New Orleans Hotelier Need Not Reimburse H-2B Workers for Certain Expenses, Court Rules
The aftermath of Hurricane Katrina required New Orleans hotelier Decatur Hotels, L.L.C, to look to foreign sources of labor. A group of these employees who held H-2B visas while working for Decatur contend that the hotelier violated the Fair Labor Standards Act (FLSA) by paying them less than the minimum wage when Decatur refused to reimburse them for recruitment, transportation, and visa expenses that they incurred before relocating to the U.S. to work for Decatur.
In an interlocutory appeal to the U.S. Court of Appeals for the Fifth Circuit, Decatur raised three issues of first impression for the court: whether under the FLSA an employer must reimburse guest workers for (1) recruitment expenses, (2) transportation expenses, or (3) visa expenses that the workers incurred before relocating to the employer’s location. The court concluded on February 11, 2009, that the FLSA does not require an employer to reimburse any of these expenses. The court therefore reversed the district court’s order, and remanded the case with instructions that it be dismissed.