In a recent settlement announced by the Department of Labor (DOL) in June 2012, Semafor Technologies, of Norcross, Georgia, agreed to pay workers $741,288 in back wages. The DOL’s Wage and Hour Division found violations of the H-1B visa program, which permits foreign nationals to work temporarily in the United States. Semafor Technologies is an IT company specializing in software development, on-site/off-site outsourcing, consulting and product development services.

An investigation conducted by the DOL’s Atlanta District office determined that Semafor Technologies failed to pay 54 H-1B workers during periods of time in which they were not productive because the company did not assign them any work. This practice is called “benching,” and is not permitted under the H-1B DOL regulations. Employers must continue to pay foreign nationals in H-1B status even if there is no work to be performed. In addition, five workers were not reimbursed for various processing fees related to their employment, and 14 were not reimbursed for processing fees or paid for periods without assigned work.

The Director of the DOL’s Atlanta office commented “as demonstrated by the resolution of this case, we are using all tools available to remedy violations, promote accountability, and ensure a level playing field for law-abiding employers and legitimate users of the foreign guest worker programs.”

DOL regulations clearly impose H-1B costs on the employer as a business expense, and not the employee. Employers should pay all expenses related to the processing of H-1B visa petitions, including attorney’s fees and government filing fees. The Semafor Technologies case demonstrates that employers who pass along any part of the H-1B processing fees to employees are creating possible exposure to DOL employer sanctions.

If you have questions regarding H-1B visas, please contact jacki@lentinivisas.com , or +630-262- 1435.