We received a number of questions regarding layoffs and layoff issues during and following our recent seminar, "Immigration in an Uncertain Economy," so felt this would be a helpful focus for this issue's Q&A. Please keep in mind, however, that these answers are necessarily generic, and we would strongly urge you to contact your immigration counsel if your company may be considering layoffs of foreign national workers. Q: As an employer, what are my obligations if the company lays off an H-1B employee?
If your company lays off an H-1B employee, the company must take certain actions to formally terminate the employment. When your company sponsors someone for an H-1B, you sign a Labor Condition Application (LCA) that is certified by the Department of Labor (DOL). That LCA carries with it a number of obligations that the employer is required to fulfill as long as there is an employee working in H-1B status under that LCA. In particular, the company is required to continue to pay the employee the higher of the prevailing wage or the actual wage. In order for these payroll obligations to cease, the employer must successfully terminate the employment relationship with the H-1B worker.
To effectuate this termination, the company must take the following actions:
(1) Notify the H-1B worker, in writing, that the employment relationship has, or will, cease as of a specific date. The H-1B worker should sign this statement, and a copy should be give to the worker for his or her records. The original signed statement should remain in the employee's Public Access File.
(2) Notify USCIS that the employment relationship has ended, and ask that the H-1B petition be withdrawn. This notification should take the form of a letter sent to the Service Center that approved the H-1B petition. If possible, this letter should be dated and sent on the date of termination. A copy of this letter should be kept in the employee's Public Access File.
(3) Offer to pay for the return transportation of the H-1B worker to the country of his or her last residence. This offer should also be made in writing and can be combined with the termination notice described above. It is important to note that this offer is limited. For example, the company is only required to pay the transportation costs of the H-1B worker, not of any H-4 dependent family members. Furthermore, the transportation need only be one-way, and does not need to be to the H-1B worker's home country, but may be to the country of last residence. Furthermore, it is acceptable to create reasonable parameters around this offer. For example, the company could offer to provide reimbursement of a one-way coach ticket to the country of last residence, for the H-1B worker only, as long as the receipt is presented to the company within a set period of time after termination. Another option would be to require the H-1B worker to go through the company travel agency when making his or her arrangements. Please note that the law does not require these limitations and, should the company choose, it can offer a broader transportation benefit. Q: I've heard that, if the company is laying off employees, I can offer to put an H-1B employee on a temporary leave of absence instead of laying him or her off immediately. Is this true? If so, why would I do this?
Often employers going through a period of layoffs would like to create an arrangement that serves to lessen the harsh affect of the immigration laws on an H-1B worker. According to the law, as soon as the employment relationship is terminated the H-1B worker is considered out of status and no longer has a legal basis for remaining in the United States. The law does not provide a grace period when an individual's employment terminates, voluntarily or involuntarily, before the authorized period of H-1B validity expires. Furthermore, the law is clear that a severance period is not considered to be an extension of the employment relationship and, therefore, does not offer the H-1B worker any legal protection. In light of this, employers may consider entering into an arrangement that prolongs the employment relationship to delay the negative immigration consequences of the layoff. At the employee's request, the company generally may be able to allow the H-1B worker to go on a temporary leave of absence, administrative leave, or some other short-term option as long as the arrangement follows the company's existing procedures regarding these arrangements and is in compliance with state employment law. These arrangements may prolong the employment relationship if the employee remains "on the books" as an employee throughout this time. It is very important that you discuss any potential relationship with us so that we can advise you in this area. Q: I recently heard from a recruiter that they want to hire someone who was working on an H-1B visa but was laid off by their former employer. Can we hire the person? Will this be a more complicated case than usual?
Yes, you can hire someone who was working on an H-1B visa but has been laid off. Depending on a number of factors, this may be a more complicated case or it may be relatively straightforward.
As you may be aware, if you file an H-1B petition for someone who is currently in H-1B status, that person qualifies for two benefits: (1) H-1B portability, which allows the H-1B worker to begin working for you immediately after your company files an H-1B petition on the employee's behalf; and (2) an extension of the worker's H-1B status. Once an H-1B petition requesting an extension of stay is approved the worker can continue to stay and work in the United States in H-1B status without taking any other action.
