U.S. Department of Labor Administrative Review Board 200 Constitution Ave. NW Washington, DC 20210-0001 In the Matter of: ADMINISTRATOR, ARB CASE NO. 2018-0075 WAGE & HOUR DIVISION, ALJ CASE NO. 2012-LCA-00044 PROSECUTING PARTY, DATE: August 27, 2020 v. VOLT MANAGEMENT CORP. D/B/A VOLT WORKFORCE SOLUTIONS, RESPONDENT. Appearances: For the Prosecuting Party, Administrator, Wage and Hour Division: Kate O. O’Scannlain, Esq.; Jennifer S. Brand, Esq.; Paul L. Frieden, Esq.; Rachel Goldberg, Esq.; U.S. Department of Labor, Office of the Solicitor; Washington, District of Columbia For the Respondent: Roland M. Juarez, Esq.; Hunton Andrews Kurth LLP; Los Angeles, California Before: James D. McGinley, Chief Administrative Appeals Judge; James A. Haynes, Thomas H. Burrell, Heather C. Leslie, and Randel K. Johnson, Administrative Appeals Judges, presiding en banc. DECISION AND REMAND ORDER This case arises under the H-1B visa program provisions of the Immigration and Nationality Act, as amended (INA, or the Act), 8 U.S.C. § 1101(a)(15)(H)(i)(b) (2014) and 8 U.S.C. § 1182(n) (2013), and its implementing regulations at 20 C.F.R. 2 Part 655, subparts H and I (2019). Sergey Nefedyev, an H-1B non-immigrant employee, filed a complaint with the Administrator of the Wage and Hour Division of the U.S. Department of Labor (Administrator) alleging that his employer, Respondent Volt Management Corp. (Volt), failed to pay him the wages required by the INA. The Administrator investigated and determined that Volt had committed violations with respect to many of its H-1B employees. The Administrative Law Judge (ALJ) assigned to the case entered summary decision in favor of Volt, concluding that the violations and penalties imposed by the Administrator with respect to all H-1B employees other than Mr. Nefedyev were based on an unauthorized investigation that exceeded the scope of the Administrator’s power under the INA. For the reasons set forth herein, we reverse the ALJ’s grant of summary decision and remand this case for further proceedings. BACKGROUND 1. Statutory and Regulatory Background The INA permits employers to hire non-immigrant alien workers in “specialty occupations” to temporarily work in the United States under the H-1B program.1 An employer desiring to hire an H-1B non-immigrant worker must file a Labor Condition Application (LCA) with the U.S. Department of Labor.2 After the employer secures a certified LCA from the Department of Labor and receives approval by the Department of Homeland Security, the Department of State issues an H-1B visa for the non-immigrant worker.3 In signing and filing an LCA, the employer makes certain attestations and is required to meet certain obligations as to the terms and conditions of employment for the worker it seeks to bring to the United States.4 Among other things, the employer attests that for the entire period of authorized employment, it will pay the H-1B worker the wages required by 20 C.F.R. § 655.731. Wages must even be paid if 1 8 U.S.C. § 1101(a)(15)(H)(i)(b); 20 C.F.R. § 655.700. 2 8 U.S.C. § 1182(n)(1); 20 C.F.R. § 655.700. 3 20 C.F.R. § 655.705(a)-(b). 4 8 U.S.C. § 1182(n)(1); 20 C.F.R. § 655.730(c)(2). 3 the worker is “not performing work and is in a nonproductive status due to a decision by the employer (e.g., because of lack of assigned work) . .”5 Balancing competing interests and policy concerns, Congress struck a compromise in the INA with respect to enforcement of the H-1B program requirements.6 On the front end, the Department of Labor is given very little scope in reviewing and approving LCAs. Generally, the Department of Labor must approve LCAs where all items on the forms have been appropriately completed and are not obviously inaccurate.7 On the back end, the INA grants the Secretary of Labor investigatory and enforcement powers to ensure compliance after certification.8 The INA allows the Secretary to conduct investigations under the following circumstances: (1) upon receipt of an aggrieved party complaint;9 (2) on a random basis, if the employer has been found to be a willful violator of the INA within the past five years;10 (3) upon personal certification of the Secretary of Labor that there exists reasonable cause to believe that the employer is not in compliance;11 and (4) in response to specific credible information from a known source who is likely to have knowledge of an employer’s practices or employment conditions in certain circumstances.12 If the Administrator finds that the employer has violated the wage requirements, she may order the employer to pay back wages to its H-1B employees.13 2. Factual Background 5 20 C.F.R. § 655.731(c)(5), (c)(7)(i); see also 8 U.S.C. § 1182(n)(2)(C)(vii). 