We recently hired a person who needed an H-1B visa to work for us. It's been one week since he started. Unfortunately, we have discovered that this person is not a good fit. Are we allowed to terminate him so soon and given all the visa-related paperwork we’ve signed? If yes, is there anything special we need to do?
Yes, you can terminate this employee now, or at any time while your H-1B petition remains valid, and yes, there are two specific things you need to do.
The first thing is that you need to offer to pay for the employee's return transportation to his last country of residence abroad. You may recall from when you signed the "H Classification Supplement to Form I-129" as part of your H-1B petition that you agreed to do this. What this usually means is offering to purchase a one-way plane ticket for the employee to return to his home country. You do not need to pay for airfare for any H-4 dependent family members (e.g. spouse or children).
U.S. Citizenship and Immigration Services ("USCIS") has explained that it views the return transportation requirement as a private contractual matter between you and your employee. USCIS also has said that it will seek to enforce this obligation only in cases where it receives credible information that an employer is terminating H-1B workers and not paying the return transportation costs.
Regardless of what USCIS has stated, the best course of action is to research the cost of a one-way ticket to your employee's home country, document how you arrived at the cost (in other words, print out the airline's or travel company's website screen shot) and give the employee a check for that amount. If USCIS were to audit your H-1B petition and inquire into whether you offered to pay for the employee's return transportation, this documentation would make it an open-and-shut case.
By contrast, if you choose to take a risk and not pay the return transportation, it likely would end up costing you a lot more in attorney fees to explain why you did not do so.
The second thing you need to do is notify USCIS of the termination and withdraw your H-1B petition. As long as the H-1B petition remains in effect, you must pay the employee his wages, even if he no longer works for you. Once USCIS revokes the H-1B petition, your wage obligation ends. To do this, you simply need to send a letter to USCIS stating that the employment has ended and asking for your H-1B petition to be withdrawn. USCIS will confirm the revocation by letter to a few weeks later. The USCIS letter will make the revocation effective as of the date you request.
The Department of Labor (DOL) is the agency that actually enforces the wage obligation, which it does so only upon receiving a complaint, such as from the former employee. The DOL will check with USCIS to determine whether the H-1B petition remains in force. If it remains valid, the DOL will assess back wages from the time you terminated the employee until the date USCIS revokes the petition. If the annual salary you were paying your H-1B worker was $75,000, for example, and you do not revoke the H-1B petition for two years, the DOL will require you to pay the employee $150,000 for the two years.
As you are preparing for the termination, something to consider is the impact upon the employee's immigration status. If the employee does not wish to return to his home country but instead wants to work for another company in the U.S., perhaps you can delay the termination and revocation of the H-1B petition until his new employer has filed its H-1B petition. This would allow your employee to maintain lawful immigration status and remain in the United States for the moment. In this scenario, you also could document that you have offered to pay the return transportation costs, but that he refused it, because he has found a new employer to sponsor him for H-1B status.