The Department of Labor (DOL) recently issued a new round of Frequently Asked Questions providing an update on the status of the Backlog Elimination Center (BEC), the entity responsible for adjudicating pre-PERM labor certifications filed prior to March 2005. The DOL confirmed that as of September 30, 2007, its backlog had been nearly eliminated, with 99% of cases completed and the remaining awaiting responses from employers. The BECs in both Philadelphia and Dallas have begun a transition and shutdown phase that will continue into December. They expect to complete all remaining cases by the end of December, and encourage employers and attorneys to respond timely to any dated material to facilitate a final decision. They also reiterated that the status of cases can be checked at http://pds.pbls.doleta.gov.
Increase in PERM Audits
Over the last month, attorneys and companies, have noticed a substantial increase in audits of PERM labor certification applications. There appear to be two types of audits. The first type of audit appears to be a randomly generated audit and follows the same format each time it is issued. Employers are requested to respond to the audit by providing copies of the recruitment undertaken, the notice of filing, the prevailing wage determination, and other documentation in support of the PERM application.
The second type of audit appears to be targeted more to those applications that "trigger" an audit. Audit triggers typically include 1) jobs that require a foreign language or 2) jobs with requirements that exceed the normal minimum requirements set forth by DOL and 3) applicants who have gained required experience with their employer in a similar job. For those targeted audits, in addition to requesting a copy of the recruitment and supporting documents, DOL is also requesting a business necessity letter (BNL) to support the need for the requirement that triggered the audit.
Until now, DOL usually accepted an employer's job requirements, whether they exceeded the normal minimum requirements set forth by DOL or not. However, in the last month, that appears to be changing. Since DOL has more resources, with the close of the BECs, they appear to have devoted those resources to audits. Employers are reminded that if a PERM application is being filed that may necessitate a BNL, it is important to prepare that document in advance and before filing the PERM.
DOL Issues FAQs on the Prohibition of Payments by Employees for Labor Certifications
There seems to be confusion regarding what fees an employer must pay related to the PERM labor certification process. DOL issued FAQs to clarify and augment its regulations. Below are four of the most frequently asked questions and answers by DOL.
How does the Department define prohibited payments for "activity related to obtaining permanent labor certification"?
Pursuant to §656.12(b), an employer may not seek or receive payment of any kind for any activity related to obtaining permanent labor certification, except from a party with a legitimate, pre-existing business relationship with the employer, and when the work to be performed by the alien beneficiary will benefit that party. "Payment" includes, but is not limited to, monetary payments; deductions from wages or benefits; kickbacks, bribes, or tributes; goods, services, or other "in kind" payments; and free labor. This includes the prohibition against the alien's paying the employer's attorneys' fees in connection with the labor certification application. What are activities relating to obtaining permanent labor certification?
"Activity related to obtaining permanent labor certification," for purposes of §656.12(b), includes, but is not limited to, recruitment activity, the use of legal services, and any other action associated with the preparation, filing, or pursuit of an application. This section prohibits any such payment. An alien may pay his/her own costs, including attorneys' fees for representation of the alien, except that when the same attorney represents both the alien and the employer, all costs related to preparing, filing, and obtaining the permanent labor certification must be borne by the employer.
Does the rule prohibit reimbursement agreements?
The regulation prohibits payment by the alien beneficiary or others of employer-incurred costs related to labor certification, including attorneys' fees. If, for example, a reimbursement agreement would require the employee to reimburse the employer for some or all of the attorneys' fees it incurred associated with preparing, filing and obtaining the labor certification, such reimbursement agreement would violate the Final Rule.
What should employers do who have entered into contracts where payments from aliens are either owed after July 16, or owed prior to July 16 but not paid until after July 16?
Section 656.12(b) prohibits an employer from seeking or receiving payment of any kind for activity related to obtaining permanent labor certification, including the employer's attorneys' fees. If the payment obligation, however, accrued prior to July 16, 2007, the employer has the right to seek the payment after the effective date. For applications filed on or after July 16, 2007, an employer who has sought this type of payment from the alien beneficiary of the application must answer "yes" to Question I-23 on ETA Form 9089 ("Has the employer received payment of any kind for the submission of this application?"), even if the employer has not yet received payment from the alien. Employers should describe the payment and from whom, and when appropriate clarify on the application, for the record, that the payment was for an obligation that accrued prior to the effective date of this provision (i.e., July 16, 2007). Employers answering "yes" to Question I-23 must be prepared, if requested by the Certifying Officer, to explain and support the details of such payment.