H-1B Employers and Coronavirus: Obligations Your Business May Have to Workers

Navigating the uncharted waters of sponsoring H-1B employees during the COVID-19 pandemic.

Even when there's not a worldwide pandemic going on, employers that sponsor employees for H-1B visas to work in the United States soon find out that they have ongoing monitoring and compliance concerns to maintain the employees' immigration status. Changes to employees' type of work, hours worked per week, work location, and employing entity (that is, when an employee moves among legal entities within a larger group or to another organization altogether) can affect employees' status. Such changes can require the employer to file an amended petition or other action. The coronavirus or COVID-19 pandemic that began in the year 2020 makes H-1B sponsorship even more confounding.

Government-mandated "stay-at-home" orders and work stoppages rolling out across the country put several issues before H-1B employers: changes in employment, remote work, furloughs, and terminations.

Changes in employment call for a case-by-case review. Remote work has its own set of nuanced considerations. Furloughs require a careful analysis to determine whose decision it was to furlough the H-1B worker. Terminations also present some tricky issues.

This article reviews the legal requirements and tries to make some sense of how employers can interpret their H-1B sponsorship duties in the midst of a pandemic.

H-1B Employees Who Change Job Duties or Employers

The pandemic has not changed the H-1B landscape for new job duties or employers. If H-1B employers want to assign different job duties to the sponsored employee, they first must assess whether the new job duties reflect a "material" (as in, major or big) change from the existing job.

If yes, the employer first must submit an amended H-1B petition on Form I-129 to U.S. Citizenship and Immigration Services ("USCIS").

If the change is not a material one, the employer does not need to submit an amended petition. An example of a material change would be an employer that wants a Civil Engineer to work as an Accountant. A non-material change could be a mid-level Civil Engineer advancing to the next step in the career progression. In the former case, the new duties are entirely different. In the latter, the job at the core remains essentially the same.

A similar analysis would apply to a change in work hours. Going from 40 hours per week to 37.5 hours per week would not be a material change, because it's likely still considered full-time. (In this example, it could be a good idea to file an H-1B petition with USCIS by checking the box for "Change in previously approved employment" and note the reduced hours.)

Going from 40 to 20 hours per week would be a material change and accordingly require an amended H-1B petition.

Changes in employers are even more clearcut. A simple rule to follow is that if the H-1B worker will work for an organization that has a different Federal Employer Identification Number ("FEIN"), the employer must submit a new or amended H-1B petition. In larger companies, there could be dozens of different divisions, which all are separate legal entities with their own FEIN. Moving an H-1B worker among those entities would require an amended H-1B petition.

On the other hand, many such large organizations have one single entity that serves as the official employer for payroll and other administrative matters. In that case, subject to the other considerations discussed in this article, assigning the H-1B worker to a different division would be akin sending that person to a new department within the building. That latter scenario would not require an amended petition.

H-1B Employees Who Do Remote Work

Let's make it a bit more complicated. If the H-1B petition already stated that the employee would work from home, and the employee can continue to do so, there is nothing to do.

On the other hand, if working from home now will be offered or required, employers need to know whether the H-1B employee's home is within normal commuting distance from the usual place of work. If yes, the employee simply needs to post a notice at his or her home office or workstation for ten business days. The notice is the same one that the employer posted when submitting the Labor Condition Application ("LCA") to the Department of Labor ("DOL"). The notice contains the number of positions covered by the LCA, job title, rate of pay, and dates and location of intended employment. It also states where any interested party can review the LCA and that complaints concerning the LCA can be filed with the DOL's Wage and Hour Division.

If the employee's home is outside the normal commuting distance of the employer, the employee can work there for up to 60 days per calendar year. As soon as the employer knows or thinks the arrangement could go beyond 60 days, it must obtain a new Labor Condition Application from the DOL and submit an amended H-1B petition to USCIS.

H-1B Employee Furloughs

And now it's time for graduate school. H-1B employers will recall that as long as they continue to employ an H-1B worker, they normally need to continue to pay 100% of the employee's wages until they withdraw the H-1B petition through written notification to USCIS. They also will remember signing the statement on the H-1B petition confirming that they will be liable for return transportation of the employee to his or her last country of residence abroad if the employer terminates the employee. That's more or less straightforward.

What about a furlough? The key question to ask in a furlough situation is, who is making the decision to furlough the H-1B worker? Is it the employee asking to be relieved from work due to fear of contracting the coronavirus? Is it because the employer is cutting costs before a coming recession? Or is it a federal, state, or local government shutting down the employer? In the first example, the DOL rules would support an employer not paying the H-1B worker's wages. In the second example, the DOL would expect the employer to pay the wages. The third example is where it gets complicated.

The coronavirus pandemic has created unprecedented developments that the DOL regulations governing H-1B employer wage obligations do not address. The example in the regulations concerning when an employer must continue to pay an H-1B worker's wages ("because of lack of assigned work") speaks to a decision by the employer to put the worker in a nonproductive status. The examples relating to the employee's situation ("touring the U.S., caring for ill relative…maternity leave, automobile accident [sic] which temporarily incapacitates the nonimmigrant") suspend the employer's obligation to pay the H-1B worker's wages. Although there is no specific provision concerning global pandemics or a government-mandated work stoppage, such work cessation most certainly is not the employer's decision, yet it does temporarily prevent the H-1B worker from engaging in normal, productive employment status.

Therefore, H-1B employers could put forth a reasonable interpretation of the regulations and express their intent to comply with the H-1B wage obligation to argue that a government-mandated work cessation qualifies as a period during which H-1B employers are relieved from paying wages to H-1B workers. Employers could document this in the form of a memo to the public access file, which all H-1B employers must maintain.

To be sure, the DOL might take a contrary position in an investigation and require payment of back wages. Nonetheless, pandemic-related work stoppages call for employers to do some thinking outside the box to try to comply with H-1B sponsorship requirements.

For those who find the above approach too aggressive, and to be sure, there are plenty who do, the most conservative approach is simply to pay the H-1B worker's wages regardless of the reason for the furlough. As noted, the regulations do not have a "pandemic" provision. While this leaves employers guessing and searching for answers, the simplest approach is to pay the H-1B worker during a furlough and thereby eliminate any exposure for back wages.

H-1B Employee Terminations

An employer that terminates an H-1B worker must offer to pay for return transportation to the employee's last country of residence abroad. In North America, that could mean a bus ticket. For any other location, it's a one-way plane ticket. The employer can research the cost of the ticket, document the research, and then give the employee a check.

If the employee expresses a desire to remain in the United States and refuses the return transportation offer, the employer should get the refusal in writing. The return transportation requirement does not apply to any dependent family members who might be in the United States in H-4 status.

Aside from the unlikely survivor of the Spanish Flu, it's doubtful that anyone around today has experience with the complexities brought on by the coronavirus. H-1B employers navigating the gray areas of reduced hours, alternate work arrangements, furloughs, and terminations need to look closely at their evolving situations and make good-faith efforts to comply with the rules. Doing so will further the policy goals of the regulations while reducing or eliminating exposure if the DOL or USCIS comes knocking.

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