H-1B Fraud Investigations Are Expected to Increase

Computerworld - Companies that hire H-1B visa holders may soon face a greater risk of being investigated for their treatment of those workers because of changes in the law that are due to take effect this month and additional funding for enforcement by the U.S. Department of Labor.

For now, the number of investigations into H-1B abuses is small. According to Labor Department figures, agency officials conducted 49 investigations into alleged H-1B abuses from the beginning of the government's current fiscal year last October through Jan. 31. In comparison, there were 142 and 118 investigations during the entire 2003 and 2004 fiscal years, respectively.

When Congress approved the Visa Reform Act of 2004 in November, it increased the H-1B application fee by $2,000 and earmarked $500 of each payment for antifraud efforts. Immigration attorneys said last week that they expect the Labor Department to increase its scrutiny of the use of H-1Bs after the government begins collecting the new fee.

"We are going to see more investigations, and not only because there is more money allocated for the purpose," said Irina Plumlee, a lawyer at Gardere Wynne Sewell LLP in Dallas. She added that heightened security measures and the political climate in Congress are also factors.

Frida Glucoft, a partner at Mitchell Silberberg & Knupp LLP in Los Angeles, said the number of investigations over the past few years seems low, "but I think we are going to be seeing more audits."

The message for IT managers who use H-1B workers is to ensure that all of the program's rules are followed to the letter, the attorneys said.

Investigations are typically triggered by complaints from H-1B holders. But the government can also conduct random audits or launch investigations based on information from third-party sources. A typical remedy involves payment of back wages by employers; for example, more than $2 million was paid to workers in fiscal 2003.

In addition to the antifraud funding, the new law gives federal officials more grounds on which to investigate companies, such as checking compliance with a modified wage-rate system that also is due to take effect this month. That system will allow for greater variances in pay to visa holders.

The government initially capped the number of H-1B visas available for this fiscal year at 65,000, a limit that was reached on Oct. 1—the first day of the fiscal year. An additional 20,000 visas were supposed to become available on March 8 for foreign workers who hold master's or Ph.D. degrees from U.S. universities, but that process has been delayed pending publication of the rules governing the visas in the Federal Register.