Not So Simple: Terminating an H-1B Employee:

A company that hires an H-1B employee has obligations to the government – both the Department of Labor and USCIS. Certain obligations are more obvious – retaining a Public Access File about the employee, paying the employee above the prevailing wage for the occupation in the Metropolitan Statistical Area, and ensuring that the employee remains in status. Other obligations are not as obvious, but they are important because not adhering to them can be costly. One particular obligation is informing USCIS that an H-1B employee is being terminated before that person’s authorized period of stay.

Merely terminating an H-1B employee may take that individual off your company’s payroll, but that is insufficient in the eyes of USCIS. As far as USCIS is concerned, your company may owe that terminated employee back wages. There are federal regulations dedicated to the proper termination procedure, and they are clear in stating that it is not enough to terminate the employee. A terminated employee has the potential to sue an employer over back wages if the termination is improper. The H-1B petition remains in effect.

It is essential that an employer takes the proper steps to ensure proper termination. Notifying USCIS properly of the termination is necessary, so that USCIS can process revocation of the petition. Under the regulations, an employer is also obligated to pay for the “reasonable costs” of the former employee’s travel back to their country of previous residence.

If the company wishes to hire that employee again, let’s say, in a year, a new petition will need to be filed. The old petition cannot be revived. The advantage for both the company and employee is that the employee has already been accepted under the cap, so there is no lottery process to undergo again.