Rajiv S. Khanna
Immigration policy has always been the favorite whipping horse of recessionary economies. True to that practice, over the last two years, U.S. employment-based visas have been whipped into a form that is now almost unrecognizable. What makes matters worse is that an attempt to withdraw a petition after an RFE is issued is now a well-known trigger for an investigation by USCIS. These types of investigations can examine H-1 and L-1 cases filed by an employer over several years. Even for approved petitions, USCIS often conducts site visits to verify the accuracy of information that was provided in the petition and RFE responses. Thus, an ill-considered petition exposes the petitioner to substantial risk and expense. This article provides suggestions on understanding and complying with the new paradigm.

I. The H-1B Category
The H-1B category is the most commonly used employment-based visa for working in the U.S. H-1B visas are meant to be utilized by those foreign workers who are coming to the U.S. to perform services in a specialty occupation – an occupation that requires at least the U.S. equivalent of a bachelor’s degree in a specific subject. An H-1B worker must be employed with a U.S. “employer,” defined as a person, firm, corporation, partnership, contractor or other association or organization in the United States, with an Internal Revenue Service (“IRS”) tax identification number. U.S. branches and subsidiaries of an overseas company can also file H-1B Petitions.

Currently, the most common issues in H-1B filings are demonstrating the existence of a valid employer-employee relationship and a job opportunity whose existence is documented and demonstrably available throughout the period for which the H-1B approval is requested. United States Citizenship and Immigration Services (“USCIS”) formally articulated these concerns in a January 8, 2010 memorandum (commonly referred to as the “Neufeld Memo”), describing an employer-employee relationship as one where the employer has the right to control the means and manner by which the employee’s work is performed, and underscoring the importance of specificity of an offered job. The memo is available at http://forums.immigration.com/entry.php?234-H-1b-Employer-Employee-Memo-of-8-January.

A. Employer’s Right to Control – Deployment at a Client Site
India takes up more than one-third of the world-wide quota for H-1B visas, most of which are used by consulting companies who deploy their employees at client sites. Therefore, the Neufeld Memo, as it applies to the deployment of workers at client sites, is of significant concern to Indian companies.   Proving an employer-employee relationship and employer’s right to control the employee can be especially challenging in these situations. Below is a sample Request for Evidence (“RFE”) from USCIS listing the factors USCIS considers important in evaluating the existence of employer-employee relationship and particularly the employer’s right to control the work of an employee:

Sample H-B RFE from USCIS – Neufeld Memo
USCIS must determine if you have the right to control the employee through evidence that describes (with no one factor being decisive or exhaustive):

• the skill required to perform the specialty occupation;
• the source of the instrumentalities and tools needed to perform the specialty occupation;
• the location of the work;
• the duration of the relationship between you and the beneficiary;
• whether you have the right to assign additional work to the beneficiary;
• the extent of beneficiary’s discretion over when and how long to work;
• the method of payment of the beneficiary’s salary;
• the beneficiary’s role in hiring and paying assistants;
• whether the specialty occupation work is part of your regular business;
• whether you are in business;
• the provision of employee benefits;
• the tax treatment of the beneficiary;
• whether you can hire or fire the beneficiary or set rules and regulation on the beneficiary’s work;
• whether, and if so, to what extent you supervise the beneficiary’s work; and/or
• whether the beneficiary reports to someone higher in your organization.

As such, it is requested that the petitioner demonstrate an employer-employee relationship with the beneficiary through the right to control the manner and means by which the product or services are accomplished for the duration of the requested H-1B validity period by providing a combination of the following or similar types of evidence. This list is not inclusive of all types of evidence that may be submitted. You may submit any and all evidence you feel would meet the employer-employee requirement.

To demonstrate the employer-employee relationship and the existence of the right to control, the Neufeld Memo requires the petitioner to provide an end-client letter in support of all H-1B visa petitions that require deployment of foreign workers at client sites. Initially the end-clients, typically large companies, were reluctant to get involved in the H-1B process. But now, almost a year since the issuance of the Neufeld Memo, end-clients are increasingly willing to provide letters in support of H-1B petitions, as long as they are carefully drafted to avoid any unintended liability for the end-client. The following sample letter should provide sufficient legal protection to end-clients and also satisfy concerns raised by the Neufeld Memo.

