Transferring High-Skilled Employees Across Borders | Business Roundtable

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The State of ImmigrationTransferring High-Skilled Employees Across Borders

Employers value the ability to transfer employees across borders since it can be crucial to complete projects and deliver products and services to customers. In contrast to the policies in other nations, the United States makes it difficult to transfer these valued workers into the country.

Employers value the ability to transfer employees across borders since it can be crucial to completing projects and delivering products and services to customers. In contrast to the policies in other nations, the United States makes it difficult to transfer these valued workers into the country.

Difficulty in transferring employees into the United States has frustrated multinational corporations, which use L-1 visas to transfer executives and managers and L-1B visas to transfer employees with “specialized knowledge.”77

“While as recently as FY 2006 the denial rate for L-1B petitions was 6 percent, the denial rate for L-1B petitions rose to 34 percent in FY 2013, after rising to 30 percent in FY 2012 — a more than five-fold increase in the rate of denials despite no new regulation changing the adjudication standard,” according to the National Foundation for American Policy.78 A related problem in the U.S. system is Requests for Evidence (RFEs), in which USCIS adjudicators ask for additional paperwork to justify an application. This request happens in approximately half of all L-1B cases. “RFEs can disrupt business operations and planning and result in delays for product development or client services,” noted the USCIS ombudsman in a 2014 report to Congress.79 In response to these concerns, the Obama Administration announced plans to issue additional guidance on international transferees.

Australia
To transfer an employee into Australia is straightforward, and adjudicators deny few cases and rarely issue requests for additional evidence. Tim Denney, managing director of Berry Appleman & Leiden in Sydney, said that, in contrast to the United States, the equivalent of the L-1 visa in Australia is “relatively easy.”80 The 457 visa in Australia combines the features of the U.S. L-1 and H-1B visas. An employer needs to demonstrate it will pay the market wage, and there are several ways to do that, according to Denney. The position also must reach a minimum salary threshold. Under Australian immigration law, a multinational corporation does not even need to maintain a presence in Australia to transfer an individual into the country to work. A U.S. entity can send someone to work for it in Australia, and the visa will be approved if the other criteria are met.

Singapore
Despite some recent changes, Singapore also remains a much easier place to transfer in employees than the United States. Employees transferred into Singapore do not need their positions tested via the new Jobs Bank, which is now required for some other positions in Singapore. Attorney Mark Chowdhry believes that gaining approval for an intracompany transferee is just as likely in Singapore today as in the past.87

Germany, France, the U.K. and Switzerland
In Germany, France, the U.K. and Switzerland (due to a bilateral agreement with the EU), an employer can transfer any EU citizen into another company in the EU without filing any immigration paperwork. In the U.K., employers transferring in non-EU employees experience an “exceptionally low denial rate,” provided the role is “genuine” and recognized as skilled enough by the U.K. government, according to attorney Emily King.88

A new EU policy on international transferees, set to take effect in 2016, would allow expedited approval (within 30 days) for managers, specialists and graduate trainees from non-EU countries to be transferred to work in a company’s EU entity. “The directive should do much to facilitate the movement of key workers for multinational companies,” according to experts in Europe.89

Today, for a non-EU citizen, an employee transferred into Germany must meet the same qualifications as the D visa, which means the individual generally needs to be in a professional or executive position and be paid comparable to Germans in those jobs. “Nonprivileged” nationals, such as Indian nationals, can stay in the country for three years after transferring as long as they earn a wage comparable to German nationals in the same positions. These workers must possess company-specific knowledge to qualify for the visa.

Until 2004, France had no formal regulations for intracompany transferees and some other aspects of employment-based immigration, with many cases decided based on internal agency memorandums and previous administrative decisions. To improve the situation, the government contracted with Karl Waheed’s law firm, based in Paris, to produce a white paper that recommended specific rules for intracompany transfers, which French authorities adopted. A non-EU employee transferred to work in France can stay for three years if he or she remains on the foreign payroll or up to six years (with a renewal after three years) if placed on the French payroll (and paid at least 1.5 times the state minimum).90

If an employer wishes to transfer a non-EU national employee into Switzerland within the same company structure, it can do so with no labor market test, particularly if it can show that the individual is part of the top hierarchy of the company or the entire position is moving to Switzerland. The length of time a work permit is granted depends on whether the employee is “on assignment” or “on a Swiss contract.” Someone working on a Swiss contract must be paid the local Swiss salary and pay taxes like a worker in Switzerland. Assignees from EU countries must also be paid a salary equal to Swiss salary levels.

Hong Kong
Employers applying to transfer high-skilled employees into Hong Kong usually find their applications approved, according to attorneys. Positions outside of banking, asset management and information technology, such as sales, are more difficult for companies. The Immigration Department is more likely to deny a case if it appears the market wage is not being paid and if the employer does not attempt to recruit locally. While rejections are generally rare, employers have experienced increased scrutiny of applications to transfer high-skilled employees into Hong Kong in the past year.

