The
intra-company transferee visa (L-1) is available
to employees of multi-national companies who are
being transferred to a parent, subsidiary, branch,
or affiliated company in the US. The L-1 visa may
be used to transfer an executive or manager, an
employee who has within the preceding three years
been employed abroad as an executive or manager
for one continuous year by a qualifying organization,
or a specialized knowledge employee, an employee
with “specialized knowledge” of the products, services
or procedures of the organization, to the United
States. In both cases the foreign national employee
has to have been employed abroad by the qualifying
organization for one continuous year in the three
years preceding the filing of the petition.
For
decades, the L-1 nonimmigrant classification
for intra-company transferees has been a
useful method for multinational companies
to transfer employees to the United States,
particularly after the standards were liberalized
by the Immigration Act of 1990 (IMMACT90).
Indeed, the L-1 classification has many
advantages over other types of nonimmigrant
classifications, including:
- no
annual limits on the number of foreign
nationals who can qualify for the category,
- no
prevailing wage standards,
- dual
intent whereby a foreign national can
apply for permanent residence without
an adverse impact on the nonimmigrant
status, and
- Employment
authorization (EAD) for spouses.
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| QUESTIONS
TO ASK YOURSELF |
|
| Q |
Does
a qualifying relationship
exist between the U.S. company
and the foreign company
abroad? |
| Q |
Will
both the foreign company
and the U.S company remain
open, active and viable
for the entire duration
of the employment in the
U.S.? |
| Q |
Has
the employee been employed
overseas by the transferring
organization for at least
one year within the past
three years? |
| Q |
Do
you possess knowledge that
is valuable to the employer’s
competitiveness in the market
place? |
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While the L-1 visa classification has many advantages,
it has its share of hurdles--especially the L-1B
specialized knowledge classification. The L-1B has
a shorter duration of authorized stay than other
employment-based nonimmigrant classifications, imprecise
meaning of the term "specialized knowledge,"
and restrictions on working at offsite locations.
Moreover, in the last few years, there has been
a perception within the government and the media
that the L-1 category is "vulnerable and susceptible
to fraud."
In this article we will look closely at, and try
to understand, the term “Specialized Knowledge,”
and what constitutes specialized knowledge. We will
also list the requirements that help an employer
and its specialized employees establish a strong
case for the L-1B.
What is “Specialized Knowledge?”
Specialized knowledge means knowledge possessed
by an individual whose advanced level of expertise
and proprietary knowledge of the organization’s
product, service, research, equipment, techniques,
management, or other interests of the employer are
not readily available in the United States labor
market. This definition does not apply to persons
who have general knowledge or expertise, which enables
them merely to produce a product or provide a service.
In October 1988, the INS issued a memorandum that
articulated a more liberal policy on the definition
of specialized knowledge. It stated that after 18
months of operating experience under the L regulations,
the interpretation and application of the definition
may have been more restrictive than Congress or
the agency intended. It stated that special
knowledge by an employee of the organization’s product,
service, research, equipment, techniques, management,
or other interests that is different from or surpasses
the ordinary or usual knowledge of an employee in
the particular field is sufficient. The memorandum
listed four characteristics of an employee who has
specialized knowledge. He or she:
- Possesses
knowledge that is valuable to the employer’s
competitiveness in the market place;
- Is
uniquely qualified to contribute to the United
States employer’s knowledge of foreign operating
conditions;
- Has
been utilized as a key employee abroad and has
been given significant assignments which have
enhanced the employer’s productivity, competitiveness,
image, or financial position; and
- Possesses
knowledge that can be gained only through extensive
prior experience with that employer.
Inspector General’s report on L-1 visas:
Because of the increased use of, and perceived abuse
of the L-1 visa, the Consolidated Appropriations
Act of 2005 required the Inspector General of the
Department of Homeland Security to examine the L-1
visa program and submit a report with recommendations
to Congress. Recently, the Inspector General released
its report, which concluded there were "vulnerabilities
and abuses" of the L-1 visa program. The report
also noted the following characteristics of the
L-1 category.
Number of Approvals: The number
of L-1 approvals began to increase in the late 1990s
and hit its peak in 2001, when the government approved
almost 60,000 L-1 petitions. In the years since
2001, the number of L-1 approvals has decreased
to between 40,000 and 50,000 each year.
Industry: The highest percentage
of L-1 visas has been in the information technology
industry. In fact, from 1999 to 2004, nine of the
10 companies that had the largest number of L-1
approvals were in the information technology industry.
