Kennedy's Immigration Law Report : Iowa Immigration Lawyer & Attorney : Austin Kennedy : Brick Gentry Law Firm : Green Cards, Permanent Residency

Over the last 6 months or so I've had the good fortune of having a spate of E investor visa work.  This kind of work is easy to feel good about, not only because it is good business, but because E-1 and E-2 investors directly stimulate the American economy.  At a time when unemployment figures are higher than we'd like to see them, it makes all the sense in the world to have these investors starting companies in the U.S. and hiring employees.  For those who are unfamiliar with the program, I should explain that E-1 and E-2 visa investors have to demonstrate as preconditions for obtaining their investor visas that they have invested a substantial amount of their own money into a U.S. business and that the business will be hiring a certain number of U.S. employees.

Anyway, after having successfully obtained a number of E-2 investor visas over the last couple months, a couple of observations come to mind: 

• First, an informed and well-written business plan is essential.  If the immigrant investor isn't capable of writing a good business plan, then someone needs to be hired to do so.  The plan needs to demonstrate that the business has forecasted reasonable expectations for financial growth and for hiring. 
• Second, the investment capital must be entirely owned and controlled by the intending immigrant.  The investment capital can have been gifted to the E investor, but the capital cannot be in the form of loan proceeds that encumber any of the business property. 
• Third, consulates abroad take a long time to process these applications, so the investor needs to understand that the visa isn't going to be issued over night.  Plus, it is extremely and maddeningly difficult to communicate with the consulate regarding the application.  You can email or call through a third party private vendor service, but it will cost you approximately $25.00 per time.  Plus, and this is a real treat, emails sent through the service have to be very short in length, I believe 200 words or less.  Finally, the consulates routinely send you mysterious faxes that lack any sort of return fax number or other contact information.  So you get the fax requesting additional information or clarification, and then it becomes an expensive race to the FEDEX box. 
• Fourth, make sure the investor hires an accountant.  The investment needs to be clearly documented and explainable to the consulate, and accountants (as you might imagine) excel at such things. 
• Fourth, probably because this is a pretty unique area of the law, many consulate branches abroad seem unaware of the fact that they (ie., the Department of State) have jurisdiction to directly adjudicate the visa.  In other words, the investor does not first have to petition USCIS for their status.  All evidence and application materials can be sent directly to the consulate abroad.    So, a friendly reminder on the front end of the process of their jurisdiction and authority seems to be a helpful icebreaker. 

As you can see, E-1 and E-2 investor visas are a challenging area of immigration law, but also rewarding in a number of ways.  The investors directly stimulate the economy by infusing it with large sums of investment cash, plus they hire U.S. workers.  Makes sense, eh?   

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On Thursday, April 16, 2009, the DOL published an amendment to its current H-2A visa regulation.  My thoughts and a summary of the new Final H-2A rule can be found here.  The most recent amendment to the Final H-2A Rule states that employers requiring H-2A temporary agricultural workers to start work before January 1, 2010 (rather than July 1, 2009), will file Applications for Temporary Employment Certification in accordance with the transition period procedures in 20 CFR 655.100(b)(2)(2009).  Stated briefly, the transition procedures provide that a prospective H-2A employer should first file its temporary H-2A labor certification application and then conduct recruitment for U.S. workers.  As always, I recommend that everybody read the full text of the new, Final H-2A rule for themselves. 

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Here's a link to the Employment and Training Administration's list of FAQs regarding the proposed suspension of the current H-2A regulation.  At this point, however, the FAQs really just say that the current regulation remains in force until the end of the comment period and until such time that the Department has had a chance to consider the submitted comments. 

