presents

Immigration Issues for Startups

LAURA E. SCHNEIDERWilmerHale

Laura E. SchneiderLaura E. Schneider is a partner in WilmerHale's Labor and Employment Practice Group, Immigration Group and FinTech Group, joining the firm in 1992. Ms. Schneider’s practice focuses on all aspects of labor and employment law. She counsels clients on employment law compliance issues, personnel policies, employee relations and performance management. Additionally, Ms. Schneider consults on immigration matters in connection with workforce composition and transactions.

Overview of Selected Immigration Issues for Startups

Laura E. Schneider, Esq.

WilmerHale

OverviewOnly U.S. citizens and permanent residents (“green card” holders) may work in the U.S. without specific work authorization from the U.S. Citizenship and Immigration Services (USCIS). § No exceptions for contractors, part time employees, casual

employment or volunteers§ All employers must complete Employment Eligibility

Verification forms (“I-9s”) for all employees

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Overview§ Generally speaking, work authorization (“work visas”) requires

employer sponsorship § Some means exist for individuals to obtain work authorization

on their own:– Students may obtain a one-year work permit after obtaining a

degree (17 month extension for holders of STEM degrees if employer uses E-Verify)

– Employment authorization documents (EADs) available to some based on special status (asylum, family relationship to U.S. resident or citizen, other limited programs)

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Work AuthorizationMost often, company must apply for a nonimmigrant work visa for a foreign national candidate and wait for approval before employment starts Regular processing times vary; generally monthsPremium Processing available (for additional fee) for certain visas – 15 daysEmployer-specificImmigrant visas (“green cards”) possible§ More expensive, and generally lengthy process§ Mergers and other corporate reorganizations may impact

validity and require further action

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Types of Work VisasH-1B SPECIALTY WORKERS§ Employer must petition and show that it is sufficiently

operational to support H-1B workers (e.g., cash flow, work site, other employees)

§ Employee must have a U.S. degree in a field related to the job or an equivalent foreign degree (or very substantial documented experience equivalent to education – 3 years' experience for every year of education)

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Types of Work VisasH-1B SPECIALTY WORKERS§ Requires Labor Condition certification from the U.S.

Department of Labor (DOL) as to prevailing wage, working conditions and other requirements prior to filing with USCIS

§ Employer must pay USCIS filing fees§ Special rules for “H-1B dependent” employers who employ

large percentage of H-1B holders for their size

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Types of Work VisasH-1B SPECIALTY WORKERS§ H-1B "portability" permits current H-1B holders to begin work

for a new employer after Labor Condition certification and filing of new employer’s petition with USCIS (if petition denied, employee must be terminated)

§ Worker may remain in U.S. in H-1B status for an aggregate of six years (limited exception for those in “green card” process)

§ H-1B cap

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Types of Work VisasL-1 Status – Intracompany Transferee§ Must be qualifying relationship between employer abroad and

U.S. employer (e.g., parent/sub, affiliate, joint venture, branch office, etc.)

§ Employee must have one year of full time employment with foreign entity within three years immediately preceding application

§ Each day spent in U.S. (e.g., on business travel) deducted from one year of qualifying employment abroad

§ Generally, initial three year period

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Types of Work VisasL-1 A – Executive or Manager§ Executive

– Directs management of organization (or major component of organization)

– Establishes goals and policies of organization– Exercises wide latitude in discretionary decision making

§ Manager– Manages organization, department or function– Supervises and controls work of other professional/managerial

employees, or manages essential function– Authority to hire and fire– Exercises discretion over day-to-day operations

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Types of Work VisasL-1 B – Specialized Knowledge§ Knowledge of the product, service, research, equipment,

techniques, or management of organization that is unique to employer’s business activities

§ Knowledge cannot be commonly found in U.S. marketplace

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Types of Work VisasL-1 Status – New Offices§ Sufficient physical premises in U.S.§ New U.S. operation, within one year, will support executive or

managerial position§ Requires documentation of scope of entity, U.S. and foreign

organizational structures, financial goals, etc.§ Requires documentation of size of U.S. investment and

financial ability of foreign entity to commence U.S. business§ Limited to initial one year period

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Types of Work VisasTN Status § Canadians and Mexicans whose occupations are listed in

NAFTA treaty and who possess specified education/experience

§ Most useful for computer systems analysts, engineers, scientists, certain management consultants

