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H1B issues

Got Pay Stubs? Transferring H1B without Pay Stubs

By: Hasan Abdullah, Esq.

An all too common question that immigration law attorneys dealing with H1B cases encounter is whether it is possible for an H1B worker to port his or her employment to a new company if this worker does not have recent pay stubs.

Consider the example of R.S. Singh. After Singh graduated with distinction from a reputable Indian university, he was offered a job by a US consulting firm, YKK Infosys, promising to pay him $60,000 a year as a systems analyst. YKK filed his H1B petition with the US Citizenship and Immigration Service, and the petition got approved. Shortly thereafter, Singh obtain his visa and gained admission to the US.

As soon as Singh arrived, willing and able to work, the employer put Singh on “bench” without pay. He was told that he would only be paid if he was placed on a project. The employer took some initiative to market him to potential client companies with no success. A few months later, through Singh’s own job-hunting efforts, he found a project and was finally put to work… for 4 months. During those 4 months of work, Singh worked 50-60 hours a week, produced excellent quality work, but was paid a paltry $2000 a month – well below the prevailing wage of a systems analyst. Of course, YKK was skimming their share of several thousands of dollars from the client. Once again, Singh would have to look for work while his employer paid him nothing.

As bad as the above scenario seems, in some cases, it has been observed that companies run an audacious scheme in which they charge a thousand dollars or more to the foreign worker just to file the H1B, and if approved, they charge several thousand more dollars to file for the visa to bring them in. Returning to our example, months later, Singh finally found a legitimate employer who offered to port his H1B employment. The new employer’s immigration attorney requested that Singh provide his pay stubs for the past three months to show proof that he was maintaining his H1B status.

Singh replied that he had none, and was worried that he was out of status as a result.Unfortunately, many H1B workers do not realize they have a lot of power with the law being on their side, and quietly endure months of hardship. They fear that if they complain too much, their employer will just notify USCIS that the position is terminated, and force the worker to return to their home country. In reality, as an H1B worker, Singh has the opportunity to file a complaint to the Department of Labor to obtain unpaid wages, and can use this complaint in lieu of pay stubs. This gives any illegally benched employee a lot of leverage against his unscrupulous employer. Consider the following liabilities that YKK would be potentially subjected to:

General Penalties: Failure to comply with all LCA requirements may result in fines from $1,000 to $35,000 per violation, and debarment from all future approvals of visas or Labor Certifications for at least one year.

Back Pay: In cases where the employer does not pay prevailing wage, it can be ordered to pay backpay to make up for the deficiency. The obligation to pay the employee may not be properly terminated unless the employer tells USCIS that the relationship has been terminated so that USCIS may cancel the I-129 petition, and the employer must provided the employee payment to fly back home. Case law precedents dictate that even in cases where the employer notified the employee, but not USCIS of the termination, the H1B remained valid until the end of the LCA period, and the former employee is able to collect back pay with interest. In one case, where the employer was found to have violated H1B/LCA regulations on numerous occasions, the DOL Wage and Hour division successfully pursued a backpay award of over $980,000.

Employers may claim the employee acted in bad faith as well, but still, the employer was held responsible. Even in a case where the employee misrepresented his credentials, given the employer a reason to terminated him, because the employer did not notify USCIS, the clock requiring the employer to cover backpay continued to run. Note that damages accrue from the time the employee makes him or herself available for work. Even if there is no work available, the employer may not use that as an excuse not to pay the employee.

Other Legal Damages:In addition to the DOL requiring the employer to pay fines and back pay for its violations, an aggrieved H1B worker can, for example, seek a claim in federal court based on RICO violations. Potentially, the employer could be required to pay triple the value of unpaid wages (“treble damages”) in addition to attorney fees.

Conclusion: In reality, the majority of consulting companies are legitimate business operations. The above liabilities should be considered a warning to companies who think they are being fair to employees who they are no longer able to support. Because for every situation like Singh’s, there is a situation where an employer pays their H1B employee well, but unfortunately has to terminate the employment prematurely because of a sudden downturn. Following the book, the employer informs the employee that it will be terminating the job and paying for the employee’s airfare to return home. But then the employee might plead with the employer to “park” their H1B, and offer to pay the employer to run pay roll because that employee would rather not return home. In such a case, the employer is obviously running a risk in trusting that the employee will not later report them for illegal benching. The message is that H1B employees should recognize the fact that they have rights, and honest and dishonest H1B employers alike should realize that they have to be very careful not to violate these rights.

Disclaimer: This article is made available by the lawyer or law firm publisher for educational purposes only as well as to give you general information and a general understanding of the law, not to provide specific legal advice. By using this website you understand that there is no attorney client relationship between you and the website publisher. The website should not be used as a substitute for competent legal advice from a licensed professional attorney in your state.

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