B-1 in Lieu of H1B – Will this Useful Category Survive?

The visa category known as B-1 in lieu of H1B is a lesser-known and frequently misunderstood option. This category is intended to permit foreign companies to send their employees to the United States temporarily, for the purpose of performing duties related to their foreign employment. The B-1 in lieu of H1B classification has been quite controversial over the years. Much of this controversy is related to abuse of the category. A discussion of the B-1 in lieu of H1B follows.

No Local Work for Hire

Despite the reference to H1B in the classification, a B-1 visa, even with the “in lieu of H1B” notation, never allows an employee to engage in local U.S. employment. In general, B-1 “business” visas are issued for business activities that do not involve the performance of day-to-day productive work duties. Among the permissible activities for B-1 status are:

1. Engaging in commercial transactions, which do not involve gainful employment in the U.S. (such as a merchant taking orders for goods manufactured abroad)
2. Negotiating contracts
3. Consulting with business associates
4. Litigating a court case
5. Participating in scientific educational, professional, or business conventions, conferences, or seminars
6. Undertaking independent research

B-1 in Lieu of H1B Requirements

The B-1 in lieu of H1B category allows a foreign company to place one or more of their employees at a U.S. location briefly, for the purpose of performing actual, productive H1B-type job duties. The worker’s salary must be paid by the foreign company and the money cannot come from a U.S. source, with the exception of reimbursement for expenses incidental to the temporary stay.

Purpose of the B-1 in Lieu of H1B

The B-1 in lieu of H1B category is intended to provide foreign employers with the flexibility to send employees to the U.S. to perform H1B-type tasks of short duration, without having to go through the administrative complexities and costs of obtaining the H1B petition approval first, which might prove prohibitive for a brief purpose. This is particularly useful for employers without U.S. affiliates, who would be unable to file H1B petitions for such workers. This can also be a helpful provision when the H1B cap has been exhausted, but appropriate services are needed in the interim. Of course, this category is not a substitute for the H1B category, and it is inappropriate to utilize the services of an employee in B-1 status for an extended period.

It is unclear how many B-1 in lieu of H1B visas actually are issued, as the U.S. Department of State (DOS) tracks the numbers of B-1 visas issued but does not separately track the notations on those visas. These visas were recorded simply as B-1 visas in DOS records. This category is used very sparingly and cautiously. Many U.S. consulates disfavor the B-1 in lieu of H1B classification and generally decline to issue such visas.

Analysis

Over the years, there have been questions about whether the B-1 in lieu of H1B would continue to be an option for employers. As recently as October 2020, the U.S. Department of State issued a proposed rule to eliminate this category altogether. Yet, at least for the time being, the category has survived. Still, it is limited and strictly scrutinized. Employers interested in using the B-1 in lieu of H1B classification should consult with a qualified attorney.

Originally published July 1, 2011, this MurthyDotCom NewsBrief has been updated for our readers.

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