By: Scott Hecker and Kevin Young

Post originally appeared as a Legal Update on Seyfarth’s News & Insights Page link here

Gone are the days when the U.S. DOL’s Wage & Hour Division (“WHD”) invited employers to proactively identify and collaborate with the Division to fix their wage and hour missteps. Closed is the chapter in which employers could expect WHD to stand down on the threat of double damages outside of egregious cases. After years of a prior administration focused on compliance assistance, there’s a new guard at the DOL, and its approach thus far might be described as less carrot and more stick.

We have observed the shift at WHD both through formal announcements and anecdotal experience. Mere weeks after the new administration’s arrival, the DOL confirmed its termination of the PAID program, which invited employers to conduct self-audits and work with WHD to remediate identified issues and provide back wage payments to employees. And just last month, the Division issued new guidance to its field staff confirming a reversal of prior policy that reserved the imposition of liquidated damages for rare and egregious cases.

Unsurprisingly, these shifts in policy have been coupled, in our experience, with a change in the temperament and approach of many WHD investigators who knock on employers’ doors and pursue investigations. We’ve seen more investigators push for near-instantaneous document production, threatening use of subpoena power or imposition of civil money penalties and citing a regulation requiring employers to make documents available for inspection within 72 hours of WHD’s demand. Some have rapidly issued investigatory conclusions to employers, sometimes with document requests still pending, both in FLSA cases and in the prevailing wage law context. Demands that employers enter into compliance agreements drafted by WHD also seem to be increasing in popularity.

Employers we work with are linked by their desire to do right by their employees and comply with the FLSA. Certainly WHD and its investigators want the same. But for many businesses, the change in approach at the Division, from policymakers at the top to enforcement agents in the field, presents a new type of pressure that demands a different level of preparedness.

So what can employers do when facing increased pressure from WHD? Here are a few tips:

  • Ensure that records are in order. WHD has broad authority to request FLSA-related records required to be maintained under 29 C.F.R. Part 516. All employers should take proactive steps to ensure that their records required under these regulations, as well as other documents pertinent to wage-hour compliance, are in good order so that they can be efficiently accessed and reviewed if the WHD comes knocking.
  • Be prepared for the knock. Employers operating across multiple physical locations should ensure that front-line managers know what to do when an investigator from any government agency, including WHD, shows up in person, sends them a letter, or contacts them by phone. While investigators should be treated with the utmost respect, their inquiries should be promptly deferred to a pre-designated point of contact who can help coordinate a response. We encourage employers to carefully consider what their response team and protocols should look like.
  • Be respectful and reasonable. Responding promptly and respectfully to an investigator’s inquiries should help limit fireworks in a potentially combustible situation. While WHD has fairly broad subpoena authority, it’s fair to question whether the Division would get much traction in court in the event that an employer isn’t objecting to or stonewalling an investigator’s requests, but is simply asking for a more reasonable approach, whether in terms of time to respond or the types of documents to produce.
  • Seek counsel. With WHD becoming increasingly zealous with its demands—both in terms of what must be produced and when—the potential for business disruption and missteps is greater than ever. We strongly encourage employers to retain counsel familiar with these investigations to assist. Experienced and capable counsel can help to manage the flow of information and work with the investigator to identify efficiencies to avoid overburdening an employer’s personnel. When necessary, counsel can support employers who choose to contest WHD’s conclusions.
  • Self-audit. The FLSA’s statute of limitations forces employers to live with missteps for two (and sometimes three) years, and the termination of programs like PAID makes it more difficult to resolve those missteps in a decisive way when they are identified. As a result, there’s no time like the present for employers to take reasonable steps to ensure compliance. The need is even greater in businesses where employees are performing different duties, or working in different settings or circumstances, as a result of the pandemic. Areas of focus will vary by business, but at a minimum they should include exempt classification, recordation of all hours worked, and proper calculation of overtime pay. As noted in our update last month, Seyfarth’s FLSA Handbook offers useful material on these topics, including:
  1. Chapter 14, “Compliance and Prevention Matters,” which provides an overview of steps employers can take to comply with wage and hour laws, and an outline to assist employers in structuring their own self-assessment process and to address any issues identified through that process.
  2. Chapter 7, “Exempt Employees,” which explains the most common, “white collar” minimum wage and overtime pay exemptions.
  3. Appendix 8, “Sample Job Assessment Questionnaire Form” which contains a practice and user-friendly set of recommendations to assist employers in reviewing exempt classifications.

