D. & O. at 19-22; 20 C.F.R. § 655.731(c)(10)(i); 20 C.F.R. §655.731(c)(11). The ALJ found Novinvest liable for the following amounts in compensation for the penalty: Peshin was due $5,000, Koloskov was due $2,347.52, and Viazovoi was due $1666.67. D. & O. at 22.
Novinvest had secured state court judgments against the respective employees, which included the $5,000 investment fee. D. & O. at 7-9 (Findings of Fact Nos. 7, 16, 21). The judgments against Peshin, Koloskov, and Viazovoi totaled $8,789.45, $2,347.52, and $1,666.66, respectively. Peshin paid none of his judgment, Koloskov paid $1,200 of his judgment, and Viazovoi paid $55 of his judgment. Id.
In its petition for review, Novinvest argues that the ALJ erred in calculating the amounts owed to the three employees. First, according to Novinvest, the ALJ arbitrarily attributed the amounts awarded in the judgments against Koloskov and Viazovoi exclusively to the impermissible penalty when Novinvest presumably had asserted other claims. As evidence, Novinvest cites the $8,683.38 claim against Koloskov for which it received an award of only $2,347.52 and the $8,487.00 claim against Viazovoi for which it received an award of only $1,666.66. Second, according to Novinvest, "the amounts assessed to Novinvest should not exceed the amounts actually paid by the three individuals toward the satisfaction of Novinvest's judgments." Petition at 1. In other words, Peshin should receive nothing, Koloskov should receive $1,200, and Viazovoi should receive $55.
The INA and its implementing regulations expressly prohibit early termination penalties. Specifically, it is a violation of the INA
for an employer who has filed an application under this subsection to require an H-1B nonimmigrant to pay a penalty for ceasing employment with the employer prior to a date agreed to by the nonimmigrant and the employer. The Secretary shall determine whether a required payment is a penalty (and not liquidated damages) pursuant to relevant State law.
8 U.S.C.A. § 1182(n)(2)(C)(vi)(I). See 20 C.F.R. § 655.731(c)(10)(i) ("[a] deduction from or reduction in the payment of the required wage is not authorized (and therefore is prohibited)" for purposes of "[a] penalty paid by the H-1B nonimmigrant for ceasing employment with the employer prior to a date agreed to by the nonimmigrant and the employer"). The ALJ found that Novinvest violated the INA when it assessed the "investment fee" penalties (D. & O. at 19-22), and Novinvest has not appealed this aspect of the ALJ's decision. We find, therefore, that Novinvest is not entitled to recover from the nonimmigrants any of the $5,000 investment fees. We disagree with the ALJ, however, with respect to the back wage calculations. The ALJ determined that Novinvest owed each of the workers the full amount of the judgments assessed. We find instead that Novinvest is required to refund to Peshin, Koloskov, and Viazovoi monies actually paid by them as compensation for the investment fee penalty. Any fees or costs associated with collection of monies pursuant to that provision also must be refunded. We note that the Secretary is authorized to impose administrative remedies, including civil money penalties, for willful failure to meet a condition of an attestation or a willful misrepresentation of material fact in an attestation. See 8 U.S.C.A. § 1182(n)(2)(C); 20 C.F.R. § 655.810. Therefore, Noinvest may be subject to additional action by the Secretary if it engages in further efforts to obtain penalty provision funds.
Noinvest is not entitled to recover any amounts under the "Relocation Assistance" provision of its contracts with the H-1B nonimmigrant employees. The decision of the ALJ hereby is MODIFIED to order repayment of amounts paid by the nonimmigrants to Novinvest pursuant to the "Relocation Assistance" provision of the employment agreement, including any fees or costs in connection therewith.
JUDITH S. BOGGS
Administrative Appeals Judge
OLIVER M. TRANSUE
Administrative Appeals Judge
1 These H-1B nonimmigrants, in addition to another nonimmigrant, Igor Politykin, arrived in the United States between March 2000 and April 2001. They arrived prepared to work, but Novinvest "benched" them and refused to pay them in violation of the INA. See 8 U.S.C.A. § 1182(n)(1)(A); 8 U.S.C.A. § 1182(n)(2)(C)(vii); 20 C.F.R. § 655.731(c)(7)(i) (if the H-1B nonimmigrant is not performing work and is nonproductive due to a decision by the employer (e.g., due to lack of work) the employer is required to pay him at the wage listed in the LCA). After an investigation, the Administrator determined that Novinvest owed these employees back wages for benching periods during the course of employment. The ALJ upheld the Administrator's determination as well as the back wage calculations. D. & O. at 15-17. Novinvest did not appeal these findings.
2 The Administrator's determination letter did not allege specifically that the "investment fee" requirement violated the INA, stating merely that Novinvest had "failed to pay wages as required." PX 29 at 1. The Administrator subsequently moved to conform the determination letter to the evidence to include allegations pertaining to the investment fee. Hearing Transcript at 129-131. The ALJ granted the motion, finding the early termination penalty issue properly before him. D. & O. at 18-19. Novinvest did not appeal this finding.