Need of 245(i)
I think 245(i) (when done before April 30,2001 or was it August 2001??) applies only to the primary applicant if he had ever been out of status. As far as the spouse is concerned, since she is a "derivate applicant" the law does not have those constraints. In other words even if the spouse had been out of status or had worked without authorization, he/she is eligible for "Adjustment of status".
Look at the following list I picked up from USCIS website about a derivative applicant's eligibility. (http://uscis.gov/graphics/howdoi/lpreligibility.htm)
Otherwise Eligible Immediate Relatives
If "otherwise eligible" to immigrate to the U.S., immediate relatives may adjust status to LPR (get a "green card") in the United States even if they may have done any of the following:
remained in the U.S. past the period of lawful admission (e.g., past the expiration date on your I-94) and filed for adjustment of status while in an unlawful status because of that,
failed otherwise to maintain lawful status and with the proper immigration documentation, or
have been admitted as a visitor without a visa under sections 212(l) or 217 of the Act (which are the 15-day admission under the Guam visa waiver program and the 90-day admission under the Visa Waiver Program, respectively).
Please note: If a person came into the U.S. illegally, that person is barred from adjusting their status to LPR (cannot obtain a green card) even if he or she marries a U.S. citizen or otherwise becomes an immediate relative. An immediate relative must meet the eligibility requirement of being “inspected and admitted or paroled into the United States.”
I think 245(i) (when done before April 30,2001 or was it August 2001??) applies only to the primary applicant if he had ever been out of status. As far as the spouse is concerned, since she is a "derivate applicant" the law does not have those constraints. In other words even if the spouse had been out of status or had worked without authorization, he/she is eligible for "Adjustment of status".
Look at the following list I picked up from USCIS website about a derivative applicant's eligibility. (http://uscis.gov/graphics/howdoi/lpreligibility.htm)
Otherwise Eligible Immediate Relatives
If "otherwise eligible" to immigrate to the U.S., immediate relatives may adjust status to LPR (get a "green card") in the United States even if they may have done any of the following:
remained in the U.S. past the period of lawful admission (e.g., past the expiration date on your I-94) and filed for adjustment of status while in an unlawful status because of that,
failed otherwise to maintain lawful status and with the proper immigration documentation, or
have been admitted as a visitor without a visa under sections 212(l) or 217 of the Act (which are the 15-day admission under the Guam visa waiver program and the 90-day admission under the Visa Waiver Program, respectively).
Please note: If a person came into the U.S. illegally, that person is barred from adjusting their status to LPR (cannot obtain a green card) even if he or she marries a U.S. citizen or otherwise becomes an immediate relative. An immediate relative must meet the eligibility requirement of being “inspected and admitted or paroled into the United States.”