H-1B VS L-1: How to Determine Your Best Option
In order for a foreign national to legally work in the United States on a temporary basis, they must first file a petition with the United States Custom and Immigration Service (“USCIS”) to obtain a visa. This most often takes the form of an application for a non-immigrant visa. This is not the same process for individuals who are seeking immigration based on their job skills. Currently, in the United States, there are about twenty-two (22) classes of non-immigrant visas under which a foreign national may apply for admittance to legally work on a temporary basis. Of those twenty-two, there are two non-immigrant visas that are most commonly used in order to bring new foreign talent into the workforce in the United States. These are the H-1B and L-1 visas. Although these two visas have many similarities which may make it difficult to determine the best option for you or your employees, there are also enough differences that make the two very distinct options for those looking to bring talent into the U.S.
What Is An H-1B Visa?
An H-1B visa is a visa that applies to people who work in specialty occupations and has a number of qualifications that are required for an individual to meet in order to apply for this type of visa. These qualifications are separated into occupational requirements and personal requirements.
- The occupation is one that requires both theoretical and practical application of highly specialized knowledge;
- A bachelor’s degree or higher in a specific specialty is a minimum requirement in the United States for entrance into the occupation; and
- The occupation must qualify as a specialty occupation as evidenced by the completion of one of the following criterion:
- Bachelor’s or higher degree or its equivalent is normally the minimum for entry into that position OR
- The degree requirement is common in the industry across similar parallel position in similar organizations or the job is so complex that it can only be performed by an individual with a degree OR
- The employer normally requires a degree or a its equivalent for the position OR
- The nature of the specific duties are so specialized and complex that the knowledge to be able to perform them are usually only attained by the completion of a bachelor’s or higher degree.
As far as personal requirements are concerned, an individual needs to only meet one of the following criteria to qualify to perform services in a specialty occupation.
- Hold a U.S. bachelors or higher required for the specialty occupation from an accredited university or college OR
- Hold a foreign degree that is the same equivalent to a U.S. bachelor’s or higher required by the specialty occupation from an accredit university or college OR
- Hold an unrestricted license, registration, or certification that authorizes the individual to practice the specialty application and to immediately begin working in the specialty in the state.
What is An L-1 Visa?
An L-1 visa is typically referred to as the “Intracompany Transferee” visa and applies to employees of American companies who (1) work abroad and (2) want to transfer and continue their employment at a domestic office. The employee must have worked at the foreign office for at least one continuous year in the past three years, with time being allowed to be added up from within the three year period. However, any work done in the US will not count towards the one continuous year total.
L-1 Visas are generally broken into two separate visa categories: L-1A and L-1B. L-1A pertains to executives and managers while an L-1B applies to people with specialized knowledge. Under L-1A, the employee to be transferred must be a manager or an executive or what is known as a “function manager”. USCIS will generally look to whether an individual has managerial capacity or executive capacity in determining which of the three possible designations an employee may fall into. Under L-1B, the employee must have some measure of specialized knowledge. Specialized knowledge is knowledge that:
- Is valuable to the employer’s competitiveness in the market place;
- Is uniquely qualified to contribute to the U.S. 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;
- Possesses knowledge that can be gained only through extensive prior experience with that employer;
- And possesses knowledge of a product or process which cannot be easily transferred or taught to another individual.
If a company wishes to transfer a foreign employee from abroad to the US, they must establish that there is a qualifying relationship that exists between the two of them. In order to do this, the company must show that it (i.e. the domestic office) and the foreign employer are one and the same and that they have ownership and control of the foreign branch. This most typically applies when a company maintains many international branches outside of the US. To show ownership, a larger company may be able to demonstrate it by a letter from an authorized official and annual report. For a smaller company, the same result may be achieved through the providing of stock certificates, tax returns, or articles of incorporation.
Additionally, L-1 Visa may be issued to a company that is looking to open a new office if the business can demonstrate the business is currently active and operating. USCIS will look to the number of employees, growth in significant cash flow, presence of significant customers and clientele, or similar elements to determine whether an L-1 visa may be issue for a company’s expansion.
H-1B vs L-1 Differences
Although there are a number of differences between the H-1B and L-1 visa, there are a few differences that ultimately factor into which visa is the best option for you and your employee:
- Objective of the Visa
H-1B Visas are for those candidates who are planning to work as a professional for a U.S. based company or organization and who work in a specialty occupation.
L-1 Visas are for candidates who already work for a foreign branch of a U.S.-based company, or are planning to open operations in the US of a foreign-based company. This applies to both the L-1A and L-1B visas.
- Education Requirements
Currently, there are no education requirements for an L-1 visa other than the specialized knowledge requirement of the L-1B. Under the L-1B, the applicant’s specialized knowledge does not need to be in a specific field.
H-1B applicants must have a bachelor’s degree or higher and should possess specialized knowledge in their field. In certain cases, hands on experience may be substituted for educational requirements.
- Employer Eligibility
International companies with offices both abroad and in the US may petition to transfer a foreign employee to their US office or branch.
Only U.S. based companies may sponsor a foreign employees H-1B visa. Once approved, H1B visa holders may work for that corporation or employer only, unless they apply for an H-1B transfer.
- Visa Duration
Under the rules pertaining to the L-1 visa, an L-1A visa holder will have valid status for up to seven (7) years while an L-1B holder will have valid status for up to five (5) years.
H-1B visa holders may stay in the U.S. for three (3) years and may file for an extension of an additional three (3) years for a maximum of six years.
- Department of Labor Requirements
For an H1B visa to be issued, an employer must first gain approval from the Department of Labor (“DOL”) that states that for the position that is being offered, there are no qualified US citizens available to accept the position. To receive approval from the US Department of Labor, the employer must submit a Labor Condition Application (“LCA”) which contains information about the position such as the work description, location, and salary. The salary will be based on a prevailing wage of which the employer must meet or exceed the prevailing wage. Additionally, specific recruiting practices must be followed in order to satisfy DOL requirements and, only after such requirements are met, may an employer submit their labor application.
L-1 visas do not need to meet that requirement and, as a result, there is no need for approval from the Department of Labor to submit an L1 visa. An employer may apply for an L-1 visa for their employee so long as the employee meets the basics requirements of the visa.
It should be noted that both the H-1B and L-1 visas are visas of dual intent. A dual intent visa is a visa that will allow a party to enter and stay within the country with the understanding that the individual may eventually intend to immigrate permanently at some point in the future. This element makes both of these visas different than many other non-immigrant visas which only allow an individual to stay on a temporary basis with the understanding that they will eventually return to their home country.
This is a very general overview of the differences between the L-1 and H-1B visas and there are many potential issues that you may run into as you attempt to onboard your employee. Thus, we believe that it is important to speak to a qualified business immigration attorney to assist you in choosing the correct visa option for your situation and, eventually, with the preparation and filing of your paperwork to help reduce the chance of a denial. If you have any questions regarding this process or are in need of guidance in how to best comply with USCIS regulations, you can set up a consultation with any of our Reddy & Neumann, P.C. attorneys.