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For years, the Adjustment of Status (AOS) process was seen as the standard, predictable final lap for international employees on their way to a green card. If your employee was eligible and had followed the rules, the approval was largely considered a formality.
On May 21, 2026, U.S. Citizenship and Immigration Services (USCIS) released a landmark policy memorandum, PM-602-0199, that fundamentally rewrites the rules of the game. If you are an employer sponsoring foreign talent, you can no longer view AOS as a "routine" step. USCIS is now framing this process as an "extraordinary relief" and a "matter of administrative grace."
This isn't just a change in paperwork, it’s a shift in how the government views your employees' right to stay in the country. At Badmus & Associates, we believe it is critical for you to understand the "bigger picture" of this policy shift so you can protect your workforce and your business operations.
The Big Shift: Is Adjustment of Status Still a "Right"?
Technically, it never was a "right" in the strictest legal sense, but for decades, it was treated as one. If an applicant met the statutory requirements under Section 245(a) of the Immigration and Nationality Act, USCIS almost always granted the green card.
Under the new May 21 memo, USCIS is doubling down on the idea that statutory eligibility is not enough. The agency now asserts that Congress intended most nonimmigrants to depart the U.S. and undergo consular processing (applying for their green card at an embassy abroad) rather than adjusting their status from within the United States.
What does this mean for you? It means USCIS now views AOS as an "exceptional" alternative. They are instructing their officers to treat every application with a high level of discretionary scrutiny. In simple terms: even if your employee does everything right, USCIS is claiming the power to say "no" just because they feel like it.
Who is affected?
📢 Every employer with sponsored workers currently in the U.S. is affected.
Whether you are sponsoring an H-1B engineer, an O-1 researcher, or an L-1 executive, the path to their permanent residency just became much more volatile. The memo specifically targets anyone seeking to "dispense with the ordinary consular visa process."
While certain "dual-intent" categories like H-1B and L-1 visas are still legally permitted to seek a green card while working, this new policy allows officers to look for any excuse to deny the AOS application based on "discretion."
The Discretionary Trap: What Counts as a "Negative Factor"?
The core of the new memo is a "weighing of factors." Officers must now balance positive equities against negative factors to decide if an applicant is "suitable" for permanent residence.
Here is where it gets dangerous for your employees. USCIS has expanded what they consider "negative factors" to include minor, often unintentional violations that were previously overlooked or forgiven. These include:
- Unauthorized employment: Even a few days of work before a status was officially updated.
- Minor overstays: Falling out of status for a short period due to administrative delays.
- Failure to maintain status: Any gap in the rigid maintenance of a nonimmigrant visa.
- Inconsistent intent: If an employee entered on a B-1/B-2 visitor visa and then quickly filed for AOS, USCIS may now label this as "misrepresenting the purpose of travel."
If your employee has any of these in their history, they may now be required to show "unusual or even outstanding equities": like extreme hardship to a U.S. citizen family member: to get their green card approved. For many employment-based applicants, these "outstanding equities" are hard to prove.
Consular Processing vs. AOS: A Business Risky Move
By reframing AOS as "extraordinary," USCIS is effectively pushing more people toward consular processing. This means instead of staying in the U.S. to wait for their green card, your employee would have to travel back to their home country for an interview at a U.S. embassy.
From a business perspective, this can be a nightmare. Consular processing introduces:
- Travel Risks: Once an employee leaves the U.S., there is no guarantee they will be allowed back in. If a consular officer denies the visa or places the case in "administrative processing," your employee could be stuck abroad for months.
- Business Disruption: Losing a key team member to a months-long visa delay can stall projects and cost thousands in lost productivity.
- Uncertainty: Unlike AOS, where the employee can stay and work with an EAD (Employment Authorization Document), consular processing leaves the employee (and the employer) at the mercy of unpredictable embassy schedules.
You must plan as though AOS is no longer a guaranteed safety net.
Strategic Business Impact: What You Need to Do Now
As an employer, you are the backbone of your employees' immigration journey. This policy shift requires you to be more proactive than ever.
We expect a significant surge in Requests for Evidence (RFEs). USCIS will likely ask for more documentation to justify why the applicant "deserves" the administrative grace of an adjustment of status. You must be prepared to provide detailed support letters emphasizing the employee's critical role in your company and the "best interests of the United States."
The Legal Conflict: Will This Hold Up in Court?
It is important to note that many legal experts believe this memo oversteps USCIS's authority. Section 245(a) was specifically created by Congress to keep families together and prevent business disruption by allowing people to stay in the U.S. while finishing their immigration process.
By calling it "extraordinary relief," USCIS is attempting to rewrite the legislative intent of the law. We expect this policy to face immediate challenges in federal court. However, until a judge issues an injunction, this policy is already in effect. You cannot wait for the courts to fix this; you must adapt your strategy today.
Summary Checklist for Employers:
- Review all current sponsored employees' status for any potential "negative factors."
- Prepare for longer green card processing times and higher RFE rates.
- Re-evaluate the risks of travel for employees with pending AOS applications.
- Consult with your immigration attorney before making any changes to an employee's job duties or location.
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