Pay Your Employees What You Promised Them Or Pay The Government And Your Lawyer(S) A Whole Lot More

Occasionally I write on labor and employment issues related to immigration law. This is one of those times. The purpose of this article is to inform both employers and employees alike of what the law is. While it should not be construed as legal advice, it should be interpreted as follows: You must follow the law. If you don’t, you will expose yourself to significant financial liability and perhaps the ruination of your business.

Prior to filing an H-1B application on an employee’s behalf, an employer certifies (promises) under penalty of perjury that it will pay an employee 100% of the level one prevailing wage for the position at issue. This certification is initially made when you file the Labor Condition Attestation with the Employment and Training Division of the United States Department of Labor. Normally, this attestation is filed on-line. Your lawyer should provide you a copy of the same when it completes the Public Access File on your behalf.

You (the employer) again promise under penalty of perjury that you are paying your employee at least 100% of the level one prevailing wage when you/your lawyer-lawyers who file H-1B applications represent both the employer and employee unless the contrary is specifically stated in writing-file documents with Citizenship and Immigration Services. When you don’t pay your employees what you promise them, you have violated the law. And, these legal violations can and often do become quite costly.

So, why this article now? Reason is that the United States Department of Labor recently negotiated a class settlement on behalf 232 foreign workers that were not paid what they should be paid. The employer was ordered to pay $2,250,000 in unpaid wages and a $400,000 fine. While the reader(s) of this article would normally be small to midsize businesses, the law is the same as applied to you.

What ends up happening is that when one of your H-1B employees becomes disgruntled, a complaint might be filed with the United States Department of Labor or by attorneys such as us, in the private sector. When a complaint is filed and facts ultimately discovered, normally it is revealed that in addition to failing to pay a worker what you promised you would on the application itself, you have also violated federal minimum wage and overtime laws, not to mention a panoply of other related issues. These types of complaints can and often do result in other federal agencies, such as the Internal Revenue Service getting involved. Why? Because if you paid less than what you were supposed too, you also didn’t pay the necessary payroll taxes. So, in addition to getting sued by your employees, you also might find yourself on the receiving end of a lawsuit filed by a federal agency.

All employers seeking to hire H-1B non-immigrants must be aware of and thus comply with, their contractual obligations with the Department of Labor. The Department of Labor aggressively enforces the law (as it should) to ensure that temporary foreign workers are compensated fully and fairly. Mark my words. Prior to any comprehensive immigration reform, the government will shore up enforcement mechanisms both at the borders and within the private sectors. Meaning, before any “amnesty” is passed, it will be mandated that employers must comply with the law. In fact, the law on employer sanctions was a result of the last amnesty passed by President Reagan.

You as an employer must pay your employees what you state under penalty of perjury you will pay them. That your employees come from the Philippines and might be perceived as not knowing the law is a costly error to make. If your employee has an H-1B, that means that have at the very least, a bachelor’s degree. And, if they don’t know the law at first, they will learn from their friends, colleagues, and lawyers that write articles such as this one.