Employer Law Report : Employment and Labor Relations Lawyer & Attorney : Porter Wright's Employer Law Report : Employment Litigation, Non-Compete, Trade Secrets

U.S. Citizenship and Immigration Services (CIS) announced today that the H-1B cap was reached on December 21, 2009. CIS will conduct a random lottery among the petitions it received on December 21 to allocate the remaining visa numbers. The cap does not apply to H-1B employees changing employers or to individuals who will work at an institution of higher education or related nonprofit entity, a nonprofit research organization or a governmental research organization. Cap-subject employers now must wait until April 1, 2010 to file petitions for the next fiscal year (October 1, 2010 – September 30, 2011).

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At a December 1, 2009 seminar in New York, representatives of U.S. Citizenship and Immigration Services (USCIS) provided an update on the H-1B cap numbers for the October 2009 – September 2010 fiscal year (please see my earlier post for more on this topic -- The H-1B "Cap" - 2010 Fiscal Year Is The Canary In The Mine) .

While a recent report indicated that 58,900 petitions had been filed against the 65,000 cap, USCIS explained that the low number of filings for nationals of Chile and Singapore (who benefit from a set aside of 6,800 visas) means that there still are visas available. USCIS also confirmed that there were approximately 2,000 petitions filed in late November. This makes it difficult to predict how much longer visas will be able for the current fiscal year. Once the cap has been reached, employers will need to wait until April 1, 2010 to file a petitions requesting an October 1, 2010 effective date. Given this recent announcement, employers that still want to file H-1B petitions for the current fiscal year likely will need to do so soon. Experience has shown that there is a rush of petitions as the filings approach the 65,000 cap. The USCIS announcement concerning recent filings suggests that this rush already has begun.

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In response to Senator Charles Grassley's September 29, 2009 inquiry into the H-1B visa program and fraud detection efforts, Mr. Alejandro Mayorkas, Director of Citizenship and Immigration Services, indicated that the H-1B fraud detection site visits would increase five-fold. For the most recent federal fiscal year, October 1, 2008 – September 30, 2009, there were approximately 5,000 site visits. The goal for fiscal year 2009 – 2010 is to complete 25,000 such visits. Therefore, as outlined in the previous posting on this topic, employers can continue to expect site visits as part of the H-1B petition process.  

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Since June 6, 2008 certain low-risk U.S. citizen, U.S. national and U.S. permanent resident travelers have been able to enroll in the Global Entry program to allow for expedited clearance upon arrival at U.S. airports from travel abroad. Rather than wait in the traditional passport control line, program participants proceed to a kiosk to scan their travel documents, provide electronic fingerprints and a photograph and receive a receipt to present to a Customs and Border Protection Agent. The program requires an online application (available at www.globalentry.gov), criminal background check, and an in-person interview at a Customs and Border Protection facility. The application fee is $100, and the average processing time for approval is one week.

The pilot program began with three airports and since has expanded to include the following 20 international airports: Atlanta (Hartsfield-Jackson), Boston-Logan, Chicago O'Hare, Dallas/Ft. Worth, Detroit, Ft. Lauderdale Hollywood, Honolulu, Houston (George Bush), Las Vegas, Los Angeles International, Miami International, Newark Liberty, New York (JFK), Orlando International, Orlando-Sanford International, Philadelphia International, San Francisco, San Juan, Seattle-Tacoma and Washington Dulles.

The proposed permanent program would be available to U.S. citizens, U.S. nationals and U.S. permanent residents aged 14 and older. Children aged 14-17 would require the consent of a parent or legal guardian to participate. The proposed program also contemplates expansion to certain nonimmigrants (e.g. individuals traveling with a visa, such as B, E, H or L) provided certain reciprocal programs are in place with the individual's country. Risk factors that would disqualify applicants from participating include false or incomplete applications, prior arrests or convictions, prior violations of customs, immigration or agriculture regulations in any country, current criminal investigations or inclusion on a government watch list. Program participants still would be subject to primary inspection by CBP agents based upon random selection or declaration of certain goods, restricted items or more than $10,000 in currency or monetary instruments.

