Department of Labor H-1B Audits force companies to take second look at its own practices
If you follow H-1b news, you may have read about the increased Department of Labor (DOL) audit of companies that hire H-1b workers. It is clear now that The Department of Labor is conducting one the most extensive H-1b audit programs in recent history. One example is the GlobalCynex, Inc. audit. GlobalCynex Inc. is an information technology company located in Virginia, recently negotiated an agreement to pay almost $1.7 million in back wages to 343 H-1B employees after an investigation by DOL. DOL found that the company did not pay required wages from March 2005 to March 2007. It also found that the company charged H-1B workers training fees ranging from $1,000 to $2,500.
Having represented several clients in such H-1b audits, clearly DOL means business this year. In fact DOL has debarred ten companies from the H-1b program during the first half of this year alone. It has been our observation that the DOL's H1b audits have been very extensive in Michigan, Ohio and Washington DC. The consensus among H-1b dependent companies is that old models of doing business must change. Companies seem to be more interested in exploring methods to reform their practices and learn more about ways to avoid exposure to liability prior to paying the heavy penalties. Such newly revised business model that focuses on compliance and preventative measures as an integral part of managing the business is emerging out of necessity. However, before the transition is complete we expect to see heavier scrutiny by both USCIS and DOL in H-1b processing and enforcement.
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