Nationality: The majority of L-1
approvals are for beneficiaries of India, Canada,
the United Kingdom, Japan, and Germany. While there
has been relatively little change in the country-percentages
for L-1A managers and executives during the last
four years, the percentage of L-1B specialized knowledge
individuals per country has changed significantly
during the last four years. For example, the percentage
of L-1 beneficiaries from India increased from 10
percent in 2002 to 48 percent in 2005, while the
other top four country-consumers of L-1Bs either
decreased or remained constant. Canada’s use of
L-1Bs decreased from 25 percent in 2002 to 15 percent
in 2005; Japan’s use of L-1s decreased from 12 percent
in 2002 to 4 percent in 2005; and the UK remained
constant with 5 percent of the L-1B approvals in
both 2002 and 2005.
Destination in the United States:
During four of the last five years, not surprisingly,
the majority of L-1 visas have been for work in
California.
U.S. Consulate: The U.S. consulate
in Chennai, India, processed 13,222 L-1 visa applications
in 2005, almost three times as many L-1Bs as any
other U.S. consulate. The other highest posts included
London, which processed 5,903 L-1B visas, New Delhi,
India, which processed 5,664 L-1B visas, Mumbai,
India, which processed 4,602 L-1B visas, and Calcutta,
India, which processed 3,146 L-1B visas. (These
statistics are consistent with the increase in the
number of L-1B visas issued to Indians.)
These statistics are noteworthy in that they were
mentioned within the same report in which the Inspector
General concluded that there were "vulnerabilities
and abuses" of the program. While it is too soon
to gauge the impact the Inspector General’s report
will have on the L-1 visa program, Senator Chuck
Grassley (R-IA) immediately issued a press release
calling for action to close the "loopholes" in the
L-1 program. It is likely – at least in the short
term – that consular officers and U.S. Citizenship
and Immigration Services (USCIS) adjudicators will
begin to more closely scrutinize L-1 petitions.
In fact, the officers may try to make a link between
the statistics mentioned within the report and the
conclusion of abuses within the report, thereby
resulting in closer scrutiny of L-1 petitions for
foreign nationals from India working in the information
technology industry.
Proving Specialized Knowledge:
The L-1B Visa classification is for employees with
specialized knowledge. As noted above, this is currently
defined as special knowledge possessed by an
individual of the petitioning organization’s product,
service, research, equipment, techniques, management,
or other interests and its application in international
markets, or an advanced level of knowledge or expertise
in the organization’s processes and procedures.
Due to the imprecise definition of specialized knowledge,
proving the specialized knowledge is often the most
difficult hurdle in L-1B petitions. Petitioners
of L-1Bs should consider the following issues in
trying to prove specialized knowledge.
Proving "essential skills" or "specialized
knowledge":
At the threshold, specialized knowledge is proven
through the employer’s supporting documentation.
The employer, in its supporting letter, should describe
each element necessary for establishing eligibility.
The letter should include:
- The
nature of the company’s work.
- Whether
the enterprise is a new or existing one.
- The
transferee’s complete education and work history,
including positions held, number of employees
overseen, and special skills he or she possesses.
- A
detailed description of job duties the foreign
worker will perform in the United States.
- The
uniqueness of the specific skills and a description
of why this does not represent knowledge held
commonly in the industry.
- Prior
training needed to perform the contemplated
duties.
- Prior
significant assignments and knowledge that has
been gained only through extensive prior experience
with the company and, if possible, how that
has enhanced the employer’s productivity, competitiveness,
or financial position.
- Evidence
that the knowledge of a product or process cannot
easily be transferred or taught to another.
- Evidence
of the qualifying relationship between both
companies (the employer abroad and the petitioner)
and proof that they are engaged in the regular,
systematic, and continuous provision of goods
and/or services.
Be specific about the nature of the specialized
knowledge:
The DHS Inspector General found that L-1B petitions
often "contain highly technical language that is
not readily comprehensible to an adjudicator." While
the report opined that the vague definition of "specialized
knowledge" leads USCIS adjudicators to "believe
they have little choice but to approve almost all
petitions," the reverse may often be the case. If
adjudicators cannot understand the specialized knowledge,
they are more likely to issue requests for evidence
(RFEs) and/or denials of L-1B petitions. Thus, it
is imperative to be clear, concise, and specific,
in language that is “simple” but gets the point
across about the type of specialized knowledge.
