Terminating an employee is rarely simple, but when the employee holds an H-1B, H-1B1, or E-3 visa, the stakes rise fast. U.S. Department of Labor (DOL) and USCIS regulations impose strict liability on employers who fail to follow the proper steps when ending employment. In other words: if you don’t complete a bona fide termination, you may still owe that former employee ongoing wages. Yes, even after they’ve stopped working for you.
The reason? All three classifications rely on the Labor Condition Application (LCA), and the LCA ties employers to very specific wage and compliance obligations until a lawful termination is completed.
Why “Bona Fide Termination” Matters
In an ordinary employment scenario, ending someone’s job typically closes out the employer’s wage obligations. Not so with H-1B, H-1B1, or E-3 workers.
Unless you complete a bona fide termination, the government still considers the employee employed, and therefore still entitled to:
- The required wage listed on the LCA
- Proper working conditions
- Compliance protections under DOL oversight
That’s true even if the employee stopped showing up, resigned verbally, or walked out on their own. The employer must take action to stop liability.
As Managing Partner Rosanna Berardi, Esq. puts it: “Too many employers assume that when the employee is gone, the compliance risk disappears too. It absolutely does not. Failing to properly terminate an H-1B worker is one of the fastest ways for a business to end up owing back wages, or worse.”
Understanding the LCA’s Role in Liability
The ETA Form 9035 LCA is the backbone of compliance for all H-1B, H-1B1, and E-3 categories. By signing it, the employer certifies they will:
- Pay the required wage for the entire period of authorized employment
- Maintain safe and fair working conditions
- Abide by all notice and recordkeeping rules
That obligation continues until the employer formally ends the LCA obligations through a bona fide termination.
DOL considers the employer on the hook for wages until all termination steps are satisfied.
The 3 Steps Required for a Bona Fide Termination
There are three actions employers must take to complete a legal bona fide termination. Miss one, and liability remains.
1. Provide Clear Notice to the Employee
The employer must:
- Give the employee explicit written notice of termination
- Document the date and method of communication
- Retain proof in the employee’s immigration file
A quick email is usually sufficient, but it must be clear, direct, and documented.
Important:
Oral conversations, misunderstandings, or “we thought they quit” do not trigger a legal termination.
2. Notify USCIS (When Required)
For H-1B workers, the employer must notify USCIS of the termination so the approval notice (Form I-129) can be withdrawn.
- This step is mandatory for H-1B
- It is not required for H-1B1 and E-3 workers admitted without an I-129 petition, but may apply for those who obtained extensions through USCIS
The safest practice is to send a formal withdrawal letter to USCIS and maintain proof of receipt.
3. Offer Reasonable Return Transportation (H-1B Only)
If the worker was dismissed before the end of their authorized stay, the employer must offer to pay:
- The cost of return transportation to the worker’s last country of residence
(This is not required for dependents or belongings.)
The employee can decline, but the offer must be made and documented.
For H-1B1 and E-3 workers, return transportation is generally recommended to demonstrate good faith, even if not automatically required by regulation.
Common Scenarios Where Employers Get Into Trouble
The Employee Walks Out Mid-Shift
A sudden resignation may feel “final,” but unless USCIS is notified and return transportation is offered (H-1B), wage obligations continue.
The Employee Stops Responding
Even if an employee ghosts the employer, DOL considers them active until the employer completes bona fide termination steps.
The Employer Assumes “Voluntary Quit = No Liability”
Wrong. Even voluntary quits must be documented, and in some cases, employers should still notify USCIS.
Remote Employees Living Abroad
If the employer never officially ends the petition, liability follows them, even if they’ve physically left the U.S.
Best Practices for Employers
Create an Internal “Termination Checklist”
Include:
- Written termination notice template
- USCIS withdrawal procedure
- Documentation of return travel offer
- Notes for updating the Public Access File
Train HR and Legal Teams Together
Terminations impact immigration compliance; HR should never act in isolation.
Document Everything
DOL audits often hinge on whether employers can produce evidence, not whether they acted in good faith.
Consult Immigration Counsel Early
When in doubt, get help before taking action. Back wages in enforcement actions routinely reach six figures.
H-1B1 and E-3 Employers: Don’t Get Comfortable
Many employers assume H-1B1 and E-3 workers come with fewer compliance requirements. While USCIS notification and return transportation obligations differ, they still require a bona fide termination.
Fail to complete it, and you may owe ongoing wages, even if the employee is long gone.
Avoid Costly Liability in Bona Fide Terminations
Bona fide termination is not a rubber-stamp process, it’s a legal obligation with real financial consequences. Employers who skip steps risk paying months (or years) of unnecessary back wages and facing DOL enforcement actions.
The safest approach? Follow all three steps every single time, and document them thoroughly. Berardi Immigration Law works with employers across the U.S. to eliminate risk and protect their company from costly mistakes. If you need assistance navigating this process, our team is here to help. Click here to schedule your consultation today.
FAQs
If an H-1B employee quits voluntarily, do I still have wage liability?
Until you notify USCIS and complete the termination steps, liability may continue, even with a voluntary resignation.
Do H-1B1 and E-3 employers also need to notify USCIS?
Not always. USCIS notification applies primarily to H-1B petitions. However, employers should still follow a documented termination process.
What happens if an employer forgets to offer return transportation?
DOL may determine the termination was not bona fide, leaving the employer responsible for continued wages.
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