Interested parties may view the entire regulation and provide comments by searching for "Global Entry Program" at www.regulations.gov. The regulation was published on November 18, 2009. Comments are due by January 19, 2010.

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You may find out soon. After several years of collecting the $500 fraud fee from employers filing H-1B petitions to sponsor foreign national employees, the U.S. Department of Homeland Security ("DHS") has increased its investigatory activities by dispatching officers and independent contractors to the places of employment indicated on the visa petition forms. Since 2005, employers have paid the $500 fraud fee with the first petition they file on behalf of new H-1B employees. With 85,000 new H-1B visas available each year, this means DHS collects at least $42.5 million annually for just the new visa numbers. That amount very well may be dwarfed by the numerous other petitions employers file. Each time an H-1B worker changes employers, the new employer must pay the fee with the petition. DHS therefore likely collects substantially more than the $42.5 million it receives from the quota-based petitions.

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The U.S. Department of Homeland Security (DHS) is to publish a final rule today in which it formally rescinds the August 2007 "No-Match / Safe Harbor" regulation. Following its review of public comments after the August 19, 2009 announcement of the proposal to rescind the No-Match / Safe Harbor regulation, DHS now confirms that the rescission will take effect in 30 days. In the final rule, DHS responds to various arguments for and against the safe harbor provisions. The general tenor of DHS' position is that it plans to continue its I-9 enforcement activities. At the same time, DHS encourages employers to take proactive measures to comply with I-9 employment eligibility verification requirements. DHS suggests that the No-Match protocol is a reactive approach to employment authorization verification. In contrast, according to DHS, employers can be more proactive by participating in programs such as E-Verify and IMAGE and following the guidance set forth in the I-9 Handbook for Employers (Form M-274, available at www.uscis.gov).

As outlined in our August 20, 2009 posting, there are advantages and disadvantages for employers to consider before enrolling in the E-Verify or IMAGE programs. Employers also need to be aware that DHS' rescission of the No-Match / Safe Harbor regulation does not alter the I-9 landscape. Employers need to continue to follow proper protocols in verifying the work authorization status of their employees. Employers also need to take immediate and reasonable steps to inquire further upon receiving credible information that an existing employee may not have authorization to work in the United States.

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As a follow up to our recent post on e-Verify, many of our financial institution clients have been asking whether they are required to comply with the new federal e-Verify requirements for federal contractors.

Under federal affirmative action laws, many banks are considered federal contractors because they are issuing and paying agents for U.S. savings bonds or they are insured by FDIC. However, as explained below, issuance and payment of U.S. savings bonds and FDIC insurance do not trigger e-Verify obligations.

Clarifying language in the e-Verify regulations states that:

Agreements or activities performed by financial institutions that are not subject to the FAR (Federal Acquisition Regulation) are not required to comply with the e-Verify provisions and clauses of the FAR.

This statement in the e-Verify regulations is given in response to a specific question about whether banks and other financial institutions whose federal contracts are limited to serving as issuing and paying agents for U.S. savings bonds or being insured by the FDIC should be excluded from e-Verify requirements. Since issuance of or payment on U.S. savings bonds and FDIC insurance are not covered by FAR, they do not trigger e-Verify obligations. Similarly, the clarification notes that financial agency agreements (FAAs) between banks and the federal government are not subject to FAR and, therefore, do not trigger e-Verify obligations.

For all of these reasons, so long as the only federal contracts for your bank are of the sort described above, you can rest assured that you do not have to comply with the federal e-Verify requirements. 

The e-Verify regulations do not address specifically federal share insurance of the sort that credit unions have under the National Credit Union Insurance Fund.  However, the rationale for concluding that FDIC insurance does not trigger e-Verify requirements would  apply also to federal share insurance for credit unions. 

