H-1B Compliance:9 Costly H-1B Visa Mistakes

Employers Make and How to Avoid Them

February 22, 2012

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Angela M. Lopez has more than 8 years of experience representing and counseling employers in all aspects of immigration law.

Ann M. Badmus has more than 18 years of experience providing strategic advice and counsel to employers on various issues of immigration law.

Presenters

Copyright 20094

Webinar Agenda

H-1B Application Mistakes to Avoid

LCA Compliance Mistakes to Avoid

H-1B/LCA Internal Audits

DOL And DHS Investigations

1

2

5

3

4

How To Document LCA Compliance

Agencies

U.S. Department of Labor (USDOL)

U.S. Citizenship and Immigration Service (USCIS)

Wage and Hour Division (WHD) of USDOL

Enforcement and Investigation

USCIS

•Surprise Site Visit

•Petition Denial/Revocation

USDOL

•Audit

•Fines/Debarment

WHD

•Complaint Investigation

•Damages/Debarment

Penalties

Civil Money Damages

Back Wages

Fringe Benefit Reimbursement

Debarment

Negative Publicity

H-1B Application Mistakes to Avoid

H-1B Application Process

ETA9035Labor Condition Application

(LCA)

I-129 H Petition

I-797 Approval Notice

Mistake # 1Failure to Provide Accurate Data

• Correct Name• FEIN

EmployerInformation

• Rate of pay• Locations

Employment

Information

• H-1B employees

• Third party sites

Business Information

Mistake #2Failure to File on Time

H-1B Numerical Limitations

Extensions/ Renewals

Amendments

Labor Condition Application

Mistakes to Avoid

Mistake #3Failure to Pay the Required Wage

Employers must pay higher of actual or prevailing wage rate, pay for nonproductive time, and offer benefits on the same basis as offered to U.S. workers

Prevailing Wage Resources

Occupational Employment Statistics (OES) SurveyUSDOL Prevailing Wage Determination (safe harbor)Davis-Bacon, McNamara O’Hara Service Contract Act

Collective Bargaining Agreement

Independent Survey

Prevailing Wage

Choose the appropriate criteria

• Occupational Class• Skill Level – I,II,III,IV• Geographic area of

intended employment

Actual Wage

Documented wage paid to all other employees with similar experience and qualifications for the specific employment • Experience and qualifications• Education• Job responsibility and function• Specialized knowledge• Legitimate business factors

Mistake #4Violating Wage Deduction Rules

Employers may not deduct its business expenses from employee’s wages• ACWIA fee• Anti-Fraud fee • Attorney fee

Mistake #4Violating Wage Reduction Rules (cont.)

Employers may not require repayment of petition costs or related business expenses upon employee’s termination of employment

Mistake #5Failing to Pay Wages on Time

Employer’s obligation to pay begins when the employee is available to work but no later than 30 days after employee enters U.S. with H-1B visa OR 60 days after H-1B validity date if employee is already in U.S. in H-1B status.

Mistake #6 - Benching

Employer must pay required wage for all nonproductive time related to employment caused by:• Lack of work or client contract• Lack of licensing • Studying for licensing• Employer required training

Payment is not required for truly voluntary absences

Mistake #7 - Failing to Properly Document Employment Termination

Bona Fide Termination Required

Written notice to USCIS withdrawing H-1B

Offer of return transportation to depart the

U.S.

Written notice of termination to employee

Mistake #8Failing to Document Changes

New work locations in a different prevailing wage location

Significant changes in job duties or working conditions

Mergers & acquisitions or other corporate changes

Mistake #9 – Failing to Maintain Required Documentation

Public Access File - LCA and other documents available for public access within one day of filing the LCA

FDNS Audit File for Surprise Site Visits

How to Document LCA Compliance

Public Access File

Certified LCA (ETA9035)

Rate of pay for the H-1B worker

Actual wage memorandum

Prevailing wage determination

Proof of LCA posting

Public Access File (cont.)

Acknowledgement of receipt of LCA by H-1B employee

Summary of benefits offered to all workers

List of entities included as “single employer”

Public Access File (cont.)

Post-employment changes must be documented:• Copy of new LCA for new

location(s)• New rate of pay, actual wage

memorandum, proof of posting, employee acknowledgement of LCA, prevailing wage determination

• Salary adjustments, e.g. cost-of-living, promotion to advanced level in same occupations

Public Access File (cont.)

Corporate organizational changes must be documented:• Sworn or notarized statement by

successor accepting all liabilities• List of H-1B workers transferred to

successor• Each affected LCA number and

effective date• Description of actual wage system• Successors employer identification

number (EIN)

LCA File

Maintain for USDOL:

• All documents included in public access file

• Records showing wage rate for all other employees for the specific employment at the specific place of employment

• Any documentation that supports the prevailing wage determination

• Documentation on the offer of benefits

• Documentation on working conditions

Retention Requirements

Public access file must be maintained:• At employer’s principal place of

business or at the employee’s worksite.

• Throughout the term of the H-1B employee’s employment and one year after termination of employment.

H-1B/LCA Internal Audits

Benefits of an Internal Audit

Identify correctable errors

Ensure consistency and integrity of documents

Prepare for USDOL or USCIS audit

Reduce liability by showing good faith

Conducting an LCA Self-Audit

•Public Access File for each occupation

•Appropriate position classification

•Correct prevailing wage/actual wage

•Documentation of employment changes

Conducting an LCA Self-Audit (cont.)

•Documentation of organization changes

•Payroll records reflect compliant start date

•Appropriate notifications/amendments to USCIS

•Verify audit results with attorney

Preparing for USDOL and USCIS Audits & Investigations

Preparing for an Audit/Site Visit

Review the H-1B petition

Conduct H-1B/LCA self-audit

Inform your client of potential for site visit if employee works at third-party locationIdentify company representative(s) to meet with auditors

Establish procedures for reception and training

Preparing for an Audit/Site Visit

Prepare FDNS Compliance File

• Copy of H-1B petition• Employee W-2 forms, three months paystubs• Previous approval notices, current passport,

current I-94, educational documents for employee

• Current job description, record/itinerary of off-site assignments

• LCA if work location has changed• Evidence of termination of employment, if

applicable

Legal Notice

. Facts of individual situations differ.

The information provided here is general in nature and should not be relied upon for specific situations.Consult with an experienced immigration attorney to ensure compliance

Copyright 2009

Badmus Law Firm, PLLC

11325 Pegasus Street

Suite S-215

Dallas, Texas 75238

469-916-7900 Telephone

469-916-7901 Facsimile

immigration@badmuslaw.com

www.badmuslaw.com

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