Although providing some "flexibility" to employers for time to respond to requests for additional evidence in connection with petitions and applications in process, United States Citizenship and Immigration Services (USCIS) is still holding steadfast in the application of its rules and regulations – little has ultimately changed. So where does an employer stand in this COVID-19 world if it needs - reluctantly or not – to reduce salaries, change full-time employees to part-time ones, or furlough or even lay off its temporary foreign workers?
Ultimately, the answer depends on the type of temporary work visa that a foreign worker holds, with the H-1B visa being the most problematic for employers. The answer also depends on the particular change in employment terms that is being made.
Reductions in Salary
One strategy for employers to reduce costs in these coronavirus times is to lower salaries. As part of the H-1B petition process, the H-1B employer must first attest to the Department of Labor (DOL) that it will pay the "required" wage.[1] The attestation is contained in the Labor Condition Application (LCA) that an H-1B employer must file with DOL, and which DOL must first certify before the employer can file its H-1B petition. The certified LCA is one of the documents sent to USCIS with the H-1B petition. The petition also includes a representation that the employer will pay the specific salary or wages set forth in the H-1B petition and in the LCA. As a result, a reduction in the H-1B worker’s salary reduced below the "required" wage as set forth in the LCA will require the filing of a new LCA, which, in turn, will necessitate the need for the employer to file an amended or a new H-1B visa petition to provide for the change in terms of the H-1B employment.
The rules that apply to H-1B workers do not all apply to temporary foreign workers employed on other temporary worker visas, such as L (intracompany transferees) and O (extraordinary ability) visas. As long as any changes in the terms and conditions of employment do not affect eligibility for the underlying visas, employers of O and L visa holders usually need do no more. A mere reduction in salary, although a change in the terms of employment, does not necessarily affect the underlying eligibility for an O or L visa. Unlike the H-1B visa, there is no obligation to pay a certain wage.
Full-Time to Part-Time Employment
The work hours of some H-1B workers are being reduced in order to save the employer costs in these times of national emergency. A change in the hours worked by an H-1B employee are material changes in employment as originally described in the employer’s LCA certified by DOL and in the H-1B petition as approved by USCIS. The change from part-time to full-time employment will require a new LCA; if a new LCA is required, the employer must file an amended or new H-1B visa petition. Accordingly, before transitioning an H-1B worker from full-time to part-time employment, the employer must file an amendment to its H-1B petition for the foreign national.
A change in the terms and conditions of employment from full to part-time is a material change that could affect the underlying eligibility for the visa. Accordingly, employers of L and O visa workers will also be required to file an amended visa petition before being able to reduce working hours to part-time employment.
Furloughs
An H-1B employer is not permitted to furlough an H-1B worker by suspending employment, or otherwise putting the employee in non-productive status (often termed "benching") due to the pandemic. DOL regulations require the H-1B employer to continue to pay the required wage – the wage set forth in the LCA certified by DOL and in the H-1B petition filed with USCIS – for any unproductive time that is imposed on the H-1B worker by the employer. Penalties for failing to continue to pay the H-1B employee’s salary include the award of back-wages, and fines, among other things. It can also affect a company’s ability to hire foreign workers in the future.[2]
If the employment upon which the underlying visa petition was approved ceases, as in the case when an employer suspends employment, or otherwise furloughs workers, then, unlike the H-1B employer, the employer of an L or O worker is not required to continue paying the salary of the foreign employee. There is no LCA involved in the processing of the L and O nonimmigrant visa categories and so no requirement that the "required" wage be paid.
Even so, employers of O visa workers who are furloughed must "immediately notify" USCIS and explain the change in the terms and conditions of employment. Employers of L visa holders have it a little easier – there is no absolute requirement to inform USCIS of a suspension of employment or furlough.
Lay-Offs
In the event of a lay-off, an H-1B employer is still going to be on the hook to pay the H-1B worker’s salary unless it (i) notifies USCIS of the termination of employment, and (ii) withdraws the certified LCA that was included in the documentation filed with USCIS in support of the H-1B petition. In addition, an H-1B employer is required to pay the cost of return transport home when it terminates an H-1B worker’s employment. DOL investigations and case law dictate that the employer’s obligation to pay an H-1B employee his/her salary does not end until all three obligations have been completed – notice to DOL, notice to USCIS, and payment for return transport home.
Not so with most other temporary worker visas, which have no LCA obligations. As with furloughs, an employer laying off O visa workers must "immediately notify" USCIS to explain the change in the terms and conditions of employment, while those employers laying off L visa holders have no formal obligation to inform USCIS of the termination of employment. Like H-1B employers, however, an employer of a O-1 visa holder is obligated to pay the cost of return transport home when it terminates an O-1s worker’s employment.
Further Food for Thought
It is easy to think that in this COVID-19 world USCIS will be understanding of any failure by an employer to comply with Immigration requirements – deadlines, amendments, employment commencement, and I-9 compliance requirements, to name a few. However, employers should not let themselves be lulled into a false sense of security; absolute and strict compliance with the immigration laws is still required. With no change in the underlying criteria to qualify for and maintain proper immigration status, and in the immigration environment of strict compliance notwithstanding the coronavirus world, it behooves employers to take a conservative approach to the treatment of their foreign workers.
COVID-19 is a moving target. The Immigration World is constantly changing as a result. Legal issues are arising daily. Rest assured that we at GrayRobinson are closely monitoring the impact of the pandemic and are responding to all immigration and other issues affecting our clients as they arise. We are here to help; let us know if you need us.
[1] The "required wage is the higher of the "prevailing" wage (as determined by DOL) or the wage that the employer pays to similarly situated workers within the area of intended employment.
[2] Although beyond the scope of this brief article, an employer could also face a dilemma when continuing to pay its H-1B workers, while cutting salaries of its domestic workforce during a furlough. Claims of discrimination might result if H-1B workers are treated better than U.S. employees.