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You may have noticed a spate of recent articles and announcements indicating that “all federal contractors” will be required to begin using the federal government’s E-Verify system beginning September 8, 2009. Originally set to take effect on January 15, 2009, there have been three prior delays in implementing mandatory use of E-Verify for federal contractors. On August 26, however, a federal district judge rejected a request for further delay, so it appears the E-Verify regulations will actually go into effect on September 8. (See our recent blog post.) In light of this, current contractors should start thinking about how E-Verify will affect them – if at all.  

Even though many of the articles on this topic indicate that “all federal contractors” are required to start using the system on September 8, the reality is that not all contractors will be covered and that even covered contractors have time after September 8 to enroll and start using E-Verify. 

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On August 26, 2009, a U.S. District Court in Maryland cleared the path for the E-Verify requirement applicable to certain federal contractors to go into effect on September 8, 2009. This decision follows several delays of the E-Verify requirement dating to earlier this year. Several plaintiffs, including the U.S. Chamber of Commerce, Associated Builders and Contractors, Inc., Society for Human Resource Management, the American Council on International Personnel and the HR Policy Association, filed suit against the Department of Homeland Security to block implementation of the E-Verify requirement under various constitutional and regulatory grounds. The court rejected the claims and essentially stated that employers that do not want to use the E-Verify system simply can choose not to do business with the federal government.

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On August 19, 2009, the Department of Homeland Security (DHS) announced that it was rescinding its August 2007 and October 2008 regulatory amendments concerning actions employers can take to benefit from "safe harbor" protection after receiving notification from DHS or the Social Security Administration that an employee's reported work authorization or Social Security information does not match government records. In October 2007 a U.S. District Court in California preliminarily enjoined implementation of the regulations. Under the revised regulations, if employers took certain actions within prescribed timeframes, they could shield themselves from liability for allegedly employing individuals who lacked authorization to work in the United States. For additional information on the revised regulation, please review prior blog postings on this topic. 

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As of August 14, 2009, Citizenship and Immigration Services indicated that it had received approximately 45,000 H-1B petitions toward the annual cap of 65,000 visas. An additional 20,000 petitions had been filed toward the 20,000 exemption amount for individuals with U.S. graduate degrees. Therefore, there remain approximately 20,000 H-1B visas for the next fiscal year, which runs October 1, 2009 to September 30, 2010. In recent years the entire 85,000 visa slots were allocated before the fiscal year began (employers can file up to six months in advance of when visas are available). The H-1B visa filings thus have become one of the proverbial canaries in the mine as an indicator of the overall economic situation. With the staggering number of layoffs and dearth of hiring among employers, the demand for H-1B visas to employ foreign national employees has decreased substantially. Monthly H-1B filings are averaging less than 1,000. This means H-1B visas for "new" hires likely will be available well into the 2010 fiscal year.

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The Immigration and Customs Enforcement (ICE) announced on July 1, 2009 that I-9 audit notices have been presented to 652 employers across the country. (To read the press release, click here.)

Notwithstanding the Obama Administration’s announcement that it will change the focus of immigration enforcement to concentrate on abusive employers, this announcement reflects a new initiative to step up I-9 enforcement actions.

By contrast, only 503 similar notices were issued during the entire FY2008. The ICE announcement included the point that these employers were not randomly selected but have been identified from leads and other investigative information.

If past experience is a guide, we can expect that at least some of these notices will result in further enforcement actions against the identified employers.

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The Courts and the Obama Administration continue to struggle over the proper role of E-Verify, particularly the proposed rule mandating E-Verify for Federal contractors. The Government has agreed with the litigants challenging the rule to delay implementation of the proposed rule until September 8, 2009, with strong hints that it will be delayed further as that date approaches. The proposed rule will not apply to any government contracts before the effective date.

For a more comprehensive review of the proposed rule and E-Verify generally, please review our article: E-Verify: Coming Soon to a Theater Near You.

