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What Employers and Employees Should Know About H-1B Employment Termination

Employers sometimes end up having to terminate an H-1B employee before the end of the validity period. Whether it’s due to circumstances beyond the employee’s control (like a layoff) or within it (job performance issues), it puts the terminated H-1B worker’s legal status at risk. The legal status of an H-1B visa holder in the United States depends on his fulfillment of the contract with the sponsoring employer. In the eyes of USCIS, if he isn’t doing the job he came here to do, then he doesn’t have a reason to be in the country. There are certain points of interest for both employers and employees to be aware of in the event that an H-1B employee is involuntarily terminated from his position.

For Employers

There are three steps that employers must follow to make sure an H-1B employee’s termination is legitimate and proper (bona fide). First, the employer must notify the worker that he or she is or has been terminated. Second, they must notify USCIS that an H-1B employment agreement has been terminated. Third, the employer must offer to pay “reasonable costs of transportation” to the employee for the return trip to his or her home country.

Above all else, it is crucial for the employer to properly document fulfillment of these three steps, as well as document payment of owed wages and, if applicable, the offer of a severance package. The burden of proof of compliance with proper policy and procedure rests with the employer, not the employee.

For example, it is advisable for the employer to offer payment for a return trip home in writing and stipulate a deadline by which the employee must decide to accept. If the employee declines, that should likewise be documented in writing with a signature. If the employee accepts, the employer should keep a copy of the airline ticket and receipt for the same. If the employee purchases his own ticket and requests reimbursement, the employer should keep a copy of the receipt and—if at all possible—have the employee sign a document confirming that he received the reimbursement payment.

However, the employer is not obligated to pay transportation costs for any H-4 dependents or moving costs for belongings (furniture, clothing, etc.). This requirement is also unique to workers who are involuntarily terminated; employers are not required to pay transportation costs for workers who resign voluntarily.

Similarly, when notifying USCIS, the employer should send a certified letter to the service center that originally approved the H-1B petition and request a return receipt, if possible. The employer should also inform the U.S. Department of Labor that it has withdrawn the labor condition application (LCA) for the terminated employee.

In the circumstances of a layoff or a furlough, the employer may have further obligations for compensation as dictated by the LCA. The employer should be careful not to leave himself open to a potential discrimination lawsuit if the H-1B employee feels he or she was not treated the same as a U.S. citizen employee.

For H-1B Employees

U.S. law generally considers H-1B employment to be “at will” employment, meaning either party has the right to end the employment agreement at any time. The law also dictates that H-1B employees be treated like U.S. citizens in the event of an employment termination; if the company has a standard severance package, the employer is legally obligated to provide it to the H-1B worker. In the U.S., the severance package might include compensation like an additional two weeks’ pay and a payout for unused sick or vacation time.

As of 2017, USCIS provides terminated H-1B employees with a 60-day grace period to make alternate arrangements before they begin to accrue unlawful status. Many workers in this position seek other employment opportunities, new sponsors for an H-1B employment agreement. It’s important to note that H-1B visas are intended for specialized workers with certain skills. Job seekers must look within their industry of specialization in order to qualify for another H-1B agreement. If a job seeker finds a new employer willing to file an I-129 petition on his behalf, he can begin working for that employer before USCIS officially approves the petition.

Others seek to change their status, either to F-1 (academic) or B-2 (tourist) visas. These are both options that come with their own sets of requirements.

Still others choose to depart the United States. The choice of what to do next is difficult for anyone who suddenly finds themselves without a job. For H-1B visa holders, it is doubly so, because they have only 60 days to come up with a plan and put it into action.

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