BY: David H. Nachman, Esq., Managing Attorney at NPZ Law Group (offices in Ridgewood, New Jersey and New York City), Adjunct Professor of Paralegal Studies, Fairleigh Dickinson University and Bergen Community College.
We have been hearing about the U.S. Department of Labors (DOL) PERM program for some time now. Nearly three (3) years after the DOL announced the desire to implement an electronic and streamlined Labor Certification Application (L/C) process the PERM regulations (the PERM Regulations) are set to take effect on March 28th, 2005.
The PERM Regulations are complex and, as promised, dramatically change the entire L/C process. The following is an overview of the PERM Regulations with appropriate references to some of the critical issues that L/C applicants are likely to encounter when Immigration Attorneys, Employers, Human Resource Managers and House Counsel initiate strategic planning with regard to using PERM.
THE PERM PROCESS OFFERS APPLICANTS CERTAIN ADVANTAGES: The biggest advantage of PERM is that the DOL is promising a sixty (60) day turnaround time for a L/C (that is not audited). The implementation of PERM presents a window of opportunity for foreign nationals seeking lawful permanent residence (green cards) in the United States. The U.S. Department of State (DOS) Visa Bulletin for January, 2005 reports that immigrant visa numbers have retrogressed for India, China, and the Philippines. After March 28th, 2005, as the PERM process is utilized, the L/C approval process will increase and what is likely to happen is that more cases will move more quickly into the I-140 (Petition For An Alien Worker) phase of the L/C process, and as a result, immigrant numbers will retrogress in the EB-3, skilled worker and professional categories.
This means that while it may be the case that one is able to quickly obtain an approved L/C, that same person is likely to have to wait an extended period of time for immigrant visa processing or adjustment of status since the demand for the visa numbers (which is limited on a fiscal year basis) is likely to out pace supply. Presently, it appears that this phenomenon is likely to occur faster in the EB-3 category, but it is conceivable that ripple effects may be felt in the EB-2, Advanced Degree, visa classification in years to come. Unfortunately, the PERM implementation program will present the opportunity for DOL to quickly shift the blame for backlogs to other administrative agencies.
PERMS DISADVANTAGES: The PERM process requires meticulous preparation and a thorough understanding of the PERM Regulations. The PERM process is analogous to the administrative process that surrounds the filing of a U.S. tax return. When one files taxes in the U.S., the filer makes a host of representations, declarations, and attestations about annual income and expenses. When the return is filed, an individual does not submit evidence about annual income and expenses. That information is only provided if the Internal Revenue Service (IRS) sends the filer a notice for an audit. The PERM program works in a similar manner. The L/C is filed by making attestations on a new L/C Form. That Form is then submitted to the DOL. The DOL can certify the Form without receiving any documentation, or the DOL can send out an audit letter.
If an organization is audited, and they don't respond within the thirty (30) day period specified in the Regulations, or the company doesn't have the appropriate documentation to provide to the DOL, a further investigation of the organization ensue. The failure to provide the DOL with proper documentation upon its request may bar the prospective employer from using PERM for a two (2) year period and/or the prospective employer may have to undergo supervised recruitment, which is very costly and time-consuming process. Thus, any user of the PERM process will want to ensure compliance with all of the PERM requirements (have all of the PERM supporting documentation) before the L/C is submitted to the DOL in order to be capable of accurately and appropriately responding to DOL queries in the event of a PERM audit.
PERM PROCESSING PROCEDURES: The Regulations clearly state that the first step in the PERM process will be to obtain a Prevailing Wage Determination (the PWD) from the State Workforce Agency (the SWA) (e.g. The State of New Jersey Department of Labor, Alien Labor Certification Unit) in the State where the position has been offered to the prospective employee. It is important to note that the PWD area of the law is constantly evolving. Once the PWD is obtained, the organization must undertake a recruitment process. The recruitment process consists of placing a job order with the SWA and placing two (2) Sunday advertisements in an appropriate newspaper. The recruitment process needs to be completed within six (6) months of the filing of the L/C. Furthermore, the L/C cannot be filed until thirty (30) days have passed from the last recruitment effort. This, the PERM Regulations point out, allows an optimal period of time for the recruitment process to attract able, willing and qualified U.S. workers.
If the position being offered is one that is professional in nature, then there are two additional steps that must be taken in the recruitment process under the PERM Regulations. Once the recruitment process is complete, a document must be created that accurately explains the specific job related reasons for rejecting U.S. workers. Once the PERM requirements are met, a PERM L/C can be filed either electronically or by mail with the DOL. The Regulations do not allow for facsimile submission of a PERM L/C. If the case is worthy of immediate certification, the DOL should respond within forty-five (45) to sixty (60) days. If the L/C is certified, the certification will be sent by mail. If the case is not certified, the DOL will send an audit letter requesting additional information. Applicants will be given thirty (30) days to respond to the audit letter.