If you hire a worker who has already ceased working with his or her previous employer, he or she is no longer in H-1B status. If your company hires the worker and files an H-1B petition on his or her behalf, that worker may
be eligible for H-1B portability but may not
be eligible for an H-1B extension. In effect, although it may be possible to request an extension of status, in which case the H-1B worker would be eligible to begin working for your company immediately upon filing the H-1B petition, the H-1B petition that is approved by USCIS might refuse the extension request. In that event, the worker will have to immediately cease working for your company, leave the United States, and reenter in H-1B status in order to "activate" his or her new H-1B status. If the worker already has a valid H-1B visa stamp in his or her passport, or is Canadian and does not need a visa stamp, the employee might take a short trip to the border and very easily return to work in H-1B status. If, however, the worker will have to apply for an H-1B visa stamp at a U.S. Consulate abroad prior to reentering the United States, the trip will take longer, particularly if the employee encounters delays in issuance of the visa stamp due to security clearance or other issues.
It is important to note that USCIS can exercise its discretion in favor of granting an extension of H-1B status in situations where the worker has been unemployed for less than 30 days before the filing of the new H-1B petition. If this were to happen, the H-1B worker would not have to leave the country, but could continue to stay and work for your company in H-1B status. Q: My company recently made an offer to a foreign national who has an EAD card based on a pending permanent residence application from his previous employer. Can we keep employing him on the EAD, or is there something else that we need to do?
If a candidate has a facially valid EAD card, you can use that EAD card to complete his or her I-9 form and he or she can begin working for you immediately, without taking any additional action. You should remember that if an employee presents you with documents that are sufficient to complete the I-9, you cannot ask for additional or alternative documents. However, if a candidate brings to your attention his or her immigration background, and the basis for the EAD card, it is in your best interest to make an assessment during the pre-employment stage as to the company's ability to continue to employ the candidate in the future.
According to The American Competitiveness in the 21st Century Act (AC21) and subsequent guidance, a foreign national is "portable" (in other words, eligible for a green card) and, therefore, can change positions and/or employers if the following are true:
(1) the I-140 petition is approved or was approvable when filed;
(2) the I-485 application has been pending for 180 days or more; and
(3) the foreign national will be moving to a position that is in the same or similar job classification as the job for which the application was originally filed.
In order to make a comprehensive assessment of the applicability of the portability provisions to your potential hire, you would need to see copies of the I-140 Receipt and/or Approval Notice, the I-485 Receipt Notice, and the underlying Labor Certification or, if filed in the EB1 category, I-140 petition.
If the candidate is portable, he or she can work for you using his or her EAD card, and can continue to apply for renewals of the EAD card until the I-485 is adjudicated. It is possible that USCIS, prior to approval of the I-485, will send a Request for Evidence to the applicant and his or her attorney requesting current employment information. At that time, the applicant would provide the necessary evidence, including a letter from your company, to show that he or she qualified for portability prior to the commencement of employment with your company. Q: As with so many companies in this economy, my firm is starting to consider layoffs, but we also have a few valued foreign national employees that we want to keep on staff and start the permanent residence process for. What impact will the failing economy have on the PERM portion of the permanent residence process?
There are several ways in which the slower economy may affect the permanent residence process, the most concrete of which is the Department of Labor's (DOL) rules regarding the filing of PERM applications. According to DOL regulations, if your company has had a layoff in the area of intended employment within six months of filing a PERM application in a related occupation, the company must document that it has notified and considered all potentially qualified laid off U.S. workers of the job opportunity listed on the PERM application, and must document the results of the notification. The only other alternative to the notification requirement outlined above is to wait for six months after the layoff to file the PERM application.
If your company has experienced layoffs or is planning for layoffs in the future, it is very important to discuss the situation with us prior to initiating the PERM process for any employee. We will work with you to determine if the layoff is "in the area of intended employment" and is for "related occupations" and, therefore, triggers the notification requirement. It is important to note that DOL has indicated that it will be utilizing information it has at its disposal regarding layoffs, so this analysis must be undertaken carefully and in good faith.
DOL also has mechanisms in place to determine if a filed PERM case was based on a bona fide job offer, if the employer advertised to meet DOL regulations, and if any resulting applicants were adequately considered for the job. These mechanisms will be used more freely by DOL in a slower economy. Specifically, DOL can use its audit function to request underlying documentation for any PERM case. While DOL has, and will continue to, conduct random audits, the audit function can also be used to allow DOL greater scrutiny of cases filed shortly after a layoff or of cases filed by companies working in an industry where there have been industry-wide layoffs. In addition, DOL has been making increasing use of its supervised recruitment function. If a case is designated for supervised recruitment, the employer will be required to work directly with the Certifying DOL Officer to re-recruit for the position. Supervised recruitment can be required for a single case or, if DOL mandates, for all cases filed by a given employer within a designated timeframe. It is important to note that while the PERM process may become slower and require additional steps during an economic downturn, the law still allows employers to move forward with permanent residency applications and you have every right to take advantage of the permanent residency provisions of the law.
If you have an immigration question which you would like to see included in a future newsletter, please send it to Sally Penney at email@example.com