Immigration Law for Startups: Best Practices, Prime Options, and Common Pitfalls

…startups should have strong business plans with five-year staffing and revenue growth projections.

Startups must have evidence of their corporate existence and financial viability in order to seek temporary work visas, which allow foreign nationals to work and live in the United States. Once that evidence is readily available, startups should have strong business plans with five-year staffing and revenue growth projections. These business plans are required for the nonimmigrant visa petitions that must be filed with the appropriate U.S. immigration authorities, whether in the United States or at U.S. consulates overseas.

Startups seeking to hire foreign nationals should begin the interview process early to determine which of the various nonimmigrant (temporary) work visas would be best to seek from the U.S. immigration authorities. Nonimmigrant visas allow the foreign national to live and work in the United States for a fixed length of time. Although they do not lead to permanent residence, as an immigrant visa or "green card" does, some nonimmigrant visas can be renewed indefinitely. It’s best to start the interview process four months before the foreign national’s anticipated start date at the company to provide a cushion. The U.S. immigration authorities will want to see a detailed job description of the position sought to be filled, its education and experience requirements, and the foreign national’s qualifications. Collecting education and experience documentation from the foreign national is a time-intensive process. For some types of work visas, it requires translations and educational evaluations of the documents. Work visa application processing times at the U.S. immigration offices vary from as short as 15 business days, if a premium processing fee is paid, to as long as five months with regular processing. Planning ahead and reviewing the start date is critical.

…authorities will want to see a detailed job description of the position sought to be filled, its education and experience requirements, and the foreign national’s qualifications.

Startups should understand that U.S. immigration authorities are wary of new corporate entities. They should document as much as possible regarding their corporate existence, including operating licenses, corporate bank accounts, and signed and dated corporate leases.

Foreign-owned companies starting up in the United States are advised to have the business plans described above, showing corporate existence and financial viability, plus evidence of ownership of the foreign-owned and U.S. startup to meet certain visa requirements to transfer foreign personnel to the United States.

Startups should determine the length of time a foreign national will be needed and whether the employment will be short- or long-term as this may determine the type of nonimmigrant temporary work visa sought. Some short-term visas can be converted to long-term, indefinite visas. These are immigrant visas (or "green cards") and permit the individual to remain in the United States as a permanent resident. Early planning and review of the position is critical for the startup seeking a foreign national to work in the United States.

Startups can take advantage of certain nonimmigrant visa options ... in some cases without having to first apply through the U.S. immigration authorities…

Prime Visa Options

Startups can take advantage of certain nonimmigrant visa options that can help them to hire foreign nationals expediently, cost-effectively and, in some cases, without having to first apply through the immigration authorities in the United States. The following temporary work visas require no application through the U.S. immigration authorities in the United States and can be presented either at the U.S. consulate overseas, or at the U.S./Canadian or U.S./Mexican border:

• TN visa for professionals coming to the United States pursuant to the North American Free Trade Agreement (NAFTA). They can present their TN application at the U.S./Canadian border and be admitted for up to three years. Mexicans can present their TN application at the U.S. consulate in Mexico and will obtain a one-, two- or three-year TN visa stamp to enter the United States;
• E-3 visa for Australian nationals coming to work as professionals. They can apply for the E-3 stamp at a U.S. consulate and enter to work in the United States;
• H-1B1s for Singaporean or Chilean nationals coming to work as professionals pursuant to free trade agreements between the United States and Chile, and the United States and Singapore. They can apply for the H-1B1 visa at the U.S. consulate overseas and enter to work in the United States;
• Canadian nationals can enter the United States as L-1 intracompany transferees by processing at the U.S./Canadian border, or at an international airport by processing directly at these ports of entry without a formal work visa petition approval issued by the U.S. immigration authorities; and
• E-1 or E-2 treaty trader or investor visas can be processed directly by U.S. consulate officials overseas for certain nationalities without a formal work visa petition approval. Such work visa classifications are governed by rules. When used, they can save startups money, time, and effort.

Common Visa Pitfalls

Startups often unknowingly hire foreign nationals in the United States to work for them under the B-1 business visa. This visa is not a temporary work visa and does not allow foreign nationals to work in the United States. Further, certain nationalities are allowed to enter the United States without a formal B-1 visa stamp. This visa waiver program is reserved solely for short-term business trips. It is not to be used to circumvent U.S. immigration work visas.

All employers in all states must complete and maintain a Form I-9 employment verification form for each employee hired after November 6, 1986…

Startups also often hire foreign nationals without completing the mandatory I-9 employment verification form. All employers in all states must complete and maintain a Form I-9 employment verification form for each employee hired after November 6, 1986, the date the Immigration Reform and Control Act of 1986 was enacted. This applies regardless of the startup’s size. Employers must complete the Form I-9 in a timely manner, usually within three days of hire; have the employee complete and sign the appropriate Form I-9 section (section 1); review the acceptable documents presented by the employee; and complete section 2 of the Form I-9. Employers cannot, in the process of completing the Form I-9 discriminate or retaliate by actions, remarks, threats, over-documenting or requesting specific documents. Employees must be given the list of acceptable documents, found on page nine of the form. As companies grow, it is critical to establish and maintain a formal I-9 policy and conduct regular internal I-9 audits to be compliant and avoid heavy monetary fines resulting from U.S. government audits.

Startups often fail to record the work visa expiration dates, fail to timely commence an extension process, or fail to convert to an immigrant visa far enough in advance. Failure to do timely extensions or processing of an immigrant visa can lead to gaps of employment between the expiration date of the temporary work visa and the approval of the extension or an effective date of the immigrant visa. Such gaps can lead to employees being unable to work for periods of time. Startups should use case management systems to track work visa dates, ensuring compliance and timely extensions. All nonimmigrant visas are valid for only limited periods of time, which vary from one to three years. Extensions should be commenced within four to six months of the expiration date. Determinations to proceed with a green card process should be made within four years of the expiration date of the nonimmigrant work visa.

As companies grow, it is critical to establish and maintain a formal I-9 policy…

Startups often lack written immigration policies that include provisions for hiring foreign nationals, an I-9 completion and maintenance policy, and an E-Verify policy. As your company (and workforce) grows, development and implementation of immigration policies and practices will facilitate compliance with applicable U.S. immigration laws and minimize exposure to serious civil and criminal penalties. A single employee can trigger liability for I-9 violations.

This originally appeared as a JD Supra Perspective.