What is an H-1B Audit?
An H-1B Audit refers to the process of examining an H-1B employer's compliance with the laws and regulations surrounding the H-1B visa program. The audit is conducted by either the Wage and Hour Division of the US Department of Labor (DOL) or the United States Citizenship and Immigration Services (USCIS). It aims to ensure that the employer is adhering to the requirements and obligations associated with hiring H-1B workers.
Why does an H-1B Audit occur?
An H-1B Audit can be triggered by various factors, including employee complaints, referrals from US embassies, or random selection for auditing purposes. Employee complaints account for around 80% of H-1B Audits, often involving issues such as wage violations, improper benching, or contract breaches. Referrals from US embassies and consulates make up approximately 15% of audits and are usually related to suspicions of fraudulent practices. Random selection accounts for about 10% of H-1B Audits.
Who performs the H-1B Audit?
The H-1B Audit can be initiated by either the Department of Labor (DOL) or the United States Citizenship and Immigration Services (USCIS). If the DOL initiates the audit, an investigator from the Wage and Hour Division will be assigned to lead the audit. The USCIS Fraud Prevention Unit may also conduct audits related to H-1B program compliance and other immigration matters.
What factors are considered during an H-1B Audit?
During an H-1B Audit, the DOL or USCIS evaluates various aspects of H-1B program compliance. Employers can face penalties for violations such as failure to pay proper wages, failure to obtain amended Labor Condition Applications (LCA) for new job sites, providing incorrect information on LCAs, failure to comply with notification requirements, and other violations of program rules. The severity of penalties depends on factors such as the employer's history of violations, number of affected workers, gravity of the violation, good faith efforts to comply, and financial gain or potential loss.
If an employer is found in violation as a result of an audit, what penalties may be imposed?
Violations of the Labor Condition Application (LCA) and H-1B program rules can lead to various penalties. These can include the payment of back wages to affected workers, civil money penalties ranging from $1,000 to $35,000 per violation, and potential debarment from participating in the H-1B program and other immigrant programs. The specific amount of civil money penalty is determined based on factors such as the type of violation, number of affected workers, gravity of the violation, and other relevant considerations.
What are the obligations of H-1B dependent employers?
H-1B dependent employers, as defined by the Immigration and Nationality Act (INA), have additional obligations related to non-displacement and recruitment of US workers. These obligations aim to protect the job opportunities of US workers. H-1B dependent employers must attest to paying H-1B workers at least the prevailing wage, offering benefits on the same basis as US workers, not displacing similarly employed US workers, and making good-faith recruitment efforts to hire US workers before seeking H-1B workers. Failure to meet these obligations can result in violations and penalties.
What is a Public Access File?
The Public Access File, also known as the Public Inspection File, is a collection of documents that must be made available for inspection upon request by interested parties. This file is a part of the H-1B employer's compliance obligations. The Public Access File includes documents such as the Labor Condition Application (LCA), wage rate statements for H-1B workers, actual wage pay system memoranda, prevailing wage documentation, information on benefits offered to H-1B workers, notification documents, and other relevant records. The Public Access File must be retained and updated as required by the regulations.