# ORR State Letter

**\# 07-13** **Date: 07/27/2007**

TO: STATE REFUGEE COORDINATORS

NATIONAL VOLUNTARY AGENCIES

OTHER INTERESTED PARTIES

FROM: Martha E. Newton S/S

Director

Office of Refugee Resettlement

SUBJECT: ORR Employment Outcomes: Refugee as Employee and Refugee as
Self-Employed

**Purpose**

This ORR State Letter clarifies the meaning of *refugee employment* to
assist Refugee Service Providers in correctly reporting successful
refugee employment outcomes. A refugee[^1] employed by an employer in a
job that meets the criteria of 45 C.F.R. § 400.81 generally fulfills the
definition of a successful refugee employment outcome. A self-employed
refugee may also meet the definition of a successful refugee employment
outcome, depending on criteria discussed below.

**Refugee as Employee Meets the Definition of Successful Refugee
Employment Outcome**

The Refugee Resettlement Program is designed to assist refugees to reach
early economic self-sufficiency by directing refugees toward employment,
as an employee, soon after arrival in the U.S. A refugee who is a)
employed by an employer in a legitimate job that meets the criteria of
45 C.F.R. § 400.81 and b) can document that employment, meets the
definition of employment for ORR reporting purposes.

ORR prefers that the refugee find and hold a job in which the refugee is
employed by an employer rather than be self-employed. Refugees who are
employed as an employee of a business or organization, have a life
structure with a regular work schedule, on-the-job direction and
training, steady compensation (sometimes with benefits), possible
prospect for advancement within the organization, and transferable work
experience. This regularity and structure in a refugee's life affords
him/her time to focus on social and cultural integration, language
development, and on his/her family. Further, in a standard job in the
U.S., the employer automatically deducts the designated income and
social security taxes and other required amounts from the employee's
paycheck, relieving the employee of this burden.

Reflected in 45 C.F.R. Part 400 is a concept of refugee employment that
makes a distinction between the employer and employee because they are
separate entities. This by definition presumes the existence of
employers, and the existence of a (prospective) employee who conducts a
job search, identifies employer prospects, participates in employment
interviews, and eventually accepts an offer of employment. ORR-funded
Refugee Service Providers assist in this process.

**Refugee as Self-Employed May Count as Successful Refugee Employment
Outcome**

Depending on factors and criteria discussed herein, a self-employed
refugee may meet the definition of a successful refugee employment
outcome for ORR purposes.

As a general rule, refugee self-employment is not the preferred
objective of ORR's program for refugees within their first eight months
in the U.S. Self-employment can be unstructured, impermanent, variable,
and not appropriate to a refugee at the vulnerable, critical early
stages of his/her resettlement in the U.S. On the path to refugee
economic self-sufficiency, self-employment can ordinarily be expected to
happen later on the continuum of resettlement.

However, ORR recognizes there are cases where the only employment
available for the refugee, or the most suitable arrangement for an
individual refugee at a specific time, is through self-employment.
Refugee self-employment may be counted as a successful employment
outcome if certain criteria and common sense guidelines are followed. In
certain cases, the refugee's age, education, experiences, skill,
language ability, social integration, self-discipline, and personality,
combined with the dynamics of the local labor market, point to
self-employment as an appropriate work status. In such cases the Refugee
Service Provider may ask the self-employed refugee about indicators of
the legitimacy of his job, using 45 C.F.R. § 400.81 as guidance. The
provider may ask about the nature and degree of effort expended,
including hours worked; commuting time and travel; output measured by
the standards for that field; number of customers, clients, or
transactions; income or income after expenses; health and safety
standards at the job site; whether any discriminatory practices are
encountered by the refugee; and a realized or expected positive trend
over time.

For example, a taxi driver should be able to show trip reports from his
daily ledger including mileage and receipts. A delivery person should
cover a certain route, or perform a number of deliveries, per day, with
corresponding receipts, mileage, or income. Day laborers, including
gardeners, painters, or construction workers, paid in cash, should
receive the same compensation as U.S. citizens doing the same work. A
haircutter or others in the field of personal care should have some
record of each client or transaction, or at least a daily or weekly
total. Child caregivers or nannies paid by the hour or block of time
should be able to roughly match their income to hours worked times
hourly rate of pay. Ask the question, "Considering the totality of the
factors, is the employment situation of this self-employed refugee
compatible with the goal of the refugee's eventual economic
self-sufficiency?"