PERM RECRUITMENT AND THE PREVAILING WAGE PROCESS:
PERMS PREVAILING WAGE DETERMINATION PROCESS: Any applicant for the PERM L/C must be paid the prevailing wage for the position offered. Until now, the employer could pay 95% of the prevailing wage. Under PERM (for the L/C), and pursuant to the provisions of The H-1B Reform Act of 2004 (for the H-1B), employers will have to pay employees one hundred percent (100%) of the mandated prevailing wage. One popular way to obtain the federally mandated prevailing wage is to use the Occupational Employment Statistic (OES). The often criticized OES reports two salary levels. Level one is for entry-level positions. Level two is for senior-level positions (which is anything above entry-level). Now, under PERM (and also The H-1B Reform Act of 2004), there are four wage levels, which will take into account middle level positions as opposed to only entry level (Level One) and senior level (Level Two).
Procedurally, the Applicant(s) must first obtain a PWD from the SWA having jurisdiction over the location of the job offer. Each State has a special form that allows one to make a prevailing wage request. The PERM Regulations do not specify the time period that a SWA has to render a PWD. However, the PERM Regulations call for the SWA to issue a quick response. In the PWD process, an organization may use their own survey (private survey) but the survey will need to meet the special criteria set forth in GAL 2-98. The PERM Regulations suggest that if the SWA is familiar with a particular wage survey, then it should not undertake an entire analysis of the survey each time a PWD request is submitted to determine if it meets DOL standards.
As previously indicated, one of the most popular ways to determine the prevailing wage has been to use the OES. The PERM Regulations state that the employer may add any guaranteed bonuses or commissions to the salary to meet the prevailing wage. If the bonus or commission is not guaranteed, it cannot be added to the specified wage. Consistent with the prospective nature of the L/C process, the prevailing wage must be paid from the time that the prospective employee takes the offered position after lawful permanent residence (LPR) in the U.S. has been granted.
It is important to note at this juncture that the offered wage does not have to specified in the recruiting advertisement but it does need to be specified on the physical posting at the worksite. The PERM Regulations provide that the worksite posting can include a salary range if, and only if, the lower-end of the specified range is equal to 100% of the designated prevailing wage. For Schedule A positions (e.g. a Nurse position), a PWD from the SWA is now required. Should the requester disagree with the specified PWD, supplemental information may be required or a request may be made for a new PWD or the request or may appeal the PWD utilizing the administrative process.
RECRUITMENT USING THE NEW PERM WORKSITE POSTING REQUIREMENT: After the PWD is obtained from the SWA, the employer must post a notice of the job opportunity at the worksite for not less than ten (10) BUSINESS days. The notice must be posted from 30 days to 180 days prior to filing the L/C. The notice must specifically designate the address where one viewing the posting can report complaints to an appropriate office of the DOL. As previously pointed out, the offered wage does not have to be listed in the recruiting advertisement but it does need to be specified in the physical posting at the worksite.
REAL WORLD RECRUITMENT USING IN-HOUSE MEDIA UNDER PERM: If the organization normally uses in-house postings or internet postings to recruit workers then the organization must do what it normally does for in-house media notifications, in terms of both the length and the content of the posting.
REAL WORLD RECRUITMENT USING THE SWA JOB ORDER UNDER PERM: Part of the recruitment process is that the organization must place a job order for the offered position with the SWA for a period of thirty (30) days. This means that an advertisement for placement of a job order must be sent to the SWA at least thirty (30) days prior to filing of the L/C.
REAL WORLD RECRUITMENT USING THE SWA JOB ORDER UNDER PERM: The PERM Regulations provide that the organization must place two (2) advertisements on two (2) different Sundays in a newspaper of general circulation in the area of intended employment. The advertisements (as with other recruitment) must be done at least thirty (30) days before and less than six (6) months prior to filing of the L/C.
According to the PERM Regulations, the advertisements must contain the following information:
- The name of the employer; and
- The geographic area of employment; and
- A description of the job specific enough to apprise U.S. workers of the job opportunity. The description may (but need not necessarily) include the experience requirements and minimum education requirements; and
- The advertisement does not have to contain the salary or a detailed description of all of the job requirements.
The PERM Regulations specify that if a job is one that is designated as Professional (which is generally a job listed in an Addendum to the Regulations) then three (3) additional real world recruitment efforts need to be undertaken.