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Yesterday's the DOL caused a good deal of confusion and anxiety by announcing the proposed suspension of the new H-2A regulation.  Apparently word of the confusion and concern somehow worked its way up through the hierarchical org chart that is the DOL, because today my sources are telling me that DOL brass produced a modicum of internal clarity by further directing that all local SWAs continue to process H-2A cases under the transition rules of the new H-2A regulation...until further notice.  Of course, the comment period for the proposed suspension is a whopping 10 days long.  So after 10 days, we could be back to last year's H-2A regulation, or we could still be operating under the so-called transition regulation.  Got it?  So now that we've cleared that up we can all go back to enjoying St. Patrick's Day.  Which is great, because it seems we'll definitely be needing the luck of the Irish to get us through this H-2A season. 

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I received word early this morning that the U.S. Department of Labor announced a 'proposed' suspension of the new rule implementing changes to the H-2A visa program.  As many of my readers know, the new final H-2A rule appeared in the Federal Register on Dec. 18, 2008, and took effect on Jan. 17, 2009.  I summarized the new regulation here.  The formal DOL announcement concerning this sudden proposed suspension is here. 

Under 'normal' circumstances the H-2A program is extremely complicated, rife with bureaucratic delays, expensive and non-user friendly.  Suffice it to say, it doesn't help the situation much when the government adds this considerable dollop of confusion to the recipe. 

The press release does provide a teeny tiny glimmer of helpful, instructive information in saying that, "[t]he Labor Department's Office of Foreign Labor Certification will continue to accept and process H-2A applications during the proposed suspension period."  By what criteria the applications will be adjudicated and whether they'll be adjudicated on a timely, consistent basis is another matter altogether. 

One would assume that the current existent rule will carry the day until the 'proposed' suspension actually takes effect.  It sure would be helpful if the DOL would step to the plate and provide some much needed assurance and communication to that effect.  Sigh.   What a mess.  Let me know what you're hearing. 

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The H-2A visa program allows foreign workers to be admitted to the United States as non-immigrants (ie., those who intend to return to their home country) to perform agricultural labor of a temporary or seasonal nature. In order to bring foreign workers in under the H-2A program, a petitioner must prove that 1) there are not sufficient U.S. workers who are able, willing and qualified to perform the agricultural labor or services; and 2) there will be no adverse effect on the wages and working conditions of workers in the United States similarly employed. Generally speaking, these conditions are tested and (one hopes) proved by submitting an application for temporary labor certification to the U.S. Department of Labor. If the petitioner’s temporary labor certification application is approved by the DOL, the petitioner must then petition the USCIS for the H-2A visas.

Many H-2A workers come to the U.S. to perform job duties that are traditionally seasonal in nature, such as harvest-time activities, bean-walking or corn detasseling. Organic farms also commonly make use of H-2A workers because of the labor-intensive nature of cultivating crops that cannot be exposed to pesticides. In most cases, if the job strikes you as a traditionally agricultural job, and you can legitimately argue that it’s either temporary (ie., a maximum of 8-10 months or less) or seasonal, then the job has a good shot of qualifying as an H-2A job.

Unfortunately, it’s oftentimes difficult to obtain a temporary labor certification for agricultural labor that occurs year round. For instance, egg layering operations, milk production facilities and hog confinement lots often struggle to obtain temporary labor certifications because of the fact that those operations typically maintain a 24 hour per day, 7 day per week, 365 day per year production cycle. In other words, while the labor at these operations is clearly of an agricultural nature, oftentimes it’s difficult (though not impossible) to argue that the labor is also seasonal or temporary.

The H-2A program has always been heavily regulated and, as a result, many employers have had a difficult time operating successfully and profitably within the program. As one of its final acts, the Bush administration rolled out a new set of regulations governing the H-2A program. The full text of the H-2A regulation is here. In the press releases accompanying the roll out of the new regulation the Administration claimed that the changes to the program would make it more user-friendly for employers, while also increasing protections for both foreign and domestic workers. The regulation officially took effect on January 17, 2009.

