Intra-corporate Transfers (L-1)

The L-1 category allows companies to transfer executive, managerial, and specialized knowledge workers into the U.S. from affiliates abroad. It also allows foreign-based companies to transfer executive, managerial, and specialized knowledge workers to U.S. to set up new operations or work for existing U.S. affiliates.

The L-1 category's purpose and effect is to facilitate business and promote foreign investment into the U.S. by authorizing the admission and employment of non-U.S. workers without outward consideration of the potential displacement of U.S. workers. Unlike with the H-1b category, the L-1 employer need not secure a Labor Department determination that transferred employees are receiving the prevailing wage, or, for that matter, that they are receiving any wage at all. Neither is there an obligation to provide notice to potentially affected U.S. employees of the particulars of an L-1 employee's engagement. Instead, the law presumes that by facilitating the easy transfer of key management functions and those with institutional knowledge, international firms will grow their operations in the U.S. leading to the creation of new jobs and commencement of new economic activity, which inures to the benefit of the U.S. economy as a whole.

A multinational seeking to transfer employees from abroad to the U.S. must establish that it is a "Qualifying Organization" under the immigration laws. This requires a showing that the petitioning entity:

• Has international affiliates;
• Is or will be "doing business" in the U.S. and in at least one other country, directly or through affiliates; and
• Will continue to do so throughout the time it wishes to maintain its foreign employees in the U.S.

In seeking to establish qualifying organization status, USCIS may look to the affiliations between entities, the presence of interlocking corporate directorates, regular sharing of technical, financial, and research and development assets, and the petitioner's corporate gravitas.

USCIS rules define "doing business" as the "regular, systematic, and continuous provision of goods and/or services" by a qualifying organization, but the activity need not necessarily be carried on as a commercial enterprise. Religious groups and other not-for-profit entities may therefore qualify as an L-1 sponsor provided they meet the other regulatory indicia.

The Petitioner may seek transfer of employees engaged in executive or managerial, functions or those with specialized knowledge who have been employed abroad by the Petitioner. In most cases, the law requires employment by the foreign employer continuously for at least one year out of the past three. The employee may have visited the U.S. while a foreign employee without interrupting the one year requirement, but time spent in the U.S. will not count toward the required one year of employment.

Qualifications of Transferees

Executive

• Directly manages the organization or major components of it;
• Establishes organizational goals and policies;
• Exercises broad management discretion;
• Receives only generalized supervision.

Managerial

• Manages an organization or a component part thereof;Supervises and controls the work of others;
• as the authority to hire and fire if he supervises others, or operates at a senior level if he manages a function;
• Exercises discretion over day-to-day operations of the entity.

Specialized knowledge Individuals

• Possesses knowledge which relates to the U.S. employer’s product, service, organization, equipment, or business abroad and its application in international markets; and/or
• Possess an advanced level of knowledge or expertise in the organization’s processes and procedures.

The L-1 petition must describe whether the petitioner is seeking to transfer the employee for the purpose of establishing a new U.S. affiliate or working with an existing one, and whether the employee is to be engaged is an executive, manager, or specialized knowledge worker. The petitioner must provide different evidence on the basis of these elections.

If transferring the employee to establish a new office, the petitioner must demonstrate that it has secured premises to house the new office, that it has a qualifying relationship with the foreign employer, and that it has the financial ability to support the foreign worker and to begin doing business within the U.S.

If the employer is seeking to transfer an employee into an already established U.S. affiliate, it must demonstrate a qualifying relationship with the foreign firm, that the employee’s qualifications fit one of the three employee categories, and that the employee meets the one year continuous employment rule. It must also provide a description of the employee's job duties with the U.S. subsidiary. The work performed abroad need not have been the same as the employee's position in the U.S. If the employee to be transferred is also a major equity stakeholder of the foreign firm, the petitioner must demonstrate that the stakeholder's services will be temporary and that he will be transferred abroad upon completion of those services.

USCIS rules require adjudication of L-1 petitions within thirty days of filing, but if USCIS requests additional evidence to support the petition, the clock is reset and the thirty-day count recommences. In addition, this 30-day rule, is commonly ignored by USCIS. Petitioners who need a quick answer can request premium processing for an additional fee.

