A reader recently asked the following:

What are the penalties and consequences, if any, for knowingly hiring an individual as an independent contractor whose work visa (H1) had expired and offering part time employment to his wife, who is on a H4 Visa?

My answer follows:

The below information in bold is directly from the United States’ Department of Labor. Please note that this is general information only, and that the Department of Labor MAY assess penalties. “May” is the key word here. As noted below, penalties really depend “on the type and severity of the violation.” Moreover, the Department of Labor generally only investigates if apprised of a violation. Generally, it doesn’t have the “manpower” to just do random investigations.

Relative to the H4 visa, it doesn’t matter if the expiring H1 visa holder’s spouse is here on an H4. One has nothing to do with the other. What matters is that the H1 visa holder’s visa is valid. Consequently, if the H1 visa has expired, then the H4 visa may no longer be valid too, and Homeland Security may take action against the immigrant violators also.

I hope that this helps. If you’d like further information, please don’t hesitate to contact me.

Penalties/Sanctions:

When violations are found, the Administrator of the Wage and Hour Division may assess civil money penalties with maximums ranging from $1,000 to $35,000 per violation, depending on the type and severity of the violation. The Administrator may also impose other remedies, including payment of back wages.

Within 15 days of the date of the determination, any interested party may request a hearing on the Wage and Hour Administrator’s determination before an administrative law judge. Within 30 days of the decision by an Administrative Law Judge, an interested party may request a review of the ALJ’s decision by the Department’s Administrative Review Board.

Employers found to have committed certain violations may also be precluded from future access to the H-1B program and other immigrant programs for a period of at least one year.

Effective March 8, 2005, an H-1B employer will be considered in compliance notwithstanding a technical or procedural failure if such employer:

  • Makes a good faith attempt to comply;
  • Voluntarily corrects violations within 10 business days of being advised by an enforcement authority; and
  • Has not engaged in a pattern or practice of willful violations; and
  • For prevailing wage violations, can establish that the wage was calculated consistent with recognized industry standards and practices.

Relation to State, Local, and Other Federal Laws

Various other laws, such as worker’s compensation, tax (unemployment insurance, local, state, and federal), the Fair Labor Standards Act, and the Family and Medical Leave Act, may apply to the employment of these workers.