Judges' Benchbook: Alien Labor Certification

Office of Administrative Law Judges
United States Department of Labor

Second Edition - May 1992

CHAPTER 3 -- SUPPLEMENT

Supplement current through January 1997

ALIEN OWNERSHIP OR CONTROL

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TABLE OF CONTENTS

I. Alien's relationship to the sponsoring employer

II. Recruitment by the alien or his agent or attorney

I. Alien's relationship to the sponsoring employer

A. Requirement of a bona fide job opportunity

Employer sought certification for the position of director of product marketing. The CO challenged the application on the basis that there was no clear job opening because Alien was in a position to control the hiring decision based on his dominant role in the business. The panel found, applying the standard set forth in Modular Container Systems, Inc. , 89-INA-228 (July 16, 1991)(en banc ) , that Alien's ownership of a significant portion of company stock represented an ownership interest in the company; that Alien's qualifications were identical to the specialized job duties stated in the application; that Alien was involved in the management of the company in that his stock ownership gave him voting rights and that Employer and Alien's employer have an interconnected history and are still related by a contract agreement. As a consequence, the panel found that Alien would have an upper hand in obtaining this position over U.S. workers. Considering the totality of the circumstances, the panel found that Employer had not shown that this position was clearly open to U.S. workers. Distribution Service Technologies , 94-INA-616 (Feb. 6, 1997)

B. Test for bona fides

Employer applied for labor certification for the position of International Purchasing Agent. The CO questioned whether a bona fide job opportunity existed. The Board applied a totality of circumstances test including such factors as whether the alien was in position to influence hiring decision, is related to corporate officers, director, owners, is one of small number of employees, has identical qualifications as stated in application, was an incorporator, is involved in management of the company. Here, the Alien was related to the corporation's Vice-President/Secretary and a member of the Board of Directors. Accordingly, strict scrutiny by the CO was entirely proper. Employer presented no evidence of business expansion except a statement of its intent to expand. Expansion must be documented. An unsupported statement of intention to expand is not enough. Although some additional evidence was presented to the CO with Employer's Motion for Reconsideration, this information came too late since it was after the rebuttal period had expired, and need not be considered. Judge Wood dissenting, found that Employer sufficiently rebutted the NOF. Topco U.S.A., Inc. , 93-INA-516 (Feb. 23, 1996).

Hybco U.S.A. , 95-INA-16 (July 18, 1996) (denying certification where Alien had the same last name as the owners, was related to 1 or both of the owners, was 1 of a small number of employees, was highly paid, and had identical credentials to those required by the company).

C. Application of (bona fides) test

1. Significant investment or managerial involvement

Labor certification properly denied where Alien is a one-half owner of Employer's business and, according to current president and other half-owner, is necessary for running of business after president's impending retirement. Given such facts, no job open to any qualified applicant was established. Library & Business International, Inc. , 93-INA-251 (Apr. 19, 1994).

Labor certification properly denied where Alien served as the managing director of Employer's parent company, and president and chief financial officer of employer/subsidiary. Because Alien has hiring and firing authority and exerts substantial influence over Employer, the panel found it unlikely that Alien would be replaced by a qualified U.S. worker. Etto Helmets , 93-INA-292 (Aug. 25, 1994).

Labor certification properly denied where Alien's ownership of 40% stock in the company combined with Employer's failure to submit documentation regarding this ownership interest indicated that position was not bona fide pursuant to §656.50. Garcia Services Inc. , 91-INA-85 (Nov. 16, 1994).

Labor certification properly denied where Alien served as General anager/Superintendent of the U.S. employer's foreign parent company and where Alien was in the U.S. on an e-2 investor treaty visa. The CO appropriately questioned whether there was a "bona fide" position open to U.S. workers and requested certain documentation, including information from Alien's visa file explaining Alien's relationship with Employer. Driessen Aircraft Interior Systems , 93-INA- 82 (Jan. 11, 1995).

Labor certification properly denied where Alien was involved in the management of the company, held the titles of President, CEO, Secretary, CFO and Agent of Service of Process and was one of three members of the Board of Directors. Promise Capital Corporation , 94-INA-36 (Apr. 28, 1995).

In Bulk Farms, Inc. , 963 F.2d 1286 (9th Cir. 1992), the Ninth Circuit held that the job of cheese maker was not clearly open to U.S. workers where Employer sought "alien employment certification on behalf of its president and driving force . . .." Although only two people responded to the advertisement and "neither knew anything about cheese making", the Court upheld the denial of labor certification to find, nevertheless, that "[t]here is no indication that the statute was intended to protect the interests of foreign, self-employed entrepreneurs." The Court further noted that "where an employer is indistinguishable from the alien seeking the job in question, there is reason for the employer to abuse the process" and, therefore, the "ban on self-employment makes it less likely that the certification process will be manipulated and 'sham' employement searches conducted."

