Business Immigration Horizon, Spring 1999

The Big Picture

Approximately 25 million temporary visas are issued annually as follows:

19.1 Million

3.88 Million
F Students &
J Exchange Visitors

H, O, & P



The ratio of temporary visas to permanent visas is 25 to 1. However, the ratio of temporary visas to business-based permanent visas is 300 to 1.

The L Visa Alternative for Multinational Employers

L-1 Intracompany Transferee

The L visa category facilitates the transfer of executive, managerial, and key technical personnel of multinational businesses for long-term temporary U.S. assignments. This visa provides several advantages and may provide to multinational employers an attractive alternative to the H-1B category. To be eligible for an L-1 visa, an individual must have been employed abroad as a full-time executive, manager, or specialized knowledge employee for at least one year. He or she must be transferring to the United States to join the parent, affiliate, or subsidiary of the foreign employer in this job capacity.

An L-1 executive or manager must spend more than half of the time performing executive or managerial duties, as opposed to tasks necessary to produce or provide the company's product or service directly. If, however, an individual is coming to open a new office in the United States, he or she may indeed engage in non-executive/non-managerial activities during the beginning phases of the new U.S. operation. After one year, however, the standard executive/managerial criteria must be satisfied.

Executives primarily direct the management of the company and establish company goals and policies. They exercise latitude in discretionary decision making and receive only general supervision from higher level executives or the board of directors. Executives include, for example, the president, controller, or vice president.

Managers primarily direct a department or subdivision of the company. They supervise and control the work of other professionals or managers. The term "manager" does not include a first-line supervisor, unless the supervised employees are professionals. Managers have the authority to hire, fire, promote, and grant absences or to recommend such personnel actions. Alternatively, a manager may supervise an essential function or component within the company, even if the supervision of other employees is not involved. Of course, this "functional" manager must direct the function or component, exercise discretionary authority over daily operations, and report to a senior level official in order to qualify for L-1 visa status.

Specialized Knowledge Employees

Specialized knowledge employees utilize an advanced level of knowledge regarding an important company process or procedure. Alternatively, they possess advanced knowledge, which is central to the company's products or services and serves to enhance competitiveness in international markets. This includes, for example, knowledge of the company's equipment, products, services, research, techniques, or management.

The L-1 visa is beneficial in that the transferred employee can be admitted for an initial period of three years (except for the one-year limit applicable to new office situations). The visa may be extended in two-year increments up to a maximum consecutive stay of seven years for executives and managers and five years for specialized knowledge employees. Furthermore, L-1 managers and executives (but not specialized knowledge employees) may utilize a short cut procedure to obtain permanent residency. All of these features render the L-1 visa category an important alternative available to multinational employers. This holds true particularly for employees who, though eligible for H-1B status, are likewise eligible for L-1 status and could thereby avoid the H visa cap. For related considerations, see "How's Your End Game?" in this issue.

L-1 or H-1B: Which Is Best For Your Company?

Category"Immigrant Intent" Allowed?Time LimitsFeesProcessingRestrictions

Executives or Managers
Specialized Knowledge Employees

Yes. Can file an immigrant petition yet remain in valid L-1 nonimigrant status ("dual intent").Initial stay of 3 years (except for one-year limit applicable to "new ofice"). Eligible for renewals in 2-year increments. Maximum aggregate stay: L-1A=7 years; L-1B=5 years.$110 if filed at Service Center. No INS fee if filed abroad under a pre-approved company "blanket" L petition.*Must file at INS Service Center (except for Canadians). If company is pre-approved for "blanket" L status, can skip INS and go straight to embassy abroad for visa. L-1B not "blanket" eligible unless professional.All nationalities eligible. Must have been employed abroad by a related company as full-time executive, manager, or specialized knowledge employee for one year.
H-1BYes. Can file an immigrant petition yet remain in valid H-1B nonimmigrant status ("dual intent").Initial stay of 3 years; eligible for one 3-year renewal. (Maximum aggregate stay of 6 years, even if there is a change in employers.)$110 INS filing fee for training U.S. workforce, as mandated by Congress.Must file at Service Center after clearance from Department of Labor.All nationalities eligible. Must be "Specialty Occupation." Bachelor's degree or equivalent required.
*Blanket L petition approval is available to a company and some or all of its parent, branch, subsidiary, and affiliate companies if (a) the U.S. office has been doing business for at least one year, (b) the company has three or more domestic or foreign branches, subsidiaries, or affiliates, and (c) these related companies have (i) a U.S. work force of at least 1000 employees or (ii) U.S. subsidiary or affiliate combined annual sales of at least $25 million or (iii) at least 10 approved L petitions for executives, managers, or specialized professionals during the preceding 12 months.

How's Your End Game?

Processing times at the INS are lengthening. As a result, company employees on temporary work visas are hard pressed to sustain employment authorization while permanent residency papers are pending. These timing problems are particularly acute for H-1B employees. Many of these employees are employed by U.S.-owned companies and have no prior work history with the company abroad. As such, they are ineligible for E or L visa status and are permitted a maximum stay of six years in H-1B status. At the conclusion of the sixth year, they must depart the United States for one aggregate year before they may return in H status.