[Sample End-Client Letter in Response to RFE from USCIS]
[End-Client’s Corporate Letterhead]

[Date]

[Addressed to: USCIS or Prime Contractor]

Re:Verification of work and anticipated duration

Dear Sir or Madam:

This letter is being provided at the request of [Prime Contractor] to verify the facts stated herein. All representations made are strictly for submission to the immigration authorities. No legal or equitable rights are created, modified or abrogated by this letter.

[Mr./Ms. H-1B Worker] is anticipated to contribute to our work in the capacity of a contracted [insert job title].   [He/she] will be performing the following job duties: [Detailed job description]

[Mr./Ms. H-1B Worker] will not be our employee. As long as [he/she] follows our standard workplace policies, we will have no responsibility to dictate how [he/she] performs [his/her] job duties.   We will also not be responsible for hiring, discharge, promotion, demotion, remuneration or any other incidents of [his/her] employment.

Currently, we have issued a work order for [6 months] but we anticipate the need for [his/her] services to go beyond that time to approximately [3-4 years].   For emphasis, we note here again, this statement is merely an expression of intent and is not a contractually or equitably binding commitment.

 ____________________

[Name]

[Title]

To ensure compliance, in addition to procuring end-client letters, all H-1B employers should consider applying the following policies and procedures to the extent applicable to their business model:

1. Implement procedures to ensure that the employer continues to supervise the employee even when the employee is working at an end-client location.
2. Establish work flows and document them to show how many times a week or month the employee reports to the employer. Prepare and maintain documentation that provides dates and substance of discussions with the employee.
3. Document that the employer has the right to control the day-to-day work of the employee. For instance, document that the employer determines for the employees the time they arrive and leave, amount of work they must do each day, qualitative standards for the work, and how to perform the work.
4. Document that the employer provides the tools or instrumentalities needed to perform the job. In many industries, that would mean providing items like laptops, desktops, printers and job-related software.
5. Document that the employer has the ability to hire, pay, and fire the employee. This can be documented through the employment contract with the beneficiary or through the initial job offer letter. Note, however, that there is no legal requirement that an employer must enter into an employment agreement with employees, H-1B or otherwise.
6. Document that the employer evaluates the work product of the employee. In the IT industry, this is akin to the review of a product before user acceptance. Even if the employer does not evaluate the employee’s completed work product, they may be able to demonstrate control over the employee by establishing performance review criteria, such as technical proficiency, ability to learn new material, client satisfaction, and communication skills.
7. Ensure that the H-1B employees are being claimed as employees for tax purposes (IRS Form W-2). During a recent compliance review/audit of a large health care client, we found that some H-1B physician employees were being paid as independent contractors (IRS Form 1099) instead of being claimed as employees, negating the existence of employer-employee relationship that is required under the law.
8. Document the employee benefits including medical insurance, paid vacations, bonuses, travel allowances (per diem), etc.
9. Document any training employer provides to the employees and the employee’s use of any such proprietary knowledge in performing the job.
10. Set up performance review processes and procedures and also create company-wide performance standards for all employees, no matter where they are deployed.
11. Reimburse employees for travel and similar job-related expenses. They should avoid letting end-clients directly reimburse H-1B employees.
12. Where possible, employers should add terms in their contracts with end-clients and vendors that specify that the employer has the right to control and manage how the employee performs their work, and the exclusive and sole right to re-assign the employee.
13. Employers should take responsibility for delegating end-client assignments to the employees.
14. Many of the above suggestions should also be incorporated in the employee handbooks.

B.In-house Deployment – Specificity of H-1B Job
If the H-1B employee is placed on an in-house project at the employer’s location, USCIS asks for specific details and proof that the employer has sufficient work for the employee on that project. Below is a sample RFE listing the factors that guide USCIS’s adjudication.

Sample H-1B RFE from USCIS for In-House Project
If the beneficiary will work on a project at your own location, provide evidence that demonstrates you have sufficient specialty occupation work that is immediately available upon entry into the United States through the entire requested H-1B validity period by providing a combination of the following or similar types of evidence. This list is not inclusive of all types of evidence that may be submitted. You may submit any evidence you feel will establish sufficient specialty occupation work.

