November-15-09

Requiring That Sponsored Foreign Workers Pay Travel Costs

Question: We are a Massachusetts employer in the process of sponsoring two foreign workers under the H2-B visa program. We understand that we must pay certain filing fees and other costs relating to the visa but are we required to reimburse to the employee the cost of his travel into the United States?

TGL Response: The United States Department of Labor (the DOL) (to which the Department of Homeland Security has delegated certain H2-B enforcement authority) recently issued guidance on this topic, found in Field Assistance Bulletin No. 2009-2. It has long been viewed as a violation of federal and state wage and hour law to withhold pay or require repayment by employees for certain expenses such as meals and lodging if the practical effect of the withholding or reimbursement is to reduce the weekly wages paid to an employee below the minimum wage. The DOL has opined that a foreign worker’s travel into the United States for the purpose of starting a job with a United States employer is “primarily for the benefit of the employer” and is thus treated similarly to employer-provided meals and lodging. Because it is primarily for the benefit of the employer, the employer cannot require the employee to pay for the expense or withhold such expense from the pay of the employee if such withholding or reimbursement has the effect of dropping the employee’s pay below minimum wage. This means that if the employee has pre-paid all travel costs, the employer must reimburse the employee in his or her first paycheck for all such costs which have the impact of dropping his or her wage below minimum wage ($8.00 per hour in Massachusetts). For example, if an employee has paid $1,000 for travel expenses and the employee earns $1,000 per week for a 40 hour work week, the employer must pay the employee at least $1,320 for that first week of work.