The Wage and Hour Division of the U.S Department of Labor (DOL) as well as U.S. Citizenship and Immigration Services (USCIS) is tasked with making sure that employers employing H-1B immigrants are in compliance with relevant law. This includes, more specifically requirements associated with the labor condition application (LCA) process. The labor condition application (LCA) process was established to help ensure a few things, one being that foreign workers were not taking the jobs of other, qualified U.S. citizens. It was also established to help ensure that employers were not paying subpar wages to foreign workers in an attempt to employ cheap labor as opposed to paying a fair wage to someone else, like a U.S. citizen qualified for the job. An H-1B audit is a serious matter and those employers who are found in violation of relevant law can be severely penalized.
What Happens During an H-1B Audit?
An H-1B audit may be triggered by a number of things. A credible complaint against an employer may have been filed, usually by a disgruntled current or former employee. In the alternative, it may be a completely random audit. The audit usually begins by DOL or USCIS sending a letter to an employer to produce the public access file (PAF) as well as immigration and wage records. The purpose of the audit is to ensure an employer is in compliance will all relevant H-1B laws and regulations. This means that either the DOL Wage and Hour Division of the USCIS Fraud Prevention Unit or both will review all aspects associated with H-1B program compliance. This includes:
- Paying wages stated in the labor certification application to H-1B employees
- Amending a labor certification in the event of a new job site established
- Supplying incorrect, misleading, or false information in the labor certification application
- Laying off U.S. workers to replace them with H-1B workers
It is important to note that an employer carries the burden of proving compliance with H-1B laws and regulations. The USDOL and/or USCIS will usually want to inspect the employer’s Public Access Files relating to every labor condition application it has filed. Particular attention will be paid to whether or not the employer complied with the labor condition application notice requirement, followed applicable regulatory record keeping directives, paid correct wages to all H-1B employees, and whether any U.S. workers were displaced due to H-1B hiring.
As part of the audit process, a DOL or USCIS representative will visit an employer’s place of business on a specified date. The officer will inspect the employer’s records and make copies. The officer is also authorized to question other employees in an effort to gather additional relevant information determined to be necessary to see whether the employer is in compliance.
Violations found as a result of ab H-1B audit can be severe. Employers found to be in violation of relevant laws and regulations may face monetary civil penalties from $1,000 to $35,000 per violation. Furthermore, the employer may be barred from further participation in the H-1B program along with other immigrant programs. The penalty to be assessed will be determined based on a number of factors, including:
- Past violations of an employer
- Number of workers impacted by the violation
- The severity of the violation
- Good faith efforts made by the employer to comply with the H-1B program requirements
- Employer’s explanation regarding the violation
- The extent of any financial gain attributable to the violation
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