There is a growing phenomenon of staffing companies in the U.S. springing up that almost exclusively target professional immigrant workers for employment. Some of these companies will literally turn away American workers seeking their assistance in job placement at the risk of violating laws protecting workers against discrimination based on their nationality due to their desire of employing immigrant workers because of the added leverage they have in dealing with their employees through their control of the employer-sponsored visa that allows the workers to work legally in the U.S. While this can occur in many categories of professional expertise, it appears that health care professionals are a common target, and physical and occupational therapists are the most popular subset within that category of workers for exploitation by staffing companies.
How do staffing companies exploit foreign workers? The most common problem occurring in the U.S. is for a staffing company to lure an alien worker to enter into a contract in exchange for a promise of employment for a defined period of time at a fixed rate of pay. Recruiters working for the staffing company will entice alien workers to sign the contracts based upon a promise to sponsor and obtain a work-based visa, most typically an H-1B visa or a green card, at no cost to the employee for placement in a job that may or may not actually exist. In the case of H-1B visas, staffing companies will file labor condition applications and non-immigrant visa applications on behalf of the employee representing that a job exists for the sponsored alien worker at a work site where it currently contracts alien workers or has in the past. It's a crime for the employer to make false representations in labor condition and non-immigrant visa applications but enforcement of violators by the U.S. Department of Labor and Department of Homeland Security is so lax that it's a risk unscrupulous staffing companies are often willing to take. Staffing companies sometimes resort to this subterfuge in order to grab a piece of the limited number of work visas issued annually, assuming they will find a job for the alien workers the successfully recruit by the time the work visa is approved, if not soon thereafter.
What staffing companies are often requiring alien applicants to do as a condition to sponsoring them for a work-based visa is to include as part of their contractual obligation a requirement to pay to the staffing company as liquidated damages a fixed sum of money in the event the worker fails to remain employed with the staffing company for the minimum period of time specified in the contract, which is typically two to three years. These liquidated damage clauses can run into the tens of thousands of dollars. In addition, some staffing companies will require their alien employees to sign a promissory note agreeing to repay the amount of liquidated damages specified in the contract in full whenever the employee leaves his or her employment before exhausting the minimum period of employment. What this means is that you begin your new employment with the staffing company owing a fixed amount of debt to your employer that you will have to repay at some point if you fail to work it off by remaining employed with the staffing company for the minimum required period. It's akin to a modern-day form of indentured servitude, which was long ago outlawed in this country.
What happens if you don't pay up after leaving your job? If the employee fails to pay up, the staffing company will sue the employee in the forum where the company is based under a forum selection clause contained in the employee's contract that is often inconvenient for the employee, who may be residing in an entirely different state or country at the time the lawsuit is commenced. Employees who fail to defend the lawsuits, which occurs quite frequently after they relocate and their whereabouts are unknown to their former employer to serve them notice of the lawsuit, wind up with default judgments entered against them which becomes a cloud on their credit record and the unpaid note continues to accrue interest at the rate specified in the promissory note instrument. Satisfaction of the judgment may include the garnishment of the employee's wages at their new place of employment through the filing of a proceeding supplemental by the employer.
Employees who are sued for breaking their contract may have defenses and counterclaims to their employer's claim against them. As a matter of contract law, if one party first breaches the contract materially, the employee can raise that as an affirmative defense which can act to bar recovery by the employer against the employee for subsequently breaching the contract by terminating the contract early, for example. An employee could argue the employer materially breached the contract by failing to pay the wages promised under the terms of the contract. Under Indiana law, an employer can be held liable to the employee under the wage payment statute if it fails to pay all of the wages due to the employee. The wage payment statute permits the employee to recover treble damages, plus attorney's fees, if the employee can prove the employee failed to pay any wages due to the employee.
You might ask why an alien worker who obtains employment in the U.S. through the services of a staffing company would want to leave his or her job knowing the risk of being sued and having to pay serious sums of money to their former employer? There are several reasons. Sometimes, alien workers arrive in the U.S. after obtaining their work visa only to learn that the job they were promised by the staffing company when they signed the contract no longer exists. Employers who directly employ non-immigrant workers will terminate the employee's employment and pay for their return travel back home if they are unable to employ the worker in the job they intended to employ the worker. The law requires them to do so. A staffing company will be out the time, money and expense it invested to bring you to work in the U.S. on a work visa if it sends you back home at its expense. Rather than send you home, it will insist that you stay put until it finds another job opening for you. The staffing company will entice you to stay by agreeing to cover your housing expenses at an employer-furnished apartment or house that you may or may not find suitable for your living expectations.
If a staffing company insists that you remain in the U.S. while it finds another job for you, it is legally required to pay you the prevailing wage rate it represented to the Department of Labor and USCIS that it intended to pay you once you become employed under your work-based visa as if you were working full-time. Unfortunately, unscrupulous staffing companies may refuse to pay you for the time you are benched while waiting for a job assignment, or they may offer you only part-time work assignments, which deprives you of the benefit of the full-time job the employer represented to you when you entered into a contract of employment, and which it represented to the government you would have once you started work under your work-based visa. If the staffing company benches you without pay, you can file a complaint with the U.S. Department of Labor. Unfortunately, prosecuting these complaints has not been a high priority of the Department and complaints sometimes linger for years before being acted upon.
