When an H-1Bemployee separates employment from an H-1B employer, the H-1B employer oftenseeks a Settlement and Release. Theemployer’s goal is to put the matter to rest. It does not want the H1-B employer to file a private lawsuit seekingback wages or to file a Complaint with the Department of Labor.
H-1B employers alsooften are seeking to collect on liquidated damage provisions, which allow theemployer to recoup the costs associated with the separation of the employmentrelationship. Costs such as reputationalloss, replacement costs, and travel costs are usually recoverable under theH-1B rules
H-1B employer andemployees often seek a “global settlement,” which settles all outstandingclaims between the parties.
A 2015 Departmentof Labor decision, Guptav. Headstrong, 2014-LCA-00008, confirms the appropriateness andenforceability of these settlement agreements. In Gupta, the Administrative Law Judge heldthat the Settlement and Release extinguish all of the h-1B employee’s claims toback wages. Notably in Gupta, the two parties were the employerand the employee. The DOL was not aparty to that lawsuit.
It remainsan open question whether an H-1B employer can legally prevent an employee from filinga Complaint with DOL following a proper Settlement and Release. The DOL does not want to see any hindrance onan employee’s ability to file a Complaint to their agency.
In Gupta the Department attempted to havethe ALJ validate their reading of the law buy filing an amicus brief. The ALJ did not address this issue in theDecision. The Department would not, of course, have bothered to raise the issuein the amicus brief if it were a settled issue of law.
Nevertheless,an H-1B employee who fairly settles a back wage claim and who subsequently orconcurrently files a complaint with the DOL solely on a back wage claim (andwho continues to assert to the Department that the back wage claim remainsunsettled following a settlement on those same claims) may be committing fraudbefore a government agency.