• Copy of signed Employment Agreement between you and beneficiary detailing the terms and conditions of employment;
• Copy of an employment offer letter that clearly describes the nature of the employer-employee relationship and the services to be performed by the beneficiary;
• Copy of relevant portions of valid contracts, statements of work, work orders, service agreements, and letters between you and the authorized officials of the ultimate end-client companies to whom the end product or services worked on by the beneficiary will be delivered;
• Copy of a position description or any other documentation that describes the skills required to perform the job offered, the tools needed to perform the job, the product to be developed or the service to be provided, the method of payment, whether the work to be performed is part of your regular business, the provision of employee benefits, and the tax treatment of the beneficiary by you;
• Evidence of sufficient production space and equipment to support the beneficiary’s specialty occupation work;
• Copies of critical reviews of your software in trade journals that describes the purpose of the software, its cost, and its ranking among similarly produced software manufacturers;
• Proof of your software inventory;
• Proof of sufficient warehouse space to store your software inventory;
• Copy of the marketing analysis for your final software product;
• Copy of the cost analysis for your software product;
• Evidence of sufficient production space and equipment to support the production of your software;
• Evidence of how many man-hours it would take to complete the proposed project and of these – how many man-hours will be assigned to the beneficiary;
• What are the various stages of the project completion;
• Explain the beneficiary’s role in the project;
• How many other employees are engaged in the project and what are their respective roles in the project.

The above RFE is self-explanatory, requiring specific details of the project from any company that claims in-house deployment of an H-1B worker. USCIS does, however, permit a petitioner to provide evidence as it applies to the petitioner’s specific situation. For instance, warehousing space as mentioned in the RFE above will not be of concern to a software manufacturing company that delivers its product online. Nevertheless, if a particular item requested by USCIS is inapplicable to petitioner’s situation, it is important for the petitioner to explain why in its response to the RFE.

II. The L-1 Category
The L-1 category is typically used by multinational companies to bring foreign employees into the U.S. in an executive or managerial capacity (L-1A visa), or as a specialized knowledge worker (L-1B visa). To qualify for the L-1 category: (i) the beneficiary must have worked abroad for the overseas company for at least one year continuously within the previous three years; (ii) the company for which the employee has worked abroad must be a parent, branch, subsidiary or affiliate of the U.S. employer; and (iii) the beneficiary must have been employed abroad in an executive or managerial capacity (L-1A), or in a position of specialized knowledge worker (L-1B). USCIS is currently placing heavy emphasis on proof of the bona fides of the petitioning employer, past experience of the intended L-1 beneficiary, as well as the nature of the offered position in the U.S.

A.L-1A Visa – Defining Managerial and Executive Capacity
An individual in a managerial position is one whose primary duties are to manage the organization, department, subdivision or its function. This individual supervises other professional personnel or manages the essential functions of the organization, and exercises discretion over daily operations. Notably, supervisors who plan, schedule, and supervise the day-to-day work of nonprofessional employees are not employed in an executive or managerial capacity, even though they may be referred to as managers in their particular organization. To prove executive capacity, USCIS requires evidence that the employee is responsible for directing the management of the organization or of a major component or function. The evidence must also show that the employee establishes goals and policies, operates under minimal supervision, and exercises a great degree of autonomy in making business decisions. It is theoretically possible for an executive or a manager to be “in charge” of a function, rather than of people. But, USCIS requires that the function itself must not be directly performed by the executive or manager, failing which the position should be viewed as that of a staff officer or specialist. In other words, such manager or executive must not be primarily performing the tasks necessary to produce the product or provide the service of the petitioning employer.

L-1A Request for Evidence

• Submit a complete copy of Form 941, Employer’s Quarterly Tax Return for all the four quarters of 2009.
• Submit a copy of all Form W-2s and Form 1099s issued by the U.S. entity in 2009.
• Submit a copy of the Form W-3 and Form 1096 issued by the U.S. entity in 2009.
• Submit photographs of interior and exterior of the premises, which you have secured for the U.S. entity. These should include photographs, which clearly depict the organization and operation of the company as well as posted signs of the business name outside of the building Inside photos should show working areas, files, sample products, etc. and any employees. They should also include factory and work space, inside and outside of the office/building, equipment, merchandise, products, etc. Also, provide addresses and detailed directions to each facility.
• Submit complete copies of U.S. entity’s phone records for the last three months.

• Submit a copy of your business’ phone listing in both the white and yellow pages of your area’s phone/business directory.

• Submit samples of your advertising copy for print media, such as newspapers, magazines, and trade journals, used by business in the U.S. to promote your organization. Please indicate the name of the periodical, which published the advertisement, as well as the date on which the advertisement was published.

