United States District Court, W.D. Missouri, Southwestern Division
DOUGLAS HARPOOL, District Judge.
Before the Court is Plaintiff Greater Missouri Medical Pro-Care Providers, Inc.'s ("Greater Missouri") Motion for Summary Judgment (Doc. No. 16) and Defendants Thomas Perez, sued in his official capacity as Secretary of the Department of Labor, the United States Department of Labor, the Administrator of the Department of Labor and the Wage and Hour Division's (collectively "the DOL") Motion for Summary Judgment (Doc. No. 18).
1. The Immigration and Nationality Act - H-1B Classification
This case comes before the Court for review of the Department of Labor Administrative Review Board's ("ARB") Order regarding Greater Missouri's alleged violations of the H-1B provisions of the Immigration and Nationality Act ("INA"). 8 U.S.C. § 1101, et seq. The INA contains an H-1B classification which can be granted to an alien who:
will perform services in a specialty occupation which requires theoretical and practical application of a body of highly specialized knowledge and attainment of a baccalaureate or higher degree or its equivalent as a minimum requirement for entry into the occupation in the United States, and who is qualified to perform services in the specialty occupation because he or she has attained a baccalaureate or higher degree or its equivalent in the specialty occupation.
Id., 8 C.F.R. § 214.2(h)(4)(i)(A)(1). In essence, the H-1B visa program allows professionals from other countries to work in the United States on a temporary basis. Cyberworld Enterprise Technologies, Inc. v. Napolitano, 602 F.3d 189, 192 (3rd Cir. 2010). In these employment scenarios, employers who voluntarily participate in the program are required to file certain applications, labor condition applications or LCAs, with the DOL and the Department of Homeland Security in order to obtain H-1B visas for their employees. Id. As part of the application process, the employer is required, among other things, to guarantee specified prevailing wages and working conditions. 8 U.S.C. § 1182(n)(1); 20 C.F.R. §§ 655.731-733.
Employers are required to pay H-1B employees the prevailing wage listed on the LCA as soon as they "enter into employment." 20 C.F.R. § 655.731(c)(6)(i). "Enter into employment" is defined as when "he/she first makes him/herself available for work or otherwise comes under the control of the employer." 20 C.F.R. § 655.731(c)(6)(i). Therefore, it includes time spent waiting for an assignment, training, interviewing, meeting with a customer, or studying for a licensing examination. Id. Employers are also required to pay the prevailing wage to H-1B employees who are in a "nonproductive status due to a decision by the employer." 20 C.F.R. § 655.731(c)(7)(i). This includes any time there is a lack of work or even a lack of permit or license. Id.
Under the INA, employers are not permitted to require the H-1B employee to pay a penalty for ceasing employment prior to an agreed upon date and shall not make deductions from their wages to collect any such penalties. 20 C.F.R. § 655.731(c)(10)(i). However, the employer is permitted to receive bona fide liquidated damages from an H-1B employee who ceases employment prior to an agreed upon date. Id. Finally, employers are not allowed to deduct any attorney fees or costs from an H-1B employee's wages for functions that the employer is required to perform, such as the preparation and filing of an LCA or H-1B petition. 20 C.F.R. § 655.731(c)(9)(iii)(C).
2. Greater Missouri
Greater Missouri provides physical and occupational therapists for hospitals, nursing homes and other similar facilities. Many of Greater Missouri's employees have come to the United States from the Philippines as part of the H-1B program. These employees signed employment contracts both before they entered the U.S. and again after arriving in the U.S. to work. The employment agreements contain provisions that require the H-1B employees to repay Greater Missouri for certain expenses and also damages if they cease employment before the end of the agreed upon period.
Upon arrival, Greater Missouri's H-1B employees were provided apartments by Greater Missouri while they studied for their licenses and attended training. During the time the H-1B employees were studying and attending training they received a stipend of $50 a week. However, once they passed their exam, or received their license, Greater Missouri began paying them their full salaries. Greater Missouri also made deductions from the H-1B employees' wages for attorney's fees and other fees associated with their LCAs.
3. Procedural History
This case originated on or about June 23, 2006 when Alena Gay Arat, a therapist from the Philippines, submitted an H-1B complaint against Greater Missouri. Arat made several allegations, including: Greater Missouri failed to pay her and other H-1B therapists the wages required under its LCA while they were gaining their licenses; she was required to pay all fees, including attorney's fees, related to her H-1B visa; she was given work not identified in her contract; and she was threatened with a monetary penalty for ending her employment early. R03435-R03437. The complaint was forwarded to the Wage and Hour Division who completed a form describing the alleged H-1B violations as follows: employer failed to pay H-1B worker(s) for time off due to a decision by the employer; employer made illegal deductions from the H-1B worker's wages; employer required H-1B worker(s) to pay all or part of filing fee; and employer imposed an illegal penalty on H-1B worker for ceasing employment prior to an agreed upon date. R03428.
The Wage and Hour Division found reasonable cause to initiate an investigation under the INA based on Arat's complaint. Therefore, Greater Missouri received a letter from the Wage and Hour Division dated August 4, 2006, that stated "The Wage and Hour Division is responsible for conducting investigations to determine compliance with the H-1B Labor Condition Application (LCA) provisions of the Immigration and Nationality Act (INA)." The letter further stated: "This is to notify you that your firm has been scheduled for investigation under those provisions." The initial investigation period covered by the investigation was June 23, 2005 through June 22, 2006. R03195. The investigator assigned to this complaint notified Greater Missouri of the date she planned to visit and also provided Greater Missouri with a list of records it was required to make available for her inspection.
Based upon the findings of the investigation, the Administrator issued a determination that Greater Missouri had committed violations of the INA. Specifically, the Administrator determined the following violations - failure to pay wages as required; required or attempted to require a penalty for ceasing employment prior to agreed upon date; and failure to maintain required documentation. R0001. The original determination found back wages owed in the amount of $372, 897.93 to 44 H-1B workers. Id. The ...