving between cap-exempt and cap-subject positions.
Transferring From Cap-Exempt to Cap-Subject Employment
Some applicants consider accepting a cap-exempt position with the intention of later transferring to a cap-subject employer. While this may appear to be a shortcut, the reality is that you cannot bypass the lottery.
If you have never worked for a cap-subject employer before, your new cap-subject employer must file a Form I-129 petition on your behalf, which is subject to the annual lottery. This means you will need to compete for one of the limited H-1B visa numbers available.
There is no way around the quota system if your ultimate goal is to work for a cap-subject employer.
Key Advantages of Cap-Exempt Employers
- No annual caps or quotas
- No predetermined filing deadlines
- No predetermined start dates for employment
At Green Card Link, its immigration attorneys frequently receive questions from individuals seeking to switch from cap-exempt to cap-subject employers. It’s critical to understand that making this switch will subject you to the lottery system. If the quota is already exhausted, you must wait until the next filing season, and there is no guarantee of selection.
Premium Processing: Does It Make You Cap-Exempt?
A common misconception is that paying the premium processing fee makes an applicant exempt from the H-1B cap. This is incorrect. Premium processing simply accelerates USCIS’s review of your petition—it does not guarantee a lottery spot or alter your October 1st employment start date.
Before opting for premium processing, consult with an immigration attorney at Green Card Link to determine whether it makes sense for your specific case.
Frequently Asked Questions About H-1B Cap-Exempt Employers
What is a cap-exempt employer?
A cap-exempt employer is an organization not subject to the H-1B visa cap. These include universities, nonprofit research institutions, and government research organizations.
Who qualifies as cap-exempt?
Examples include accredited higher education institutions, nonprofit entities related to higher education, and nonprofit or government research organizations.
Are all jobs at cap-exempt employers eligible?
No. The position itself must qualify as a “specialty occupation” requiring at least a bachelor’s degree or equivalent.
Can cap-exempt employers hire indefinitely?
While they can file H-1B petitions without regard to the cap, they must still meet USCIS requirements for each case.
Can H-1B workers transfer from cap-exempt to cap-subject employers?
Yes, but they must go through the H-1B lottery system and are not permitted to start work until the petition is approved.
Can cap-exempt employers sponsor foreign graduates of U.S. universities?
Yes, if the position qualifies as a specialty occupation, universities and research organizations can sponsor these graduates directly.
Do cap-exempt employers pay the same fees?
Yes, filing fees still apply, including the base fee, ACWIA fee, and fraud prevention fee.
Is there a limit to how many workers a cap-exempt employer can hire?
No numerical limit exists, but all petitions must meet USCIS eligibility standards.
Final Thoughts on H-1B Cap-Exempt Employers
For many professionals, securing an H-1B visa through a cap-exempt employer is a smart strategy. Universities, nonprofit organizations, and research institutions can often process cases more quickly and without the uncertainty of the lottery.
That said, if the employer is a smaller or lesser-known nonprofit, preparing a thorough petition may take more time to ensure compliance with USCIS requirements. Regardless, cap-exempt H-1B petitions offer unique flexibility: no annual quotas, no fixed deadlines, and no restrictions on start dates.
At Green Card Link, its immigration attorneys are ready to guide you through the process—whether you’re pursuing a cap-exempt petition, considering a transfer, or planning your long-term path to working in the U.S.