The L-1 Intracompany Transferee visa category is a valuable visa category for international companies wishing to transfer key employees to the company’s U.S. operations.   The L-1 visa category authorizes the transfer of managers, executives and individuals with specialized knowledge from a foreign company to a U.S. related company.  There are two L-1 visa categories.  The L-1A visa category permits the transfer of managers, and executives, while the L-1B visa category permits the transfer of individuals working in a specialized knowledge capacity.

In general, for L-1 visa purposes, a manager is an employee who manages an organization, department, subdivision, or function of a business.   An executive is an employee who directs the management of the organization or a major component or function of the organization.  An employee with specialized knowledge is someone with special knowledge of the company’s products, services, equipment, techniques, etc. or an advanced knowledge of the company’s processes and procedures.

In order to qualify for the L-1 visa category, the foreign employee must have been employed by a foreign entity related to the U.S. company.  The qualifying relationship between the U.S. and foreign entity includes, parent, branch, subsidiary, or affiliate.    In addition, the foreign employee must have been employed in an executive, managerial or specialized knowledge capacity for at least one full year during the three years preceding the filing of the petition.  The employee is not required to be transferred to the U.S. in the same position, but the U.S. position must be as an executive, manager or in a specialized knowledge capacity. 

Whether the U.S. position is in an executive, managerial, or specialized knowledge capacity will determine how long the person is permitted to remain in the U.S. in L-1 status.  The L-1A visa category for managers and executives authorizes employment in the U.S. for up to 7 years.  The L-1B visa category for specialized knowledge authorizes employment for up to 5 years.  Individuals approved for the L-1A visa are not only permitted to stay in the U.S. for a longer period of time, but are also eligible for a streamlined permanent residence process.  Spouses and children of L-1 visa holders are given L-2 visa status and spouses are also eligible to apply for work authorization in the United States.

The normal procedure for applying for the L-1 category is for the U.S. employer to file a petition with U.S. Citizenship and Immigration Services.  However, Canadian citizens are allowed to apply for L-1 status directly at the U.S. border. 

There is not a numerical cap on the number of L-1 visas available each year, so an employer may file an L-1 petition at time.  Further, there are no specific educational requirements for the L-1 visa category.   In order to qualify, the employee must have only worked in a qualifying capacity.  Therefore, U.S. companies with international operations should consider the L-1 visa whenever the company’s business requires the services of an employee from a foreign related company. 

Since the H-1B visa cap was reached on June 11, 2012, U.S. employers wishing to hire a foreign worker who is a Canadian or Mexican citizen should consider the TN visa category.  The TN visa category is part of the North American Free Trade Agreement (NAFTA) and permits Canadian and Mexican citizens to enter the United States to participate in professional business activities on a temporary basis.

Under the TN visa category, Canadian and Mexican citizens are permitted to work in the U.S. in certain defined professional occupations, including, but not limited to, Accountant, Architect, Computer Systems Analyst, Engineer, Hotel Manager, Management Consultant, Mathematician, Scientific Technician/Technologist, and Scientist.  There are specific educational requirements and alternative credentials for each category and TN status is only available to individuals employed in the listed occupations who possess the required credentials. 

The TN visa category is available to an unlimited number of Mexican and Canadian citizens.  Unlike the H-1B visa category, the TN visa category does not have a numerical limit on how many visas are available each year.  Under the TN visa category, a Canadian or Mexican citizen can obtain employment authorization in three-year increments and renew indefinitely. 

In order to apply for a TN, Canadian citizens can simply apply for TN status at a U.S. port of entry.  Canadian citizens are not required to obtain a visa at a U.S. Consulate.   However, Mexican citizens are required to apply at a U.S. Consulate and obtain a TN visa stamp in their passport prior to entering the U.S.