§ Canadians may apply at land border or airport § Mexicans must apply directly at U.S. embassy or consulate

(following petition approval from USCIS)§ Initial admission up to three years (no limit to total time in TN

status as long as no intent to establish permanent residence)

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Types of Work VisasO-1 -- Extraordinary Ability § Requires advanced degree and significant accomplishment in

field of science, art, education, business or athletics -- sustained national or international acclaim

§ Petition must demonstrate extraordinary abilityInternational major prize (e.g., Nobel) OR 3 of following:Lesser prizes/awardsPublications about foreign national’s workAuthorship of relevant articlesInvited to judge work of others or display work at exhibitionsLeading/critical role in distinguished organizationEvidence of original contributions of major significanceEvidence of high salary (commercial success in arts)Other competent evidence (references of other experts)

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Types of Work VisasE-1 and E-2 Visas – Treaty Traders/Investors § Treaty of commerce/navigation between U.S. and visa

applicant’s home country§ Treaty Trader – substantial trade, principally between U.S. and

treaty country§ Treaty Investor – invests substantial capital in U.S. enterprise

which investor develops/directs– Investment must be “at risk” and not “passive”

§ Holders must act in executive/managerial capacity or have essential skills/qualifications; must have same nationality as treaty country

§ Admission to U.S. in two year increments

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Types of Work VisasE-3 – Australian Nationals § Hybrid between E and H-1B§ Australians working in U.S. in specialty occupations§ Similar requirements, such as LCA, but no petition with USCIS

is required§ Admission to U.S. in 2 year increments

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Types of Work VisasF Status – Students § Foreign national pursues full-time course of study at approved

educational institution§ Employment permissible only under limited circumstances

– On-campus full-time during vacations/holidays, not more than 20 hours per week during academic year (all work must be approved)

– Off-campus pursuant to curricular practical training (same restrictions/approval requirements as on-campus)

– Optional practical training Related to student’s major field of studyMaximum of 12 months (17-month extension possible for those with STEM degrees if employer is registered with E-Verify)

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Types of Work VisasJ Status – Exchange Visitors § Students, teachers, professors, research scholars in U.S.

approved educational exchange programs § Employment permitted with approval of program sponsor§ Authorized professional associations and third-party

organizations offer programs§ Possible 2 year home residence requirement, depending on

foreign national’s skill set and country of origin– Means foreign national must return home following exchange and,

generally, may not change visa status or apply for permanent residence until 2 year residence abroad is completed

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Types of Work VisasB-1 and B-2 Visas – Business/Pleasure Visitors § B-1 for foreign nationals who do not qualify for visa waiver

– Business visitors cannot be employed or paid by U.S. company– Permitted to engage in commercial transactions, negotiate

contracts, consult with business associates, participate in litigation, attend conferences/seminars/board meetings, engage in independent research, install/repair equipment purchased outside U.S. (or train U.S. workers to do so), seek investment in U.S.

– Same rules for visa waiver (like B-1, but for country where no visa is required to enter U.S.)

§ B-2 is tourist visa – no labor or study during visit§ Up to 6 month admission (possible 6 month extension)

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Immigrant Visas -- Permanent Resident § Allows foreign nationals to reside indefinitely in the U.S. § Non-immigrant work visa status is temporary -- Many limited to

5-7 years§ Generally, U.S. citizenship can be sought after five years in

LPR status§ Predominantly family or employment based

– Certain individuals can sponsor themselves if their work is in the national interest or they can prove extraordinary ability

Not tied to particular employer, but must remain working in their field of endeavor

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Immigrant Visas -- Permanent Resident Employer Petitioners§ Employer must sponsor through multi-step process generally

requiring years to complete– Must obtain certification from DOL to prove lack of U.S. workers

qualified for job– Requires engagement in specific recruitment program designed to

find qualified U.S. workers§ Proof of employer financial status (tax returns, audited

financials, etc.) to demonstrate ability to pay§ Portability after 180 days§ Shorter process (possibly still years) for employer sponsoring

employee as outstanding researcher, extraordinary ability/national interest, or certain multinational executives/managers

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Special Considerations for FoundersWhat can I do without a work visa?

At what stage is a work visa necessary?

Do I need to think about immigration issues when thinking about equity ownership?

When can I hire other employees?

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