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Layoffs Under PERM


In PERM labor certification application cases, the U.S. Department of Labor (DOL) requires employers to conduct a test of the U.S. labor market.  If an employer has recently laid off a U.S. worker, the employer may be required to notify and consider the former worker who held either (a) the same job for which labor certification is sought or (b) a job sufficiently similar to be deemed a "related occupation." 

Related Occupation Defined

DOL defines a related occupation as "any occupation that requires workers to perform a majority of the essential duties involved in the occupation for which certification is sought."  
For example, if a labor certification is sought for the position of Senior Systems Engineer, and the employer has had recent layoffs in other positions such as Systems Engineer or Software Engineer, the employer would have to compare the duties of the two jobs to determine whether the majority of the essential duties overlap, paying particular attention to the time spent on each duty. 


DOL does not provide guidance regarding how an employer should notify the potentially qualified laid-off U.S. worker.  Because the burden is on the employer to demonstrate compliance in case of a DOL audit, we recommend that employers notify each laid-off U.S. worker in writing whenever feasible. 


DOL requires an employer to document that it has both notified and considered the U.S. worker.  DOL has said that "employers must document that they offered the position to those laid-off workers who are able, willing, and qualified for the job opportunity and the result of their consideration of such workers."  Therefore, an employer should be prepared to defend its decision not to extend an offer of reemployment to any potentially qualified laid-off U.S. worker.  At a minimum, the employer will want to demonstrate that the laid-off U.S. worker did not meet the job’s minimum requirements, or was no longer available, or could not perform the main job duties even with a nominal period of training, or that past performance appraisals clearly disqualified the worker. 

Meaning of Layoff

DOL defines a layoff as "any involuntary separation of one or more employee without cause or prejudice."  This definition includes, but is not limited to, personnel actions characterized by an employer as a reduction-in-force, a restructuring, or a downsizing.  Even a single layoff is sufficient to trigger the employer's duty to notify and consider a laid-off U.S. worker.  DOL does not consider a U.S. worker who was separated for cause, such as not meeting performance goals or violating company policy, as being laid off.  Contract staff who are laid off are also specifically excluded.  The closer questions involve separations which fall somewhere between a firing and a layoff, such as a forced resignation accompanied by a financial settlement.  These cases need to be analyzed on a case by case basis. 

Location of Layoffs

PERM case layoff circumstances apply only to layoffs that have occurred "in the area of intended employment."  The area of intended employment means "the area within normal commuting distance of the place (address) of intended employment."  If an employer has two work locations within a single metropolitan area, the employer must consider layoffs at both locations.  Conversely, an employer with multiple locations outside of normal commuting distance from another need not survey its entire workforce. 

Only the Employer's Layoffs

An employer need consider only U.S. workers laid off by it, not by other employers in the industry, even those operating within the same geographical area.  DOL says that it is “able to determine whether an employer had laid off workers by relying on various sources of information such as Worker Adjustment and Retraining Notification (WARN) notices, newspaper articles, and internet search tools." 

Timing of Layoffs

The duty to notify and consider applies to U.S. workers whose layoffs occurred "within six months of filing an application."  An employer is under no continuing obligation to notify and consider U.S. workers in the same or a related occupation who were laid off after to the filing of a PERM application.  

Likely Audit Trigger

Employers whose PERM cases invoke the layoff provisions should include documentation of their notification and consideration of affected laid-off U.S. workers in their PERM audit file because an indication on a PERM application that the employer has had recent layoffs in same or a related occupation may be an audit trigger.  Because of this, a risk-adverse employer may wish to wait until six months after a layoff before filing a labor certification application under PERM. 

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