H-1B Worker Terminations Must Follow Three-Step Process

Severing the employment relationship with a worker who holds an H-1B visa before the visa expires can expose employers to liability if the process is not followed properly.

Terminating an H-1B worker's employment triggers specific obligations for employers because the employee will in most cases immediately lose status to live and work in the United States.

When an employer fires an H-1B worker, it must do these three things: clearly inform the employee of the action, notify U.S. Citizenship and Immigration Services (USCIS) that the visa petition should be cancelled, and offer to pay "reasonable" transportation costs for the employee to return to his or her home country.

Notify the Employee

Employers are required to begin the termination process by providing clear, written notification to the employee that the employment relationship has been ended.

"The most obvious way for an H-1B employer to meet the first step is to send a letter or e-mail to the H-1B employee notifying him of the termination of employment," said Chris Musillo,immigration attorney and managing partner at Musillo Unkenholt in Cincinnati.

Musillo explained that in a recent Department of Labor (DOL) decision, a health care staffing firm was ordered to pay $55,587 in back wages to a terminated nurse manager working in the U.S. on an H-1B visa, for delaying nearly five months before sending the employee a termination letter.

H-1B employers should consider giving as much notice as possible of a termination affecting an H-1B worker, even though there is no requirement to do so, said Katie Nokes Minervino, a partner in the Portland, Maine, office of Pierce Atwood.

"An H-1B termination without advance notice may make it more difficult for the H-1B worker to maintain a lawful status in the United States while finding and transitioning to another employer. Termination without notice may also make it more difficult for the employee to take advantage of H-1B porting provisions which allow eligible employees to commence work in valid H-1B status upon timely filing of an H-1B change of employer petition," she said.

Minervino said that in some cases, an employer may want to consider an immediate termination of job duties, followed by a defined period of salary continuation during which the employee will remain on the payroll and will maintain H-1B eligibility to allow the employee a "softer landing" and improved chances to transition to another H-1B employer.  

Alert USCIS

Employers are required to notify USCIS by letter of any "material change" to the terms and conditions of an approved H-1B petition, including termination of the H-1B worker's employment. Experts recommend mailing a certified letter to the USCIS service center that approved the H-1B visa, providing the date of termination and a request to revoke the petition.

"Notifying USCIS of the termination is considered a 'bona fide' termination and clear evidence that the employer is ending their obligations under the labor condition application (LCA)," said Addie Hogan, a partner with the Pearl Law Group, an immigration law firm based in San Francisco. "Without notification to USCIS, an employer leaves themselves open to a suit from a terminated H-1B worker for back wages." The reason for termination does not need to be provided, she added.

In another recent DOL judgment, a chemical manufacturer was ordered to pay $182,943 in back wages for failing to notify USCIS that it terminated an engineer on H-1B status. The worker was fired for unsafe conduct after two months, but was awarded back wages from the time he was fired until the time he left the United States, nearly three years later.      

The judge determined that because the employer had not notified USCIS, it had "benched" the employee rather than terminated him under the regulations governing the H-1B program.

Benching is when an employer temporarily places the employee on an unpaid leave of absence or temporary status before termination.

"Department of Labor rules are very clear that benching of an H-1B employee is not allowed," Hogan said. When an employer submits a LCA to the DOL, it attests that it will pay the H-1B worker according to the wage and hours indicated on the LCA. "There are no exceptions to this, even in scenarios where companies may have shutdowns or companywide furloughs where U.S. workers may not get paid," Hogan said. "In these situations, H-1B workers must still be paid the wages in the LCA. The only situations where an employer is not obligated to pay the wage on the LCA are situations not related to employment, such as medical or family leave requests made by the employee."

Employers may place an H-1B worker in nonproductive status, but they must still pay the wages indicated on the LCA, Hogan stressed. 

Offer to Pay for Return Travel

Employers must offer either to directly purchase a travel ticket or reimburse the cost of the travel to the terminated worker's home country. "The employer should consider, in a written offer, specifying … whether the return transportation offer is limited to the principal H-1B worker and not dependent family members and that the offer does not include other relocation expenses," Minervino said.

She added that the employer should also consider specifying in writing the steps required for employee acceptance, such as requirements that the offer is subject to prior approval of the transportation arrangements and expenses by the employer and must comply with the employer's normal procedures for expense reimbursement.

The offer should "specify a reasonable time on or after the employee's last day of employment for receipt of the employee's response, perhaps with language specifying that, if the employee does not respond within the designated time, the offer will be deemed rejected," Minervino said.

If employers actually pay for the return flight for the terminated employee, HR should retain a copy of the ticket and proof of payment. If the employee purchases the ticket and the employer issues a reimbursement, HR should retain receipts for the purchase and, if possible, have the employee sign a document acknowledging receipt of the payment.