As President Biden’s appointees settle in at WHD, we expect to see ramped up enforcement not only under the FLSA, but also under the Davis Bacon Act, Service Contract Act, and other statutes in the Division’s wheelhouse. Prevailing wage laws may represent a particular area of emphasis, given the Biden Administration’s focus on infrastructure projects.

In short, employers must be prepared for a shift in approach at the Division and be ready to demonstrate and defend their compliance. Please feel free to reach out to the authors or your friendly, neighborhood Seyfarth attorney with any questions.

By: Angelo P. Paparelli

Seyfarth Synopsis: This is the third installment in a series of recommendations to the Biden Administration on immigration reform previously published by the Cato Institute in “Deregulating Legal Immigration: A Blueprint for Agency Action.”  Read the first and second installments here.  A total of five installments will be published on a weekly basis.  Please stay tuned for additional updates.

USCIS Should Enforce Its Policy against Broad-Brush Requests for Evidence

USCIS Policy Manual should reinforce an existing agency policy memorandum banning broad​brush requests for evidence (RFEs) and notices of intent to deny (NOIDs) and track RFEs and NOIDs by individual adjudicators.

During immigration adjudications, USCIS issues RFEs or NOIDs to give applicants an opportunity to correct deficiencies in their applications. RFEs are commonly issued for family‐​based applications and for employer‐​sponsored work visas like the H-2B for nonagricultural workers and the H-1B for workers in specialty occupations at U.S. companies. The share of work visa petitions with an RFE nearly doubled from 2015 to 2020 (Figure 8). Unnecessary RFEs or NOIDs can add additional work and costs for employers or lead to denials, which would thus prevent eligible individuals from obtaining or keeping the immigration benefits the law allows.

 

 

 

 

 

 

 

 

 

RFEs 2015: 23%
RFEs 2016: 22%
RFEs 2017: 23%
RFEs 2018: 36%
RFEs 2019: 39%
RFEs 2020: 40%

 

 

A 2005 USCIS policy memorandum prohibits issuing RFEs “for a broad range of evidence when, after review of the record so far, only a small number of types of evidence is required” because it concludes broad‐​brush RFEs “overburden our customers, over‐​document the file, and waste examination resources through the review of unnecessary, duplicative, or irrelevant documents.”[i] USCIS will often create “template” RFEs that generally describe issues that can come up, but the memorandum tells adjudicators not to “‘dump’ the entire template in [an] RFE; instead, the record must be examined for what is missing, and a limited, specific RFE should be sent.”

Despite clear headquarters instructions, these requirements are uniformly ignored by USCIS adjudicators, and boilerplate RFEs are now routine. The USCIS Ombudsman has described how USCIS will issue RFEs for information already provided by the applicants,[ii] and one court noted that USCIS had “issued an RFE requesting nearly identical information as it did when it last reviewed the petition.… Although not mirror images, the information requested is the same. [The employer and the H-1B beneficiary] have already provided this information in response to the defendants prior RFE.”[iii]

To remedy this problem, USCIS should add a new chapter in its Policy Manual reaffirming the binding nature of the 2005 policy memorandum and requiring supervisory review when adjudicators issue all‐​encompassing, broad‐​brush, or template RFEs and NOIDs. It should also extend the memorandum to Notices of Intent to Revoke previously approved petitions. Moreover, it should expressly note all interim adjudications as to specific legal issues of eligibility for the immigration benefit sought to avoid wasting the time of the applicant or petitioner addressing already resolved issues. USCIS should also be required, by executive order or otherwise, to collect statistics on the ID code (but not the name) of adjudicators and begin to report the frequency of RFEs and NOIDs and the resulting outcome of the adjudication. In this way, renegade adjudicators who fail to comply with the requirement of the Administrative Procedure Act that agency decisions be reasonably explained can be identified.