The prospective employer has a choice of three (3) of any of the following:
- Evidence of recruitment for the position at job fairs; and/or
- Posting on the prospective employers website; and/or
- Posting of the position on a job-related website other than that of the prospective employers. (For example, if a print advertisement is made in the New York Times then the prospective employer can use the internet advertisement that appears at the New York Times website to satisfy this requirement.); and/or
- Evidence of on-campus recruiting at colleges or universities; and/or
- Listings with or in journals of trade or professional organizations; and/or
- Efforts of recruitment from private employment firms; and/or
- Evidence of employee referral program(s) (but only if the program provides specific incentives for referrals); and/or
- Listings in local and ethnic newspapers, to the extent they are appropriate for the job being offered; and/or
- Evidence of radio and/or television advertisements for the position.
Only one of the foregoing additional recruitment steps can be made within thirty (30) days prior to filing the L/C. The other recruitment efforts must be made within six (6) months of the filing of the L/C.
PERM RECRUITMENT REPORT FOR THE DOL: Following recruitment efforts, the prospective employer is required to prepare and maintain a detailed recruitment report that fully and accurately describes the recruitment efforts undertaken and the results. The recruitment report must include the number of positions available, the number of U.S. workers rejected which have been categorized by the job-related reasons for rejection. While not required as part of the report, in the event of an audit, the DOL may request copies of workers resumes, sorted by the reasons for rejection. The PERM Regulations do not require the report to contain the names of the U.S. workers who applied for the prospective position(s). The recruitment report and other supporting documentation must be retained for five (5) years from the date of filing of the PERM L/C.
SPECIFYING THE METHOD FOR THE REJECTION OF U.S. WORKERS UNDER PERM: If U.S. workers do not meet the specified minimum requirements for the prospective position being offered on a full-time and permanent basis, he or she may be rejected. However, the Regulations make it clear that if a worker lacks a skill that may be acquired during a reasonable period of on-the-job training, the lack of any such skill is not a basis for rejecting an otherwise qualified U.S. worker.
FILING THE LABOR CERTIFICATION UNDER PERM:
PERM FILING: After the prospective employer has completed the recruitment process, the organization can electronically file the L/C or can send it by mail (original signatures are required in this case) to the appropriate processing center. Presently, the PERM Regulations do not indicate that a filing fee is required to file an L/C. However, the DOL has reserved this possibility for a future rule.
TRANSITION OF PENDING CASES TO PERM: If someone has a pending L/C, the PERM Regulations allow the withdrawing and re-filing of cases prior to the placement of a job order by the SWA. Since the implementation of GAL 1-97, almost all of the cases that have been filed by our office have been filed as Reduction-in-Recruitment ("RIR") cases and ninety nine percent (99%) of these cases do not require SWA job orders, therefore, in practical terms, the case may be withdrawn.
If a case is successfully withdrawn, and re-filed, the original filing date will be preserved, so that the case can be converted to PERM. This is very important because of the retrogression of EB-3s, having a older filing date which may decrease the chances of delay due to the reported regression in EB-3 numbers (which we see in the Visa Bulletin for Employment-Based Visas for January, 2005). The PERM Regulations make it clear that in order to convert to PERM, all re-filed cases must comply with all PERM Regulations including recruitment and minimum requirements, business necessity, audit procedures and PWD issues.
One of the problems with re-filing a case under PERM is that the case can only be withdrawn and re-filed if it is for the identical job opportunity. This means, the same employer, same alien, job title, job description and minimum requirements including any changes as per previous SWA requests. The problem is that if the case is not found to be "identical", the original priority date (the date of filing of the original application) will be lost and will not be able to be used on another application. If the L/C was filed in order to preserve a 7th Year H-1B, it is very important to fully analyze the circumstances before a pending case should be withdrawn. If there are any questions with respect to whether the case is "identical", it may be better to start the process from the beginning until the DOL promulgates an interpretation concerning this issue.
For example, if the company has undergone a corporate restructuring and has a new Employer Identification Number ("EIN"), the DOL may not find the PERM L/C to be "identical to the original L/C. Even if the job site has changed (e.g., where the prospective employer has moved) the DOL could find that the original L/C is not "identical". Also, in the event that the wage is not one hundred percent (100%) of the PWD specified in an old L/C, it may not be found that the PERM L/C is not "identical".
From a practical perspective, applicants should be aware that the PERM process is new and that it will take some time for DOL representatives (and immigration law practitioners) to develop and understand PERM nuances and hone PERM strategies so as to obtain a PERM L/C on a "fast track."
PERM NUANCES: MINIMIZING DOL RESISTANCE TO ACHIEVE EXPEDITIOUS LABOR CERTIFICATION PROCESSING IN A PERM WORLD:
BUSINESS NECESSITY IN A PERM WORLD: Under the PERM Regulations, the concept of business necessity remains a defense to a DOL allegation that the employer designated special requirements for a proposed position. To prove business necessity an employer must demonstrate that the job requirements bear a reasonable relationship to the occupation. A prospective employer may have a business necessity for a foreign language or an uncharacteristic combination of job duties. The DOL has recognized that foreign languages are a business necessity in the workplace when there is a need by the prospective employer to communicate with a majority of the employers customers, employees, and/or contractors.
