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I am an H1-B employee and my boss is deducting money from my salary? Are these deductions legal?

Thumbnail image for Thumbnail image for Thumbnail image for Thumbnail image for Thumbnail image for above-the-bar-logo-no12.jpgIt depends on the type of deductions. Employers often try to take advantage of H1-B employees with the hope that the H1-B employees will be too scared or uninformed to complain or bring a legal complaint. Below are some general guidelines.

According to the United States Department of Labor regulations (20 CFR Part 655 Subparts H & I), the following are some payroll deductions that are unlawful:

1. A penalty for the employee’s failure to complete the full employment period. See Section 212(n)(2)(C)(vi)(I). Often employers try to disguise this penalty in an employment agreement as liquidated damages for non-competition provision. The employment transition period can be a stressful process for H1-B employees. Depending on the circumstances, this provision may be unenforceable and the employee may have rights to change employers.

2. Any part of the training and processing fee required by USCIS. See Section 22(n)(2)(C)(vi)(II).

3. Any part of the five-hundred dollar ($500) anti-fraud and detection fee required by the USCIS. Section 214(c)(12)(A)

4. Any deduction for the employer’s business expenses that would reduce the employee’s pay below the required wage rate. Some prohibited deductions include:

  • Travel Expenses (however this does not include the employee’s first trip to the United States);
  • Tools and Equipment; and
  • Attorney’s Fees and expenses directly related to filing the Labor Condition Application.

Other deductions (not described above) may be made even if they reduce the H1-B employee’s salary below the required wage rate if one of the following three categories is satisfied:

1. The deduction is required by law. For example, payroll deductions are permitted.

2. Reasonable and customary charges such as health insurance premiums and union dues. It is important to note that these deductions should be the same of H1-B employees and other employees.
3. The H1-B employee voluntarily agrees to the deduction and:

  • There is a signed written authorization by the employee for the specific deduction;
  • The deduction is principally for the benefit of the employee such a travel reimbursements or meals;
  • The amount does not exceed the fair market value or the actual cost of the matter (whichever is lower);
  • The amount deducted is not greater for garnishments than the limits set forth in the Consumer Credit Protection Act.

If you have any questions or concerns about deductions made to your paycheck, call today to speak with one of our experienced employment attorneys to discuss your specific situation. Our business immigration attorneys can be reached at (800) 893-9645.

Thank you for visiting our Blog. This blog provides general information and thoughts about various employment law issues primarily in the New York Tri-State area and occasionally in other areas. You are welcome to read the posts. However, do not construe any content on this blog as legal advice or the creation of an attorney-client relationship. Again, we provide the content only for informational purposes. You should not make decisions based information on our blog since the application of the law depends on the facts and each situation may be different. In addition, the law in most jurisdictions is different and changes constantly and we make no representations that any information on our blog has been updated. The Blog should not be used as a substitute for competent legal advice from an experienced employment law attorney in your state or jurisdiction.

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