In This Issue
 RECENT CHANGES IN DEPARTMENT OF LABOR (DOL) IMMIGRATION LAWS & REGULATIONS RESULT IN RANDOM EMPLOYER AUDITS
It is critical for employers to understand the recent changes in the Department of Labor (DOL) immigration laws and regulations. As a result of these changes - businesses are now being randomly selected for immigration compliance audits.
UNDERSTAND HOW THE IMMIGRATION LAW CHANGES IMPACT YOU
Immigration announced late last year that, due to a new policy implemented in July 2009, they would begin randomly selecting businesses for immigration compliance. In 2010 the number of investigations is expected to increase by fivefold. Previously, it was the DOL's policy to audit a business only when a complaint by an aggrieved employee had been submitted.
Now, even if an overseas U.S. Consulate believes employment violations are being committed by a business, they, too, can notify the DOL and request an audit, along with that state's own local department of labor. Therefore, the statistical chance of an investigation/audit by one of the above government bodies has increased dramatically. This includes businesses that employ people from other countries as well as U.S. citizens and lawful permanent residents.
IMMIGRATION RANDOM AUDITS ARE COSTLY
Due to these recent changes by DOL, many companies and businesses have received notification of an audit from the DOL, Immigration and Customs Enforcement (ICE), and/or the local labor departments informing them they are being investigated for immigration violations as well as labor law violations. Even without penalty damages as described below, the attorney's fees alone can far exceed $20,000 if this happens. This is a key reason a preemptive audit before your business is affected is crucial.
SUMMARIZATION OF IMMIGRATION & NATIONALITY ACT REQUIREMENTS
The Immigration and Nationality Act, as amended, created the H-1B classification for the temporary employment of foreign workers in specialty occupations where there is presumably a shortage of qualified U.S. workers. Although employers are not required to demonstrate the lack of qualified U.S. workers, they are required to comply with standards that protect U.S. workers. Any employer that employs an H-1B non-immigrant worker is subject to the rules.
Public access files, which must be set up, are provided for by Labor Department regulations. Within one working day after the date of filing with the Labor Department, the public has a right of access to the labor condition application documentation providing:
- the wage rate paid to the H-1B non-immigrant
- an explanation of the system used by the employer to establish the actual wage and
- a copy of the documentation the employer used to establish the prevailing wage (the survey or state employment service determination).
The public is not entitled to payroll records. Only the Labor Department is entitled to that information. The information that is available to the public must be retained for one year beyond the date of employment specified on the labor condition application. However, payroll records must be retained for a period of three years from the date of the creation of the records.
POTENTIAL PENALTIES FOR VIOLATIONS OF IMMIGRATION REGULATIONS
Potential penalties for violations of the regulations include back pay awards to the H-1B beneficiary, civil monetary fines, and debarment from the H-1B program and from the use of the nonimmigrant and permanent immigration process. Civil money penalty and debarment can only be based on a willful failure to pay the wages or to provide prevailing working conditions. This would require a finding of a knowing failure or a reckless disregard.
With regard to the I-9s and making sure that all other labor laws are in compliance (through means other than ICE raids, of which there have been several in New England since August), an audit must be conducted in accordance with the Fair Labor Standards Act, which prescribes standards for the basic minimum wage and overtime pay that affects most types of employment. It requires employers to pay covered employees who are not otherwise exempt at least the federal minimum wage and overtime pay of one-and-one-half-times the regular rate of pay.
Immigration/Labor Self-Audits = Good Business Practice
Many employers are not fully aware of the nuances of this act, and simple procedures such as creating mandatory daily time slips for salaried and non-salaried non-managerial staff, who do not have to answer to a superior for their time, can save extremely high needless payment of back wages.
Before you are faced with a government investigation or the increasingly more prevalent private litigation, you should consider a self-directed internal wage hour audit.
Five reasons for a self audit are:
1. Proper classification of workers (independent contractor or employee; exempt or non-exempt);
2. Determining all hours of work;
3. Using the proper "regular rate" to calculate required overtime;
4. Assuring I-9 compliance; and
5. Avoiding a federal/state investigation or private litigation.
It is estimated that over 40,000 cases have been sent to the USCIS for investigation in 2009 alone. Therefore, not only are internal preemptive audits a good idea, for many employers they should be considered a must. Many businesses are now having these preemptive audits done, and have saved tens of thousands of dollars.