Well, after carefully reading the new regulation, I can only say this—it should keep us employment-based immigration lawyers busy. And I’d hesitate to apply the term “user-friendly” to the legislation. The new regulation asks a lot more from employers, especially those employers who qualify under the regulation as an H-2A labor contractor. The more major changes to the regulation include: new pre-filing recruitment requirements, post-recruitment reporting requirements, surety bond requirements, document retention requirements, audit possibilities, and some seriously dangerous new debarment provisions—to mention just those new areas that come easily to mind.
 

Below I’ve made an effort to summarize the new H-2A regulation. Keep in mind that I’ve certainly summarized the H-2A regulation with an eye toward the needs of my existing clients. As is always the case, my summary and analysis will not apply to each employer or petitioner’s situation. Every petitioner or employer should absolutely read the full text of the new H-2A regulation.

My summary of the new H-2A regulation governing the employment of temporary agricultural laborers can be found here.
 

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U.S. Attorney Matt Whitaker announced yesterday that his office and federal immigration enforcement authorities had uncovered an alleged scheme here in Iowa involving the H-1B visa program.   Whitaker alleged that U.S. computer companies Vision Systems Group Inc. and Pacific West Corp  claimed to have H-1B employees located in Iowa, when in fact, the H-1B employees were actually located in larger coastal cities.   If you're not familiar with the H-1B program, you're probably wondering why and how this would be a crime. 

Employers of H-1B workers are required to pay these employees at least the minimum of the "prevailing wage" for the specific occupation in the specific geographic area where the employee will be working.  Because of cost-of-living differences and a host of other economic factors, the prevailing wage for a software engineer working in Des Moines, IA, is considerably lower than the prevailing wage for a software engineer working in Manhattan or Los Angeles.  So, basically, Whitaker is alleging that the computer companies were claiming that their H-1B employees were working in Iowa, when in fact they were working in coastal cities, so that the employer could pay the employees considerably less money. 

If true, this is an unwelcome development, and certainly an incident Sen. Charles Grassley and other anti-H-1Bers will point to as an example of the the visa program's supposed inherent evil.  For the uninitiated, the H-1B visa program allows the U.S. government to issue a total of 65,000 visas per year to foreign workers who qualify for an H-1B visa and want to come work for U.S. employers.  In order to qualify for an H-1B visa, the hiring company must have a position available that qualifies as a "specialty occupation".  In very general terms, a specialty occupation is one that requires a minimum of a bachelor's degree in a related field of study.  Further, the position must be an occupation that requires a theoretical and practical application of a body of highly specialized knowledge.  And of course, the worker's educational and professional background must fit the specialty occupation. 

As this scandal unfolds across the 6 other states cited by Whitaker, my concern is that these bad apples will be held up by anti-immigration forces as a reason to eliminate or severely restrict the H-1B program.  A short-sighted measure of this nature would be an unmitigated economic disaster. 

The H-1B visa is the primary vehicle through which immigrant entrepreneurs enter the United States.  And according to Vivek Wadhwa, a senior research associate at the Labor and Worklife Program at Harvard Law School, more than half of Silicon Valley start-ups were founded by immigrants over the last decade.  These immigrant-founded tech companies employed 450,000 workers and had sales of $52 billion in 2005 alone.  Furthermore, a recent study by William Kerr of Harvard Business School and William Lincoln of the University of Michigan found that in periods when H-1B visa numbers went down, so did patent applications filed by immigrants in the U.S.  And when H-1B visa numbers went up, patent applications also increased.  If we truly want our country to be the world's preeminent knowledge-based economy, why would we make it more difficult for the world's most entrepreneurial minds to legally find their way to the United States? 

For every U.S. employer who abuses the H-1B visa, there are thousands who use the program appropriately, in accordance with the strict letter of the law.  With our economy on very unsteady footing, now is not the time to be placing additional restrictions on the H-1B program.  The system already has safeguards in place, they simply need to be enforced.  So, as long as these H-1B related arrests don't create a backlash against the H-1B program as a whole,  they are a good thing.  The arrests prove that the appropriate safeguards already exist to hold accountable employers who chose to utilize the H-1B program. Here's to hoping that cooler legislative heads prevail. 