 

[i] William R. Yates, “Requests for Evidence (RFE) and Notices of Intent to Deny (NOID),” U.S. Citizenship and Immigration Services, HQOPRD 70/2, February 16, 2005.

[ii] U.S. Citizenship and Immigration Services Ombudsman, “Annual Report 2015,” June 29, 2015; and U.S. Citizenship and Immigration Services Ombudsman, “Annual Report 2016,” June 29, 2016.

[iii] Relx, Inc. v. Baran, et al., 2019 U.S. Dist. LEXIS 130286 (August 5, 2019).

Seyfarth Synopsis:  The U.S. announced on April 30, 2021 that most travel from India will be restricted effective May 4, 2021, due to rising COVID-19 infections in India.

On April 30, 2021, White House Press Secretary Jen Psaki announced that following advice from the Centers for Disease Control and Prevention (CDC) the U.S. will restrict most travel from India, beginning on Tuesday, May 4, 2021.  The CDC recommendation to impose a travel ban stems from a surge of COVID-19 cases in India. Through this announcement, the White House will add India to the list of countries from which travel is already restricted, which currently includes Ireland, the United Kingdom, China, South Africa, Brazil, and countries within the Schengen region. More information on the countries subject to a COVID-19 travel ban may be found here.

Many details on the impending travel ban remain unknown, including who will be exempt and the duration of the restrictions. The White House is expected to release a Presidential Proclamation that will provide further information, and Seyfarth will issue another update once the Presidential Proclamation is published.

Should you have any questions, please alert your Seyfarth Shaw contact.

(Originally posted as a legal update on April 30, 2021) 

By: Angelo A. Paparelli

Seyfarth Synopsis: This is the second installment in a series of recommendations to the Biden Administration on immigration reform previously published by the Cato Institute in “Deregulating Legal Immigration: A Blueprint for Agency Action.”  Read the first installment here.  A total of five installments will be published on a weekly basis.  Please stay tuned for additional updates.

Let L-2 and E Spouses Work without an Employment Authorization Document

USCIS should expressly authorize employment for L-2 and E spouses without requiring the spouse to apply for an employment authorization document.

The L-1 visa category allows multinational companies to transfer certain skilled foreign employees to the United States, such as managers, executives, and skilled workers with specialized knowledge. The E visa allows similar categories of foreign nationals from countries where the United States has “a treaty of commerce and navigation” to carry out substantial trade (E-1), develop and direct the operations of a business (E-2), or perform services in a specialty occupation if from Australia (E-3). The law entitles the spouses of these workers to derivative status,[i] and it requires that USCIS “authorize the alien spouse to engage in employment in the United States and provide the spouse with an ‘employment authorized’ endorsement or other appropriate work permit.”[ii]

This statute clearly requires that, while USCIS must separately issue a “work permit,” the agency must authorize E and L-2 spouses to work whenever they are in the United States without such a permit. The Social Security Administration (SSA) recognizes their eligibility for employment incident status—that is, based on their admission as an L-2 or E spouse. SSA issues a Social Security card “valid for work only with specific DHS authorization.”[iii] An admission stamp entered into the passport of an E or L-2 spouse with a handwritten notation showing a period of authorized stay by a DHS border inspector should suffice as a DHS authorization.[iv]

USCIS seems also to adopt the view that E or L-2 employment is authorized as an inherent attribute of spousal derivative status. Its approval notices for L-2 and E spouses refer to USCIS’s regulation that lists noncitizens authorized to accept employment “incident to status.”[v] Yet the regulation itself does not actually include L-2 or E spouses.[vi] Moreover, USCIS’s Handbook for Employers (M-274) implies that L-2 and E spousal status does not suffice to prove employment authorization.[vii] USCIS should modify its regulations so that individuals are authorized for employment based on their spousal relationship and thus do not appear to violate their status or lose eligibility to change or adjust their status by working as the statute allows.

