Court Affirms Denial Of Work Visa Where Employer Fails To Show That It Can Afford The Alien's Wages
CONSTRUCTION AND DESIGN CO. v. UNITED STATES CITIZENSHIP AND IMMIGRATION SERVICES (April 21, 2009)
Construction and Design Co. (CDC), a small construction company with three employees, is organized as a Subchapter S Corporation. As such, its income is taxed directly to its shareholders. CDC petitioned to obtain a visa to add a Ukrainian carpenter to its staff. The Department of Homeland Security denied the petition, ruling that CDC could not afford the proposed $50,000 salary for the carpenter. The district court affirmed. CDC and the alien appeal.
In their opinion, Judges Posner, Flaum and Wood affirmed. In order to obtain a visa, an employer must demonstrate to the Department of Labor that no U.S. citizen is qualified to do the work and must satisfy the Department of Homeland Security that it can afford the proposed salary of the alien. The Court pointed out that tax returns, relied on by the government, are not reliable indicators of a company's ability to afford another employee, particularly with respect to a Subchapter S company. Tax considerations can frequently influence the way income is treated. Nevertheless, the employer has the burden of proof with respect to its ability to pay. Here, the company's gross receipts in the year in question were only $400,000, the alien was already working for CDC in a temporary capacity for $23,000 less than his proposed permanent salary, there was no evidence of new business or a new contract with which to pay the new salary, and there was very little cushion in the company’s expenses. Although the Court hypothesized several scenarios under which the hiring might make economic sense, the employer never established an evidentiary record that met its burden.
Michael Rigney practices in the law offices of GVC Ltd. in Chicago. In this blog, he reports on select