No-Benching Rule for H-1B Employers
The Department of Labor (DOL) plays a significant role in administering the H-1B program. It has always been concerned about employers not paying H-1B workers during periods of nonproductive status and attempted to enforce a "no benching" provision way back in 1994. A federal court enjoined this rule, among many others, after the National Association of Manufacturers sued DOL in 1995.
The American Competitiveness and Workforce Improvement Act of 1998 amended section 212(n)(2) of the Immigration and Nationality Act providing that it is a violation of the wage attestation requirement for an employer to fail to pay the wage for nonproductive status "due to a decision by the employer," such as lack of work assignments or lack of permit or license. The recently promulgated regulations of the DOL implementing ACWIA further clarify the no-benching rule under the H-1B program.
The employer is not required to pay if the nonproductive period is due to "conditions unrelated to employment" at the employee's "voluntary request and convenience" (such as caring for a sick relative or touring the US) or due to circumstances such as maternity leave that render the employee unable to work, provided the period is not subject to pay under the employer's benefit plan or under other statutes.
On the other hand, employers would not be excused from paying H-1B workers in cases of annual plant shutdowns or holidays or other events, which affect both US and H-1B workers, even if the US worker is not paid. Laying off US workers in such situations would be a violation of the ACWIA layoff attestation for H-1B dependent employers or willful violators. If the employer is not subject to the layoff attestation, DOL has indicated that such an action may also possibly constitute a violation under anti-discrimination laws.
The H-1B worker must be paid the full time wages in non-productive status, but may be paid a part-time wage if that has indeed been the designation on the petition. If a range of hours is indicated on the petition, then the employee must be paid for the average number of hours he or she ordinarily works. The DOL has also indicated that if an employee works more than the designated part-time hours stated on the petition, it may charge the employer with misrepresentation if the H-1B worker is paid only for the designated part-time hours during nonproductive status.
The "no-benching" obligation becomes effective after the H-1B worker has entered into employment with the employer, but in any event, no later than 30 days after the worker's date of admission to the US (if entering the US pursuant to the petition) or 60 days after the date the worker "becomes eligible to work for the employer" (if already in the US when the petition is approved).
The DOL has concluded that the term "entered into employment" means the date on or after the date of need on the H-1B petition when the worker makes himself or herself available for work or otherwise comes under the control of the employer and includes all activities hereafter, such as waiting for an assignment, going to an interview or meeting with a customer, attending orientation, studying for a licensing exam.
DOL's overbroad interpretation of "entered into employment" virtually eliminates the 30 or 60-day window that an employer might have to not pay the H-1B worker. Many employers may only be able to find an assignment for the H-1B worker after he or she joins the employer. The DOL rejected suggestions that the term "entered into employment" should only trigger when the employee actually starts working and not when the worker first makes himself or herself available for employment or is waiting for an assignment.
The employer's obligation to pay the H-1B worker ends only if there has been a "bona fide" termination of the employment relationship. The preamble to the DOL's final rule suggests that a "bona fide" termination will be deemed to have occurred only when the employer notifies the INS of the termination, the H-1B petition is cancelled and the return fare obligation is fulfilled.
The requirement that an employer notifies the INS of termination imposes an additional obligation, which does not presently exist in the INA. It also contradicts the new portability provision, Section 105, of the recently enacted American Competitiveness in the Twenty First Century Act (AC21).
Under Section 105 of AC21, a nonimmigrant who was previously issued an H-1B visa or provided nonimmigrant status under section 101(a)(15)(H)(i)(b) is authorized to accept new employment upon the filing of a petition by the prospective employer. In order to be eligible under Section 105, this nonimmigrant should have been lawfully admitted into the US and the petition must have been filed "before the date of expiration of the period of stay authorized by the Attorney General." Furthermore, this nonimmigrant subsequent to such lawful admission has not been employed without authorization in the US before the filing of the petition.
If the DOL requires an employer to terminate the H-1B petition, it would undermine the H-1B worker's ability to have a new employer file another petition and allow him or her to immediately start working provided the conditions under Section 105 are satisfied.
About The Author Cyrus D. Mehta, a graduate of Cambridge University and Columbia Law School, practices immigration law in New York City. He is Vice Chair of the American Immigration Lawyers Association's National Labor Department Liaison Committee, trustee of the American Immigration Law Foundation and recipient of the 1997 Joseph Minsky Young Lawyers Award. He is also Chair of the Immigration and Nationality Law Committee of the Association of the City Bar of New York. He frequently lectures on various immigration subjects at legal seminars, workshops and universities and may be contacted at 212-686-1581 or email@example.com
Cyrus D. Mehta, a graduate of Cambridge University and Columbia Law School, practices immigration law in New York City. He is Vice Chair of the American Immigration Lawyers Association's National Labor Department Liaison Committee, trustee of the American Immigration Law Foundation and recipient of the 1997 Joseph Minsky Young Lawyers Award. He is also Chair of the Immigration and Nationality Law Committee of the Association of the City Bar of New York. He frequently lectures on various immigration subjects at legal seminars, workshops and universities and may be contacted at 212-686-1581 or firstname.lastname@example.org