I. PERM and Layoffs

The collapse of the financial infrastructure in the US has had a Domino effect on every sector in our economy. As a result, many organizations find themselves in economic crisis which resulted in massive layoffs almost in every aspect of our workforce. Notwithstanding layoffs, organizations still desire to process permanent labor certificate applications on behalf of certain foreign national professionals. PERM regulations, however, place certain restrictions on organizations and firms which experienced layoffs that could prevent them from taking advantage of this program.

II. History of the PERM Process

PERM stands for Permanent Electronic Review Management introduced by the US Department Labor in March of 2005 to replace the prior process which had been in existence since the 1980's. The regulatory directives of the PERM process evolved from a predecessor process called Reduction In Recruitment ("RIR"). Even though PERM regulatory provisions have their roots in the prior RIR process, RIR itself was an ad hoc administrative procedure introduced by the USDOL during the Y2K era. At that time, there was a documented shortage of certain professionals in the information technology filed which necessitated an agile administrative process for the permanent employment of certain foreign professionals. Hence, RIR was a modification of a prior process known as "supervised recruitment" for labor certification which was truly an administrative nightmare including overlapping steps between the State Workforce Agencies ("SWA")and the US Department of Labor. The SWA's approved the recruitment language and mode of recruitment and supervised all the resumes received throughout the recruitment process itself. It took more than 2 years to process a Labor Certificate application prior to the introduction of RIR. The most important aspect s of RIR process that survived the PERM regulations are the idea that all recruitment for the labor certificate application must precede the filing of the application itself.

III. Current Regulatory Directives and Layoffs

PERM regulatory provisions under 20 CFR §656.17(k)(1) require employers to provide notice and to consider all similarly situated U.S. workers which it had laid off within the same geographical area in the six months immediately preceding the filing of the labor certification. Put in different words, an employer may not successfully file a labor certificate application unless it engages in a specific process for consideration of all qualified US workers which it had laid off in the six months prior to filing the labor certificate application on behalf of a foreign national for a particular occupational classification. This process is intended to prevent US workers from dismissing US workers and replacing such US workers with foreign labor who are perceived to accept less favorable working conditions and compensation. This specific regulatory provision was not necessarily mandatory in the pre-PERM rules governing the RIR process. However, the Certifying Officer had authority to deny or remand the labor certificate application for additional recruitment if he believed that the specific occupational classification experienced layoffs within the geographic area. Hence, it is important to note that the current regulatory provision is an extension of the prior position the US Department of Labor had regarding layoffs.

It is important to remember that the PERM regulations have two important criteria that must be examined more closely. If there have been layoffs in the geographic area in the occupational classification that is the subject of the labor certificate application that the employer must notify and consider all qualified US workers who had been laid off within the prior six months. It is thus critical to understand in great detail what is considered layoff, the geographic area, and the particular occupational classification.

IV. Layoffs Defined in the PERM Regulations

The definition of layoff is rather expansive and it includes any involuntary separation of one or more employees without cause or prejudice. Any such separation that is characterized as "attrition," "reduction in force," "downsizing" or "restructuring" which results in the loss of US workers without cause is covered as layoffs pursuant to USDOL directives.

V. Occupational Classification Defined

In analyzing the effect of company layoffs on the manner in which the PERM application should proceed and in deciding whether the employer has an obligation to "notify and consider" qualified US workers who had been laid off in the six months prior to the filing of the PERM application it is important to understand how the regulations define the same occupational classification. If the employer is able to distinguish the occupational classification on which the PERM application is based, then it will not be subject to the "notify and consider" requirements. The regulations define an occupational classification is rather expansive, however. More specifically, the regulations focus on the "majority of the essential duties" not necessarily on the title of the position in question to determine whether the position giving rise to the PERM application is the same or "related" occupation. If comparison of the majority of the essential duties between the occupation for which PERM is sought are the same or similar to position wherein a US worker was laid off within the prior 6 months, then the employer is required to "notify" and "consider" US workers who were laid off within the six months prior. On the other hand, if the comparison between the position on which the PERM application is based and those of the laid US workers yields a significance in the majority of duties, then the employer is absolved from notifying or considering any US workers who had been laid off within the prior six months.

