Employers of Alien Workers Caught in Different (and Intricate) Visa Abuses

Misuse of tourist visas in one case, of NAFTA visas in the other

By David North on April 12, 2023

There are lots of ways for employers of aliens to break the immigration law and for the government to detect such behavior; two relatively large employers made news this month by abusing the law in different ways — and then getting caught. Neither used the garden-variety approach of simply hiring illegal aliens.

In one case, filed in South Carolina, major Indian labor broker, Larsen & Toubro employed (as it should not have done) large numbers of aliens — presumably mostly from India — who were in the U.S. on tourist visas; if the jobs were to go to aliens, these workers should have been on H-1B visas. This plot was upset, by the way, through the use of the Civil-War-era False Claims Act, which was triggered by an about-to-be-rich whistle-blower.

Somewhat similarly, an auto parts manufacturer, SMART, is said to have used the NAFTA visa (somewhat akin to the H-1B visa) to bring in factory production workers when it should have used the H-2B system, or better yet, domestic workers.

In the Larsen & Toubro case, the employer managed — for years — to skirt both the numerical ceilings of the H-1B program and also the much higher fees for that program as compared to the tourist fees. It was the second of these dubious achievements that led to their downfall. The H-1B fees would have been $4,000 to $6,000 each, compared to the tourist visa fees of $200 to $300.

The difference between the two fee levels caused a substantial loss in income to the federal government, thus opening the way for a whistle-blower to sue under the ancient False Claims Act (a “qui tam” suit), which was written to reward informants against Civil War profiteers. In this case, that person, one Michael Harmon, is due to get a share of the $9,928,000 settlement.

The settlement also reminds us that the qui tam route can be used by non-government players to help enforce this fairly obscure kind of immigration fraud, if not other employer violations, as we have written in the past.

Although we have seen a number of instances of the illegal employment of tourists in the past, the other case of interest involves a novel — I think — misuse of the NAFTA visas. These visas, created by the North American Free Trade Agreement, allow people from Mexico and Canada (under somewhat different rules) to work in America in H-1B-type jobs. Again, the attraction of these visas is that they allow the employer to bypass the ceilings, the expense, and the nuisance of the H-1B program.

In the instant case, that of Alabama-based SMART, the employer, according to a Law360 report, was accused of using the NAFTA visas not to bring in high-skilled workers but to import factory workers, overstating the workers’ qualifications in order to them admitted.

The latter case, filed in Georgia’s federal courts, is just getting started, while the older South Carolina dispute is in the settlement stage.

Topics: Visa Fraud