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H1B extension pending i94 expired, valid i140

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My employer filed for my H1B extension in the 7th year basis an approved i140 with the same employer few days before the i94 expired.

The application is still pending and I have not received any RFE. It is now pending for 7.5 months with barely 10 days left for 240 days. My employer says the 240 day rule does not apply as i benefit from the portability act and I can continue working till as long as the application is in pending status. 

The employer also advises against premium processing as it may require me to come off my current job to go for stamping. 

My questions are as follows;

1. Does the 240 day rule apply and should I be premium processing my application?

2. If the application approves without i94, do I have to come off the project and go for stamping or can I take unpaid leave get stamping done and rejoin the project. 

3. What happens if the decision takes longer, can I continue to work while the application is pending?

4. What is the general trend on current processing times. Is it normal for it to take this long?

Please advise.

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