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Representative Courtney Combs, a Republican from District 54 in Butler County, has introduced H.B. 184 to the Ohio House of Representatives. The bill would require all employers in Ohio, both public and private, to register and participate in E-Verify, a voluntary, federal program designed to supplement the I-9 employment verification process for all new employees. We have written a more extensive article on E-Verify for interested employers. 

As introduced, H.B. 184 would require all employers to certify their participation in the E-Verify program on state income tax forms. As a result, although the bill does not provide direction to the Department of Taxation on the enforcement mechanisms for this provision, it would appear that some additional burden of enforcement would also be imposed upon the Department of Taxation. Presumably, failure to register for the E-Verify program would not excuse a non-compliant employer from its income tax obligations. Additional responsibilities for the administration of federal immigration laws are also assigned to local law enforcement agencies and the Department of Corrections in other parts of this bill. Congress is expected to address immigration reform over the next several months, so the future of State initiatives such as H.B. No. 184 is not clear. 

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If you missed our recent Employment Relations Seminar:  The Changing Landscape of Labor and Employment Law, that was held on Monday, May 4, 2009 in Columbus, we invite you to download a copy of our materials from the program here.

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Resolving a split among the circuit courts, the U.S. Supreme Court yesterday in Flores-Figueroa v. United States significantly limited a tactic used by U.S. Immigrations and Customs Enforcement (ICE) to address the issue of undocumented workers. 
 

In particular, ICE has used the Identity Theft Penalty Enhancement Act as a way to pressure undocumented workers.  That Act created the crime of “aggravated identity theft,” which occurs when a person “knowingly transfers, possesses, or uses, without lawful authority, a means of identification of another person” in connection with the commission of certain enumerated felonies, including immigration violations. Because violation of the Act carries a mandatory two-year jail sentence, ICE had been using the threat of prosecution for aggravated identity theft to convince undocumented workers to plead guilty to other lesser immigration offenses such as the misuse of social security numbers. 
 

Under the Court’s decision, however, the Act requires the Government to prove that the defendant-worker knew that the means of identification at issue actually belonged to another person, not merely that the worker knew that the means of identification used to obtain employment were fraudulent. This holding makes the threat of prosecution under the Act much less realistic because ICE will have to prove that the individual using the false identification information also knew that the information belonged to a specific individual – as opposed to information relating to an entirely fictitious identity.
 

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Last week, the Obama Administration reiterated its commitment to enact comprehensive immigration reform during the first year of the new administration. On Tuesday, the New York Times reported that a coalition of unions have agreed to support the Administration’s initiative, joining the business community and the Chamber of Commerce, who have long supported immigration reform. Of course, with immigration reform, as with other contentious legislation, the devil is in the details, and different advocates define immigration reform differently. 

The Unions, Chamber of Commerce and the Administration agree that key elements of reform will include a reduction in the excessive backlogs for permanent resident status in both the employment and family based application tracts. There also appears to be an agreement coalescing among the interested stakeholders that will include a path to citizenship for the estimated 12 million undocumented immigrants in the country. 

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We just ran across a wage and hour case out of Texas with a unique twist on the usual overtime claim. Bustamente, an undocumented immigrant, alleged that the El Palenque Mexican Restaurant and Cantina forced him to work under another identity to avoid overtime.  

According to Bustamente, the kitchen manager realized he lacked the documentation to work legally in the country but told him it wouldn’t be a problem if he had some documents. Bustamente began working under his brother’s identity. (He actually brought the case as Jesus Bustamente, the brother– he only confessed that his real name is Cristoforo one week prior to trial). Soon after, Bustamente alleged that the restaurant had him fill out an application using his nephew’s identity in order to avoid overtime pay. He worked the early shift as his brother, the evening shift as his nephew. Bustamente testified that he received two separate paychecks. 

