The COVID-19 pandemic firmly reshaped how we envision and utilize the workplace. Many employers were forced to allow hybrid or fully remote work schedules and, though COVID-19 restrictions have largely been eliminated, the repercussions of the pandemic persist. Employers should continue to update their work location policies to ensure consistent implementation and enforcement across the workforce.
There are also immigration law challenges to consider when employing foreign nationals who may be working remotely. Specifically, employers must be keenly aware of the potential pitfalls for employees in H-1B, H-1B1, and E-3 status. Having an outdated policy (or no policy) in place to address these workers can be costly to the organization.
The H-1B, H-1B1, and E-3 regulations require employers to maintain a Labor Condition Application (LCA). The LCA requires the company to list each worksite where the foreign national will provide services, attest that the foreign worker is being paid the “required wage rate” applicable to each worksite, and confirm that the worker is provided the same working conditions and fringe benefits that are offered to similarly employed U.S. workers. Within the scope of this article, the most critical issues are the “worksite” and the “required wage rate.” When drafting an LCA, an employer must list the foreign national’s “place(es) of employment” (except for limited short-term placement), meaning the worksite or physical location where an H-1B, H-1B1, or E-3 employee actually performs their work[1]. The employer must also attest that it will pay at least the prevailing wage – the average wage paid to similarly employed workers in the specific occupation within the geographic area of intended employment.[2]
The employer must pay the prevailing wage set by the Occupational Employment Statistics (OES) program or some other legitimate or independent authoritative source to the foreign national wherever they are physically performing the job. When the LCA regulations were introduced in 1990, with minimal changes in the early/mid-2000s, the Department of Labor (DOL) did not contemplate how technology and circumstances may impact the understanding of permanent worksites. Even now, after the pandemic, the DOL and U.S. Citizenship and Immigration Services (USCIS) have yet to provide firm guidance on remote schedules. However, both agencies have indicated that a home office constitutes a “place of employment” and that the location of that home office is determinative in setting the prevailing wage.
For example, for fiscal year 2024, the Occupational Employment and Wage Statistics (OES) provides that an entry-level Web Developer working in Pittsburgh, Pennsylvania, must be paid at least $47,736/year, while the same worker in San Francisco, California, must be paid at least $71,448/year. If a foreign worker was initially hired to work in Pittsburgh, but is later permitted to work remotely in San Francisco, the employer must pay the San Francisco prevailing wage. Though this obligation may seem straightforward, it can lead to considerable complications. In addition to the increase in wages, having a higher prevailing wage for a remote-based foreign worker that is not commensurate with the salary of a similarly situated U.S. worker might expose the company to claims of national origin discrimination and unfair treatment of U.S. workers. Conversely, if a prevailing wage is lower and not commensurate with the similarly situated U.S. worker, the company may not comply with the LCA attestation that the foreign worker receives the same benefits as other U.S. employees.
Employers must also look at the potential impact that any immigration employment policy might have on employees who do not require immigration support. For example, if an employer plans to limit relocation requests because the relocation would require higher wages and/or for other reasons (such as employer-associated requirements of having an employee in a state in which the employer previously did not have any employees – i.e., registration, taxes, etc.), the employer may need to ensure a facially neutral relocation policy in that case. We recommend that relocation requests be considered on a case-by-case basis and may be denied if the relocation imposes new and additional requirements on the company and/or requires an increase of more than a certain percentage of the employee’s current wages. The neutral policy will not necessarily protect the company from disparate impact claims, but it will clarify the legitimate business reasons for the policy and help protect it from disparate treatment claims. This type of policy also clarifies to employees that they cannot relocate wherever they would like and that there are associated implications for the company that must be considered.
Please also consider that moving from one Metropolitan Statistical Area (MSA)[3] to another requires the employer to file an amended petition with the USCIS because the agency considers this type of relocation to be a material change in the terms and conditions of the foreign worker’s employment. This may result in additional employer costs, including legal and USCIS filing fees. Additionally, an amended petition must be filed with the USCIS before the foreign worker’s relocation.[4] Failure to file an amendment or filing after the foreign worker has moved and begun working at the new location will result in compliance risks. This is not a hypothetical situation—USCIS investigators routinely visit worksites to verify that an H-1B visa worker is located at the site or sites specified in the LCA. If not, USCIS will issue a Notice of Intent to Revoke the H-1B visa petition, which triggers a compliance crisis.
On the other hand, if a foreign worker relocates within their current MSA, an amended petition may not be required, avoiding the legal costs and administrative burdens outlined above. Instead, it may be sufficient to repost the initial LCA electronically or at the foreign worker’s new worksite address for the required 10-business day period and add it to the company Public Access File (PAF) with a memo noting the location change.
Allowing hybrid and remote schedules can be excellent retention and recruitment tools for employers. They better enable companies to recruit and retain talent and provide additional benefits, such as improved productivity, greater work/life balance, and reduced traffic congestion. However, when a company employs foreign nationals, the employer must work with both employment and immigration counsel to create a robust and fair work location policy. Dentons has an experienced team of Employment and Immigration attorneys who can help you set conditions for your remote policy so that everyone can continue to benefit from this “new normal.”
[1] DOL, Wage and Hour Division, Fact Sheet #62J: What Does “Place of Employment” Mean? (rev. July 2008), https://www.dol.gov/agencies/whd/fact-sheets/62j-h1b-worksite.
[2] DOL, Wage and Hour Division, Fact Sheet #62G: Must an H-1B worker be paid a guaranteed wage? (rev. July 2008), https://www.dol.gov/agencies/whd/fact-sheets/62g-h1b-required-wage.
[3] A MSA is a core area, usually a city and adjacent communities, that are linked by economic and social factors as delineated by the Office of Management and Budget (OMB)., United States Census Bureau (2023), https://www.census.gov/programs-surveys/metro-micro/about.html.
[4] The employee may begin working at the new location as soon as USCIS receives the properly amended petition.