Citing Bulk Farms , a panel held that labor certification was properly denied where Employer sought labor certification on behalf of the company's "driving force" composer- writer-musician. The panel also found the Employer's "extremely special job duties and experience requirements" nothing "other than an attempted manipulation of the certification process." Leonard Cohen Stranger Music, Inc. , 92-INA-78 (Jan. 5, 1994).

Citing Bulk Farms , a panel held that labor certification was properly denied where Alien was one of two partners in the company and also held 55% of the interest in Employer, which he sold to his partner only four days prior to filing the labor certification application. Moreover, in the same four day period, Alien changed positions from corporate vice president to general manager, the position (general manager) for which labor certification was sought. Super Flooring, Inc. , 92-INA-340 (June 3, 1993).

Citing Modular Container Systems, Inc. , 89-INA-228 (July 16, 1991)(en banc) and Malone & Associates , 90-INA-360 (July 16, 1991)(en banc), the panel concluded that "Alien is such an integral part of the company that there is not a legitimate job opportunity clearly open to any qualified U.S. worker pursuant to § 656.20(c)(8)." In so holding, the panel noted the following factors: (1) Alien was the sole employee of the U.S. affiliate of Employer; (2) Alien influenced hiring decisions of Employer; and (3) Employer's president regarded Alien's services as "critical and vital for the company's existence." Beximco U.S.A., Ltd. , 90-INA-302 (Apr. 15, 1992).

Labor certification was properly denied where Alien is the President of the U.S. subsidiary "with broad powers of supervision and management." Moreover, the alien is one of two Directors of the subsidiary and "has a definite ownership interest in the Taiwan parent corporation, being one of a small number of shareholders." J.V Company, Ltd. , 91-INA-159 (July 22, 1993).

The panel concluded that "Alien's position as president and director of Employer, with the largest single investment and ownership of 50% of the stock and probable control of another 30% through his children, is clearly able to control the choice of the person to fill the job which he seeks to occupy." Thus, labor certification was properly denied. Integral Marketing Corp. , 91-INA-124 (May 4, 1992).

No bona fide job opportunity existed where Alien owned 20% interest in the employer-partnership and had "'equal rights in the management and conduct of the partnership business.'" The panel further noted that Alien had family ties with the remaining four partners. Phone Masters , 91-INA-277 (Oct. 15, 1992).

No bona fide job opportunity existed where Alien was "the sole incorporator, president, secretary, and treasurer of Employer." The panel noted that "[a]lthough Alien has no ownership interest in Employer, his brother is a co-owner and director of the Parent, which owns one hundred percent of Employer's stock." The panel concluded that Alien was in a position to influence hiring decisions for the job offered and that no bona fide job opportunity existed. Mi Dyuk L.A., Inc. , 90-INA-465 (May 19, 1992).

Labor certification was properly denied for lack of a bona fide job opportunity where the "Alien is a director and the secretary of Employer . . . and holds 25% of Employer's stock." Moreover, the panel noted that Alien's three brothers filled the remaining positions on the Board of Directors and each brother owns 25% of Employer's stock. One of the brothers is the president of Employer and manages the business. Morex, Inc. , 91-INA-206 (Oct. 27, 1992).

The CO properly denied labor certification where, the panel noted, as "Employer's incorporator, president, one-third shareholder, and incumbent import/export manager, Alien's control of Employer (a closely held corporation) is substantial." Moreover, the panel concluded that, although the corporate secretary had "formal authority" to replace Alien, there was no evidence that such a "decision (is) independent of influence by Alien in his capacity as corporate president and shareholder." Foodmix, Inc. , 90-INA-521 (June 4, 1992).

No bona fide job opportunity existed where Alien had "considerable influence" over Employer in light of the fact that he was Employer's "sole incorporator, vice president, secretary" and he is one of a few shareholders along with his brother. Asseman (Sky) Travel Agency , 90-INA-496 (May 26, 1992).

The CO properly denied labor certification where Alien had "a ten percent interest in Employer through his shares of the Parent's stock; he is one of five shareholders in the Parent's closely held company; and his ten percent interest is equal to that of three other investors . . .." The panel further noted that Alien served as director, secretary, and chief financial officer of Employer as well as the secretary and chief financial officer of the parent company. Goodway Co. , 91-INA-49 (June 4, 1992).