The restaurant’s defense was straightforward – Bustamente and his nephew were both employees. The company used a fingerprint timekeeping system, making it difficult to impersonate someone. Witnesses remembered the nephew as taller than Bustamente. The company did pay overtime to other employees.  Most important, the company produced payroll records showing that Bustamente and his nephew actually worked the same shift on one occasion. In light of the conflicting testimony and confusing payroll records, the court found that Bustamente could not prove his claims. 

While the facts of this case are amusing and hopefully not likely to repeat themselves often, it serves as a good reminder that clear, accurate payroll records can be an employer’s best friend in a wage and hour case.   Cristoforo Bustamente, a/k/a Jesus Bustamente, a/k/a Angel Bustamente, v. El Palenque Mexican Restaurant and Cantina, Inc., Case No. No. H-07-2506, (S.D. Tex, February 3, 2009).

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The USCIS has announced that there were not sufficient H-1B petitions filed within the first five days of the filing period to reach the H-1B cap. Therefore, all petitions filed through April 7, 2009 will be accepted and processed. The USCIS will continue to accept petitions until the cap is reached. On the day that the cap is reached, USCIS will conduct a lottery of the petitions received on that date (assuming that the number of petitions received exceeds the number of available visas) for the remaining visas.

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After a two-month delay for the Obama Administration to review the new form and related policies, today (April 3, 2009) marks the introduction of the yet another version of the I-9 form. Employers are required to use the new form to verify the employment eligibility of all newly hired individuals on or after today's date  - April 3, 2009. 

There are two changes from the previous editions of the form. First, the last page of the form, which identifies acceptable documents, has some modified language and adds additional documents that can be accepted to verify employment eligibility in both List A (documents that establish both identity and employment eligibility) and List C (documents that establish employment eligibility). Employers may now accept a passport from the Federated States of Micronesia or the Republic of the Marshall Islands with an I-94A admission document as proof of both identity and employment authorization. This modification is based upon a recent compact between these two territories and the United States. The second modification requires the new employee to identify their status as a citizen, permanent resident, national of the United States, or an alien temporarily authorized to work. Prior versions of the form included citizen or national with the same check mark, but the new form differentiates between the two classifications. Neither of these changes will impact many individuals, but the new form is nevertheless required for all newly hired employees beginning on April 3, 2009. 

The new form is available at this link on the USCIS web site.

A new version of the employer’s I-9 Handbook is also available on the USCIS web site.

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The conference committee negotiating the American Recovery and Reinvestment Act of 2009 (H.R.1), also known as the stimulus bill, agreed to include one controversial immigration provision, but deleted a second. The first provision prohibits all financial institutions receiving TARP funds from hiring any employee in H-1B status unless the company complies with the H-1B dependent provisions. These provisions inhibit the ability by an employer to hire H-1B employees by requiring a recruiting process similar to an application for labor certification before filing the petition. This will make it very difficult for any recipient of TARP funds to hire or retain H-1B employees, and will deny banks and other recipients the ability to hire highly skilled individuals for some positions.

Opponents of the bill have argued that rather than stimulating the economy, this provision could actually have the opposite effect by stifling the ability of troubled businesses to hire and retain the expertise needed for their operations. The second provision, requiring the expansion of E-Verify to even more employers, has been deleted.

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On Friday, January 30, 2009, USCIS announced that it was delaying the implementation of the new I-9 form and regulations published during the final days of the Bush Administration. On January 20, President Obama issued an executive order requiring review of all new regulations not yet effective.

Implementation of the new I-9 form, which for the first time requires new employees to distinguish between a representation of U.S. citizenship or non-citizen nationality and also reduces the number of acceptable documents, has been delayed for another 60 days. The new effective date for this form and the new requirements is April 3, 2009. The regulations also prohibited the use of some expired documents to demonstrate citizenship or identity. Existing regulations permit the presentation of expired driver’s licenses or passports. The now delayed regulation, however, requires all documents to be valid at the time they are submitted.