Canada
Although it has tightened its rules in the past two years, Canada also remains an easier place than the United States to transfer in high-skilled employees and managers. Attorneys in Canada do not report the type of large increase in denials on intracompany transferees experienced in the United States. One advantage in Canada’s favor is that nationals of many countries, including the United States, European nations, the U.K., Japan and Australia, are exempted from requiring a visa to travel to Canada and can therefore apply for intracompany transfer-based work permits at the port of entry.

Japan
Employers transferring high-skilled foreign nationals to work in Japan must pay a salary equivalent to that of a Japanese professional, and the individual must have worked for the company abroad as a specialist or an executive for at least a year. One area of denials for intracompany transferees in Japan is the issue of whether the company in Japan is truly a subsidiary of the company abroad, according to Yoshio Shimoda of ILS Shimoda in Tokyo.95


77. Daryl Buffenstein and Bo Cooper, Business Immigration Law & Practice, vol. 1, (Washington, D.C.: American Immigration Lawyers Association, 2011), p. 863. L-1B status for an employee with “specialized knowledge” has a maximum limit of five years. “Specialized knowledge” for L-1B petitions is “special knowledge of the company product and its application in international markets” or “an advanced level of knowledge of processes and procedures of the company.”
78. National Foundation for American Policy (March 2014), L-1 Denial Rates for High Skill Foreign Nationals Continue to Increase, NFAP Policy Brief.
79. Department of Homeland Security (June 27, 2014), Annual Report 2014, U.S. Citizenship and Immigration Services Ombudsman.
80. Interview with Tim Denney.
87. Interview with Mark Chowdhry.
88. Interview with Emily King.
89. Global Client Alert, Fragomen (April 22, 2014), “EU States Expected to Harmonize Immigration Rules for Intracompany Transferees by 2016.”
90. Interview with Karl Waheed. Waheed points out the six-year limit creates a conflict with French labor law since the statute permits indefinite employment in France after 18 months for almost all workers.
95. Interview with Yoshio Shimoda.

Score Breakdown by Country on Transferring High-Skilled Employees Across Borders

Germany
Germany 5.0

EU citizens can transfer into Germany without immigration processing. A new EU process in 2016 will make transferring even easier for non-EU international workers. Denials are considered rare, and employers must pay a wage that is comparable to that of a German in similar position.

View Germany Profile
Australia
Australia 5.0

There are few denials, and the process is considered easy; a company does not need to maintain a presence to transfer an employee into Australia.

View Australia Profile
United Kingdom
United Kingdom 4.5

EU citizens can transfer into the U.K. without immigration processing. Denials are considered rare if the U.K. government recognizes a position as highly skilled, which is sometimes an issue.

View United Kingdom Profile
France
France 4.5

EU citizens can transfer into France without immigration processing. A new EU process in 2016 will make transferring even easier for non-EU international workers. Transferees can stay three years or six years if placed on French payroll and paid at least 1.5 times the state minimum salary (about $30,000 a year). French labor rules are stringent.

View France Profile
Hong Kong
Hong Kong 4.5

Denials are rare for intracompany transferees, but there has been increased scrutiny in the past year.

View Hong Kong Profile
Switzerland
Switzerland 4.0

EU nationals currently can transfer into Switzerland to work on local employment contracts without immigration processing or checks on salary; EU nationals on assignment must be paid a comparable Swiss salary. Employers must pay non-EU employees at comparable Swiss salary levels. 

View Switzerland Profile
Canada
Canada 3.5

Rules on intracompany transferees, including for those with specialized knowledge, have been tightened in the past two years, but transferring employees is still considered easier than in the United States.

View Canada Profile
United States
United States 3.0

Over the past five years transferring high-skilled employees from abroad into the United States has become more difficult, especially transferring those with “specialized knowledge.” Denial rates reached 34 percent in FY 2013.

View United States Profile
Japan
Japan 3.0

Transferred individuals must be paid a salary equivalent to Japanese professionals; there is scrutiny as to whether a company in Japan is a true subsidiary of a company abroad.

View Japan Profile

About the Report

Business Roundtable selected the evaluated countries based on five criteria:

1. Worldwide university rankings;
2. Per-capita income;
3. Gross domestic product growth rate;
4. Net migration rate; and
5. Research and development investment.

After comparing each advanced economy relative to the five criteria, the top 10 countries (including the United States) were selected for the study: Australia, Canada, France, Germany, Hong Kong, Japan, Singapore, Switzerland and the United Kingdom (U.K.). Not coincidentally, these are the countries with which the United States competes most for foreign talent, particularly in science and technology fields.

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