STRATEGIES FOR SUCCESS -WINNING YOUR L-1A CASE
By Farhad Sethna, Attorney © 2011 all rights reserved
Please note, as always that this article is purely for informational purposes only and it is not meant to be legal advice. All cases are different and unique in their own way. Therefore, this article is intended as general information based on my analysis and observations. For specific advice about your case, please contact a licensed professional.
The L-1A visa classification is for a intracompany transferee executive or manager. The L-1B is for aliens of specialized knowledge, and that requires a different set of criteria which will be covered on a separate article. This article concentrates only on the L-1A.
Where is the application filed?
As an initial matter, the L-1 application for proposed L-1 employees from countries whose citizens require a visa to enter the US must be filed in the USA with the USCIS (United States Citizenship and Immigration Services). Once it is approved by the USCIS, the employee will then apply for a L-1 visa at the appropriate US Consulate overseas. Citizens of Canada do not need visas to enter the USA and so can apply for L-1 classification with the USCBP (United States Customs and Border Protection) at a port of entry to the USA. Only the employer can file the application.
Factors in a successful L-1 application
There are four key factors that must be properly addressed in any L-1A application. These four factors are:
∙ Establish joint ownership, affiliation or legal relationship between the two companies.
∙ Establish that the position is either “executive” or managerial capacity.
∙ Show that the L-1A employee must supervise subordinates; and
∙ At least some of these subordinates must themselves be “professional” as defined by the immigration laws.
Thus, there are two steps in any L-1A application:
1. Qualifying the company; and
2. Qualifying the employee
Examining each of these items in further detail, let’s start with the issue of ownership.
The two companies must have a qualifying relationship to transfer L-1 employees to the USA:
It must be clearly shown through documentation that there is a legally supported relationship between the two entities. These two entities are: the entity overseas from where the employee is sought to be brought to the USA, and the entity in the USA for which the proposed L-1A employee is going to work. This relationship can be direct ownership such as a parent company overseas owning a majority of the stock of the US company or it could also be an affiliate relationship, where the owners of the company overseas are also the owners of the company in the USA. The overseas company and the US company can both be subsidiaries of a third corporation, whether in the US or overseas. Please note that simply having a trade or business relationship between the two companies does not make them affiliated.
The L-1A employee’s duties must be either of an executive nature or in a “managerial capacity”:
Simply put, what this means is that the L-1A employee mus be performing duties which are of a higher level than simply “day to day” activities of a normal enterprise. There is a detailed list of what constitutes both executive duties and managerial duties in the law. This list is as follows:
Managerial capacity means an assignment within an organization in which the employee primarily:
∙ Manages the organization, or a department, subdivision, function, or component of the organization;
∙ Supervises and controls the work of other supervisory, professional, or managerial employees, or manages an essential function within the organization, or a department or subdivision of the organization;
∙ Has the authority to hire and fire or recommend those as well as other personnel actions (such as promotion and leave authorization) if another employee or other employees are directly supervised; if no other employee is directly supervised, functions at a senior level within the organizational hierarchy or with respect to the function managed; and
∙ Exercises discretion over the day-to-day operations of the activity or function for which the employee has authority. A first-line supervisor is not considered to be acting in a managerial capacity merely by virtue of the supervisor’s supervisory duties unless the employees supervised are professional.
Executive capacity means an assignment within an organization in which the employee primarily:
∙ Directs the management of the organization or a major component or function of the organization;
∙ Establishes the goals and policies of the organization, component, or function;
∙ Exercises wide latitude in discretionary decision-making; and
∙ Receives only general supervision or direction from higher level executives, the board of directors, or stockholders of the organization.
As you can see, therefore, there are definite and very specific criteria for what constitutes “higher level” duties in order to qualify as either an L-1A executive or manager. This should not come as any surprise, because this is indeed a upper level employee classification. Further, the USCIS is typically very stringent when it comes to applying these requirements. Therefore, the USCIS requires evidence of these high level duties in order to meet the criteria set forth above.
The L-1A manager or executive must supervise employees:
Since the L-1A cannot be performing day to day activities of the company, it obviously stands to reason that the L-1A must supervise employees. If the L-1A does not supervise employees, then obviously the L-1A would have to be doing the day to day activities of the company which does not make the L-1A either an executive or a manager. In other words, in order to be an executive or a manager one must have subordinates who perform the day to day functions of the business.
The subordinates must be “professionals”:
Having subordinates in and of itself is not enough. In fact, the subordinates must be “professional” in the sense that they have at least a bachelors degree in their field. However, that again is not sufficient. Not only must some of the subordinates have at least a bachelors degree, but in addition, their jobs must require the services of someone with a bachelors degree. In other words, simply hiring someone with a bachelors degree in accounting and placing them as a bookkeeper does not meet the requirement that an L-1A supervise a professional. Since the position of a bookkeeper does not necessarily require the services of someone with a bachelors degree, even having a degreed employee in that position will not satisfy the USCIS. However, if the company hires a full time financial manager or accountant who holds a bachelors degree in accounting, AND is able to justify the need for a full time accountant, then the executive or manager may be deemed to be properly supervising a subordinate who is also a professional.
Obviously, this requirement can be very burdensome, especially for smaller or start up companies who typically outsource their professional work to third parties such as accountants, lawyers, marketing personnel, shipping companies, warehouses, etc.
Interestingly, the USCIS admits that the criteria for an L-1A manager for a business enterprise is very different (and significantly higher) than the duties of a manager of a domestic (US) business.
Again, to show the executive or managerial level of the job duties is necessary to spell out in as much detail as possible the exact job duty of the L-1A, the specifics of what that job duty includes, the types of interactions required for that job duty to be performed, and the amount of time spent per week or per day on each specific duty. It might be very helpful in such a case for a company to maintain a detailed log of the executive or manager’s duties and perhaps use a calendar software to keep track of these duties in order to preserve and compile this information.
Permanent immigration options for the L-1A manager or executive
As discussed in another article on this website, a successful L-1A employee can use that classification to apply for Permanent Residence (“Green Card”) in the USA without going through the cumbersome and expensive “PERM – Labor Certification” process. Since the L-1A is classified in the EB-1 (Employment Based-1) category for issuance of immigrant visas, there is typically no visa backlog for EB-1 immigrants. Thus, the L-1A is a pathway to immigrating to the USA for those genuinely qualified managers and executives who can meet the USCIS’ high standard of evidence.
I will end with the admonition from a reported decision, Matter of Church Scientology International, 19 I&N 593, 604 (Commissioner 1988), which stated:
“An employee who primarily performs the tasks to produce a product or provide services is not considered to be in a managerial or executive capacity.”
I do believe this one quote sums it up. To make a successful L-1A application, a qualifying company must show the combination of executive or managerial duties coupled with adequate support staff, some of whom are professionals, to show that the L-1A will not be performing the day to day activities of the company but who will truly be in an executive or managerial function.