39 Offices in 19 Countries

Cross BorderEmployment Issues:Essentials for GlobalCompanies

2

Introduction – Cross Border Issues

• Expanding Operations Globally – Some considerations for whenmoving employees from outside U.S. into U.S. or from U.S. toother Countries

Cultural Issues

Data Protection

Business Visitor Visas

Employment Agreements

U.S. Work Visas

Concluding Employment

David Greg

Millstone Wald

david.millstone@squiresanders.com+1.216.479.8574

gregory.wald@squiresanders.com+1.415.393.9828 or +1.305.577.7016

3

Cultural Issues

• Country cultural issues

• Local company culture

• Integrating company culture

4

Data Protection and Privacy

• Transfer of Employee Data -EU law requires an “adequate levelof 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

5

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

6

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.

7

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

8

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 inUS

– Travel patterns and lengthy (beyond a couple weeks) raisered flags

Visa could be denied or traveler refused entry if improper usesuspected

9

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 TravelAuthorization (ESTA)

Must possess e-Passport and machine-readable passport

• Canadians – visa exempt (all visas except for E)

10

UK - Business Visitors

• Non-EEA nationals visiting UK for a short time to do business ontheir own or their employer’s behalf

• Maximum stay in any one visit is 6 months; separate visits mustnot exceed 6 months in any 12 month period (academic visitorscan stay for up to 12 months)

• Work/employment (whether paid or unpaid) is prohibitedregardless of duration of visit; permitted business activitieslimited

• Visitor can be refused entry and receive a re-entry ban ofbetween 1 and 10 years if Immigration Officer believes that thereis an intention to take employment

• UK is NOT part of the Schengen agreement

• US nationals do not require visa stamp

11

Schengen Area

• The Schengen Agreement abolished internal borders, enablingpassport-free movement between 25 European countries.

• The Schengen visa is a visitor visa; purpose of the visit must beleisure, 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

12

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.

13

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

14

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”.

15

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

16

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

17

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)

18

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

19

H-1B

• For “specialty occupation”

• Minimum job requirements require attainment of at least abachelor’s degree or equivalent in a professional field (suchas 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 thanone year prior to end of 5th year

• Proposed rule issued extending employment authorization tospouses of H-1B workers in green card process

20

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

21

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 Mathfield) up to 29 months if work for E-Verify employer

Cap Gap: F-1 status and OPT work authorization extendedthrough H-1B petition validity commencement if change ofstatus filed prior to expiration of OPT

• Dependents – F-2; no work authorization

22

J-1 (Exchange Visitors)

• Participant in educational or cultural program

Students, professors/teachers, scholars

Trainees, specialists, au pairs, physicians

• Program administered through SEVIS (DOS) by:

University, Company, Organization

• Most programs have 18 month max

• Participant might be subject to 2-year home residencyrequirement b/f eligible for H-1B or green card

Possible waiver

• Dependents – J-2; work authorization for spouse

23

TN - NAFTA

• Canadian and Mexican nationals

• Coming to U.S. to work in profession listed on NAFTA schedule(i.e., engineers, accountants, lawyers, med. prof, scientists,teachers)

• Canadians apply at border (non-national dependents mustobtain visa at U.S. Consulate)

• Mexicans apply at Consulate

• Duration: 3 years for Canadians; 1 year for Mexicans

• Dependents – TD; no work authorization

24

O (Extraordinary Ability) andP (Athlete/Entertainer)

• O-1 - Extraordinary Ability in the sciences, arts, education,business, or athletics

O-2 - the artist’s or athlete’s support staff

O-3 - O-1’s spouse and/or children; no work authorization

• P-1 - Internationally recognized athlete or performer

• P-2 - Artist or entertainer of reciprocal exchange program

• P-3 - Artist or entertainer to perform, teach, or coach under aprogram that is culturally unique

• Visas available for accompanying/support personnel anddependents; no work authorization

25

Employment-Based Categories(Immigrant Preference Categories)

EB-1: Priority workers

EB-2: Advance-degree professionals & aliens ofexceptional ability

EB-3: Professional, skilled & unskilled workers

EB-4: Special immigrants

EB-5: Employment creation

26

Permanent Residency Flowchart EB-2/3

27

Employment Verification/Form I-9

• Applicable to all US employers and employees hired after11/6/1986

• Employee completes Section 1 on or before hire

• Employer must verify (inspect/record) documents w/in 3 days ofhire

• May need to reverify work authorization (Section 3)

• Must retain 3 yrs after hire or 1 yr. after termination, whicheverlonger

• E-Verify

Online verification of employment eligibility

Now used by 500,000 + employers

Pilot program with funding through 9/30/2015

Mandatory in some states and for federal contractors

28

DHS Continues Auditing Employers

0

500

1000

1500

2000

2500

3000

3500

FY 09 FY 09 FY 10 FY 2011 FY 2012

I-9 Inspections

29

Concluding Employment

• Termination Considerations

Contractual Obligations

Reinstatement of Suspended or Hibernating Contract

Governing Laws

• Localizing

Employment Issues

Visa Process

30

Worldwide Locations