Unlike prior changes in the I-9 form, employers cannot use the new form until its effective date, and must use it after the effective date. Prior changes permitted the use of either form until the effective date of the new form, usually announced several months in advance. Thus, employers should continue to use the existing I-9 form until April 3, 2009. It is also possible that the new Administration may change the form or regulations before the new effective date.  Please continue to check our blog for future updates.

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The Department of Homeland Security recently published amendments to the regulation governing the US-VISIT program. This Final Rule, which will become effective January 18, 2009, requires all non citizens (with some exceptions noted below), including lawful permanent residents, to register with US-VISIT, upon admission to the United States. US-VISIT is the electronic registration program implemented at land, air and sea ports in the wake of the September 11 attacks. The program has been implemented in stages over the past few years, and now requires all visitors and temporary residents to register at a US-VISIT kiosk upon admission to the United States. Non citizens are required to provide biometric data, meaning fingerprints and electronic photographs, as the system registers both admissions and departures. Effective January 18, 2009, the program has been extended to permanent residents returning to the United States from a temporary trip abroad. 

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On December 12, 2008, U.S. Citizenship and Immigration Services (CIS) announced an interim final rule to modify the Employment Eligibility Verification Form I-9. The new form will be effective 45 days from the date of the interim final rule. There are two major changes. The first is to limit the number of acceptable documents for verifying a new employee's identity. The second is to prohibit accepting expired identification documents. Employers must complete and maintain the form for all employees hired after November 6, 1986. The new form should be available on the CIS website (http://www.uscis.gov/i-9) toward the end of January 2009.

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On October 16, 2008, the Department of Homeland Security adopted the May 9, 2008 proposed regulation without change. Therefore, effective October 16, 2008, qualifying individuals now may obtain initial periods of TN status or extensions of status for up to three years. As noted in the prior post announcing the proposed regulation, this new development certainly is good news for TN employers and employees alike.

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Organizations with overseas operations in certain countries that routinely send employees to the United States for short-term business travel now need to plan ahead before sending employees to the airport. In its ongoing efforts "to strengthen the security of travel to the United States," the U.S. Department of Homeland Security has implemented a new protocol for Visa Waiver travelers. On August 12, 2008 the U.S. Customs and Border Protection’s "Electronic System for Travel Authorization Web Site" went live (available at www.cbp.gov/travel). All foreign nationals seeking to enter the United States using the Visa Waiver Program now must access the secure web site, enter requested information and receive authorization before boarding an aircraft. The airline will verify a traveler’s authorization status through an electronic verification from Customs and Border Protection before allowing the passenger to board. CBP recommends obtaining the authorization at least three days before any planned travel using the Visa Waiver Program. Upon approval, the authorization will be valid for two years unless revoked sooner.

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On June 12, 2008, U.S. Citizenship and Immigration Services (USCIS) informed the American Immigration Lawyers Association that the H-1B random selection process has been completed. USCIS completed the intake and receipt processes for all filings as of May 24, 2008 and began mailing rejection notices the week of June 9. Therefore, if an employer has not yet received a filing confirmation (Form I-797C Notice of Action), it likely means that the petition was not selected in the random process and that the rejection notice will be forthcoming.

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On May 9, 2008, Citizenship and Immigration Services published a proposed regulation to extend the permitted period of admission in TN status for Canadian and Mexican professionals under the North American Free Trade Agreement (NAFTA) up to three-years. NAFTA allows individuals from Canada or Mexico to enter the United States to work for or provide services to an organization in the U.S. provided the proposed services fall within one of the designated occupations, including Computer Systems Analysts, Economists, Engineers and Management Consultants.

At present, the maximum period of admission in TN status is one year. The new regulation would apply both to applications at the border as well as to applications filed with CIS to extend TN status for individuals already present in the United States. The goal of the new regulation is to reduce the administrative burden of annual renewal applications. If the regulation eventually becomes effective, it will be a welcome change to many individuals who either make annual trips to the border or file applications to extend their TN status.