Attorney Seth Miller is an of counsel attorney with Waterbury, Conn.-based Moynahan & Minnella. For more information, please visit www.moynahanlawfirm.com or call (203) 573-1411.
MOYNAHAN & MINELLA ADDS TWO LITIGATORS TO THE FIRM
Attorney Regina Duchin Kraus brings to Moynahan & Minnella a comprehensive litigation background with experience in state and federal courts. Her extensive litigation experience encompasses commercial and business litigation, general commercial liability defense, professional liability defense, employment issues, probate and civil rights.
Attorney Duchin Kraus has conducted the deposition of hundreds of expert and fact witnesses, selected more than fifty juries and tried ten cases to verdict, with the responsibility from initial filings to closing arguments. In working with clients – Attorney Duchin Kraus is proactive in minimizing client exposure and legal fees by formulating creative legal theories and successfully mediating cases or negotiating cost-effective settlements in cases where she recommended avoiding the risk of trial.
Attorney Jennifer Wheelock practices primarily in the areas of personal injury, criminal defense, family law and general civil litigation and is licensed to do so in Connecticut, Massachusetts and Rhode Island.
Prior to joining Moynahan & Minnella, Attorney Wheelock practiced with a Hartford area insurance defense firm and was responsible for defending claims brought against motorists, property owners, municipalities, municipal employees and commercial entities. She also litigated insurance coverage disputes, practiced family law, handled landlord/tenant summary process eviction matters, performed extensive subrogation work, and was engaged as a special public defender in Hartford and Middlesex counties.
What is Cash-in Refinancing and How Could It Help You?
For years, many homeowners have used cash-out refinancing where the borrowers take out equity from their homes to purchase things like cars and vacations. Here, the new mortgage is for a larger amount than the old loan. The homeowner receives a check for the difference at closing.
However, because of the impacts of the housing crisis, borrowers are starting to look at another trend; cash-in refinancing. In a cash-in refinance, the refinanced mortgage is for a smaller amount than the old loan. The homeowner takes a check to the closing. This allows for a lower mortgage rate which means large savings in the long run, for many homeowners.
For example, someone who bought a $100,000 house a few years ago. The housing crisis hit, and now the house is appraised at $80,000. To avoid mortgage insurance, the refinanced loan can't be for more than $64,000. That's 80 percent of the home's current value of $80,000. If the borrower owes more than $64,000, she'll have to go to the closing table with a check for the difference or pay premium mortgage insurance (PMI). In the last three months of 2009, the cash-in refinance accounted for one-third of Freddie Mac-owned loans.
Who can cash in?
Cash-in refinance is typically for a homeowner who has a fixed-income or who has additional money to contribute to their loan amount.
Some borrowers want to reduce the term of their mortgage, maybe they can move from a 30-year to a 15-year fixed-rate mortgage. The extra cash can reduce the mortgage amount and make their monthly payments bearable.
Homeowners, who increase the equity in their home during a refinance, may be able to eliminate the private monthly insurance payments (PMI), which are mandated fees for homeowners who have less than 20 percent equity in their homes. In turn, they save money by putting it towards their principle.
People are now starting to treat their home as a place to save and keep money, as opposed to a place where the borrower can pull money from.
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EMPLOYERS: Critical Changes to Immigration Regulations
DOL Immigration is randomly selecting companies for audits
Impacts companies who employ people from other countries as well as U.S. citizens and lawful permanent residents.
Any employer that employs an H-1B non-immigrant worker is subject to the rules.
The statistical chance of an investigation/audit by any of the government bodies has increased dramatically.
Several of these audits have already occurred in the New England area.
Be preemptive. Conduct your own audit to ensure compliance prior to being contacted by government .
Can Cash-In
Refinancing Help You
Are you on a fixed income?
Do you have additional money to contribute to your loan?
Here's a way to use your home to save!
Who We Are
At Moynahan & Minnella, we pride ourselves on offering our clients personal, professional and affordable services to individuals, family and companies of all sizes; to provide the value of a full-service law firm; to be committed to being accessible and responsive to our clients needs.
Practice Areas
Appellate Law
Commercial and Corporate Law
Criminal Defense
Employment & Labor
Estate & Probate
Family Law & Domestic Relations
Immigration
Intellectual Property
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