Cross Border Employment Issues: Essentials for Global Companies 39 Offices in 19 Countries
Introduction – Cross Border Issues • Expanding Operations Globally – Some considerations for when moving employees from outside U.S. into U.S. or from U.S. to other Countries Cultural Issues Data Protection Business Visitor Visas Employment Agreements U.S. Work Visas Concluding Employment David Greg Millstone Wald david.millstone@squiresanders.com gregory.wald@squiresanders.com +1.216.479.8574 +1.415.393.9828 or +1.305.577.7016 2
Cultural Issues • Country cultural issues • Local company culture • Integrating company culture 3
Data Protection and Privacy • Transfer of Employee Data -EU law requires an “adequate level of protection” Join the Safe Harbor Network – Notice – Choice – Onward Transfer – Security – Data integrity – Access – Enforcement Establish binding corporate rules – Requires advance approval Conclude a model contract between the EU and US entity 4
US Visa Process • Entering on permanent basis – Immigrant (green card) OR • Coming to the U.S. temporarily - Nonimmigrant Retain residence abroad Visiting or engaging in work related activities Presumed to have immigrant intent – Dual intent - only for H’s and L’s – E-1/2 - limited extent • Administering agencies Department of Homeland Security (DHS) – Customs and Border Protection (CBP) – Immigration and Customs Enforcement (ICE) – Citizenship and Immigration Services (CIS) Department of State Department of Labor 5
Entry Procedures • Approved petition, Notice of Action, I-797 • Visa Application at U.S. Consulate • Inspection - admission by CBP at U.S. port of entry • I-94 card - proof of legal status while in U.S. 6
Visitor Visas: Going Global • Is a visa required? • Short term vs. long term • Purpose of stay Tourism or Engaging in business related activities • In country registration • Work permit may be required 7
Business Visitors - US • B-1 Visa Foreign payroll Activity in U.S. benefits foreign employer – Business meetings, training, & joint development projects – Prohibited from engaging in active employment while in US – Travel patterns and lengthy (beyond a couple weeks) raise red flags Visa could be denied or traveler refused entry if improper use suspected 8
Business Visitors – US cont. • Visa Waiver Program 38 participating countries 90-day maximum stay Ineligible for extension or change of status Must first register online with Electronic System for Travel Authorization (ESTA) Must possess e-Passport and machine-readable passport • Canadians – visa exempt (all visas except for E) 9
UK - Business Visitors • Non-EEA nationals visiting UK for a short time to do business on their own or their employer’s behalf • Maximum stay in any one visit is 6 months; separate visits must not exceed 6 months in any 12 month period (academic visitors can stay for up to 12 months) • Work/employment (whether paid or unpaid) is prohibited regardless of duration of visit; permitted business activities limited • Visitor can be refused entry and receive a re-entry ban of between 1 and 10 years if Immigration Officer believes that there is an intention to take employment • UK is NOT part of the Schengen agreement • US nationals do not require visa stamp 10
Schengen Area • The Schengen Agreement abolished internal borders, enabling passport-free movement between 25 European countries. • The Schengen visa is a visitor visa; purpose of the visit must be leisure, tourism, or business • The following countries adhere to the Schengen Agreement : Austria; Belgium; Cyprus; Czech Republic; Denmark; Estonia; Finland; France; Germany; Greece; Hungary; Iceland (not a European Union Member State); Italy; Latvia; Liechtenstein (not a European Union Member State); Lithuania; Luxembourg; Malta; Netherlands; Norway (not a European Union Member State); Poland; Portugal; Slovenia; Slovakia; Spain; Sweden; and Switzerland (not a European Union Member State) • US citizens can enter without visa for travel up to 90 days 11
Select Countries • Canada Stay for less than six months Do not plan to enter the Canadian labor market Main place of business, and source of income and profits, is outside Canada Visa exempt: US (including LPRs), UK, Japan • Mexico Stay for less than 180 days Acceptable business activities are broadly construed May not receive compensation from sources within Mexico Visa exempt: US, Canada, Japan, UK and Schengen countries. 12