A classic example is the high tech employee who has served in H-1B status for three years in Research Triangle Park and now moves to Silicon Valley with a new H-1B employer. The worker can remain in H-1B status in Silicon for three more years, but must then depart the United States for one year before he or she may return in H-1B status for any employer. Most efforts to convert from H-1B status to green card status are employer-specific and location-specific. Therefore, the green card effort undertaken for the H-1B worker in Research Triangle Park must start over when the move to Silicon Valley occurs.

Currently, Silicon Valley green cards are taking four to six years to complete, according to standard processing methods. Reduction in recruitment is advised to reduce this timeframe. (See our Winter 1998 discussion of reduction in recruitment.) In any event, the H-1B visa may be exhausted before permanent residency is attained.

If the H-1B status expires before the green card is complete, may the green card continue to be processed even after the employee departs the United States? Fortunately, the answer is yes. Therefore, employers with the ability to do so should consider transferring the H-1B employee to a foreign facility for the one-year period. Meanwhile, the green card papers in the United States continue to be processed. After the one-year period, the employee may then return anew in H-1B status for an aggregate validity of six years. Alternatively, the employee could enter in L-1 status, since he or she has now worked abroad for one full year for a related company. If, by chance, the majority ownership of the U.S. employer is foreign, and if the employee's nationality is the same as the foreign owner's, the employee may depart after year six in H-1B status and return shortly thereafter in E status. One year abroad is not required before returning in E status. Of course, green card papers in the U.S. continue to be processed during this time.

For those employers who do not have foreign facilities, H-1B employees in year six may consider returning to school as full-time F-1 students who may obtain curricular work authorization. Alternatively, the employee may depart the United States and take employment with an unrelated employer for one full year and then return in H-1B status for the U.S. employer. Again, green card papers would continue processing in the U.S. during this time.

The "end game" in permanent residency processing is becoming increasingly critical, particularly for H-1B employees. In business immigration, as in chess, your company's moves today will greatly influence the final outcome. Early planning and awareness of alternatives are essential.

INS Backlogs Frustrate Employers

INS processing of temporary work visas and green cards has slowed to a crawl. Commonly referred to as the INS "meltdown," the processing backlogs have led to increasing uncertainty for immigrants and employers as cases remain in limbo for months, if not years.

Due to backlogs and inadequate funding, cases are delayed and inconsistently processed at the four regional service centers. For example, processing times for temporary visas range from two weeks in Vermont to almost six months in California. Green card processing times range in years, rather than in months. This inconsistency results in disparate treatment for employers based on their geographic location. In some cases, these delays result in failure to receive the benefit altogether. (See "How's Your End Game?" in this issue.)

The backlogs have arisen due to many factors: rapid changes in the immigration laws over the last several years that require the agency to adjust its decision making quickly; lack of adequate funding to support adjudication functions; recent drastic increases in the number of filings in all categories; ongoing technology problems with the systems designed to help the agency cope with the increased workload; and agency policies that require more, not less, work on its part. Though the INS has received substantial increases in funding over the last several years, the majority of this funding has been directed to enforcement and naturalization, to the detriment of other services. These time frames require advance planning and creative strategies to avoid "lockout" after year six for H-1B visa holders and in year five or seven for L-1B or L-1A visa holders. Littler Mendelson is the largest firm in the United States handling employment and labor matters exclusively for management.

Choosing The Best Entry Category

Is Your Company..?
Is The Worker..?
Consider This Visa
50% Or More Foreign Owned?From That Country?E Category
Legally Related To A Company Abroad?Employed Abroad By That Company For At Least One Year?L Category
Neither Of The Above, But Trying To Fill A Position In An Industry That, At A Minimum, Requires A Bachelor's Degree?The Holder Of A U.S. Bachelor's Degree Or Its Equivalent?H Category

How Long Will It Take?1

Where the work will be
E Visas
L Visas
H Visas
Business Green Cards
AK, CO, ID, IL, IN, IA, KS, MI, MN, MO, MT, NE, ND, OH, OR, SD, UT, WA, WI, WY303030670-730
AZ, CA, HI, NV30060160385-400
AL, AR, FL, GA, KY, LA, MI, NM, NC, OK, SC, TN, TX453545700-950
CT, DE, DC, ME, MD, MA, NH, NJ, NY, PA, PR, RI, VT, VA, WV303030210-290

Notes: "How Long Will It Take?"

1. All of the following processing times run from the date an application is received by the government. Preparation time prior to filing the application depends heavily on client participation and promptness in providing documents and information. Preparation time generally ranges from 2 to 30 days in addition to the time shown.

2. H data includes average time required to obtain labor department and related pre-filing clearances. These times may vary widely from region to region.

3. Processing times include both the I-140 stage and the subsequent I-485 stage. Generally, travel and work permission may be obtained, respectively, on or before the 45th and 91st days after the filing of the I-485.

4. For business green cards, find the state where the employee will perform the work. You will see the total number of days required to complete a business green card. If labor certification is involved, add an average 500 days. For example, processing in Vermont requires 240 days, but if a labor certification is involved, add the average 500 days for a total time of 740 days to complete a business green card.

HORIZON is published by Littler Mendelson in order to convey recent developments in immigration law.

HORIZON is designed to provide accurate and general information but should not be considered legal advice.

)1999 Littler Mendelson. All rights reserved.