Implications of the Infosys settlement for B-1 visas

News Release from Jewell & Associates, PC

What can employers learn from Infosys’ recent settlement with federal prosecutors? Ultimately, the more conservatively one follows the immigration law, the more limited one’s interest may be. The government alleged that Infosys misused B-1 visitor visas – inexpensive, for short term stays, and for a narrowly-defined range of commercial activities – to bring foreign workers to the United States to perform skilled labor, for long periods of time, that should have required H-1B visas. It alleged that Infosys submitted false statements to deceive U.S. consular officials into granting B-1 visas to workers, and Customs and Border Protection officers into granting them entry to the United States. This included letters stating the purpose of travel as “meetings” when the true purpose was activities not authorized under a B-1 visa. The government also alleged that Infosys directed the workers themselves to take part in the deception. Infosys did not admit to the allegations of fraud and misfeasance, but agreed to a fine of $34 million.

Two parts of the story will interest employers: How B-1 visas should be used, and relatedly, how to properly use a B-1 visa in lieu of an H-1B visa (BILOH for short). B-1 visas are inexpensive, relatively simple to obtain, and meant only for short-term stays and a narrowly defined range of commercial activities not involving employment for hire. BILOH is a longstanding exception to this rule that exists in the State Department’s Foreign Affairs Manual (FAM). BILOH allows a B-1 or VWP visitor for business to perform work in the United States that would typically require an H-1B visa, as long as they work on behalf of a foreign entity that continues to employ and remunerate them, and they only visit the United States for limited periods of time. It is meant to save time and money for employers who may not need a worker to come for the full three years afforded to H-1B visas holders.

BILOH is controversial and the disagreement within the government over when it should be used, if ever, has been enhanced by the Infosys litigation. It has been absent from government publicity about the settlement but, in response to questions about Infosys in 2011, the State Department said that it was “discussing with [Department of Homeland Security] removing or substantially modifying” BILOH. State also noted that it had first proposed eliminating BILOH in 1993. BILOH has survived, but often U.S. immigration has appeared reluctant to honor it by subjecting applications to enhanced scrutiny and frequent denials. Thus an individual may apply for a BILOH; however, if the application is denied, the denial will remain on their record; and if he or she is a national of a Visa Waiver Program participant country, they will be barred from using the VWP in the future.

For all the controversy around BILOH, the Infosys litigation provided no clarity for employers who may be wondering whether it is an appropriate visa/status for a potential foreign visitor. Some of the government allegations seem partly defensible under the BILOH guidelines –BILOH does allow for B-1 visa holders to perform work normally requiring an H-1B visa – but the size of the settlement indicates that a BILOH "defense" was either unavailable or overwhelmed by the allegations taken as a whole. Either way, given the lack of new guidance, BILOH remains a risky option in the current climate. If BILOH must be used in a particular case, it is important to follow the available guidance closely.

By Christopher Beckerson. © Jewell & Associates, PC 2013