U.S. employers wishing to hire a foreign worker who is an Australian citizen should consider the E-3 visa category.  The E-3 visa category is only available for Australian citizens. The E-3 visa category permits Australian citizens to work in the U.S. in “specialty occupations” on a temporary basis. 

Specialty occupations are those which are professional in nature and require at least a bachelor’s degree in a specific field.  In order to qualify for the E-3 visa category, the Australian citizen must also possess the required bachelor’s degree or the equivalent in education or work experience. 

There is an annual limit of 10,500 new E-3 visas available to Australian citizens each year.  Under the E-3 visa category, an Australian citizen can obtain employment authorization in two-year increments and renew indefinitely.  Spouses and children of E-3 visa holders are also given E-3 visa status, but they are not counted against the annual cap.  Additionally, spouses of E-3 visa holders are eligible to apply work authorization in the United States.    

In order to apply for the E-3 visa category, an Australian citizen may apply directly at a U.S. Embassy or Consulate.  Alternately, an Australian citizen already in the U.S. may apply to U.S. Citizenship and Immigration Services to change his or her status to E-3 while in the U.S. 

An application for the E-3 visa category must include the following:

• Valid Australian passport as proof of citizenship;
• A Labor Condition Application (LCA);
• Offer letter of employment from a U.S. employer, detailing the professional position and applicant’s credentials; and
• Proof of the applicant’s qualifications, including degree, diploma, and/or experience letters.

While there is a limit on the number of E-3 visas available each year, the E-3 visa cap has not been reached this year.  Therefore, U. S. employers with immediate hiring needs should consider the E-3 visa as a viable option for hiring Australian citizens into professional positions.  Once employers have identified a potential candidate, they should contact an immigration attorney to evaluate whether the offered position and the candidate’s credentials meet the E-3 visa requirements.   

A recent decision from the Court of Appeals of New South Wales, Australia, illustrates the potential value of using a series of independent but “cascading” covenants to create options for enforceability of restrictive clauses depending on what a reviewing court may find to be reasonable.  In Hanna v. OAMPS Insurance Brokers Ltd., NSWCA 267 (Oct. 19, 2010), the Court of Appeals upheld a trial judge’s decision enforcing a 12-month restriction prohibiting a former insurance brokerage executive from soliciting or dealing with clients anywhere in Australia with whom he had contact during the final two years of his employment.  Notably, the covenant said that he could not “during the Restraint Period” and “within the Restraint Area” directly or indirectly “canvass, solicit or deal with” the described clients, with the following definitions:

"2.  Restraint Period means, from the date of termination of your employment:   

(a) 15 months;
(b) 13 months;
(c) 12 months.

Restraint Area means:

(a) Australia;
(b) The State or Territory in which you are employed at the date of termination of your employment;
(c) The metropolitan area of the capital city in which you are employed at the date of termination of your employment."

The contract also specified that “each restraint contained in this Deed (resulting from any combination of the wording in clauses 1 and 2 constitutes a separate and independent provision, severable from the other restraints.”

The defense argued that the covenant left the employee unable to determine where and for how long he was entitled to compete.  The court rejected this argument, relying largely on the language specifying that the covenants were independent, and noting that a series of “repetitive and overlapping restraints of ever widening reach and subject matter” were a reasonable commercial response to the perils of the common law “blue pencil” rule.  The court accepted the legitimacy of the employer trying to obtain for itself “some post-contractual restraint … within the temporal and geographic ranges identified.” 

The lesson for companies with employees in New South Wales and those other British and American common law jurisdictions that continue to use a traditional “blue pencil” approach to the enforcement (or non-enforcement) of assertedly overbroad covenants?  Consider whether a cascading set of interlocking but severable covenants might provide an avenue to obtain some level of post-employment protection when a contract is challenged by a former employee.

A copy of the court's opinion is available in pdf format below.

Christopher P. Stief is the Chair of the Employee Defection & Trade Secrets Practice Group at Fisher & Phillips LLP.  To receive notice of future blog posts either by Mr. Stief or other members of the Practice Group, you may subscribe to this blog's RSS feed or follow Mr. Stief on Twitter at @CStiefLaborLaw.  As always, please feel free to share your thoughts or pose your questions in the comment field below. 

Hanna v OAMPS decision.pdf (1.42 mb)