Whether applying at a U.S. port of entry or at a U.S. Consulate, applicants for a TN must provide the following documentation:

• Valid Canadian or Mexican passport as proof of citizenship;
• Offer letter of employment from U.S. employer, detailing the professional position and applicant’s credentials;
• Proof of applicant’s qualifications, including degree, diploma, and/or experience letters; and
• Application fee.

Due to the availability of the TN visa for qualified applicants, the TN visa is an option for employers seeking to immediately hire a Canadian or Mexican citizen into a professional position.  Once employers have identified a potential candidate for TN status, they should contact an immigration attorney to evaluate whether the offered position and the candidate’s credentials fit within one of the defined TN occupations and will support a TN application.   

Your company just signed a lucrative contract to start a project in Canada next week.  Your company, however, does not have operations in Canada.  Moreover, the only employees qualified to perform the work are U.S. citizen employees currently working in the U.S.  What do you do? 

Most employers do not contemplate the immigration issues surrounding a scenario like the one listed above until after the contract is signed and the work is imminent.  The North America Free Trade Agreement (“NAFTA”) provides a solution for swiftly tapping U.S. citizen employees to work in Canada. 

Under NAFTA, a U.S. citizen employee can present an Application for Canadian Work Permit at the port of entry into Canada if the following requirements are met:

• The employee is a citizen of the United States;
• The employee works in a profession identified in Appendix 1603.D.1 of NAFTA (see http://www.nafta-sec-alena.org/en/view.aspx?x=343&mtpiID=147#Ap1603.D.1); 
• The employee qualifies to work in that profession (most of the NAFTA professions require at least a bachelor’s degree);
• There is pre-arranged work with a Canadian employer; and
• The employment will be temporary.

A U.S. citizen employee must present the following documentation at the port of entry:

• A U.S. passport;
• A completed Application For Canadian Work Permit form;
• A letter of invitation from the Canadian client and a copy of the contract;
• A letter of support from the U.S. employer  providing information regarding the proposed employer in Canada, the profession for which entry is sought, details of the position (title, duties, duration of employment, arrangements as to payment, and the educational qualifications or alternative credentials required for the position);
• Evidence that the employee has at least the minimum education requirements or alternative credentials listed in Appendix 1603.D.1 (copies of degrees, diplomas, transcripts, professional licenses, accreditation or registration, etc.); and
• Evidence of the employee’s ties to the U.S. to show that the position in Canada is temporary.

Citizenship and Immigration Canada typically grants initial work permits for durations of up to three years.  Citizenship and Immigration Canada may extend the Canadian Work Permit in increments of up to three years with no limit on the number of extensions providing the employee continues to comply with the requirements for NAFTA professionals.

NAFTA’s Appendix 1603.D.1, a list of over 60 occupations, including Accountants, Engineers, Computer Systems Analysts, Management Consultants, Scientific Technologists, is the mechanism by which selected professionals can enter Canada to provide their services.  Generally, if an occupation does not appear on the list, it is not a profession as defined by Appendix 1603.D.1 of NAFTA.

If an employer determines that its U.S. citizen worker meets the above-listed requirements of a NAFTA Professional, the employer should work with its immigration attorney to provide the traveling employee with all relevant documents to present the Canadian Work Permit Application to the Canada Border Services Agency officer upon arrival.  If the Canada Border Services Agency denies an individual entry in Canada as a NAFTA Professional, it could prevent future entries into Canada for that particular employee and possibly for employer’s other workers. Thus, a thoroughly-prepared Work Permit Application on the first entry into Canada is essential.

Gone are the days when an employer could send its U.S. citizen employees to the Canadian border with a passport and a simple explanation of the business purpose of the trip.  Effective April 1, 2011, Citizenship and Immigration Canada is taking a more aggressive stance against the often abused NAFTA Business Visitor category.  Employers cannot use the business visitor category in lieu of obtaining a Canadian work permit for employees who will be actually working in Canada as defined by Canadian immigration laws. 

Armed with greater powers to scrutinize employer compliance with immigration regulations, immigration officials now have the discretion to request additional information on employer compliance and the power to impose greater penalties for noncompliance, including debarment from hiring foreign workers for two years.