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For when you're gnashing your teeth or spinning your wheels, a little employment-based immigration practice aide with a list of important DOL email addresses. 

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Since posting my summary of the new H-2A regulation below, I’ve received a number of calls and notes from folks asking me whether the new H-2A regulation will—for lack of a better phrase—remain in effect. As many of you are aware, on January 26, 2009, President Obama issued a memorandum to the heads of executive departments and agencies entitled “White House Memo Calling for Halt to Midnight Regulations Published in Federal Register”. As the memo’s title implies, the new administration plans to review and possibly amend or quash regulations issued in the final hours of the Bush administration. At first blush the new H-2A regulation would certainly seem to fall within the somewhat loosely defined category of a “midnight regulation” and would therefore be subject to review.  However, after analyzing the memo, I don’t think the H-2A reg actually is subject to any further administrative review.

The directive’s first prong stipulates “…no proposed or final regulation should be sent to the Office of the Federal Register for publication unless and until it has been reviewed and approved by a department or agency head appointed or designated by the President after noon on January 20, 2009…[.]” (my emphasis). On this count, the new H-2A regulation was already published on December 18, 2008, so the directive's first prong wouldn’t apply.

The directive’s second prong requires that the agencies or departments “[w]ithdraw from the OFR all proposed or final regulations that have not been published in the Federal Register so that they can be reviewed and approved by a department or agency head…[.]”(again, my italics). Since, as I stated above, the new H-2A regulation was already published in the Federal Register on December 18, 2008, the directive’s second prong also would not apply to the new H-2A regulation.

Finally, the directive’s third prong requires agencies and departments to “[c]onsider extending for 60 days the effective date of regulations that have been published in the Federal Register but not yet taken effect, subject to the exceptions described in paragraph 1…[.]” (my italics and bolding added). The new H-2A regulation, in fact, took effect on January 17, 2009. The Obama administration’s regulatory review memo wasn’t published until January 26, 2009. As a result, the new H-2A regulation also falls outside the directive’s third prong and, therefore, should not be subject to further administrative review.

In short, based on what I’m hearing, I sadly yet fully expect the DOL and USCIS to be in a state of unbridled confusion over the issue of whether the new H-2A regulation is truly in effect. But, according to my analysis, the new regulation is definitely the law of the land. It’s clear that practitioners, employers and governmental agencies must forge ahead under the new regulation’s requirements.
 

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The E-1 and E-2 classifications present great opportunities for certain people to come to the United States under fairly flexible and rewarding circumstances. What makes the E category so great? Well, in some limited ways the E classification confers benefits similar to legal permanent residency. For example, one huge plus of the classification is, at least in theory, E non-immigrants can remain in the U.S. in E status forever. It doesn’t always play out that way in practice, and there are plenty of contingencies involved, but knowing that the possibility of an indefinite stay exists points to this classification’s considerable upside. Maybe most impressively, a limited form of dual intent is recognized for those in E status. This basically means that under the right circumstances, an E nonimmigrant may be the beneficiary of a labor certification, immigrant petition, or have an adjustment of status application and still remain eligible for E status. One final, enormous perk offered by this classification is that a qualified applicant can initiate an E petition on their own behalf. Most of the other employment-related classifications require that a prospective employer be first willing to offer employment to the prospective employee and submit a petition on the prospective employee’s behalf. In comparison, the E classification is a self-starter.

So, who qualifies?

#1) Show me the treaty

The E classification consists of two subcategories, the E-1 category for treaty traders and E-2 classification for treaty investors. The basis of the E classification as a whole lies in treaties that were intended to enhance and facilitate economic and commercial interaction between the U.S. and the treaty country. So, the first criteria to examine in assessing whether someone qualifies for E status is whether a treaty of Freedom, Commerce and Navigation exists between the U.S. and the country of the applicant’s nationality. A list of the qualifying treaties and the corresponding countries can be found here.

