L-1 Reform Act Implemented
Posted Jul 01, 2005
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The USCIS announced on June 23, 2005 that they will begin the implementation of the L-1 Visa Reform Act of 2004. As MurthyDotCom and MurthyBulletin readers may recall, this law was passed in December 2004 as part of the Omnibus Appropriations Act for Fiscal Year (FY) 2005. Information on this law and its L-1 provisions is available in several articles on MurthyDotCom, including our December 8, 2004 NewsFlash, Omnibus Bill Signed - USCIS Clarifications. Changes in the legislation were primarily aimed at restricting contract placement of L1B workers through agreements between the L-1 sponsoring employers and unrelated third-party worksite employers. The restrictions on offsite placement described here apply to L1B petitions filed after June 6, 2005, including any extensions or amendments of previously approved L1B petitions.
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Background
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The provisions apply to L1B workers and their employers. L1Bs are inter-company transferees of multinational companies who possess specialized knowledge pertaining to the particular sponsoring company product or advanced level knowledge of the processes and procedures of the company. Essentially, a multinational company is permitted to transfer a worker to its U.S. branch or affiliate if that person has some particular knowledge about the company's product or its operations. Controversy arose, however, as L1B sponsors did not limit the use of the services of L1Bs to direct work for the company or within the area of specialized knowledge. For a variety of reasons, some L1B petitioning employers engaged in the practice of placing the L1B employees at various client sites for contracted work. This raised the question of whether they were really working on matters that required the specialized knowledge required of an L1B. Concerns arose for a variety of reasons, including the fact that L1Bs, unlike H1B workers, are not subject to prevailing wage requirements or to limitations on how many L1Bs can work within the United States. Therefore, restrictions have been added that address the need to continue an employer-employee relationship between the L1B sponsor, or the L1B worksite employer, and the L1B employee.
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Restrictions on Offsite Work
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The L1B Visa Reform Act prohibits the L1B employee from working primarily at a location other than the petitioning employer's physical location in two situations. The first prohibited situation is one in which the individual's work is controlled and supervised by a different employer. The second is where the arrangement is in the nature of providing local labor for hire to an employer other than the petitioner, rather than a service that is related to the required specialized knowledge regarding the petitioning employer.
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Specialized Knowledge Work Allows Offsite Placement
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The required control and supervision of the L1B worker are interpreted by ultimate authority over that worker. The bar to offsite placement does not apply if the offsite work could not be performed without the specialized knowledge of the petitioning employer's product, service, or operations, as defined by regulation. This knowledge must be beyond ordinary job skills.
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One Year Abroad for All Petitions
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The L-1 Visa Reform Act also reinstates the requirement that all L-1 employees work for the qualifying foreign employer for one year out of the past three prior to coming to the U.S. on L-1 status. This rule had previously been reduced to six months for employees covered by a blanket L-1 approval. The increased time to one year working abroad applies only to new L-1 cases filed after June 6, 2005. It does not apply to requests for extension of persons who entered pursuant to an approved L-1 blanket prior to that date.
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Conclusion
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These changes are important for all L1B employers and employees. They should be prepared to document compliance with the requirements explained above, both in connection with L1B petition filings as well as with L1B visa requests at the consulate. They should expect higher levels of scrutiny in these applications and should plan accordingly.
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