Labor certification was properly denied where Alien served as chairman of the Board of Directors of the parent company and had a close, familial relationship with the founders of the sponsoring company and the parent company's Board of Directors. The panel also noted that "Alien and his family own a majority of stock in both the parent company and sponsoring company." Kaja International, Inc. , 90-INA-232 (Aug. 14, 1992).

No bona fide job existed where "Alien is owner, President, Treasurer, shareholder, and sole employee of the company and currently occupies the position offered." Olivia Garden International, Inc. , 91-INA-137 (Dec. 11, 1992).

Labor certification was properly denied where Alien was Employer's highest ranking senior manager in the U.S., a member of the Board of Directors, and was in direct supervision of the officer who signed the labor certification application. Nakano Warehouse & Transportation Corp. , 92-INA-337 (Nov. 23, 1993).

No bona fide job existed where Alien is president and 100% voting stock owner with significant control over recruitment officer. Musika Records, Inc. , 92-INA-352 (Nov. 23, 1993).

Where Alien held the petitioned position for 10 years and owned a controlling block of shares and where Alien would be voting on who would/might fill his job (other than him) employer had not established a job clearly open to U.S. applicants. Atari Games Corp. , 94-INA-290 (June 22, 1995).

The Employer applied for labor certification for the position of Coordinator of Russian Events, Russian Band leader, the duties of which the employer now performs. The CO challenged whether a bona fide job opportunity existed. Employer's response, which included invoices and 1099 forms that indicate that he does a substantial business, evidence that the Russian immigrant population is expanding in the area of his business, evidence that has had permanent employees in the past, and evidence that he has sufficient funds to pay the $31,845 salary for the position was sufficient to rebut the CO's challenge since the CO did not request other specific documentation. Simcha Productions , 93-INA-545 (July 17, 1995).

See also O.K. Liquor , 95-INA-7 (Aug. 22, 1996) (denying certification where several documents submitted by the Employer, including ATF special tax stamps, and a seller's permit, indicated that Alien had an ownership interest in the liquor store).

2. Investment or involvement not significant enough to find lack of a bona fide job opportunity

A bona fide job opportunity existed where, although Alien was one of three members of the Board of Directors, he did not own any stock in the company or its parent, he had no relatives who were owners or managers of the company or its parent, he was not a founder under or incorporator of the company, he was only one of 65 employees at the company, and he "gained his experience while working for an entirely unrelated company." Data Ray Corp. , 91-INA-330 (Nov. 30, 1992).

3. Alien's family relationship to the employer

Labor certification was improperly denied where Aliens were the principal's brothers but they were "not yet employed in the job at issue, and (had) no ownership or control or directorial or managerial interest in the business." Guven Fine Jewelry , 92-INA-52, 434 (Aug. 31, 1993).

Labor certification properly denied where Alien had worked for Employer for a number of years and where Alien's brother is company president and 35% owner, Alien's wife is secretary and 45% owner, and Alien's two daughters own and additional 20% share of the company. The panel concluded that in this situation it "stretches credulity to think" that Employer would seek out U.S. workers to replace Alien as the company's project engineer. Roman E.C.D., Inc. , 93- INA-228 (July 8, 1994).

Employer applied for labor certification for the position of International Purchasing Agent. The CO questioned whether a bona fide job opportunity existed. The Board applied a totality of circumstances test including such factors as whether Alien was in position to influence hiring decision, is related to corporate officers, director, owners, is one of small number of employees, has identical qualifications as stated in application, was an incorporator, is involved in management of the company. Here, Alien was related to the corporation's vice-president/secretary and a member of the Board of Directors. Accordingly, strict scrutiny by the CO was entirely proper. Employer presented no evidence of business expansion except a statement of its intent to expand. Expansion must be documented. An unsupported statement of intention to expand is not enough. Although some additional evidence was presented to the CO with Employer's Motion for Reconsideration, this information came too late since it was after the rebuttal period had expired, and need not be considered. Judge Wood dissenting, found that Employer sufficiently rebutted the NOF. Topco U.S.A., Inc. , 93-INA-516 (Feb. 23, 1996).

D. Documentation requested by the CO

1. Obligation to provide information reasonably requested

no new cases

2. Effect of § 656.20(c)(8) attestation

no new cases

3. Confidentiality of information

no new case notes

4. Responsiveness of evidence

no new case notes

E. Scope of issue preserved for appeal

no new cases

F. Appropriateness of remand

no new case notes

II. Recruitment by the alien or his agent or attorney

no new cases

A. Applicable regulation

no new cases

B. Recruitment by the alien

no new cases

C. Recruitment by the alien's agent or attorney

no new cases