The U.S. Department of Labor announced this week a $638,449 back wage consent order and $126,778 civil fine against a New Jersey IT consulting firm, Peri Software Solutions, Inc. The announcement indicated that the back wages resulted from the employer’s failure to compensate the H-1B workers as required under Department of Labor regulations. The civil fine arose from two issues: the employer failed to provide notice of its intent to employ H-1B workers and it sued former employees "for early cessation of employment."
The announcement may raise more questions than it answers concerning the specific facts involved, but it serves as a good reminder for H-1B employers that the applicable regulations are very exacting and can be costly when disregarded. While this case appears to have involved a failure to pay the required wage rate, employers may be surprised to learn that the wage obligation continues as long as the H-1B petition remains valid, which in many cases can be for up to three years. Even after an H-1B worker has resigned or been terminated, the Department of Labor requires the employer to pay the worker’s wages until U.S. Citizenship and Immigration Services (USCIS) has revoked the H-1B petition. The H-1B regulations in fact require employers to notify USCIS when the H-1B worker’s employment ends. Requesting revocation of the petition therefore complies with USCIS regulations and avoids a potential Department of Labor assessment of back wages.
The civil fine similarly is a good reminder of the notice requirement of the H-1B petition process. Employers must provide notice at the place of employment that it intends to employ H-1B workers at that location. The notice may be provided through a paper posting or electronic communication and must contain information concerning the occupation, salary and intended period of employment. In situations where the job location may change, such as IT consulting positions, there are specific guidelines for when and where the notice must be provided.
The H-1B visa program is a useful means for employers to hire and retain qualified noncitizen professionals for positions that require at least a bachelor’s degree. Examples include many IT positions, engineers and financial analysts. And although the regulations contain many traps for the unwary, with careful planning and counsel, employers can satisfy the requirements and concentrate on running their businesses.