Even alien workers employed by staffing companies that pay them regularly the wages due to them regardless of their work status can become frustrated if their employment requires frequent job changes that require the employee to physically relocate their residence every few months. Staffing companies may only be able to obtain short-term assignments for you at particular work sites. Your contract will typically require you to relocate your job location at the employer's discretion. Even with a housing allowance to offset the hassle of frequent job relocations, it is not unusual for the employee to grow weary and demoralized from packing up and moving just as the employee begins to get settled in and becomes comfortable working at a job site. Adding to the frustration may be disputes between the staffing company and the employer to whom you are contracted over the amount of hours that you are working and for which the employer is being billed. This conflict often results in wage underpayment disputes between you and the staffing company that can further fracture your relationship with the staffing company.
How can the alien worker avoid the foregoing scenarios from playing out? I would advise any alien working seeking work in the U.S. on an employment-based visa to look for employment opportunities that provide direct employment with an employer rather than an indirect employment arrangement through a staffing company. If you are unsuccessful in finding employment through the direct approach, then follow some simple rules to avoid being exploited by a staffing company.
- Never sign a contract with a staffing company before performing some basic independent research on the Internet about the company. You might be surprised by the amount of information former workers share about their experience working with specific employers. You can also search the U.S. Department of Labor's website database to determine if there are pending or adjudicated complaints against the prospective employer.
- When discussing potential employment with a recruiter at a staffing company, treat the process as an interview of your potential employer as much as the recruiter should be treating your hiring as a serious interview process. The distance between you and the staffing company often makes in-person interviews impossible but video conference calling can close that distance. If the recruiter asks you to sign a contract without first conducting a serious interview with you as a job candidate and obtaining your biographical, educational credentials and pertinent work history, then you should question the professionalism of the staffing company.
- If at all possible, please take the time to retain the services of an attorney to review any contract presented to you and to advise you on the benefits and consequence of entering into a written contract. Keep in mind that if the employer is planning to employ you as a non-immigrant worker, then by the very terms of your work visa, you are only a temporary worker allowed to legally work in the U.S. during the authorized period of time and upon the terms provided in your work visa. If your employment terminates for any reason, so does your work authorization. Employers who directly employ non-immigrant workers often avoid written contracts that act to convert what is otherwise an at-will employment agreement to a legally-enforceable agreement for a specific term of employment for that very reason. Staffing companies choose to use written contracts as a club to compel performance by workers they sponsor for temporary work visas and green cards.
- Never sign a contract with a staffing company that does not specifically identify the nature of employment you are agreeing to accept, including a specific location of the proposed employment, the wages you will be paid and written assurance that the employment you are agreeing to accept is based on full-time employment that will commence as soon as your work visa is approved, or at least no later than 30 days thereafter, and that you will be paid wages based on the agreed wage amount for full-time employment, including any periods during which you are benched while awaiting a new assignment through no fault of your own or under-employed as a result of being assigned to jobs that require less hours than full-time employment.
- Because the staffing company has to identify a specific employer, job site location and wage rate in the labor condition and non-immigrant visa applications it files on your behalf, ask the staffing company to state in writing up front that pertinent information. If the staffing company refuses to furnish you this information, it should serve as a warning to you that the job the staffing company says is available does not really exist. By law, the employer is required to provide a copy of the labor condition and non-immigrant visa applications to the employee on request. Always request them and retain them for your records.
- Never sign a contract with a staffing company that does not include a covenant that requires the employer to abide by all laws and regulations governing the employment of non-immigrant workers and provides that violation of those laws and regulations constitute a breach of the contract by the employer.
- Never sign a contract that includes an unreasonably high liquidated damages clause. Take into consideration the amount you expect to earn from the job once you are employed, the minimum length of time you are required to work for the staffing company to avoid the consequences of paying damages to your employer and the likelihood of your ability to pay the liquidated damages in the event you decide to terminate your employment early in determining the reasonableness of the liquidated damages sum. The liquidated damages clause should specify that it does not include the cost of filing fees, attorney's fees and other costs associated with obtaining your work-based visa.
- Never sign a contract with a staffing company that does not include a provision that permits the prevailing party in any dispute that arises under the contract to be awarded their reasonable attorney's fees. Some staffing companies will draft contracts that only provide for an award of attorney's fees to the employer in the event it is required to take legal action against you to enforce the contract. Make sure that obligation is mutual.
- You should always take the view that any contract the staffing company puts in front of you for signature is subject to negotiation. If the terms of the contract are one-sided and the staffing company says the terms are non-negotiable, you should take that as a warning sign of potential trouble down the road in your dealings with them. Always insist on receiving a fully-executed copy of the contract for your records. Some unscrupulous staffing companies have been known to furnish altered versions of the original contract to the employee when disputes arise later.
- Retain for your records all communications you have with the staffing company and the employer to whom you are assigned to work, particularly all e-mail communications. If your employer typically communicates information to you over the telephone, document the substance of those conversations in a follow-up e-mail to your employer. You will be delighted at how useful that information can become when disputes arise between you and your employer that lead to litigation. Of course, if those communications document your reluctance to perform your work or other work-related problems brought about by you, you can bet that your employer will have retained records of that correspondence for use against you.
- Whenever your employer begins acting more like a bully instead of a professional employer by threatening to terminate your legal status and making life difficult for you in general, it's probably time to explore your legal rights before terminating your employment and finding a more suitable place of employment.