F1 OPT STEM to H4

[amol_saurabh]

Hello all,

My wife is on F1 OPT STEM extension now and I just got my H1B approved. Now, we decided to convert her into H4 visa and contacted her employer regarding a letter about end of emplyment.
Its a unpaid job so we don't have recent paystubs and there is no other way to prove the employment during OPT period. But now employer is saying, her employment is terminated last year and they sent us termination latter which we never received. On the other hand, its been more then 120 days since she is unemployed. If we had recevied that letter, we might have done something about it but we were unaware about that.

My company's lawyer firm is asking for this letter and I don't have one. even if my wife's employer provide one, it will have a old date.
I want to ask?

1. Is my wife illegal in US?
2. What are my options?
3. Is employer informs USCIS while terminating any employee?
4. What if she goes to our home country and applies for H4 after OPT end date?

ANy kind of help will be really appreciated
Thanks
amol_saurabh