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Terminating an H-1B employee. What Employers need to know

Employers that hire H-1B employees need to be aware of their responsibilities when terminating an H-1B employee.

When an employee comes to the US to work for an employer, they typically receive approval for 3 years.  This means they have an expectation of working for that employer for the full 3 years.  Of course, as many employers know it doesn’t always work out like that.  Sometimes the employee doesn’t perform as expected and it becomes necessary to terminate them and other times the employee chooses to transfer to another employer.

If an employee resigns the Employer should take the following steps:

  • Confirm the resignation in writing to the employee. This means providing the employee with a letter accepting their resignation and confirming their last date of employment.
  • Send a letter to USCIS confirming that the Employer would like to withdraw the H-1B petition. USCIS will typically send an acknowledgment.

However, if the employer is the one terminating the relationship, they should take the following steps to ensure a “bona-fide termination”:

  • Confirm the termination in writing to the beneficiary and inform them of their last day.
  • Send a letter to USCIS confirming that the Employer would like to withdraw the H-1B petition.
  • Offer to pay the beneficiary the reasonable cost of return transportation to their home country.

Failure to take all three steps can result in a continuing obligation to pay the beneficiary’s wage and gives the Beneficiary to write to make a complaint to the Department of Labor.  This could result in the employer being found liable for back wages. However, a bona-fide termination will also occur if the beneficiary starts working for another H-1B employer.

The obligation to pay the reasonable cost of return transportation only arises if the beneficiary departs the U.S.  If the beneficiary ultimately transfers his/her H-1B to another employer a bona-fide termination occurs and there is no requirement to pay the cost of return transportation.

Once terminated the beneficiary will typically have a 60- day grace period to find another employer.  This means that if they can find another employer to sponsor them for an H-1B and file a transfer petition within 60 days the beneficiary will continue to maintain status and can work for the new employer once the petition is filed.  If the new petition is filed outside of the 60-day window, then USCIS is likely to approve that petition for consular processing.

The exception to the 60-day rule is if the beneficiary has less than 60 days left on their I-94.  So, for example, if the relationship is terminated by the employer towards the end of the beneficiary’s authorized period of stay, the beneficiary will only have however many days are remaining.  Therefore, if the beneficiary gets terminated and they only have 30 days until their current I-94 expires, they will only have 30 days to find another employer and that employer will need to ensure that the transfer petition is filed prior to the expiration of the beneficiary’s current I-94.  This is because the rule regarding the 60-day grace period provides for 60 days or until the end of their authorized stay, whichever is shorter.

 

Based on the above rule if a beneficiary’s H-1B has expired and they have a pending extension with USCIS, and the Employer terminates them and then withdraws the pending extension petition, the beneficiary will not be entitled to any grace period whatsoever.

For those beneficiaries that are entitled to a grace period, they also have the option of switching to another status, so an H-1B employee who is terminated cannot find another job, could switch to H-4, if their spouse is also working on H-1B.

One more thing to bear in mind is that even after the employment relationship is terminated and the employer has complied with the above obligations, they still have a continuing obligation to maintain a public access file.  Employers are required to maintain the public access file for one year beyond the date of employment.  For further details regarding this please refer to our previous article:

https://www.patellegal.com/employers-responsibility-to-maintain-a-public-access-file-paf/

If you have questions regarding the above or anything else that is Immigration-related, please contact PLG Partner Chris Prescott at cprescott@patellegal.com.

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