Recognize that the definition of specialized
knowledge has two alternatives:
Either special knowledge possessed by an individual
of the petitioning organization’s product, service,
research, equipment, techniques, management, or
other interests, and its application in international
markets, or an advanced level of
knowledge or expertise in the organization’s processes
and procedures. Clearly explain how the beneficiary
acquired the special knowledge or advanced level
of knowledge and document it with proof, such as
training certificates, performance evaluations,
etc.
Distinguish the beneficiary’s specialized
knowledge from the knowledge in the general labor
market:
In a 1994, USCIS memorandum, the Acting Executive
Associate Commissioner for Operations instructed
officers to make a comparative assessment between
the beneficiary’s specialized knowledge and the
knowledge in the general labor market.
Distinguish the beneficiary’s specialized
knowledge from other employees in the petitioner’s
workforce:
When the L-1 visa program was created in 1970, the
Congressional Record stated that the L-1 category
was intended for "key personnel." Twenty years later,
Congress broadened the scope of the L-1 category
through IMMACT90 and made the L-1B category more
flexible for case-by-case basis. However, USCIS
often cites the Congressional Record from the 1970
legislation and imposes a standard of "key personnel"
that involves a comparison of the beneficiary’s
specialized knowledge with the knowledge of other
employees in the petitioner’s workforce. While this
may be improper under the current L-1B scheme it
is easier to address it earlier than fight about
the point later.
In some cases, USCIS has issued RFEs asking for
the names, positions, and case numbers for all other
L-1B beneficiaries that the company has transferred
to the United States. While there is nothing in
the statute or regulations that state specialized
knowledge can only be held by a relatively small
number of people in the company, petitioners should
be prepared to explain how the beneficiary’s knowledge
is unique or more advanced than the knowledge of
the "average" employee.
Sometimes specialized knowledge is easier to prove
to a U.S. consular officer through the blanket L
procedures than to a USCIS adjudicator through the
individual L procedures because the Department of
State (DOS) is arguably more expansive in its interpretation
of specialized knowledge. However, it is important
to note that for L-1B Intracompany transferees to
qualify under the blanket L procedures, the person
must be a specialized knowledge "professional."
Therefore, an L-1B person applying through the blanket
procedures needs proof of a college or university
degree or the equivalent professional qualifications.
Overcoming Processing Delays and the Five-Year
Limit:
The L-1B category can pose challenges in timing
at both ends of the spectrum: in applying for an
L-1B initially and in reaching the five-year limit
on L-1B status. The timing issues in applying for
an individual L-1B petition can be reduced through
premium processing of the petition. While the regulations
require the USCIS to process L-1 petitions within
30 days of filing, there is no way to enforce the
30-day processing time limit. Instead, the only
method to ensure that USCIS processes the petition
in an expedited manner would be to file a petition
and to request that it be premium processed. In
June 2001, legacy INS implemented a premium processing
program that guarantees processing within 15 calendar
days of filing for a premium fee of $1,000 per petition.
Still, after USCIS approves the L-1B petition under
the individual procedures, the beneficiary must
appear at the consulate for a visa (except for Canadian
citizens, who are exempt from visa requirements
and apply directly at a port of entry pursuant to
the North American Free Trade Agreement). The wait
time for an appointment at a consulate varies among
the consulates but can take anywhere from a few
weeks to a few months. To reduce the waiting time
for an interview, most consulates allow a beneficiary
to schedule an appointment at the consulate while
waiting for USCIS to approve the petition, although
the beneficiary needs to plan accordingly since
he or she will need the approval notice from USCIS
before he or she appears at the consulate.
The five-year limit on L-1B status creates a different
type of hurdle. An L-1B specialized knowledge employee
is limited to five years in the United States in
L-1B status. Due to the long processing times for
permanent residence petitions – particularly due
to visa retrogression in recent years – an L-1B
employee who wants to remain in the United States
will have to start the permanent residence process
within the first few years of entering the United
States. If the employee is approaching the five-year
limit and will not be able to file the I-485
application and obtain an employment authorization
document before the expiration of the L-1B 5 year
durational limit, the employee will have to rely
on the possibility of other strategies or return
home until they can enter on their green card or
qualify for a new L-1 visa.
The most common strategies include:
- filing for a change of status to H-1B
status, which provides the benefit of an additional
year of employment authorization and also the
possibility of extending beyond the six-year
H-1B limit, based on the provisions of the American
Competitiveness in the 21st Century Act;
- filing for change of status to L-1A status
if the employee has been working in a managerial
or executive position for at least six months
before reaching the five-year limit; or
- recapturing time in L-1 status for previous
stays that were seasonal, intermittent, less
than six months per year, or part-time when
commuting from abroad.