Agency action is also necessary because as long as the USCIS’s M-274 Handbook for Employers is left unchanged, the Justice Department’s Immigrant and Employee Rights (IER) unit could penalize employers who follow it.[viii] Employers that decline to accept an unexpired foreign passport containing an L-2 or E dependent’s entry stamp issued by DHS would be engaging in “unfair documentary practices” related to verifying the employment eligibility of employees. The IER states that “when verifying a workers’ employment authorization, employers … are not allowed to demand more or different documents than necessary” to verify identity and employment eligibility.[ix] With the backing of SSA’s interpretation, L-2 or E derivative spouses would have a claim of unfair documentary practices if an employer rejected them for failing to produce a USCIS employment authorization document. Thus, by policy memorandum and later by regulation, USCIS should conform its interpretation to that of the SSA and explicitly provide L-2 and E spouses employment authorization incident to their status.

 

[i] 8 USC § 1101(a)(15)(E), (L) (2018)(All hyperlinks in the endnotes last visited on April 28, 2021).

[ii] 8 USC § 1184(c)(2)(E); and 8 USC § 1184(e)(2) (2018).

[iii] Social Security Administration, “Program Operations Manual System (POMS)—Policy For Non‐​Immigrant Employment Authorization,” RM 10211.420.

[iv] Border inspectors are part of U.S. Customs and Border Protection (CBP), which is a component of DHS.

[v] When USCIS issues work permits to L-2 and E spouses, it annotates the approval with a code, “A17” (for E nonimmigrant spouses) or “A18” (for L-2 spouses)—two reserved sections of 8 CFR § 274a.12(a) (2019) applicable to classes of noncitizens authorized to accept “employment incident to status.”

[vi] 8 CFR § 274a.12(a) (2019).

[vii] U.S. Citizenship and Immigration Services, “12.0 Acceptable Documents for Verifying Employment Authorization and Identity.” The M-274 does not explain what an employer should do if the prospective employee presents a List B driver’s license and a Social Security number card stating that it is valid for work only with DHS authorization, and the employee also presents DHS authorization in the form of a CBP‐​issued L-2 admission stamp in his or her passport.

[viii] 8 USC § 1324b(a)(6) (2018).

[ix] Immigrant and Employee Rights Section, “Types of Discrimination,” Department of Justice.

By: Angelo A. Paparelli

Seyfarth Synopsis: This is the first installment in a series of recommendations to the Biden Administration on immigration reform previously published by the Cato Institute in “Deregulating Legal Immigration: A Blueprint for Agency Action.”  A total of five installments will be published on a weekly basis. Please stay tuned for additional updates.

Eliminate Bars to Entrepreneurship

The Department of Labor (DOL) should affirm that an owner of a company is legally distinct from the company itself and should define entrepreneurship as a Schedule A occupation not needing a labor certification. USCIS should rescind its currently enjoined H-1B interim final rule, which restricts self​sponsorship by owners, and the Justice Department should stop defending it.[i]

Even though immigrants are disproportionately likely to start businesses or be self‐​employed,[ii] DOL and USCIS make it all but impossible for immigrant entrepreneurs to establish companies that can sponsor the entrepreneurs for green cards or other work visas, a prohibition that hampers job creation and entrepreneurship. The law requires employers sponsoring most foreign workers for green cards to first obtain a permanent labor certification from DOL that finds no qualified U.S. workers were available for the position.[iii] But DOL can pre‐​certify certain jobs as Schedule A occupations if no harm to U.S. workers would result from them being filled without a rigorous and time‐​intensive labor market test.[iv] A job that was created through a foreign worker’s commercially reasonable investment should automatically qualify as such a job.

DOL has also created a strong presumption against granting a labor certification in situations where there is any “alien influence and control over the job opportunity” on the dubious assumption that no job opportunity can be “bona fide” if the sponsored immigrant has any significant ownership role in the company.[v] DOL should rescind this regulation and formally recognize the distinction between the corporate entity and the owner of the company. These changes would allow immigrant entrepreneurs to start businesses and have those businesses sponsor them for green cards.