Example.

ACME Insurance Company is desirous to file a PERM application for a Programmer Analyst who works in its IT Department in the Washington DC. The immigration counsel was advised that the company laid off 150 employees within the last 90 days. The immigration counsel was concerned whether these employees need to be notified considered pursuant to regulations since they were laid off within the last six months. Upon examination of the position description of these laid off employees, it was discovered that they all were call center operators and not connected in any manner to the information technology field. On that basis, the immigration counsel determined that the "notify and consider" provision of the regulations does not apply.

It is for that reason that qualified and skilled immigration counsel should be consulted to make certain that the position giving rise to the PERM application is not considered similar or related to any potential position that has been or may be subject to layoff. It is that kind of planning that could make or break a PERM application in the face of today's layoffs.

VI. How Does the Employer Effectively "Notify and Consider" Laid Off Workers?

As mentioned, under PERM regulations, the employer wishing to file a PERM application for a foreign national whose job duties are similar or are related to that of US workers who were laid off or terminated without cause within the six months preceding the filing of a labor certificate application, must notify and consider such qualified US workers for the specific position. But what constitutes acceptable norms of notification and consideration? The answer is not clear in the regulations as they do not specify how the employer is required to notify such laid off US workers. The American Immigration Lawyers Association attempted to find out through liaison communication as to what the USDOL considers sufficient forms of notification. Would email, phone calls, or other forms of written communication suffice? The USDOL had not responded in approval to any of the aforementioned methods. Hence, it continues to be a mystery as to what constitutes proper notification methodologies. Competent immigration counsel will make certain that the employer documents every conceivable mode of communication with US workers to make certain that its attempts are considered within the realm of "good faith recruitment efforts" which underlie the PERM process.

US Workers are defined as US Citizens, US Permanent Residents, Refugees and Asylees. The regulations again do not define who is considered to be a "potentially qualified Worker" for purposes of the "notify and consider" requirement. It is worthy to note that the regulations seem to consider an expansive approach to the evaluation as to who needs to be notified. In other words, the regulations did not say that only those who are qualified for the position need to be notified of the job opportunity; rather the regulations stated, that all those who are "potentially" qualified will need to be notified and considered for the job opportunity giving rise to the PERM application.

Example:

The requirement of notification and consideration should work in this manner:

1. Employer finds out that the occupational classification giving rise to a PERM application is significantly similar or identical to one that was the subject of layoffs within the 6 months prior to the filing of the application;
2. The employer further determines that only a portion of those laid off were within the same geographical area where the position in question will be performed.
3. The employer examines the qualifications of all US workers within such occupational classification and determines who may be potentially qualified.
4. The employer notifies such US workers that it is about to file a PERM application for the particular occupational classification. In doing so, the employer makes a good faith effort to discover the employment
5. US Workers submit resumes in response to the notification process. The employer should then consider such resumes and should conduct interviews to determine whether such qualified, willing and able US workers exist to fill this position.

Important Note: If this process yields a US worker who is qualified, the employer needs not hire this US worker as the PERM recruitment process is fictitious in nature and is only intended to test the market as to the availability of willing, able and qualified US workers to occupy the position giving rise to PERM application. If such qualified US worker is found, the application is deemed unapprovable at this point. Hence, the employer is not at risk of having to accept the employment of someone it had previously laid off as a result of the PERM process.

6. The employer carefully documents all its efforts and procedures in the evaluation, notification and consideration processes.

VIII. Conclusion

Undertaking filing a PERM application in today's economic conditions may be a daunting task. As an organization begins to plan for the PERM process, it may not know that next month will result in layoffs. Hence, the decision as to move forward with the PERM recruitment and filing is one that must be taken with the guidance of experienced immigration counsel. Once the correct analysis is made, the company will be better equipped to make this decision. The attorneys at the law firm of Shihab & Associates, Co., LPA are experienced in all facets of the PERM process. They have processed more than a thousand PERM, RIR and supervised recruitment applications in their careers. Contact the law firm of Shihab & Associates, Co., LPA. at 1-877-479 4USA for a free initial consultation.

