In response to the COVID-19 pandemic, many government authorities in the US and around the world issued shelter-in place orders in an attempt to protect public health and slow the spread of Coronavirus. In the US, employees in jobs listed as non-essential are ordered to work from home. As a result of the economic downturn, employers are evaluating business operations, including the options and consequences of termination, furlough, and reductions in pay and or hours.
Employers of foreign workers often have additional legal obligations that must be considered before taking such action. In particular, employers of foreign professionals on H-1B, H-1B1 and E-3 specialty occupation worker visas have additional obligations and liabilities under US immigration law that must be considered, in addition to the other legal requirements under relevant state and federal employment law.
Labor Condition Application
These employers are bound by attestations that the employer was required to make on the Labor Condition Application (LCA) filed with the visa petition, pursuant to Department of Labor (DOL) regulations. The COVID-19 pandemic may impact the ability of employers to fulfill these obligations. DOL recently issued additional guidance for scenarios likely to occur during this challenging time.
Obligation to continue to pay the offered wage indicated in the LCA
DOL regulations require employers to pay the wage promised in the LCA with only limited exceptions.
The employer remains liable to pay even during nonproductive time caused by conditions related to employment, such as lack of work. When an employee is in a nonproductive state due to a decision made by the employer, the employer’s obligation to pay continues.
However, no payment is required if the nonproductive time is caused by reasons unrelated to employment, such as a worker’s voluntary absence from work or a hospitalization.
Note that the employer must still pay the required wage if the employee’s nonproductive period was subject to payment under the employer’s benefit plan, or state or federal law, such as the Family and Medical Leave Act or the Americans with Disabilities Act.
When does the obligation to pay start?
The duty to pay is the earlier of:
- The date the employee is first available for work or otherwise comes under the control of the employer, such as reporting for orientation or studying for a licensing exam;
- No later than thirty (30) days after the worker is first admitted into the U.S. pursuant to the H-1B petition, whether or not employment otherwise commences; and
- For a worker already in the United States, generally no later than sixty (60) days after the date the worker becomes eligible to work for the employer (usually the petition validity start date printed on the USCIS Notice of Action Form I-797 for a change of status or change of employer petition), whether or not employment commences.
How much pay is due and for how many hours?
The employer must pay full-time workers the full amount of the wages stated on the LCA.
If the LCA indicated that the job is part-time, the employer must pay for at least the number of hours indicated on the visa petition and the LCA. If the LCA and visa petition state a range of hours, then the amount paid must be for the hours actually worked, so long as the employer pays for no fewer than the minimum number of hours indicated for the range of part-time employment.
When does duty to pay stop?
The obligation to pay stops when there is a bona fide termination of employment or one of the exceptions mentioned earlier applies.
Note that bona fide termination under the immigration law differs from the federal and state employment law. DOL regulations require the employer to notify the USCIS that:
- The employment is terminated;
- The petition should be withdrawn; and
- The employee was offered payment for transportation home, if the termination occurs before the worker’s H-1B expiration date.
The duty to pay continues even during a COVID-19 shelter-in-place order
The employer’s obligation to pay continues even during a COVID-19 shelter-in-place/quarantine order, because these conditions are considered to have been caused by reasons unrelated to employment and the employee is otherwise able to work.
Therefore, employers cannot furlough, bench, or otherwise render an H-1B, H-1B1 or E-3 employee who is nonproductive, and cannot stop paying the required wage, merely because an employee is unable to perform their work from home due to a COVID-19 – related order.
Violation of this DOL rule exposes the employer to fines, back wage with interest and, in the most egregious cases, ineligibility to sponsor foreign workers for visas through the DOL’s temporary and permanent immigration programs for a period of time. In addition, the USCIS would withhold approval of immigrant and non-immigrant petitions filed by that employer.
The duty to pay when an employee is afflicted with COVID-19 and consequently unable to work due to isolation and quarantine
The regulations do not require an employer to pay the required wage if an employee becomes nonproductive due to a reason which is not directly work-related and required by the employer, such as a worker’s voluntary absence from work or a hospitalization.
That said, if an employer has policies in place requiring an employee who has tested positive for COVID-19 to remain in quarantine, arguments may be made that the employer must continue to pay the employee because the quarantine rule was created and imposed by the employer.
An employer should be aware that it could be subject to required payment under the employer’s benefit plan or other statutes such as the Family and Medical Leave Act or the Americans with Disabilities Act.
Furthermore, this is an evolving situation. New statutes, regulations and agency guidance is anticipated. Even more than usual, employers should consult with legal counsel regarding employers’ obligations during this national emergency.
