Thursday, November 10, 2016

Sponsoring Your Relative as an Employee: Importance of Good Faith Efforts in PERM Recruitment

Our immigration law firm represents many small business employers, many of whom, for many legitimate reasons prefer to hire their family members to assume important functions in their businesses. On October 21, 2016, BALCA released decisions on two cases dealing with PERM labor certification and audits for hiring relatives, Tyrrell Limited on behalf of Espino, Jose Miguel Tantoco and Johnman U.S.A., Inc. d/b/a Karoke Champ, on behalf of Kida, Takuya, with opposite rulings.


Most PERM employers know that hiring relatives is possible as long as there is a bona fide job opportunity and the job is made available to U.S. workers. The court considers the totality of the circumstances using the following factors outlined in the famous case of Modular Container Systems, Inc., looking at whether the employee:

  1. Is in a position to control or influence hiring decisions regarding the job for which labor certification is sought; 
  2. Is related to the corporate directors, officers or employees; 
  3. Was an incorporator or founder of the company; 
  4. Is involved in the management of the company; 
  5. Is on the board of directors; 
  6. Is one of a small number of employees; 
  7. Has qualifications for the job that are identical to specialized or unusual job duties and requirements stated in the application; and 
  8. Is so inseparable from the sponsoring employer because of his or her pervasive presence and personal attributes that the employer would be unlikely to continue in operation without the alien.

Why Tyrrell Limited On Behalf of Espino, Jose Miguel Tantoco and Johnman U.S.A., Inc. d/b/a Karoke Champ, On Behalf of Kida, Takuya Were Ruled Differently

Both cases deal with hiring a family member, one hires her son while other hires his brother. When a familial relationship exists between the employer and the employee, the employer must overcome the presumption that the employee's influence and control over the job opportunity is such that the job opportunity is not bona fide (not open and available to US workers). In this case, Kida was unable to overcome that presumption while Espino could. We explore why in the paragraphs that follow.

Both employers are closely-held, family-owned companies, with high chances of audit. Both had followed the recruitment procedure correctly. The Certifying Officers had determined, in both cases, that the foreign employees had the authority to make interviewing and hiring decisions. What made BALCA determine differently?

First, in Espino, the employer had stated that the role of the Officer in Charge (OIC), the employee's position, includes taking over exigent tasks when the General Manager (GM) is unavailable.While the GM's tasks include interviewing and hiring potential employees, these would not be considered "exigent tasks" and can wait until the GM returns. As such, the OIC's tasks would not include interviewing and hiring employees. BALCA agreed.

In contrast, Kida was hired to fill three titles, head of the Management Division, head of the Finance Division, and the head of the Division of Store Development. As the head of the Management Division, Kida also oversees the Human Resources Department, which is responsible for the company's interviewing and hiring. The court held that these titles held essential functions of the company and considered the employee as "inseparable from the sponsoring employer," which was the last factor provided in Modular Container Systems, Inc.

What Ultimately Led The Employer Astray: The Inconsistencies in Kida's Petition

What became clear to me as a lawyer is the court's enumeration of the inconsistencies in Kida's petition, which, I think, ultimately led BALCA to conclude that there was no bona fide job opportunity. Here are some of the inconsistencies the court mentioned:
  1. In the organizational chart, one of Kida's three titles was the head of Management Division of the company, which is responsible for the actions of the Human Resources Department.  However, the employer made inconsistent statements throughout the application, once claiming that the Human Resources Department was autonomous in making hiring decisions, and another time claiming that the President/CEO was the primary decision-maker.
  2. The organizational chart submitted with Kida's petition stated that the company had thirteen employees, while the ETA 9089 stated that the company had six employees.
  3. The organizational chart showed that Kida would hold multiple management titles in the company, presenting him as a key player. However, the labor certification application stated that no experience is necessary and provides for basic accounting duties. This inconsistency suggested that his actual job position was not accurately presented in the labor certification.

These cases make clear that when sponsoring your relative for a position in your company, it cannot be handled carelessly, you need an attorney to ensure consistency across all the documents and forms submitted to the Department of Labor and USCIS. Between the ETA 9089, the job postings, and the supporting documents for the I-140 petition, consistency is crucial. If you are planning to hire a relative to fill one of your company's positions, contact our law office to see how we can help ensure that the information for these documents are entered correctly!

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