#2) Does the applicant have the right nationality?

As the second basic criteria, the applicant for E status must possess the nationality of the treaty country. In most cases nationality is fairly easy to determine as a matter of birth. If you weren’t born in a country that’s party to a FCN treaty and you still want to make a run at an E visa, call your local immigration attorney.

E-1 Treaty Traders:

After working through the preliminary questions of whether an appropriate treaty exists and whether the applicant has the requisite nationality, the focus shifts to the specific requirements germane to the individual E visa categories (ie., E-1 or E-2). First we’ll focus on the E-1 subcategory, which requires that the applicant be facilitating “trade” between the United States and the treaty country. “Trade” means the existing international exchange of items of trade for consideration between the U.S. and the treaty country. The governing regulations require that the exchange of items be traceable and identifiable. Furthermore, title to the trade item must pass from one treaty party to the other.

A non-exhaustive list of items that qualify for trade include: goods, services, technology, monies, international banking, insurance, transportation, tourism, communications, some news gathering activities, data processing, advertising, accounting, engineering and management consulting.
 

Finally, the trade must be substantial. The term “substantial trade” means an amount of trade sufficient to ensure a continuous flow of trade items between the U.S. and the treaty country. The emphasis is on numerous exchanges over time rather than a single transaction, regardless of the monetary value. In general, the trade will generally be considered substantial if it generates enough income to support the treaty trader and his or her family.

E-2 Treaty Investors:

Alright, let's now move our focus to a discussion of the E-2 treaty investor subcategory.  In general I'd say that the E-2 is probably the most flexible E visa because you're not dealing with the specific mechanics of international trade.  Once the treaty and nationality bridges have been crossed, the E-2 treaty investor must be in possession of and have control over the capital invested or being invested. The investment will be considered a proper investment if the investor received the funds in the first place by legitimate means—and this can be any source from earnings, savings, inheritance or even gift. Secondly, the investment capital must be subject to partial or total loss if the investment doesn’t work out. ie., Capital must be irrevocably committed to the enterprise. A mere intent to invest or possession of uncommitted funds in a bank account will not suffice.

Furthermore, the enterprise must be real and active commercial or entrepreneurial undertaking, it cannot be a paper organization or a speculative investment held for potential appreciation in value. Finally, the investment must be “substantial” in order to qualify the applicant for an E-2 visa. The relevant authorities haven’t drawn a line in the sand to identify the amount that constitutes a “substantial investment”, but suffice it to say that the amount depends on the investment opportunity at hand. If an applicant plans to use her E-2 visa to start a state-of-the-art microchip processing factory in Simi Valley, CA, an investment of $50,000.00 probably isn’t going to pass scrutiny. If, on the other hand, the applicant is going to invest $50,000.00 to open a falafel stand, and the applicant’s business plan projects a realistic chance for financial and employment-related growth, the chances are greater that the adjudicator at the Department of State will look favorably upon the application.

Options for people to immigrate to the U.S. so often depend on whether the alien has the right job offer, the right educational background, or the necessary family relationship. With the E-1 or E-2 investor visa classification, the normal rules don’t apply. If a person is a national from the correct country, has a decent bit of investment capital and some basic business acumen, the E-1/E-2 classification is an excellent, exciting immigration option.  Oh, and finally, please remember that the E-1 and E-2 non-immigrant visas need to be distinguished from the EB-5 permanent residency investor status.  Check back with us in the near future for an overview of the EB-5 program. 
 

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First, some basic background--the TN professional worker classification is a visa category available to eligible Canadians and Mexicans who have at least a bachelor's degree or appropriate professional credentials AND who work in certain specific qualified fields described within the North American Free Trade Agreement (NAFTA).  The NAFTA treaty actually goes so far as to specify 65 occupational titles that qualify for the TN category, including (but not limited to) the following:  accountant, architect, economist, hotel manager, interior designer, landscape architect, lawyer, management consultant, social worker, dentist, teachers and a slew of science-related professions. 