Select Countries, cont. • Brazil Permissible activities include: meetings, conferences, fairs and seminars; visit potential customers; and carry out market research Not authorized to work for any Brazilian company, regardless if paid or not Up to 90 days; can be extended for another 90 days Visa exempt: UK, Schengen countries and most South American Visas required for nationals of US, Canada and Japan • China (mainland) M visa for most business/commercial activities: Conferences, seminars or training sessions Business, fact-finding ” meetings, or conducting negotiations On behalf of the overseas employer Up to 90 days cumulatively within a calendar year Invitation letter required Citizens of Singapore, Brunei and Japan visa exempt for up to15 days 13
Employment • Expatriate or Expat An individual originally hired in one country and later assigned to work in another country for the same company or affiliate. • Foreign Hire A foreign national hired for local domestic position. • Secondment Employed in the home-country, but renders services for the host country entity. • Expat localization or transfer Temporarily transferred to host-country entity • Joint or co-employment Simultaneously working for both the home country and host country entity. The home-country relationship may or may not be subordinated and thus suspended or “hibernating”. 14
Expat Contract Considerations • At-will versus Fixed Term • Tax Equalization and Preparation • Expat Allowance/Cost of Living • Housing Allowance • Transportation To and from Assignment Local Home Leave • Moving and Storage Expenses • Personal or Emergency Leave • Language Lessons • Children’s Education • Social Security • Pension • Reassignment/Repatriation 15
Expat Contract Considerations (continued) • Health Benefits • Immigration Issues • Choice of Law • Confidentiality and Trade Secrets • Restrictive Covenants • Term of Agreement • Termination Grounds/Notice • Compensation and Benefit Plans • Stock and Option Agreements/Plans 16
Business Visas - The Alphabet Soup Common business categories: • Business visitors (B-1) • Intracompany transferees (L-1) • Treaty Traders and Investors (E-1 & E-2) • Professionals (H-1B, H-2A/B, TN, O, P) • Free Trade (H-1B1, Chile and Singapore; E-3, Australia) • Trainees (J-1 & H-3) • Students on Practical Training (F-1) 17
L-1 Intracompany Transferees • Intracompany Relationship: Parent, subsidiary, affiliate, branch or joint venture • Prior Employment Abroad: 1 year within 3 years preceding transfer to U.S. • Qualifying Capacity: Executive, Managerial (L-1A) “Specialized” Knowledge (L-1B) • Duration: L-1A = 7 years; L-1B = 5 years • L-2 for dependent family members (spouse/children) • Spouse eligible for work authorization • Dual intent 18
H-1B • For “ specialty occupation” • Minimum job requirements require attainment of at least a bachelor’s degree or equivalent in a professional field (such as engineering, sciences, law, architecture, accounting, business specialties, teaching, etc.); or requires a license • Up to of six years , in three year increments Can extend beyond if green card commenced no later than one year prior to end of 5 th year • Proposed rule issued extending employment authorization to spouses of H-1B workers in green card process 19
Additional H Visa Categories • H-1B1 – Chilean and Singapore nationals Specialty occupation (professionals) similar to E-3 & H-1B Annual quota of 6500 • H-2B – Temporary non-agricultural workers For seasonal employment, pro athletes (hockey, baseball) 66,000 annual cap Must test US Labor market • H-3 – Training visa For fields including agriculture, commerce, communications, finance, government, the professions, etc. Maximum period of 24 months • None provide for spousal work authorization 20
F-1 (Students) • Educational institution accepts for enrollment & issues I-20 School uses SEVIS systems through DOS • Students applies for visa at US Consulate • Curricular Practical Training (CPT) Approved part-time work during academic year • Optional Practical Training (OPT) Post-graduate work authorization to 1 year If STEM (degree in Science, Technology, Engineering or Math field) up to 29 months if work for E-Verify employer Cap Gap: F-1 status and OPT work authorization extended through H-1B petition validity commencement if change of status filed prior to expiration of OPT • Dependents – F-2; no work authorization 21
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