Now that the Fiscal Year 2020 H-1B cap season is over, it is a good time for an internal review and update of public access files (PAFs).
What is a Public Access File?
U.S. employers who sponsor H-1B employees must make certain records available, on request, to government auditors, members of the public, and the H-1B employee. The PAF must establish that the employer is paying the higher of: (a) the prevailing wage; or (b) the actual wage paid to other employees in similar positions who have similar qualifications.
Why does PAF compliance matter?
Failure to comply with PAF requirements, if discovered by the U.S. Department of Labor (DOL), could cost an H-1B employer millions of dollars in back wages, fines, and other penalties. A little spring cleaning now will protect a business going forward.
What documents must be retained in the PAF?
Each PAF must contain the following materials related to the H-1B application:
- Actual Wage Memo
- Summary of Benefits offered to U.S. and H-1B workers
- Prevailing Wage Documentation for the occupation and geographical area
- Posting Notices and Certification of Posting
- LCA, Form ETA 9035
- LCA Cover Pages, Form ETA 9035CP
In addition, during a PAF audit, DOL may request (a) proof that the H-1B employee received a copy of the certified LCA, and (b) payroll records for the H-1B employee and other employees in the same or substantially same positions at the worksite. These do not need to be in the PAF itself, but may need to be provided on request.
Where should the PAF be stored?
The PAF must be kept at either the employer’s principal U.S. place of business or at the location where the H-1B worker is employed. Records may also be maintained electronically. The PAF must be kept separate from other immigration or personnel records maintained by the employer.
How long must PAFs be maintained?
PAF documents must be retained for one year after the last date the H-1B worker was employed under the LCA or from the LCA expiration date, whichever is longer. PAFs prepared for H-1B applications that are not selected in the H-1B lottery do not need to be retained.
What if an employer fails to comply with PAF requirements?
DOL can audit a company’s PAFs. Common audit triggers are complaints from current or former H-1B employees or colleagues who have knowledge of the employer’s LCA practices. DOL can impose various penalties including fines up to $53,969 per violation for willful violations, payment of back wages, and debarment from using the H-1B program.
The risks of audits and related penalties are real. DOL is keeping its promise to enforce laws governing immigration and it is costing employers. Just last week, a Michigan employment services company paid more than $1.1 million in back wages for failing to pay required wages, and on February 19, 2019 a Minnesota administrative law judge ordered a company to pay $43,666 in back wages to one H-1B employee for violating the LCA and failing to maintain required records.
The H-1B nonimmigrant visa classification is under constant scrutiny and immigration enforcement activity continues to hit record highs. Employers’ should work with counsel to ensure proper compliance with all aspects of immigration law, including maintenance of PAFs. Failure to do so can be a costly mistake.