In order to be granted TN status the applicant must present a letter at the port of entry from their prospective U.S. employer (along with other basic application materials) detailing the following: 

• the specific professional position for which the applicant qualifies;
• the occupational activities in which the applicant will be engaged;
• the applicant's anticipated length of stay in the U.S.;
• educational or professional qualifications which qualify the applicant for the professional position; and
• a description of how the worker will be paid.

In relation to the third bullet point shown above, it is important to realize that in order to successfully obtain TN status every applicant must first be able to demonstrate to the inspecting officer that they eventually intend to return to their home country.  ie., The applicant cannot intend to remain indefinitely in the U.S.  The employment letter should describe a finite period of time the applicant will remain in the U.S.  Unlike the H-1B visa, the TN category is not a dual-intent visa. 

OK--now on to the exciting new developments:  The USCIS just announced a final rule increasing the maximum period of time a TN professional worker from Canada or Mexico may remain in the United States in TN status before needing seek readmission or obtain an extension of stay.  In the past, the maximum period of admission in TN status was one year.  This meant frequent trips back and forth to the border for the TN professional and considerable amounts of uncertainty for both the employer and the professional.  Now, under the new rule, TN status may be granted for a maximum of three years.  I can hear the sighs of relief already...

I'm often critical of our government's immigration policies, so I need to give credit when it's due.  Changing the maximum period of stay for those in TN status from one year to three years is a simple and effective improvement which will allow both employers and employees to plan their business and personal lives in a more realistic manner.  Well done by all involved. 

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I've been getting a number of calls recently regarding the E-3 visa, so I thought a brief post on the topic would be timely.  If you're an Australian national who has a minimum of  a bachelor degree (ie., a 4 year university degree) and you want to come work in the U.S. on a temporary basis, this is a great visa for you and your American employer.   

In many respects the E-3 visa is like an H-1B visa designed specifically for Australians.  In order to qualify for the E-3 visa, the following basic criteria must be met: 

• The beneficiary (ie., worker) must be an Australian national.  Typically this means that you were born in Australia and you hold an Australian passport.  Unfortunately Australian permanent residents are not eligible for the E-3.
• The beneficiary must have a valid written job offer from a U.S. employer;
• The employer must have first obtained an approved Labor Condition Application;
• The beneficiary must have at least the equivalent of a U.S. bachelor's degree (ie., 4 year college or university degree) AND the job opportunity at which they will work in the U.S. must require at least a bachelor's degree in the field of study that corresponds with the employee's field of study.  For example, an Australian with a 4 year degree in computer sciences would likely qualify for an E-3 visa to take a job in the U.S. as a computer programmer or systems analyst.  Similarly, a person with an engineering degree would likely qualify for an E-3 visa to work for an engineering firm in the U.S. as a  structural engineer.  In contrast, an Australian with a political science degree is unlikely to be able to qualify for an E-3 visa to work in the U.S. as a physicist; and finally
• The beneficiary must be able to prove that they do not have an intent to permanently immigrate to the U.S.  The applicant must demonstrate their intent to eventually return to Australia. 

The E-3 visa typically allows the beneficiary to work in the United States for 2 years at a time and is, in theory, renewable indefinitely in two year increments.  Another really nice feature of the E-3 is that it allows the spouse of the E-3 visa beneficiary to also be eligible for employment authorization.  

Unfortunately, as I've mentioned above, there is one drawback to the E-3 visa.  In contrast to the H-1B visa, the E-3 beneficiary must initially prove and continue to prove that they at some point intend to return to Australia.  Unlike the H-1B, the E-3 visa does not allow a person to adjust to become a permanent resident of the United States (ie., the E-3 is not a dual-intent visa).   With that limitation in mind, the E-3 visa provides a great potential avenue of immigration for skilled Australian workers to come to the U.S. on a temporary basis. 

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