Here are some frequently asked questions to help employers understand the legal ramifications of furloughs and terminations of H-1B workers in light of the coronavirus (COVID-19) outbreak.
A furlough (i.e., placing a worker in an inactive and unpaid status because of a lack of work or another basis identified by the employer) would technically be considered a “benching” of the affected H-1B employee. Benching of H-1B workers is specifically prohibited by law. Neither the US Department of Labor nor US Citizenship and Immigration Services (USCIS), the agencies that share jurisdiction over various aspects of the H-1B program, have announced any leniency in the interpretation of the rules that prohibit benching.
Section 212(n)(2) of the Immigration and Nationality Act states that it is a violation of the H-1B wage attestation requirement for an employer, because of its own decision, to fail to pay the H-1B worker’s wage indicated in the underlying H-1B petition and Labor Condition Application by placing him or her in nonproductive status because of a factor such as a lack of work assignments. The employer is not required to pay this wage if the nonproductive period is due to “conditions unrelated to employment” at the employee’s “voluntary request and convenience” (such as caring for a sick relative) or due to circumstances such as maternity leave that render the employee unable to work. Employers are not relieved of the obligation to pay the H-1B worker’s wage in cases of temporary furloughs, annual or seasonal shutdowns, or other events that affect both American and H-1B workers, even if the American workers are also not paid.
If an employer is found to have committed a benching violation, a back wage plus interest penalty could be assessed. This would be a complaint-driven process, so an employee or other whistleblower would have to contact a government agency to notify it of the alleged violation. It is important to note that an H-1B worker may file a complaint regarding benching up to one year following termination from his or her H-1B employment. Therefore, it is possible that a benching complaint stemming from the extraordinary circumstances that many employers are currently experiencing could arise several years from now.
There is no exception for catastrophic events of the type we are currently experiencing, so the most conservative course of action would be to exempt H-1B employees from any furloughs, or terminate the H-1B worker. If an employer is not able to offer such an exemption, and decides not to terminate, the employer may have to be prepared to defend itself against a benching claim and to provide evidence of why the decision was made to have the H-1B employee take an unpaid leave.
The benching rule was crafted to address situations very different from the one we are facing now. Namely, the rule was intended to prevent the widespread practice of certain IT consulting companies of bringing H-1B workers to the United States and not paying them until assignments at third parties could be found for them. Therefore, it is possible that an administrative tribunal might be sympathetic to an exigent-circumstances defense. An employer that will not exempt its H-1B workers from a furlough may try to use as a defense the extraordinary circumstances that we find ourselves in and the fact that the benching rule was crafted to combat a quite different situation. This is a reasonable position, but there is no guarantee that an administrative tribunal would share this view.
As noted above, the fact that the furlough affects the entire workforce would support the view that the step is being taken on the basis of economic necessity and is not intended to single out H-1B workers for whom there is no work (the situation the benching rule was designed to address) and may be a positive factor to an administrative tribunal. It would not eliminate liability entirely, however.
H-1B workers must generally be working in the position described to be considered to maintaining lawful status. The USCIS’s regulations do recognize, however, that certain ‘‘extraordinary circumstances’’ may exist that would allow the agency to consider an H-1B worker to have maintained status despite an interruption in employment or work performed, and the agency has indicated that it could exercise its discretion favorably in a benching situation.
Yes. However, any change in work schedule for an H-1B worker requires the filing of an H-1B amendment with USCIS. The worker can start the part time schedule upon receipt of the petition for amendment by USCIS. Theoretically, there is no minimum number of hours that an H-1B worker may work. Employers and H-1B workers should keep in mind that a drastic reduction in hours may lead to a Request for Additional Evidence asking the employer to prove availability of specialty occupation work. In addition, an amendment that shows a drastic reduction in work hours may be a negative public charge factor in any future petition.
An employer that is terminating an H-1B worker must do so in writing, and must notify USCIS of the termination. When USCIS receives the notice of termination, it will issue a notice revoking the petition. It is a best practice for the employer or the employer’s counsel to withdraw the Labor Condition Attestation as well. An H-1B worker who is terminated has a 60-day grace period during which he or she can seek new employment in the United States. If he or she is able to find new employment, and the new employer files a new H-1B petition during the 60-day grace period, the H-1B worker will not be considered to have failed to maintain lawful status during that time. The original employer may also rehire the H-1B worker during the 60-day grace period, but must file a new H-1 petition.
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If you have any questions or would like more information on the issues discussed in this alert, please contact any of the following Morgan Lewis lawyers:
Laura C. Garvin