With a recession upon us, many companies have no choice but to terminate some workers. What happens if a terminated worker is a nonimmigrant H-1B visa holder?

There are several issues that arise for employers and terminated H-1B workers: (1) what happens to the authorized stay of a H-1B worker upon termination? (2) what is the employer’s responsibility for return transportation costs to the country of origin? And (3) when should the employer withdraw the underlying H-1B petition? Contrary to popular belief, there is no such thing as a grace period for H-1B workers. Many believe that there is a 10-day grace period after the last day of employment, but this idea stems from misunderstanding the regulatory language. The relevant statute reads: “A beneficiary may be admitted to the United States for the validity period of the petition, plus a period of up to 10 days before the validity period ends. The beneficiary may not work except during the validity period of the petition.” 8 C.F.R. Sec. 212.4(h)(13)(i)(A)(2001). What is unclear in this definition is that the validity period of authorized employment ends upon termination. Therefore, the regulation does not allow for a grace period for H-1B workers beyond the termination of authorized employment.

H-1B workers who choose to remain in the U.S. to search for employment after termination cannot assume they will be granted an extension by the Immigration and Naturalization Service (“INS”) based on filing a petition with a new employer. It is in the discretion of the INS to determine if a petition with a new employer can be treated as an extension. The H-1B worker will have to apply from abroad if the INS denies the extension. The INS considers the length of time from termination of employment and the filing of a new H-1B petition with a new employer in determining whether to grant an extension.

The second issue is that employers have the responsibility to pay the transportation costs home of a terminated H-1B worker. 8 C.F.R. Sec. 214.2(h)(4)(iii)(E). If the employer wishes to limit its responsibility, it may request that the H-1B worker sign a letter upon termination indicating that the employer has explained its willingness to pay for the H-1B worker’s transportation costs home if the alien chooses to return home within a designated period of time from the date of termination. Most employers will find that H-1B workers will choose to stay in the U.S. and search for new employment, thereby relieving the employer from the travel cost responsibility.

By requesting that the H-1B worker sign a letter explaining the employer’s willingness to pay transportation costs home, the employer safely covers its regulatory obligation. However, in practice this obligation is very rarely enforced even when the employer fails to offer to pay for the alien’s return trip home because it views this as part of the employer/employee relationship. Gen. Couns. Op. 92-44 (Aug. 17, 1992), Jacquelyn A. Bednarz, Chief, Nonimmigrant Branch, INS Office of Adjudication, reprinted in 70 Int. Rel. 1172 (Sept. 3, 1993).

The employer has another regulatory obligation pertaining to a terminated H-1B workers. According to the pertinent regulation, the employer “must immediately notify” the INS of any changes in the terms and conditions of employer. 8 C.F.R. Sec.214.2(h)(11)(i)(A). Notification means that the employer must file a withdrawal letter with the INS upon termination of a H-1B worker. However, there is no penalty listed in the regulations for failure to notify the INS promptly of a terminated H-1B worker.

To summarize, an employer has several issues to keep in mind when terminating a H-1B worker that do not arise when terminating a U.S. employee. These issues are (1) that there is no grace period for a H-1B worker beyond the termination of authorized employment; (2) the employer should pay for a H-1B worker’s travel costs home, or limit its timeframe for covering such costs; and (3) an employer must notify the INS upon termination of a H-1B worker. An employer should consult an attorney with experience in business immigration for guidance on the above issues.

By Jacqueline Lentini McCullough. Kane County Bar Briefs, March 2002.