Upon grant, USCIS will either notify the consulate specified by the petitioner so as to permit the employee to apply for a visa, or will change the status of the employee already in the United States to reflect L-1 status.

Blanket Petitions

The procedures described to this point apply to one-off petitions. Larger firms, which may have thousands of employees and significant employee churn, would be subject to a crushing compliance burden if forced to demonstrate their qualifying organization status with each petition. As such, the law permits commercial employers (to the exclusion of not-for profits and religious ones) to secure grant of a blanket petition which streamlines the employee transfer process. Firms may qualify for a blanket petition on demonstrating that they:

• engage in commercial trade or services;
• have an office in the US which has been doing business for one year or more;
• have three or more domestic or foreign branches, subsidiaries, or affiliates;
• and either:
• have, in the prior twelve months, obtained approval of at least ten individual L-1 petitions for executives, managers, and specialized knowledge professionals (i.e. specialized knowledge employees who are also members of the professions); or
• have, on an aggregate basis with their affiliates, combined annual sales of $25 million or a US work force of at least 1,000 employees.

Grant of a blanket petition permits the employer to secure L-1 status for its executive, manager and professional specialized knowledge employees without having to reestablish the qualifications of the sponsoring entity with each employee transfer. Instead, the grantee may submit a short form application identifying the employee and describing the position and entity in which he is to be working in the U.S. On grant, the individual either secures a visa at a U.S. consulate or USCIS changes his nonimmigrant status while in the US.

The blanket petition also permits the U.S. employer to transfer the employee among different U.S. affiliates without notice to or prior consent from USCIS. If the employee's job functions change, the employer must complete a new certificate of eligibility.

The blanket petition approval is issued for a period of three years. The holder may extend the blanket grant indefinitely by resubmitting its petition and evidence of prior grant and by providing a report detailing, for the prior three years, the identity of employees transferred into the U.S., the employing entities, dates of admission, and whether the petitioner retains status necessary for a blanket grant. If the holder fails to seek indefinite grant by the expiration of the blanket petition, it will expire and the employer must thereafter seek employee transfers on an individual basis for three years, after which it will again be eligible for a blanket petition.

Duration of Admission

Employees holding L-1 status are permitted to reside in the U.S. for varying terms depending upon: (1) whether they are entering the US to establish a new office or operate an existing one, and (2) whether they are employed as executive/managers or as specialized knowledge workers. Employees establishing a new office are admitted to the U.S. for a one-year term subject to extension upon demonstration that the new office has, in fact, commenced doing business. Employees transferred to operating businesses will be granted initial terms of three years, which may be extended to seven years for executives and managers and five years for specialized knowledge workers. A specialized knowledge worker may be moved to an executive/manager position and obtain the longer duration of stay, but must have been in that status for at least six months prior to filing a petition for extension to the seven year maximum.

An employee who has reached the duration limit of the applicable classification must reside abroad continuously for one year before returning to the US in L-1 status.

Dual Intent

Unlike with some nonimmigrant statuses the L-1 classification expressly permits non-U.S. employees to pursue adjustment to permanent resident status while in the U.S. in nonimmigrant status as an L-1 transferee. While an employee is applying for, maintaining, and extending L-1 status they will not have to prove they maintain a residence abroad which they have no intent of abandoning. In addition, the U.S. employer may petition for an employment-based immigrant visa for the employee, and the employee may apply for permanent resident status or take other steps towards lawful permanent residency, all without affecting the employee’s L-1 status.

In allowing for this “dual intent,” the L-1 classification differs from other nonimmigrant classifications like TN, E-3, and F student status, which require the nonimmigrant maintain the intention to depart the U.S. upon the expiration or termination of their status and has no intention of relinquishing their residence abroad.

Status of Dependents

The L-1 employee may be accompanied by his or her spouse and unmarried minor (under age 21) children for the duration of his or her authorized admission, including extensions. These individuals are admitted as L-2 dependents. The spouse may secure employment without an employers' sponsorship upon obtaining an Employment Authorization Document (EAD), which is available as a matter of right. (This represents a distinct advantage over H-1b status, which bars spousal employment unless the H-1B spouse is the beneficiary of an approved I-140 immigrant petition or an H-1B extension beyond the six-year limit pursuant to specific provisions of AC21.) EAD’s are not available to minor dependents.