Reductions in Pay
Employers seeking to reduce compensation may file a new LCA with the DOL and visa petition amendment or extension with the USCIS stating the new wage offer.
Note that the wage offer must still be at least the higher of the prevailing wage paid to similarly employed workers in the same geographic area or similar employed workers of the employer.
The lower wage may start after the USCIS receives the visa petition. There is no requirement to wait for agency approval.
Converting a job from full-time to part-time
Employers seeking to convert a job from full-time to part-time must file a new LCA and a petition amendment or extension. The change may commence after the petition is received by the USCIS.
Changes in work location / working at home
In response to shelter-in-place or similar provisions arising from the COVID-19 pandemic, many employers have employees working from home. Unless that new job site was included on the original LCA, DOL rules govern what action is required.
DOL regulations require employers to post notice of the LCA filing at the job site in two clearly conspicuous locations for 10 days, regardless of whether a new LCA was filed. Though the regulations do not provide specific exceptions for home worksites, during a 2017 American Immigration Lawyers Association’s Liaison meeting with the DOL’s Wage and Hour Division, the DOL indicated that the agency would not expect employees to post at their home residences. If the worker will be working at home in a geographical area of employment that is not covered by the LCA, the employer can post at its headquarter.
Employers who have closed their offices due to the COVID-19 may not be able to physically post the notice at the headquarter office. In that case, employers may opt for electronic notification. DOL regulations provide that an employer may accomplish electronic notice by any means it ordinarily uses to communicate with its workers about job vacancies or promotion opportunities. For example, the employer can post the notice on an internal “home page” or “electronic bulletin board.”
DOL regulations also state that the posting is required on or before work at the new site begins. In response to COVID-19, the DOL relaxed this requirement and issued guidance stating that employers are in compliance if the posting is done within 30 days after work at the new site begins.
No new LCA if the new job site is in the same geographic area
If the new job site/home office is within the normal commuting distance of the job site listed on the approved LCA, no new LCA is required.
The DOL has not clearly identified how many miles is considered the normal commuting distance. If the new job location is within a Metropolitan Statistical Area (MSA) or a Primary Metropolitan Statistical Area (PMSA), any place within the MSA or PMSA is deemed to be within normal commuting distance of the place of employment. The borders of MSAs and PMSAs are not definitive measures. If the new job site is within 50 miles, that is likely to qualify.
No new LCA required for short-term placement
DOL regulations also state that a new LCA is not required for short-term placement at the new job site.
This rule applies to H-1B only. To qualify, the employer must first meet the following conditions:
- must fully satisfy the other requirements to which it agreed upon on the approved LCA;
- shall not place, assign, lease, or otherwise contract out any H-1B workers to any worksite where there is a strike or lockout in the course of a labor dispute in the same occupational classification(s) as that of the H-1B worker;
- must continue to pay the required wage, the actual cost of lodging, and the actual cost of travel, meals and incidental or miscellaneous expenses for the duration of the assignment.
The DOL identifies 30 workdays or less in a one-year period as short-term.
Sixty workdays or less in a one-year period is considered by the DOL to qualify as short-term only if all of the following conditions are met. The employee must:
- continue to maintain an office or work station at the previously approved permanent worksite (e.g., the worker has a dedicated workstation and telephone line(s) at the permanent worksite);
- spend a substantial amount of time at the permanent worksite in a one-year period; and
- maintain a residence located in the area of the permanent worksite and not in the area of the short-term worksite(s) (e.g., the worker’s personal mailing address; the worker’s lease for an apartment or other home; the worker’s bank accounts; the worker’s automobile driver’s license; the residence of the worker’s dependents).
The short-term placement rule does not apply for worksites for which the employer has a certified LCA for the occupational classification. In other words, if the employer has a certified LCA for a worksite, it must follow the proper rules to post notice.
The DOL regulations did not contemplate a home office as a short-term placement. In any event, employers may well need to have employees working from home for well more than 60 days. Once any H-1B worker’s short-term placement has reached the time limit as stated above, the employer should take one of the following actions, if applicable:
- File an new LCA for the new worksite and an amended H-1B petition; or
- Immediately terminate the placement of the H-1B worker and revert to the permanent worksite as indicated on the approved LCA.
Keep in touch
These are difficult times and government rules are reasonably expected to evolve, but not always as fast or in the ways expected. Dentons makes available to clients a large number of COVID-19 related resources regarding laws and regulations around the world.
Please contact your Dentons lawyer for further assistance.