Unlike DOL, USCIS claims to respect the centuries‐​old distinction between a corporate entity and the owner of that entity, yet USCIS still makes it difficult for entrepreneurs to have their companies sponsor themselves for nonimmigrant visas (e.g., H-1B and O visas). In 2010, USCIS announced that self‐​employed workers could not receive nonimmigrant work visas because a company they own cannot possibly “employ” them as the law requires—a conclusion that flouts its own binding and well‐​settled legal precedents.[vi] While litigation forced USCIS to rescind this policy in 2020,[vii] it is currently attempting to place this standard into its H-1B regulations in a rule that a federal district court enjoined in December 2020.[viii] USCIS should rescind the rule—and the Justice Department should cease defending it—to allow immigrant entrepreneurs to have their companies more easily sponsor them. Once the rule is rescinded, USCIS should explicitly recognize eligibility to grant employment‐​based immigration benefits to entrepreneurs.[ix]

 

[i] For more background, see Angelo Paparelli, “Hey, Immigration Bureaucrats: Corporations Are NOT People!,” Nation of Immigrators (blog), October 14, 2012.

[ii] Robert W. Fairlie, “Immigrant Entrepreneurs and Small Business Owners, and Their Access to Financial Capital,” Small Business Administration Office of Advocacy, May 2012.

[iii] 8 USC § 1182(a)(5)(A)(i) and (ii) (2018).

[iv] 20 CFR § 656.5 (2019).

[v] 20 CFR § 656.17(l) (2019). For instance, see Department of Labor, Matter of Step by Step Day Care LLC, 2012-PER-00737, September 25, 2015.

[vi] Donald Neufeld, “Determining Employer‐Employee Relationship for Adjudication of H-1B Petitions, Including Third‐Party Site Placements,” U.S. Citizenship and Immigration Services, January 8, 2010. Contradicting: Matter of Aphrodite Investments Limited (1980), Matter of Tessel (1980), Matter of Allan Gee, Inc. (1979), and Matter of M– (1958).

[vii] U.S. Citizenship and Immigration Services, “Rescission of Policy Memoranda,” Policy Memorandum, PM-602‑0114, June 17, 2020.

[viii] 85 Federal Register 63918, (October 8, 2020); and Chamber of Commerce v. DHS, 20‐cv‐07331‐JSW (N.D. California, 2020).

[ix] U.S. Citizenship and Immigration Services, “Entrepreneur Visa Guide,” 2013; U.S. Citizenship and Immigration Services, “Employment‐Based Second Preference Immigrant Visa Category, Frequently Asked Questions regarding Entrepreneurs and the Employment‐Based Second Preference Immigrant Visa Category,” August 2, 2011; and Alejandro Mayorkas, “Encouraging Entrepreneurs and High Skilled Workers to Bolster the U.S. Economy and Spur Job Growth,” The Beacon (blog), U.S. Citizenship and Immigration Services, August 2, 2011.

By: Dawn M. Lurie

Seyfarth Synopsis: This announcement extends the flexibilities in rules relating to Form I-9 compliance that was initially granted last year. It also expands the scope of the “in-person” exemption benefit to certain employees, and offers flexibility for companies that are phasing back in employees, as doing so will no longer trigger the in-person requirement for all new hires.  While an improvement in the overall dialogue, the guidance leaves uncertainty regarding the end of I-9 virtual flexibility, and as such, employers should consider moving away from the virtual completion model while continuing to heavily document current practices.