• Submit proof of business conducted at the location listed on the petition. Such evidence should include utility deposits and bills, rent receipts, etc. Provide copies of all city, county, and state business licenses. In addition, submit a letter from the owner of the building and/or management company on their corporate stationery, which verifies company occupancy. This should include information to show authorization for another company to sublease to your business.

• Submit letters from public or private professional, business, and trade organizations stating their knowledge of the U.S. company’s membership. Provide details as to the type of organization, purpose, membership requirements, and benefits gained by members.

• Submit a copy of the zoning map that shows the location of the U.S. company’s business premises to verify the listed addresses zoned for commercial purposes.

• Submit a copy of company’s business insurance policy or the business insurance policy from the building owner or management company, or from the sub-lessor. The policy must include the U.S. company and all its facilities and equipment. Include a letter from the insurer stating their knowledge of the U.S. company’s building occupancy.

• Submit a copy of the city or county fire department occupancy permit for the U.S. company. Provide a letter or other proof from the local fire department as to the permit’s validity, and their knowledge of the U.S. company’s building occupancy.

• Submit an organizational chart for the foreign entity, indicating the beneficiary’s position within this hierarchy.

• Describe the typical managerial responsibilities performed by the beneficiary abroad; for example, your method of evaluating employees under the beneficiary’s authority. Please articulate and submit documentary evidence of the managerial decisions made by the beneficiary on behalf of the foreign organization.

• In addition, please provide short answers to the following:

1. How many subordinate supervisors were under the beneficiary’s management?
2. What are the job titles and job duties of the employees managed?
3. What executive and technical skills were required to perform the overseas duties?
4. How much of the time spent by the beneficiary was allotted to executive duties and how much to other non-executive functions?
5. What degree of discretionary authority in day-to day operations did the beneficiary have in the overseas job?

• Submit additional evidence to establish the beneficiary has been employed abroad, in an executive/managerial capacity for one continuous year of full time employment within the three years prior to February 4, 2010. The documents to submit should include, but are not limited to:

1. The beneficiary’s last annual tax return and if applicable tax withholding statement reflecting the employer
2. Copies of payroll documents of the company reflecting the beneficiary’s period of employment and salary, and
3. Other unequivocal evidence establishing the foreign employment by the beneficiary.

• Submit a comprehensive description of beneficiary’s duties. Also indicate how the beneficiary’s duties will be managerial or executive in nature. For executive or managerial consideration, you must also:

1. Demonstrate the beneficiary functions at a senior level within an organizational hierarchy other than in position title, or
2. Demonstrate the beneficiary will be managing a subordinate staff of professional managerial or supervisory personnel who will relieve him from performing non-qualifying duties, if appropriate.

• Submit a list of your U.S. employees, which identifies each employee by name and position title. In addition, submit a complete position description for all of your employees in the U.S. Submit a breakdown of the number of hours devoted to each of the employees’ job duties on a weekly basis, as well as the educational requirements needed to fulfill their job positions.

The amount of detail required by RFEs has become quite cumbersome.   In addition to tax filings, the above RFE requires pictures of the company’s premises, phone records and listing, advertisements promoting the company, utility bills, rental receipts, proof of occupancy, evidence of membership in trade organizations (if any), zoning maps, and insurance policies. USCIS requires evidence that clearly indicates that the beneficiary is an executive or a managerial level employee and not merely a first line supervisor.

B. L-1B Category – Current Issues
An individual qualifying as a specialized knowledge worker, or L-1B employee, either has specialized knowledge of the petitioning employer’s product and its application in international markets or has an advanced level of knowledge of processes and procedures of the company.