Case Study: Administrative Appeals Office (AAO) Decision on H-1B Autorized Deductions:
In 2009, the AAO issued a decision of denial revoking a previously approved H-1B visa on the basis that the deductions by the employer were not authorized. The H-1B petitioner in that case was a Filipino newspaper/entertainment promoter that employed the H-1B beneficiary as a public relations specialist and journalist. The issue was whether the beneficiary was being paid the prevailing wage taking into account the deductions which the employer believed were authorized. Failure to pay the prevailing wage violates the H-1B terms and conditions of employment and will have the effect leaving the beneficiary without valid H-1B status. Thus, care must be taken to strictly abide by the authorized deductions procedures indicated in Part 1.

On appeal, counsel for the petitioner explained that the beneficiary received free housing for ten months in 2003 and 2004, valued at $9,500.00 for each year. Counsel explains that as part of the beneficiary's wages in 2003 and 2004, the petitioner paid rent on behalf of the beneficiary. The beneficiary occupied only the master bedroom of a two bedroom whch was viewed as compensation in the amount of $9,500.00 for each year. Counsel further explained that "starting in November 2004, beneficiary began paylng his own housing." Thus, counsel for the petitioner contended that the beneficiary's salary, plus the residential expenses, which is $9,500.00 per year, was above the prevailing wage, and thus the petitioner did not violate the H-1B requirements.

General Rule: Deductions MUST be for the benefit of the employee
The AAO determined that housing and food allowances may be permissible deductions if tthey meet the benefit of the employee standard. The H-1B employee's housing must be principally for the benefit of the employee. According to the regulations, the employee's housing may not principally benefit the employer, such as requiring the employee to be "on-call." As a journalist, the petitioner may require that the beneficiary be "on-call" at all times to report on any news-breaking stories. The petitioner did not provide sufficient documentation to establish that the housing provided to the beneficiary meets the benefit of the employee standard. Thus, the deduction was not a permissible deduction of the beneficiary's wages.

Housing and Food Allowances Generally:
Housing and food allowances are examples of deductions that usually are principally for the benefit of the employee unless the employee is traveling on the employer's business. The rules also permit deduction of the cost of transportation from and to the alien's home country at the beginning and end of the assignment, unless the employer is liable for the cost of return transportation because it has terminated the H-1B worker. Translation and visa application fees associated with the case may also be lawfully deducted (such expenses are not considered the employer's business expense). The value of "in-kind" benefits, such as the value of a car, apartment, parking space, may also be lawfully deducted, provided each criteria is satisfied.

Impermissible Deductions on H-1B Worker's Wages
Matters that are considered impermissible deduction for the employer's "business expenses" include the following: (1) the cost of tools and equipment; (2) travel expenses to and from off-premises assignments; (3) living expenses when the employee is traveling on the employer's business; and (4) attorney fees and other costs associated with the preparation and filing of the LCA and H-1B petition (not including translation and visa application fees). Matters that do not meet each of the five criteria listed above are considered unauthorized deductions.

The law firm of Shihab & Associates, analyzed data posted on the USCIS website relative to the number of cap subject H-1B visa petitions received by the USCIS since the FFY 2011 opened on April 1, 2010 and plotted the graph below. The date shows a surprisingly linear and consistent number of cap subject H-1B visa petitions received by the USCIS on a weekly basis. The slope of the graph has not changed drastically since April 2010 which suggests a consistent demand for H-1B visa workers in the Ohio and United States. Although data is not available for the federal fiscal year 2009 on the USCIS website, however, the law firm of Shihab & Associates, Co., LPA believes that the demand for H-1B visa workers in calendar year 2010 may be less than the previous years.

The same date was projected forward in the future to predict as to when the USCIS cap will be met this year. Based on the projections, it does not appear that the cap will reach this year at all. The "Regular" H-1B visa cap will is shown to reach in April 2011. While the Master's Degree cap subject H-1B visas will more than likely meet in December 15, 2010. It is a mathematical fact that once the "Master's" degree cap will reach in December that it will cause the demand for "Regular" H-1B visas to increase. Based on the foregoing, it is more realistic to expect the "Regular" cap to reach in February 2011.

