3/26/2008

The U.S. Department of Labor's (DOL) Administrative Review Board (ARB) assessed over $250,000 in back wages and a $40,000 civil fine against a computer consulting company, on June 30, 2005, that had unlawfully benched H1B foreign national employees. The ARB awarded substantial back wages to both the employer's current and former employees, even though the employer attempted to argue that the employees had been laid off or otherwise terminated. 

It is important for employers and employees to understand that there are legal consequences that will likely follow if there is a breach of obligations under immigration law. It is important to follow steps to avoid these adverse consequences.

The common thread for all of the employees who were granted back wages was that the consulting company had never notified the U.S. Citizenship and Immigration Services (USCIS) (or its predecessor, the Legacy INS), that it terminated the employment of any of the employees. The company asserted that the USCIS has the authority to determine when termination has occurred. The ARB disagreed with the employer, since it asserted that the DOL's wage and hour division has the authority to decide what wages are due to an employee.

The company argued that some employees were never authorized to enter the U.S. H1B visas were granted to these employees, however, because the company had filed H1B petitions and sent assertions to the consulates that the employees were needed. The employees worked in-house for the company and/or visited or called the headquarters routinely to inquire about work. They were not paid while working at the company's headquarters. Neither were they paid when they were not working, but awaiting projects. The ARB agreed with prior findings that these employees were also entitled to back wages.

Some employees worked on projects intermittently. These employees were not paid during the periods when they were not working on projects. The employer claimed that these periods were leave-without-pay or should be considered as terminations. The ARB rejected the employer's arguments, holding that the employer is responsible for paying for involuntary leaves of absence until there is a proper termination of employment.

The ARB indicated that the DOL's Wage and Hour Division Administrator had proven a pattern and practice of failure to pay back wages through persons who testified against the employer. Therefore, the ARB found that persons who did not testify, but fell under the same pattern, were also entitled to back wages.