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Responsibilities of the H-1B Employer

December 6, 2007

To avoid the consequences of violating immigration and DOL regulations, employers of H-1B visa holders must be prepared to take proactive steps when conditions of employment or duties of the H-1B employee materially change. With the help of legal counsel, employers can determine when the change is characterized as "material," thus requiring the filing of a new or amended petition, new labor certification, and/or payment of transportation costs to the alien's home country.

Payment of Fees

The H-1B sponsoring employer must pay three sets of fees to the government.  First, the employer must pay the standard petition filing fee of $320.  Second, the employer must pay a supplemental fee of $1,500 (or $750 if employer has 25 or fewer employees).  Primary or secondary education institutions, institutions of higher education, non-profit organizations affiliated with institutions of higher education, and non-profit organizations engaged in curriculum related clinical training of students, are exempt from paying this fee.  Finally, the employer is required to pay a $500 fraud prevention and detection fee.  If the employee is abroad, an additional visa application fee will also have to be paid at the consulate. 

Payment of Salary

Employers must begin paying wages to an H-1B employee within 30 days of entry or 60 days from becoming eligible to work for the employer (for change of status cases).  Employers may not "bench" H-1B workers or move to a decreased hours schedule due to lack of work.  The actual wage paid must be the wage provided on the Labor Condition Application, which, in turn, must be at least 100% of the prevailing wage for the position in the respective geographic area of employment.

Payment of Transportation Costs

If the employer dismisses the employee after petitioning for the visa, the employer must pay the employee for the reasonable cost of transportation back to the employee's home country.  The enforcement of this provision is regarded as a private contractual matter.  An H-1B employer will not effectuate termination until the employer offers return transportation costs to the alien's country of residence.  A recent DOL decision also underscores the importance of notifying the USCIS of an H-1B employee's termination, to effectuate a bona fide termination.

Changes Requiring a New H-1B Petition

Because H-1B approvals are location-specific, changes in worksite location will require employers to file a new or amended H-1B petition.  Further, changes in job duties to a different specialty occupation will require a new filing.  Additionally, changes in the hours of employment below the generally defined full-time 35 hour/week will require the filing of an amended H-1B petition.

Public Access File

Within one day of filing the Labor Condition Application (LCA), the H-1B employer must make available for public inspection a "public access file," which contains:

  • A copy of the completed LCA;
  • Documentation detailing the wage rate to be paid to H-1B non immigrants;
  • A full and clear explanation of the system that the employer used to set the "actual wage," such as a memorandum to the file summarizing the manner in which the wage was set, or a copy of the employer's pay system (note: payroll records are not required for public display although they must be retained for 3 years from their date of creation, for enforcement purposes);
  • A copy of the documentation used to establish the prevailing wage (which may be a general description of the source and methodology);
  •  A copy of the notice given to the union/other employees.  If notice was given directly to employees, then a hard copy of the posted notice or electronic notice must also be kept;
  • A summary of the benefits offered to U.S. workers in the same occupational classification, and a statement as to how any differentiation in benefits is made (without divulging proprietary information).

Where an employer undergoes a change in corporate structure, the file should also include:

  • a sworn statement by a responsible official of the new entity, stating that it accepts all obligations, liabilities and undertakings under the LCAs filed by the predecessor;
  • a list of each affected LCA;
  • the date of certification;
  • a description of the actual wage system; and
  • the EIN of the new employing entity.

Any such sworn statement should be completed before the H-1B employee is employed.

Where the employer utilizes the definition of "single employer" in the Internal Revenue Code, the file should also include a list of any and all entities included as part of the single employer.

Furthermore, where the employer is either H-1B dependent or a willful violator, and it indicates that an employee is exempt under 20 C.F.R. §655.737, then the file should also include a list of all such exempt H-1B employees, as well as a summary of recruitment methods used, and the time frame during which U.S. workers were recruited.