F1 to H1 B with Dependents - Oct 1st automatic COS?

Hi experts,
I have a concern on my current visa status with work permit and my dependent’s status as well.
Here is my details:
My Visa on the passport is F1 (International Student) it expires by Dec-2020.
I have my wife and son as dependents since December 2018 in the US with F2 (Dependent of International Student) Visa on the passport.
My employer filed an H1B petition (April 2019) and it got approved and they passed I-797B to me beginning of October 2019.
Soon after this, my University informed me that my visa status changed (“Change of Status”) and my SEVIS record has been updated and I am no longer an International student.

My employer and Immigration lawyer (who worked on this) asking me to continue my studies as a foreign student until I go to my home country and get an H1B visa stamped in my passport for work authorization.
My school says they can’t make me again as an international student because of the SEVIS record already updated (“Change of Status”).

I am very confused right now, I need help to see what exactly I should do, to continue work. Is I-797B allow me to work? If not, how may I get work authorization? Change of status doesn’t mean I could work until I go to the home country, attend a visa interview, and get my Visa stamped?

Thanks in Advance.

@titto.thomas, your status changed technically on October 1st, so you are no longer a student.
Your school is right, you cannot go back to school now as your status has changed…You need to again apply for Change of Status to F1. As you are already on H1B status, you need to prove that you maintained status, which you did not as you did not work for them…

To avoid issues, the best recommendation at this point is to exit the country and get stamping in your home country and return back.
As you are not working for your current company, technically you have not maintained status, also your family also would be the same as they are tied to you. So, talk to your new company’s attorney and seek guidance and leave immediately. Alternatively, talk to another attorney and get this sorted out…If you stay long you are going to be in more trouble with status…
It is not your mistake, many are not aware of the realities of COS and get in this trap…so, do not panic…talk to your attorney or another attorney and then leave the country soon.
Do post your update after you made decision here for community benefit.

Thanks for the response Kumar.
I was working using my CPT from current school and for current employer since 2017. I never changed my employer and the same employer filed for H1. I have no plans to change the employer in the near future. My F1 Visa stamped for another one more year. So when should I go to home country and stamp my H1 visa? I assume Change of Status will allow me to work. Will that be legal to work here in the USA with “Change of Status” without going to home country and stamp H1 visa? What will be my dependants status now?

You have been working for over a year on CPT ?

Yes, I was working for same employer, with CPT since March 2018.

Well, I am not sure, how you can work for over 1 year of full time CPT…The Day 1 CPT schools and all of these schools that give CPT like that are subject to extra scrutiny. In any case, you are on H1B now, and you are in a very tricky situation…so, discuss with your employer’s attorney and then take a decision.