There is no limit on the period of time an individual may qualify for TN status, provided the nature of the services continues to be temporary. In this regard, however, the commentary to the new regulation specifically confirms that the doctrine of “dual intent” does not apply to TN professionals. Dual intent allows a foreign national to be in the United States temporarily yet at the same time pursue lawful permanent resident status (i.e. “a green card”) to be able to remain indefinitely. Currently, only the H-1B and L-1 visa categories benefit from dual intent. Accordingly, individuals with TN status need to continue to plan carefully if they desire to obtain lawful permanent resident status.

The comment period ends June 9, 2008. Comments may be submitted via the Internet at  http://www.regulations.gov or by e-mail to rfs.regs@dhs.gov. Comments need to include a reference to “DHS Docket No. USCIS-2007-0056.” There also is the option to submit comments by mail or courier.

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U.S. Citizenship and Immigration Services announced on April 18, 2008 a special "cap gap solution" for F-1 students whose Optional Practical Training (OPT) expires before October 1, 2008. An April 8, 2008 interim final rule automatically extended OPT for F-1 students, but it applied only in those cases where the employer requested a "change of status" on the H-1B petition. To be eligible for the change of status from F-1 student to H-1B temporary worker, however, the student must have had less than a 60-day gap between when the OPT expires and October 1, 2008. Therefore, when employers filed H-1B petitions on April 1, it was not possible to request a change of status for any F-1 student/employee whose OPT expired on August 1, 2008 or earlier. Therefore, there were many individuals who could have benefited from the new regulation had it been published before April 1.

Recognizing the inequity of the situation, the solution announced on April 18 allows employers whose H-1B petitions are accepted on behalf of an F-1 student to amend the petition and request a change of status. The OPT then will be extended to October 1, and the individual will be permitted to remain in the United States and continue working without interruption. This is a significant benefit for individuals who otherwise were planning to spend several months abroad after their OPT expired and before they could obtain H-1B visas and return on or after October 1, 2008. After the H-1B filing confirmation has been issued (all notices are to be issued by June 2, 2008), the employer will have 30 days to amend the petition and request the change of status.

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As a follow up to my earlier post, Citizenship and Immigration Services ("CIS") announced today that it has received sufficient H-1B petitions for the next fiscal year, which begins October 1, 2008, for both the base amount of 65,000 and the additional 20,000 for U.S. master's or higher graduates. For those who have been following this situation, the announcement should come as no surprise. CIS accepted petitions through April 7, 2008 to allow for delivery of the expected, large number of petitions at the two designated service centers. On a date it has yet to announce, CIS will conduct a random selection to identify the first 20,000 master's/higher petitions. Thereafter, any remaining master's/higher petitions will enter the random selection for the 65,000 remaining visas. CIS will return, with the filing fees, any petition that is not successful in the lottery. For employers that filed duplicate petitions (for the same person and same job) in hopes that at least one would be successful in the random selection, CIS will keep the filing fees for both as a punitive measure against such employers.

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The Department of Homeland Security (DHS) again published the so-called “No-Match Regulation” on March 26, 2008. The regulation, first proposed on June 14, 2006, and published in final form on August 15, 2007, was withdrawn when the federal court in San Francisco enjoined enforcement actions based on the regulation. DHS now proposes to re-publish the rule in the identical form as it was published last August but with further commentary and justification. The supplemental commentary and justification reads more like an appeal brief challenging the district court’s injunction against the regulation than a review of the comments and considerations typical in Administrative Procedure Act proceedings. The regulation  has no new effective date, but the public is invited to provide comments before April 25, 2008. 

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The Government can file enforcement actions for hiring unauthorized employees in either criminal or civil proceedings. Criminal proceedings may result in either fines or prison sentences while civil proceedings result in administrative fines. Attorney General Mukasey announced on Friday, February 22, 2008, that the administrative fines would increase effective March 29, 2008 to adjust for inflation. The minimum fine for the first offense of the knowing hire of an unauthorized individual will increase by $100 to $375. The maximum civil penalty for the first violation increases to $3,200. For multiple offenses, the maximum penalty increases from $11,000 to $16,000. 