**Responsibilities of Self-Employed Refugees**

Self-employment carries with it responsibilities for legal compliance
that are more complex than those for employees. Refugee service
providers should remind refugees of their obligation to pay taxes.
Self-employed refugees paid in cash have earned income just as if paid
with a paycheck, which must be reported to the Internal Revenue Service.
The self-employed person is solely responsible for timely filing and
payment of taxes, and for registration with the state or locality as a
business. Self-employed refugees, like all self-employed persons, must
pay to the Internal Revenue Service both the employer's and the
employee's share of Social Security and Medicare taxes. Refugee Service
Providers should assist refugees with these complex matters when
possible.

If you have questions, please contact Thomas Pabst at 202-401-5398

**Appendix**

**Title 45: Public Welfare\
**[PART 400---REFUGEE RESETTLEMENT
PROGRAM](http://law.justia.com/us/cfr/title45/45-2.1.3.1.1.html)

##### Subpart F---Requirements for Employability Services and Employment

##### 

##### General Requirements

##### Criteria for Appropriate Employability Services and Employment

##### § 400.81   Criteria for appropriate employability services and employment.

The State agency or its designee must determine if employability
services and employment are appropriate in accordance with the following
criteria:

\(a\) The services or employment must meet the following criteria, or,
if approved by the Director, the comparable criteria applied by the
State in an alternative program for TANF recipients:

\(1\) All assignments must be within the scope of the individual\'s
employability plan. The plan may be modified to reflect changed services
or employment conditions.

\(2\) The services or employment must be related to the capability of
the individual to perform the task on a regular basis. Any claim of
adverse effect on physical or mental health must be based on adequate
medical testimony from a physician or licensed or certified psychologist
indicating that participation would impair the individual\'s physical or
mental health.

\(3\) The total daily commuting time to and from home to the service or
employment site must not normally exceed 2 hours, not including the
transporting of a child to and from a child care facility, unless a
longer commuting distance or time is generally accepted in the
community, in which case the round trip commuting time must not exceed
the generally accepted community standards.

\(4\) When child care is required, the care must meet the standards
normally required by the State in its work and training programs for
TANF recipients.

\(5\) The service or work site to which the individual is assigned must
not be in violation of applicable Federal, State, or local health and
safety standards.

\(6\) Assignments must not be made which are discriminatory in terms of
age, sex, race, creed, color, or national origin.

\(7\) Appropriate work may be temporary, permanent, full-time,
part-time, or seasonal work if such work meets the other standards of
this section.

\(8\) The wage shall meet or exceed the Federal or State minimum wage
law, whichever is applicable, or if such laws are not applicable, the
wage shall not be substantially less favorable than the wage normally
paid for similar work in that labor market.

\(9\) The daily hours of work and the weekly hours of work shall not
exceed those customary to the occupation. And

\(10\) No individual may be required to accept employment if:

\(i\) The position offered is vacant due to a strike, lockout, or other
bona fide labor dispute; or

\(ii\) The individual would be required to work for an employer contrary
to the conditions of his existing membership in the union governing that
occupation. However, employment not governed by the rules of a union in
which he or she has membership may be deemed appropriate.

\(11\) In addition to meeting the other criteria of this paragraph, the
quality of training must meet local employers\' requirements so that the
individual will be in a competitive position within the local labor
market. The training must also be likely to lead to employment which
will meet the appropriate work criteria.

\(b\) If an individual is a professional in need of professional
refresher training and other recertification services in order to
qualify to practice his or her profession in the United States, the
training may consist of full-time attendance in a college or
professional training program, provided that such training: Is approved
as part of the individual\'s employability plan by the State agency, or
its designee; does not exceed one year\'s duration (including any time
enrolled in such program in the United States prior to the refugee\'s
application for assistance); is specifically intended to assist the
professional in becoming relicensed in his or her profession; and, if
completed, can realistically be expected to result in such relicensing.
This training may only be made available to individuals who are
employed.

\(c\) A job offered, if determined appropriate under the requirements of
this subpart, is required to be accepted by the refugee without regard
to whether such job would interrupt a program of services planned or in
progress unless the refugee is currently participating in a program in
progress of on-the-job training (as described in §400.154(c)) or
vocational training (as described in §400.154(e)) which meets the
requirements of this part and which is being carried out as part of an
approved employability plan.

\[54 FR 5477, Feb. 3, 1989, as amended at 65 FR 15448, Mar. 22, 2000\]

[^1]: "Refugee" will be used throughout this document to refer to all
    ORR-eligible populations. For more details on ORR-eligible
    populations, see ORR State Letter 00-17 and ORR State Letters on
    victims of severe forms of trafficking.