Below is a list of the 2011 FFY cap subject H-1B visa cases received by the USCIS since April 2010.

Prevailing Wage for H-1B Specialty Occupation Workers:
An employer must pay an H-1B specialty occupation worker the prevailing wage or the actual wage paid to other similarly situated employees. The Immigration and Nationality Act (INA) requires that the foreign worker will not adversely affect the wages and working conditions of U.S. workers employed in similar positions. Per the DOL regulations, H-1B employees must be paid the prevailing wage rate for the occupational classification in the area of employment or the actual wage paid to similarly employed workers.

H-1B Worker Paid Below the Prevailing Wage: Authorized Deductions?
According to Federal Regulations for the H-1B classification, wage rate means the remuneration (exclusive of fringe benefits) to be paid, stated in terms of per hour, day, months or year. In addition, the required wage rate must be paid to the H-1B employee, cash in hand, free and clear, when due, except that authorized deductions may reduce the cash wage below the level of the required wage.

Question: What are "Authorized Deductions" under H-1B?
According to the regulations, "Authorized deductions," for H-1B purposes means a deduction from wages in complete compliance with one of the enumerated criteria below. These deductions allow an employer to pay an H-1B worker below the prevailing wageso long as each deduction is primarily for the benefit of the employee.

These deductions are considered "authorized" for H-1B purposes:

1. Deduction which is required by law (e.g., income tax; FICA); or
2. Deduction which is authorized by a collective bargaining agreement, or is reasonable and customary in the occupation and or area of employment (e.g., union dues; contribution to premium for health insurance policy covering all employees; savings or retirement fund contribution for plan(s) in compliance with the Employee Retirement Income Security Act), except that the deduction may not recoup a business expense(s) of the employer (including attorney fees and other costs connected to the performance of H-1B program functions which are required to be performed by the employer, e.g., preparation and filing of LCA and H-1B petition); the deduction must have been revealed to the worker prior to the commencement of employment and, if the deduction was a condition of employment, had been clearly identified as such; and the deduction must be made against wages of U.S. workers as well as H-1B nonirnrnigrants (where there are U.S. workers);
3. Deduction must be made in accordance with voluntary, written authorization by the employee (an employee's mere acceptance of a job which carries a deduction as a condition of employment does not constitute voluntary authorization, even if such condition were stated in writing);
4. Deduction must be for a matter principally for the benefit of the employee (housing and food allowances would be considered to meet this "benefit of employee" standard, unless the employee is in travel status, or unless the circumstances indicate that the arrangements for the employee's housing or food are principally for the convenience or benefit of the employer (e.g., employee living at worksite in "on call" status);
5. Deduction must not be a recoupment of the employer's business expense (e.g., tools and equipment; transportation costs where such transportation is an incident of, and necessary to, the employment; living expenses when the employee is traveling on the employer's business; attorney fees and other costs connected to the performance of H-1B program functions which are required to be performed by the employer (e.g., preparation and filing of LCA and H-1B petition)).
6. Deduction must be an amount that does not exceed the limits set for garnishment of wages in the Consumer Credit Protection Act, and the regulations of the Secretary pursuant to that Act, under which garnishment(s) may not exceed 25 percent of an employee's disposable earnings for a workweek.

Any deduction that does not meet the above enumerated criterion will not be considered "authorized" and cannot be deducted from the H-1B beneficiary's wages to meet the prevailing wage requirement. The next article addresses a case study of these requirements in a real life example.

Question: How does one apply for an interim Employment Authorization Document?

The U.S. Citizenship and Immigration Services (USCIS) is required by federal regulations to decide an application for employment authorization I-765 (EAD) within 90 days from the date the EAD application is received. Generally speaking, the USCIS takes anywhere from 45-90 days to make a decision on a filed EAD. Under current regulations, if USCIS does not decide the application by the 90 day deadline, federal regulations instruct USCIS to issue an interim Employment Authorization Document (EAD), which is valid for up to 240 days. This allows the alien to work when USCIS has otherwise failed to meet its statutory and regulatory obligations.

