Written by Colleen F. Molner, Esq., Partner, N.C. Board Certified Immigration Law Specialist.
The United States unemployment rate continues to remain at a historically low level in the first quarter of 2023.
However, multiple layoffs have been announced in the tech industry over the last few months, reportedly disproportionally impacting employment-based nonimmigrant visa holders.
It is important for employers to consider potential immigration consequences during layoffs – that is, an involuntary separation of one or more employees without cause or prejudice – for both the employers themselves and the employees.
Below are further details and information about immigration considerations for both employers and employees during layoffs.
Employers who are contemplating layoffs should consider the following immigration implications for the company:
H-1B visa holders
The H-1B nonimmigrant visa category is available for U.S. companies to fill a “specialty occupation” with a qualified foreign national. A specialty occupation is one that generally requires a bachelor’s degree or higher, or its equivalent, as a minimum, entry-level credential.
There are specific responsibilities and obligations for employers after laying off an H-1B visa holder. For instance, they must notify United States Citizenship and Immigration Services (USCIS) that the employee-employer relationship has been terminated by withdrawing the H-1B approval notice from USCIS. Not doing so may result in the employer having to pay back wages to the terminated H-1B employee per the certified Labor Condition Application (LCA) on file with the DOL.
The employer is also required to offer a terminated H-1B employee the cost of the return flight to their home country.
The attorneys at Garfinkel Immigration Law Firm recommend that employers document every step of the process including their notification and correspondence with USCIS; their communication with the employee; as well as their offer to pay for the cost of the return flight; the foreign national’s acceptance or rejection of such offer; and copies of the payment towards the foreign national’s flight costs (if applicable).
Employers should keep these records available in the employee’s public access file as well as their personnel file.
PERM is often the first step in the sponsorship process for employers seeking a green card for a respected employee.
PERM is an electronically filed, attestation-based application submitted to the U.S. Department of Labor (DOL) following a test of the labor market. The sponsoring employer certifies that:
- It has an opening for a full-time, permanent position
- It conducted advertising to determine if there are able, willing, available, and qualified U.S. workers for the position
- U.S. worker applicants were rejected only for lawful, job-related reasons
- The employer can and will pay a wage that equals or exceeds the prevailing wage for the position as determined by the DOL
Employers must complete a significant extra step if a layoff occurs while there is an ongoing PERM process. Specifically, the employer is obligated to notify any “U.S. worker” who was terminated in the six-month period before the PERM was filed that there is an open position in a “related occupation” and invite them to apply.
A “U.S. worker” is defined as an employee who is either a citizen or national of the U.S, a lawful permanent resident (“LPR” or green card holder), a refugee, or asylee.
A “related occupation” is any position that shares a worksite area and occupational classification (based off the Department of Labor occupation classification) with the role that is linked to the PERM application.
Take, for example, a hypothetical employer who intends to file a PERM with the Department of Labor in March 2023 for an engineer. That same employer also terminated a senior engineer, who was a U.S. citizen, at the same worksite location in December 2022.
In order to fulfill their obligation in this circumstance, the employer must notify the senior engineer that there is now an open engineering position at the company and invite them to apply for the role.
If the senior engineer U.S. worker applies for the role and is found to be “able, willing, available, and qualified” for the role (thus cannot be lawfully rejected for it), the Labor Market Test is considered to have “failed” and the employer may not proceed with submitting the PERM on behalf of the foreign national engineer employee.
The attorneys at Garfinkel Immigration Law Firm recommend that employers document their communications (and attempts) with the laid-off U.S. workers in these scenarios, and retain correspondence as part of the audit file.
While the facts of each individual’s circumstances vary and should be assessed on a case-by-case basis, foreign national employees who have been laid off by their employer should keep in mind the following general information and options while considering their next steps:
60-day grace period
The regulations provide foreign nationals a 60-day grace period following a layoff. Specifically, the grace period applies to E-1, E-2, E-3, H-1B, L-1, O-1 and TN nonimmigrant visa holders, as well as their dependents. It went into effect in 2017 as a welcomed measure to allow high-skilled nonimmigrant workers to more readily pursue new employment opportunities and/or wrap up their affairs when their existing employment ends, rather than having to immediately pick up and depart the U.S.
The grace period provides applicable individuals with 60 consecutive days “following the cessation of employment,” to depart the U.S. or change their status/employer in the U.S. However, one must be very mindful that if their Form I-94 Arrival/Departure Record is valid for less than 60 days, the grace period instead ends on the Form I-94 expiration date (i.e., whichever date is shorter between the 60 days following cessation of employment or the I-94 record expiration date).