To prove business necessity in this context we have advised (and continue to advise) prospective employers to retain information including, but not limited to: (1) the number and proportion of employers customers or employees that do not speak English; and/or (2) plans to market to a foreign country; and/or (3) why the job duties include frequent communication with such individuals. Additionally, a combination of duties are permissible if a prospective employer can demonstrate that it normally hires individuals with such combinations of skills or that such a combination of skills is customary in the industry.
EXPERIENCE WITH THE SAME EMPLOYER IN A PERM WORLD: Previously, the DOL has taken the position that experience gained while working for an employer cannot be used to meet the experience requirement in the L/C. The PERM Regulations allow experience gained by the foreign national with the same employer so long as that experience is not substantially comparable to the job for which certification is sought. The term substantially comparable is defined in the PERM Regulations as a job requiring the performance of the same duties more than fifty percent (50%) of the time.
Additionally, the PERM Regulations take a very liberal and practical approach with respect to related entities, such as foreign employers. The PERM Regulations state that experience can be used for the L/C if the prospective employing entity does not have the same U.S. Employer Identification Number (EIN). Presumably this means that any experience gained abroad or in a subsidiary may be used since such entity would not have an EIN.
PERM APPROVAL/DENIAL, AUDITS AND INVESTIGATIONS:
PERM AUDITS AND NOTIFICATIONS OF AUDITS: Organizations throughout the U.S. have been exposed to the DOLs audit and enforcement powers in connection with complaints filed either directly (discretionarily) by the DOL or by complaining H-1B nonimmigrants in connection with the Labor Condition Application (LCA) process and the American Competitiveness in the 21st Century Act (ACWIA).
Similarly, the PERM Regulations state that the DOL can request an audit of any pending L/C for cause or in the DOLs discretion. In the event that a prospective employer is noticed for audit, the prospective employer will receive an audit letter that lists the additional documents that will be required to be submitted. The audit letter shall set a date that is thirty (30) days from the date of the letter for submission of the additional documents and shall advise the prospective employer that the L/C will be denied if the information is not received in a timely manner. If the prospective employer does not respond, the PERM L/C will be denied.
Additionally, the prospective employer may also be required to conduct supervised recruitment for any future labor certification filings for up to two (2) years. Supervised recruitment is the traditional L/C process that has existed for years and requires a three (3) day advertisement be placed as directed specifically by the DOL. As previously stated, the traditional L/C process is very time-consuming and is likely to result in significant additional costs and delays in processing the L/C case.
PERM APPROVAL OR DENIAL: According to the PERM Regulations, the DOL will send a written approval or denial notice to the prospective employer by e-mail or by mail. The PERM Regulations also state that the Final Determination (FD) will be sent by mail to the attorney or to the organization. If the FD is negative, a Request-for-Review (RFR) can be undertaken by the prospective employer. If there is no RFR, a new L/C can be filed.
L/C REVOCATION UNDER PERM: After the L/C has been approved under PERM, it may be invalidated by either the DOL, the U.S. Department of Homeland Security, Citizenship and Immigration Services (CIS) or by the U.S. Department of State (DOS) if it is determined that there was fraud or willful misrepresentation of a material fact in the L/C. The DOL can also revoke an L/C if it is found that the L/C was not justified. In this instance, DOL will notify the prospective employer and then the employer has thirty (30) days in which to submit evidence to rebut DOL findings. The DOS and the CIS could be notified as well.
CONCLUSION: PERM CHANGES THE BUSINESS IMMIGRATION WORLD.
The PERM Regulations are new and as such will be the subject of guidance memoranda from the CIS, DOL and DOS for years to come. What appears to be clearly the case at this point in time is that the L/C process is going to become much more complicated, time-consuming and costly for applicants. The perceived benefit of PERM is the speed at which L/C cases can be approved. The PERM process is the genesis of a whole new L/C philosophy.
As previously reported by this author, The American Competitiveness in the 21st Century Act (AC-21) revolutionized the H-1B nonimmigrant visa process by making it an employer-related process. Similarly, PERM changes the L/C landscape and places the process more squarely in the business immigration realm. Organizations should no longer view the L/C process as one belonging to the prospective employee. The PERM L/C process impacts upon the organization as a whole and its ability to process other applications.
The PERM process is DOLs flare shot into a dark sky. The emanating light beckons organizations to be more involved in the L/C process. Organizations as well as their legal representatives will be required to get up to speed quickly so that they are able to appropriately wind their way through the nuances of PERM and make the necessary adaptations in their hiring processes. A new and difficult challenge for us all certainly lies ahead.