6 See Alien Temporary Employment Labor Certification Process, 56 Fed. Reg. 11,705, 11,706-07 (Mar. 20, 1991). 7 8 U.S.C. § 1182(n)(1); 20 C.F.R. § 655.740(a)(1); see also Cyberworld Enter. Techs., Inc. v. Napolitano, 602 F.3d 189, 193 (3d Cir. 2010) (stating that generally the Department of Labor may not “investigate the veracity of the employer’s attestations on the LCA prior to certification”). 8 See Labor Condition Applications and Requirements for Employers Using Aliens on H-1B Visas in Specialty Occupations, 56 Fed. Reg. 54,720, 54,721 (Oct. 22, 1991) (Final Rule). 9 8 U.S.C. § 1182(n)(2)(A). 10 8 U.S.C. § 1182(n)(2)(F). 11 8 U.S.C. § 1182(n)(2)(G)(i). 12 8 U.S.C. § 1182(n)(2)(G)(ii). 13 8 U.S.C. § 1182(n)(2)(D); 20 C.F.R. § 655.810(a). 4 Volt Management is a staffing agency and employs numerous H-1B non- immigrants. It hired Mr. Nefedyev for a temporary assignment as a Software Design Engineer for one of Volt’s clients.14 Mr. Nefedyev entered the United States on an H-1B non-immigrant visa.15 On September 22, 2009, Mr. Nefedyev filed a complaint with the Administrator alleging that Volt had failed to pay him in accordance with the requirements of the INA and the attestations in his LCA.16 According to Mr. Nefedyev, Volt did not pay him between June 30, 2009, when his assignment with Volt’s client ended, and August 18, 2009, when Volt issued Mr. Nefedyev a notice of termination letter.17 Mr. Nefedyev alleged that the June 30 to August 18 period constituted nonproductive time due to a decision by Volt (commonly known as a “benching” period), during which he should have been paid.18 The Administrator commenced an investigation in response to Mr. Nefedyev’s complaint on March 1, 2010.19 By letter dated March 24, 2010 (the Investigation Letter), the Administrator provided notice to Volt of the investigation.20 The Investigation Letter instructed Volt to make available a number of records concerning Volt’s H-1B employees and LCAs for a two-year period, from September 22, 2007 to September 22, 2009.21 The Investigation Letter did not indicate that it 14 Declaration of Wage and Hour Investigator Ming Sproule in Support of the Administrator’s Motion for Summary Decision (Sproule Decl.) at ¶3; July 31, 2008 Request for Temporary Work Visa for Sergey Nefedyev, attached as Exhibit 5 to Declaration of Roland M. Juarez in Support of Volt Management Corporation’s Notice of Motion and Cross-Motion for Summary Decision and Opposition to Administrator’s Motion for Summary Decision (Juarez Decl.). 15 See Sproule Decl. at ¶4. 16 September 22, 2009 Complaint of Sergey Nefedyev, attached as Exhibit 1 to Juarez Decl. 17 Id. 18 Id. 19 See Administrator’s Responses to Respondent’s First Set of Requests for Admission (RFA), at RFA 2, attached as Exhibit 3 to Juarez Decl. 20 March 24, 2010 Investigation Letter, attached as Exhibit 2 to Juarez Decl. 21 Id. 5 was prompted by a complaint, nor did it reference Mr. Nefedyev or the allegations of his complaint.22 The Administrator ultimately determined that Volt violated 20 C.F.R. § 655.73123 by failing to pay Mr. Nefedyev and many other H-1B employees for nonproductive time.24 In total, the Administrator seeks $298,413.78 in back wages on behalf of 74 H-1B employees.25 Volt objected to the determination and requested a formal hearing before an ALJ. Volt and the Administrator submitted cross motions for summary decision below. Having resolved Mr. Nefedyev’s individual claim with the Administrator, Volt argued, among other things, that the Administrator’s investigation with respect to all of the other H-1B non-immigrant workers exceeded the authority granted to the Administrator by the INA. The ALJ agreed, and granted summary decision in favor of Volt. The Administrator appealed. For the following reasons, we remand. JURISDICTION AND STANDARD OF REVIEW 22 See id. The Investigation Letter stated “[t]his is to notify you that your firm has been scheduled for investigation pursuant to and under authority of INA and implementing regulations at 20 C.F.R. Part 655 . .” 23 The Administrator also determined that Volt violated 20 C.F.R. § 655.734 by failing to post notice of its LCA filing for ten days in conspicuous locations in the areas of intended employment. The Administrator ordered Volt to comply with the regulation, but assessed no civil money penalty for the violation.