With employers impatiently waiting, the U.S. Immigration and Customs Enforcement (ICE) announced (at 2:00 PM EST on March 31, 2021) another sixty (60) day extension of the flexibilities in rules related to Form I-9 compliance, initially granted in March 2020. These flexibilities have been extended until May 31, 2021. The announcement was expected, as a portion of the American workforce is still very much remote, including much of the federal government in Washington, D.C.  However, the delay in the announcement was disappointing, causing unnecessary stress on already fragile H.R. departments. Continue Reading ICE Warms to the Cold Realities of COVID-19: Latest I-9 Virtual Flexibility Guidance Extended to May 31, 2021

By Angelo A. Paparelli and Tieranny L. Cutler

At the urging of President Biden, two members of Congress – Senator Robert Menendez and Representative Linda Sanchez – introduced companion 353-page bills last month in the Senate and the House entitled the “U.S. Citizenship Act of 2021.”

Presented as a comprehensive modernization of our nation’s long outdated immigration laws, this proposed legislation – uniformly lauded by Democrats and opposed by Republicans – features many provisions that U.S. employers may welcome, including, as this White House Fact Sheet details, a path to legal status, employment authorization, and eventually, American citizenship, for some 11 million undocumented noncitizens; relief for Dreamers, persons in Temporary Protected Status, and immigrant farmworkers; and improvements to the legal, employment-based immigration system. Continue Reading Beware the Employer Risks Nesting in President Biden’s Comprehensive Immigration Reform Bill

The Biden Administration: Enforcement Actions Affecting Labor & Employment
Tuesday, March 23, 2021 – 2:00-3:00 p.m. EST

The Biden Administration has gotten off to a busy start with a wide array of executive actions and policy directives. In this webinar, Seyfarth subject matter experts will discuss what employers can expect regarding the enforcement in the areas covered by these directives and how that will effect business moving forward.

Register today!

By: Angelo A. Paparelli  

“America is back, the trans-Atlantic alliance is back.” – So declared President Biden on February 23, 2021.  Apparently, however, Antony J. Blinken, the newly installed U.S. Secretary of State (DOS), didn’t get the memo.  On March 2, 2021, he “rescinded the previous national interest determination regarding categories of travelers eligible for exceptions under Presidential Proclamation (PP) 10143 [relating] to the Schengen Area, United Kingdom, and Ireland.” As DOS’s announcement of the rescission noted, PP 10143, issued on January 25, 2021, restricted the issuance of visas and U.S. entry to “certain technical experts and specialists, senior-level managers and executives, treaty-traders and investors, professional athletes, and their dependents.”

NIEs for travelers from these Trans-Atlantic countries had been granted (at times with relative ease at some U.S. embassies and consular posts) based on previous State Department guidance. Under the prior guidance, executives, managers and specialists in the E-1 and E-2 (treaty traders and investors), H-1B (specialty occupation workers) and L-1 (intracompany transferees) visa categories, whose visit could be shown as likely to confer “substantial economic benefit” on the U.S., would often be approved. (For background, see this blog post (“Pursuing a National Interest Exception to the Presidential Entry Bans on Economic Grounds — Not A Fool’s Errand,” and slide deck, “Getting Your Key Employees Back to the U.S. under the National Interest Exceptions” to Presidential Proclamations ~ A Conversation about Eligibility and Process.”) Continue Reading Why? Oh My! State Department Makes It Harder for Travelers from the Schengen Area, UK, and Ireland to Receive National Interest Exceptions (NIEs) under Pandemic-Based Visa and Entry Bans

By Angelo A. Paparelli and Dawn Lurie

Globe-hoppers of the world, too long cabined and constrained by the pandemic, are exhilarated at the prospect of imminent foreign travel.  Many have received the vaccine and are poised to fly far away for business or pleasure.  The vaccinated among us, however, should not buy that airline ticket just yet – unless you know before you go how you will be treated at your foreign destination upon arrival, and upon departure.

Entry and Exit

Increasingly, as multiple variants of COVID-19 are identified, national governments worldwide have tightened entry protocols, and some have imposed exit restrictions.  France, for example, has announced new requirements when departing the country. See “[What is:] Can I leave France?”  – a Jeopardy-style question whose answer is: “You can only travel from France to a country outside the European space if you have pressing grounds for travel, or if you are travelling to your country of origin or residence.” Continue Reading Hey, Immigration Lawyer: Get Me a Coronavirus Passport