Although business visitors are generally allowed to stay in Canada for up to 180 days, business visitors typically stay in Canada for a few days or a few weeks. In order for a U.S. employer to send its U.S. citizen employees into Canada as business visitors, employers must show the following:

• The employee intends to stay for less than six months and does not plan to engage in gainful employment in Canada (even if the gainful employment is for a duration as short as a few days);
• The principal place of business of the employer is located outside Canada;
• The primary source of the employee’s income is located outside Canada;
• Profits from the employer’s business will accrue outside Canada;
• The activity of employee must be international in scope; and
• The employee meets Canada’s basic entry requirements and does not pose criminal, security or health risks to Canadians (Canada is particularly strict on DUIs).

Acceptable cross-border business activities include:

• Buying Canadian goods or services for a foreign business or government;
• Taking orders for goods or services;
• Attending meetings, conferences, conventions or trade fairs;
• Providing after-sales service (mainly supervision, not hands-on labor);
• Training by a Canadian parent company;
• Training employees of a Canadian subsidiary of a foreign company;
• Training by a Canadian company that has sold a U.S. company equipment or services; or
• Under NAFTA, a U.S. or Mexican national may also take part in other activities, such as research, marketing and general service.

For example, where a Canadian employer has directly contracted for service from a foreign company, the employee of the foreign company performing services for the Canadian company cannot enter Canada as a business visitor as this entry would require a Canadian work permit.  Since a contract exists between the Canadian company and the foreign worker’s employer, the Canada Border Services Agency presumes that the employee is entering the Canadian labor market.  Since that foreign worker is receiving payment for the service that is being provided, the Canada Border Services Agency deems that the worker is receiving payment from a Canadian source even if the worker is paid by the U.S. employer.  Thus, the worker cannot enter Canada as a business visitor.

If an employer determines that its U.S. citizen worker meets the above-listed requirements of a business visitor, the employer should work with its immigration attorney to provide the traveling employee with all relevant documents to present to the Canada Border Services Agency officer upon arrival.  If the Canada Border Services Agency denies an individual entry in Canada as a business visitor, it could prevent future entries into Canada for that particular employee and possibly for employer’s other workers. Thus, a thoroughly-prepared business visitor application on the first business visitor entry into Canada is highly recommended.     

 In May 2009, the Quebec Equity Pay Act, which was initially passed in 1996, was substantially revised.  The amendments to the Pay Act, whose main effects are detailed below, became fully effective on December 31, 2010. 

The amendments modify the timing of when an employer subject to the Act (generally, one with 10 or more employees) must comply with the Act.  Under the 2009 amendments, an employer that grows to 10 or more employees during a calendar year must comply with the Act beginning in the following calendar year.  In addition, an employer that drops below 10 employees during a calendar year must continue to comply with the Act for the remainder of that calendar year.

 Generally speaking, all employers were required to take the following steps by December 31, 2010 (note that there are additional requirements for employers of greater size)

•  Identify predominantly female and male job categories and calculate salary adjustments; 
• In conducting this equity exercise, use salary data from February 1, 2009
• If salary adjustments are necessary, make these payments retroactive to March 12, 2009, along with statutory interest;

The amount of time an employer will have to make any required payments will depend on whether the employer had begun, but not finished, the equity exercise as of March 12, 2009.  Employers that had not started the process by this date are required to make payments to affected employees in a lump sum.  Employers that had started the equalization exercise by this date are permitted to make payments in installments over four years. 

For those employers that are now in noncompliance with the December 31, 2010 deadline, there are serious consequence.  They may have a complaint filed against them with the Commission, and be subject to increased fines and penalties, as well as a waiver of their right to pay in installments. 

If you have operations in Quebec that subject you to the Equity Pay Act, and haven’t taken the steps necessary to bring your equity pay plan into compliance, now is the time – there are considerable ongoing penalties if your company does not comply.