The Attorney General announced these increases as routine adjustments for inflation, but noted that the increases were also part of the initiative announced last August as part of enhanced effort to improve interior and worksite enforcement. Current efforts, however, remain focused on the criminal prosecution of employers for the hiring of unauthorized immigrants. In one recent press release, Immigration and Customs Enforcement noted that 57 undocumented workers were arrested in Utah, and many of the workers as well as the employer would be indicted for various criminal charges. The press release also noted that the Department of Labor participated in the investigation and processing of the arrested workers to be sure the proper wages had been paid for work before the arrest. The workers were then processed for criminal charges and deportation. 

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Today's Columbus Dispatch features an op-ed I wrote titled "Immigration crackdown hurts economy," which discusses my thoughts on how the Administration's immigration policy impacts our struggling economy. 

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On February 13, 2008, the Department of Labor (DOL) proposed amendments to the regulations and streamlined the application process for temporary agricultural workers. Interested parties will have 45 days to submit comments in response to the proposed rule. Although it is not clear when the new rules will become effective, the regulatory process is not expected to be completed in time for the 2008 growing season. 

Known by the technical classification H-2A, the temporary agriculture worker program is only one part of the more generic guest-worker program discussed in the popular press. In its announcement, the DOL noted that employers hired only 75,000 workers through this program last year, while they estimate that the undocumented workforce was between 600,000 and 800,000. The application process is lengthy, expensive, and difficult to navigate. Duplication of efforts between the state workforce agencies and DOL contributed to the dysfunctional nature of the program. Comments to the proposed rule quoted several news sources discussing the adverse impact this program had on the agricultural industry and explained the need to streamline the process to provide a realistic legal alternative for agricultural employers to hire the required workforce. 

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With the April 1, 2008 filing opportunity for “new” H-1B petitions looming, employers can begin planning now to try to obtain one of the limited number of H-1B visas available for the next federal fiscal year, which runs from October 1, 2008 to September 30, 2009.

A “new” H-1B petition refers only to individuals acquiring the H-1B visa or status for the first time, such as F-1 students changing to H-1B status and individuals abroad who plan to enter the U.S. for the first time using an H-1B visa. These cases often are referred to as “cap-subject” cases because they require one of the 85,000 allotted visas (65,000 for bachelor-level candidates and 20,000 for U.S. masters graduates). It does not apply to one who already has an H-1B visa or status. An exception that private sector employers should note, however, is that an H-1B foreign national currently working for a university in most cases will be subject to the cap. Universities are exempt from the H-1B cap, and when a foreign national leaves a university for the private sector, he/she then becomes cap-subject.

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A recent wage-and-hour case illustrates the effect payroll deductions can have on minimum wage compliance. In Rivera v. Brickman Group, Ltd., No. 05-1518 (E.D. Pa. Jan. 7, 2008), a company brought Guatemalan and Mexican workers to the United States for seasonal employment under H-2B visas. Although the workers were paid amounts that appeared to be above the minimum wage, the company failed to take into account certain travel expenses and other employment-related costs incurred by the workers – expenses that reduced the workers’ earnings below minimum wage levels.

In particular, the court found that transportation expenses, costs involved in obtaining visas, and fees charged by the company’s recruiters were incurred by the workers primarily for the company’s benefit. Therefore, the company violated the Fair Labor Standards Act because the deductions brought the employees’ earnings below the minimum wage. In reaching its decision, the court rejected the company’s argument that the Immigration and Nationality Act and the Portal-to-Portal Act supersede the FLSA with regard to H-2B workers’ wages and do not require employers to bear the travel expenses of such employees. The company has not yet announced whether it will appeal the decision.

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