Filing
a Change of Status from L-1B to L-1A:
The regulations limit the availability of the full
seven years of L-1A status for someone originally
admitted in L-1B status to where a promotion occurs
from a specialized knowledge position to a managerial
or executive position. Specifically, the regulations
read:
When
an alien was initially admitted to the United
States in a specialized knowledge capacity
and is later promoted to a managerial or executive
position, he or she must have been employed
in the managerial or executive position for
at least six months to be eligible for the
total period of stay of seven years. The change
to managerial or executive capacity must have
been approved by USCIS in an amended, new,
or extended petition at the time that the
change occurred.
This provision caused some concern among immigration
advocates because there were denials in the
past at some USCIS |
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| An
employee in L-1B status
was recently promoted to
an executive position. Should
we change status to L-1A? |
| Changing
status from L-1B to L-1A
would be a good strategy
because the employee will
be entitled to a 7-year
maximum stay on L-1A as
compared to 5-year stay
on L-1B. The petition for
change of status to L-1A
from L-1B can only be filed
after being employed at
least six months in a managerial
or executive capacity. L-1A
may also pave way towards
a quicker route to Green
Card. |
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service
centers. Some adjudicators interpreted the regulation
to require approval of an L-1A petition before four
and one-half years of L-1B status had occurred.
Additionally, the final sentence of the regulation
made it appear that the practitioner must file two
separate petitions--one to notify USCIS of the change
in job duties, and another one six months later
to be eligible for the total period of stay of seven
years. The American Immigration Lawyers Association
(AILA) brought this problem to the attention of
USCIS in its March 23, 2006, meeting and the received
the following response:
The regulation requires that USCIS has "approved"
the change to managerial position at the time of
the change. This is in accordance with the independent
regulatory requirement that the petitioner inform
us of any changes in "capacity of employment." So
not only must the alien have been in the new position
for six months at the time of filing the extension
from five to seven years, but USCIS must have approved
that change when it happened. However, the centers
should not deny an extension request simply because
it was FILED during the final six months of the
five-year stay. It can be filed the last day if
need be, so long as the change occurred at least
six months ago. The reason for requiring the extension
at the end of six months is to establish the bona
fides of the promotion. This is an important fraud
deterrent--an appropriate indicator of the legitimacy
of the managerial position. Therefore if the filings
were to be combined after the beneficiary was in
the promoted position would not meet the requirement
that the beneficiary has been in the "position"
for six months since the petition record would only
reflect the original position. Therefore, with regard
to a promotion at or during the last six months,
premium processing would be the option.
Tips for filing Change of Status from L-1B
to L-1A:
- When
filing a change of status from L-1B to L-1A,
make sure that the beneficiary has been a manager
or executive for at least six months prior to
filing for the additional two-year period. Document
evidence of the change in duties and when it
occurred, and that the USCIS approved the change
at the time it occurred.
- When filing for the additional
two years within the last six months of L-1B
time, ensure that the person has been in the
managerial position for at least six months
at the time of filing and file premium processing.
- If filing a change of status from L-1B to
L-1A, consider whether the person may also qualify
for an H-1B. If a labor certification has been
filed for the beneficiary in the EB-3
category, or EB-2
if a Chinese or Indian national, then time the
filing of the cap case to ensure the beneficiary
can have indefinite extensions of stay in H-1B
status after the seventh year in L-1A status,
or fifth year in L-1B status.
- A beneficiary may change from L-1B to L-1A
if the US position qualifies, even if the beneficiary
was never a manager or executive in the foreign
office. But remember that the beneficiary will
not qualify for EB-1
status if that is the case.
Conclusion:
The L-1B, while it has its share of issues to watch
out for, can be a very useful tool in the immigration
“toolbox” of any company doing business in the US.
Its advantages – no annual cap, no prevailing wage
requirements, dual intent, and employment authorization
for spouses – far outweigh many of the alternatives
available. With skillful preparation and careful
documentation you can move your employees between
related companies as needed for good business practices.
Visapro can provide you with the expert guidance
necessary to be successful with your L-1 applications.
Our experienced Immigration attorneys are always
there to assist you.
Contact
VisaPro if you have any questions regarding the
L-1B Visa or need help in filing. Our experienced
attorneys will be happy to assist you.
We also cover the latest happenings on various other
work visas in Immigration Monitor,
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