A Texas IT services firm, Dibon Solutions, has just been indicted by federal authorities, who allege that Dibon unlawfully benched H-1B employees, reports Computerworld. Six Dibon Solutions employees have been arrested.
Dibon's business model, which is permissible for US workers, is impermissible for H-1B workers. The model called for Dibon to place H-1B employees at third-party client worksites, as those third-party clients needed IT services. When there was no client work, Dibon benched the employees and did not pay the H-1B workers the requisite H-1B wage, which is the alleged illegal act.
The U.S. Department of Labor requires that H-1B employers pay H-1B workers their full H-1B wage, even if the H-1B worker is not working. The H-1B employer has the option of terminating the H-1B worker, which dissolves he H-1B employer's wage obligation. However, if the H-1B employer wishes to re-hire the terminated H-1B employee, the H-1B employer must file a new H-1B petition with the USCIS and may be required to file a new Labor Condition Application with the DOL.
Computerworld's Patrick Thibodeau notes that the last headline-grabbing H-1B visa fraud case involved Vision Systems Group in 2011. The Vision Systems Group case alleged $7.1 million in violations, but the USCIS quietly settled for $236,250. It remains to be seen if the Dibon Solutions case will mirror Vison Systems Group or result in more serious penalties. The fact that six employees have been arrested certainly means that the US believes that these charges are serious.