Unfortunately, USCIS has yet to define when “cessation of employment” – and thus the 60-day grace period – begins. It also does not specify whether the “cessation of employment” must be involuntary, or whether a voluntary separation also benefits from the grace period.
USCIS must provide clarification on when the 60-day grace period starts, and the employer/employee relationship ends, in the context of a layoff.
Garfinkel Immigration Law Firm generally advises clients that the “cessation of employment” date starts on the day the relationship between the employer and the employee ends.
This may be interpreted as the date on the foreign national’s last pay stub, even if it is through an extended severance package. However, this approach may pose risk to the foreign national, as USCIS has discretion to deem such nonproductive status (beyond the 60 days) as a violation of the foreign national’s nonimmigrant visa classification which may ultimately impact their eligibility for future immigration benefits.
Therefore, more conservatively speaking, the last date that the employee provided productive services to the employer is interpreted as the cessation of employment date.
During the grace period and before the 60th day, the foreign national must either change their status, change their employer, or leave the country. More details can be found below.
Change of status
Foreign nationals with nonimmigrant work visas who lose their jobs have the option to file a change of status to another visas classification they are eligible for during the 60-day grace period mentioned above.
Viable options for changing status include:
Switching to a dependent of a spouse with an already approved nonimmigrant visa petition
This would typically only apply to a foreign national spouse who is eligible to switch into E, L-2 or H-4 dependent spousal status. E and L-2 spouses have been authorized to work “incident to status” since early 2022, while those in H-4 status also have limited work authorization.
Switching to B “visitor visa” status
Foreign nationals who are approaching the end of their 60-day grace period could consider changing their status to the B visa category.
The B visa classification is typically intended for individuals who are briefly in the United States for activities such as touring, visiting family members, obtaining health care, attending meetings or seminars or conducting business on behalf of an overseas employer.
Switching to B “visitor visa” status is an option for laid off employees who need additional time beyond the 60-day grace period to wrap up and conclude their affairs in the United States.
However, B visitor status is usually only granted for a period of six months to a year, depending on circumstances, with the possibility of an extension, which is not guaranteed. Individuals in B visa status are also strictly prohibited from “performing skilled or unskilled labor.”
Therefore, moving to B “visitor visa” status is not always a practical solution for remaining in the United States beyond a small window outside of the initial 60-day grace period.
Change of employer
Foreign nationals who have been laid off have a few options for finding new employment, depending on their visa type.
H-1B visa holders can generally file to switch employers without penalty during the 60-day grace period. H-1B visas are “portable,” which allows the foreign national to begin working with a new employer as soon as the employer files a new petition with USCIS. If the H-1B change of employer petition is filed within the 60-day grace period, the petition does not typically need to be approved for the foreign national to start employment.
Additionally, eligible non-H-1B foreign national visa holders can find a new employment sponsor during the 60-day grace period and apply to switch visa status/employers based on that new sponsorship. As USCIS notes in its December 2022 memo, filing a “non-frivolous change of status application will prevent the accrual of unlawful presence until the application is adjudicated.”
Other options for laid-off foreign nationals include:
- Filing for adjustment of status: In rare circumstances, some nonimmigrant visa holders who have been laid off have the option to apply to adjust their status to become legal permanent residents. This usually involves self-petitioning with an EB-1 Extraordinary Ability, EB-2 National Interest Waiver or EB-5 Immigrant Investor application.
- Enrolling at a U.S. college or university: Nonimmigrant visa holders may enroll at a U.S. college or university. This will make the individual eligible to apply to change to F-1 status, as long as they are registered in a full-time program that culminates in a degree or diploma at the college or university. There are some limited work authorization options for those in F-1 status.
- Leaving the United States: Foreign nationals who have been laid off and cannot benefit from any of the above options must leave the United States following the conclusion of their 60-day grace period. These individuals can then explore and apply for new sponsorship and/or employment options in the U.S. from their home country.
It is important to keep in mind that foreign nationals who remain in the country past the 60-day grace period will likely be considered to have “overstayed” their nonimmigrant status and/or are unlawfully present in the United States. This could affect their eligibility to receive immigration benefits in the future and/or may result in deportation proceedings.
Foreign national employees who have lost their job should consider consulting with experienced immigration counsel to discuss all their options following a layoff.