Presently, interim EADs are issued by USCIS service centers. Since 2005, USCIS local offices no longer issue interim EAD cards. The local offices used to issue interim EADs upon an in person request by the application. This is no longer true. The below procedures govern the process by which an applicant can obtain an interim EAD allowing the alien to take up employment in the U.S. faster so that he/she does not have to wait for a slow moving bureaucratic governmental agency.

Procedure for Obtaining an Interim EAD Card:

1. Make an Info-Pass Appointment. If USCIS has not adjudicated the employment authorization application (I-765), or issued an interim EAD by day 90, an alien is required to make an Info-Pass appointment at the nearest USCIS local field office. Click here for further information on scheduling the appointment.
2. USCIS field office CLAIMS Evaluation. After the info-pass appointment has been scheduled, the USCIS local office will perform a Computer Linked Application Information Management System (CLAIMS) evaluation. This ensures that the original I-765 EAD application is still pending and unadjudicated, that there is no request for evidence (RFE) on file regarding the application (which effectively restarts or tolls the 90 day period), and the applicant has undergone his/her biometric fingerprinting.
3. The applicant must have completed a biometrics appointment. The CLAIMS verification will determine whether the applicant has undergone fingerprinting. If they have not, the USCIS local office will refer the applicant to obtain biometrics at the USCIS Application Center (ASC). The applicant must have his/her biometrics completed to obtain an interm EAD.
4. Case refered to USCIS Service Center. After the CLAIMS verification process is complete, the local office will contact the Service Center with jurisdiction over the applicant's U.S. residence. At this point, the Service Center will be responsible for adjudicating the interim EAD.
5. Call 1-800-375-5283 if the interim EAD is not issued by the Service Center by the time the applicant appears at the local office. The applicant may make a status inquiry via telephone to the Service Center while in the local office. All inquiries should be responded to within 30 days.

Question: What are the documents needed for obtaining an interim EAD

In order to obtain an interim employment authorization document the applicant should bring the following items to the USCIS Info-Pass appointment:

1. A new, completed Application for Employment Authorization (Form I-765);
2. The original Notice of Action (Form I-797) notice of receipt of the underlying pending EAD (I-765) application
3. The original Notice of Action (I-797) receipt notice for the underlying pending application which gives rise to the employment authorization such as a green card application receipt notice (I-485) and/or petition for alien relative (I-130 approval notice);
4. The applicant needs all present and past passports and Form I-94s;
5. Two passport-style photographs according to these specifications;
6. Proof of U.S. residency, such as state issued photo ID or driver's license (for proof of USCIS office jurisdiction); and
7. All current and expired EAD cards issued to the applicant.

Question: What happens when USCIS has issued an RFE on the pending application for employment authorization (I-765)? Can you still obtain an interim EAD?

A request for evidence (RFE) affects the applicant's eligibility for an interim EAD depending on the type of evidence requested in the RFE. If the RFE seeks "initial evidence", i.e., evidence mandated under federal regulations in order to obtain employment authorization, then USCIS will restart the 90 adjudication timeline. The evidence requested must have been required to obtain the EAD from the get go. Once the evidence has been gathered and the RFE has been responded to, USCIS will start the 90 adjudication clock over upon receipt of the response. Therefore, it is a must to make sure you submit all required evidence up front so that the 90 day clock does not get reset.

But, if the RFE seeks evidence not required under federal regulations, the USCIS will "toll" the 90 day deadline until it receives the RFE response, at which point USCIS will resume counting at the point that the clock was interrupted by the RFE. Tolling simply means that the 90 clock will be suspended at the point the RFE was issued (say at day 46). If the RFE is responded to 14 days later, the clock will be "tolled" for those 14 days and counting will begin again at day 47 upon receipt of the response to the RFE.

If you are currently applying for a green card (Form I-485) and have sought employment authorization EAD in connection therewith and have not received your EAD within 90 days of receipt of the application, please call The Law Firm of Shihab & Associates, Co., LPA for help in obtaining an interim EAD. Our firm handles all employment-based and family-based green card applications, EADs and advanced parole as well as naturalization, citizenship, deportation and removal, and immigration litigation. Call today at 614-255-4USA.