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Impact of Furloughs, Layoffs and Changes to Terms of Employment

April 4, 2020

As companies increasingly implement work-from-home policies and contemplate furloughs, layoffs and other employment changes in response to the COVID-19 outbreak, they must grapple with the immigration consequences for both the employers themselves and the foreign national workers they have sponsored. Changes to the terms and conditions of employment contemplated in the original visa application can trigger a range of requirements and potential consequences, regardless of the reason for the change.

For instance, H-1B employees must be paid the required wage listed in their certified Labor Condition Application (LCA) even during a work furlough. Generally, an employer is not required to pay the wage during an H-1B worker’s voluntary leave or if a worker is temporarily incapacitated (for example, due to a car accident), although they are still bound by the Family and Medical Leave Act and other relevant laws. To date, neither the Department of Labor nor USCIS has shown a willingness to relieve employers from their wage obligations in light of COVID-19, though the situation is fluid and evolving.

In the case of employers who have implemented work-from-home policies, they may be required to make additional LCA postings or file amended applications on behalf of their H-1B workers, depending on whether the worker’s home is within “normal commuting distance” of the office (generally considered to be within 50 miles.)

If an employer terminates an H-1B worker, they must notify the employee and the US Citizenship and Immigration Services in writing. The employer is also obligated to pay the reasonable cost of the worker’s return transportation to their home country. In the event that a termination is later found not to be “bona fide,” the employer may be liable for back wages.

If you are an employer considering a furlough, layoff or other changes, or an impacted employee, please contact your KM&M attorney as soon as possible. We will review risks to both employer and employee, possible stop-gap measures and other steps you can take to protect both the business and its sponsored workers.