Labor Department escalates PERM audits

The Labor Department has increased audits of PERM labor certification applications.

Companies applying for PERMs should prepare for more audits and longer timelines, given that audits can delay PERM application approval by up to 10 months and sometimes longer.

PERM audits have increased across all industries. Besides the usual triggers, two types of applications have been particularly vulnerable to audits in recent months: those involving jobs requiring a degree but no experience and those that are re-submitted for the same employee. A second application may be filed after an initial denial or where an employer applies for a different position for the same employee. In addition, the Department has recently added a new question to its audit notices that asks for documentation of why an employer who rejected U.S. job seekers as “not qualified” could not have trained those workers for the necessary job skills. Audit notices frequently now include a request that the employer provide “documentation explaining why the U.S. applicants deemed ‘not qualified’ could not have attained the skills necessary to perform the duties (required) during a reasonable period of on-the-job training.”

PERM applications are the first step for many employers seeking to sponsor a foreign employee for permanent residence. Labor Department data as of Aug. 31 showed that 67,691 PERM applications had been received in fiscal year 2014 and that 29 percent of the PERM applications being processed at the time were in audit review. Those numbers may not capture the recent increase in PERM audits.

Audits frequently focus on employers’ attempts to find qualified U.S. workers for the position for which they are hiring a foreign worker. They also may focus on an employer’s ability to demonstrate a business necessity for the worker. Audits may stem from a random selection for quality control or based on criteria that may help identify problematic applications. Traditionally, applications more likely to be audited include applications for trade-related occupations, positions that do not require a bachelor’s degree, where the employer has indicated layoffs, and applications that were not filed electronically.

BAL Analysis: The surge in PERM audits across the board signals increased scrutiny by the Labor Department, especially on second PERM applications and on jobs requiring a degree but no experience. This trend is likely to continue, in light of the Department’s recent feedback confirming these two categories face greater likelihood of audits. Companies should work with their BAL attorney to prepare for and respond to audits of PERM applications.

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