Difference between Layoff and Termination in Immigration perspective.

U.S. Citizenship & Immigration Services* ("USCIS") has made a crucial distinction between the terms layoff and termination.

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  “Layoff” involves a period of nonproductive status for which the employer is responsible – as opposed to medical leave or vacation time – during which the H-1B beneficiary is not actually performing his or her work duties. 

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  “Termination” refers to a clean break in the employer-employee relationship. Termination results in the beneficiary's loss of H-1B status unless s/he finds sponsorship for other temporary, professional employment, whereas a beneficiary who is laid off may be considered to be maintaining status with the same employer during the work slowdown.

Under the guidance of the Hernandez Memo, a beneficiary may continue to reside in the United States and maintain lawful nonimmigrant status even despite a layoff, or "benching" as it is called by USCIS and the U.S. Department of Labor ("DOL"), provided that the employer continues to pay him or her the required wage during all such inactive periods, 20 C.F.R. §655.731(c)(7). See also INA § 212(n)(2)(C)(vii). However, it is advisable not to completely rely on the Hernandez Memo. As a policy memo or advisory letter does not have the same effect as a statute or regulation, USCIS could still decide that even an employee who is fully compensated while in non-productive status has failed to maintain lawful nonimmigrant status.

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* Letter of Efren Hernandez II, Director, then Business and Trade Services Branch of the Office of Adjudications, to Wendi S. Lazar, Esq. (March 27, 2001), reprinted, 78 INTERREL 616, Appx. II (Apr. 2, 2001) ("Hernandez Memo").