SAMPLE L-1B RFE

Duties Abroad: Submit a more detailed description of the beneficiary’s duties abroad. Be specific. Provide timelines for training and experience. Additionally, explain how the alien’s employment abroad qualifies him to perform the intended services in the U.S. in a specialized knowledge capacity. A petitioner’s assertion that the alien possesses an advanced level of knowledge of the processes and procedures of the company must be supported by evidence describing and setting apart that knowledge from the elementary or basic knowledge possessed by others. It is the weight and type of evidence that establishes whether or not the beneficiary possesses specialized knowledge. Petitioner’s Product: Explain, in more detail, exactly what is the equipment, system, product, technique, research, or service of which the beneficiary of this petition has specialized knowledge, and indicate if it is used or produced by other employers in the U.S. and abroad Beneficiary’s Training or Experience: Explain how the beneficiary’s training or experience is uncommon, noteworthy, or distinguished by some unusual quality and not generally known to practitioners in the alien’s field in comparison to that of others employed by the petitioner in the alien’s field of endeavor. Specialized Knowledge position at the off-site work location: In order to establish that the beneficiary will be coming to the U.S. to perform duties in a specialized knowledge capacity, at the off-site employer’s work location, please submit the following additional documentation: Contracts: Submit copies of contracts, statements of work, work orders, service agreements between the petitioner and the unaffiliated employer or “client” for the services or products to be provided.

The above RFE describes many of the current issues we are currently facing in L-1B adjudications. Admittedly, not all of them are applicable to every case, but petitioners should be prepared for the entire gamut of possibilities.

1. Beneficiary’s Duties Abroad and Training
USCIS expects job description to be specific and detailed enough to describe the typical work day or week of the employee in non-technical terms, along with details of any applicable specialized training. The details of the training must include the number of hours of instruction provided, the time span over which the hours were spread, and the detailed content of the training. Evidence must be presented that the training is provided only to key employees of the organization and that the training or specialized knowledge obtained as a result of such training is not a matter of common knowledge within the industry.

2. Petitioner’s Product
USCIS requires a detailed and specific explanation regarding the petitioner’s equipment, system, product, technique, research, or service, and how it is distinguishable or unique in comparison with items available in the open market. We have successfully used the following types of evidence to satisfy this uniqueness requirement:

• Comparative market or feasibility studies conducted or commissioned by employer.
• Evidence of tie-ins for joint marketing with other companies who are willing to attest to the uniqueness of the petitioner’s product.
• Letters from clients who use the product.
• Articles in media about the product.
• Evidence from expert witnesses.

3. Specialized Knowledge position in USA
We need to address how the specialized knowledge that the beneficiary possesses will be required while working in the US. The level of specificity goes down to describing in lay terms what the typical workday or week of the beneficiary would entail. Generic statements are likely to be rejected.

4. Control of Employee
When an L-1B employee is posted at a client site, USCIS requires proof that the petitioner has the requisite employer-employee relationship. In effect, they are trying to ensure that the L-1B (and even L-1A) category is not being used merely as a device for staff augmentation at the end-client site. Consider this requirement to include most of what we have discussed in relation to the Neufeld Memo above. In addition to the existing contracts, work orders, etc., petitioner should also provide a letter from the end-client essentially in the format provided above under the discussion of Neufeld memo related control issues.

III.Conclusion

The cautionary conclusion in both H-1 and L-1 cases is that even before contemplating filing a petition, we need to ascertain whether or not we can meet the anticipated evidentiary requirements interposed by USCIS.

Rajiv is a member of the Virginia and District of Columbia Bars and the principal of the Law Offices of Rajiv S. Khanna, PC. His practice is focused on employment and business-based immigration and related litigation.  He can be reached at rskhanna@immigration.com.

Welcome to the India Committee!

As with past issues of India Law News, the Steering Group has decided that the Winter Issue should be devoted to a specific topic – for this issue, Immigration. Also in keeping with our most recent practice, we have a guest Editor for this issue, Poorvi Chothani. We wish to extend our heartfelt thanks to Poorvi for organizing this issue.

We welcome input from members of the India Committee for topics and how to best present India Law News. So far, we have enjoyed exceptionally strong interest from our members, which has helped mold India Law News into the quality publication it is today. Our next issue — which again will be topical — will deal with laws against corruption. As with prior issues, this is being published in conjunction with our webinar on dealing with corrupt practices.

At our Steering Group call on February 1, the Steering Group discussed numerous potential topics for our 2011 Summer issue. However, no decisions have been made as yet. If you have any ideas of interesting and worthwhile topics, we would enjoy hearing from you.

In our 2010 Fall Issue, we mentioned the possibility of a delegation of US lawyers visiting India. However, due to timing constraints, we were not able to organize this for early 2011. We are now starting early planning at organizing a program to be held in India (probably Mumbai or New Delhi) in the Fall of 2011 in conjunction with a visit by US lawyers. We will keep you posted on these developments as they unfold. In the meantime, we expect to have a number of members of the India Committee from India attend the ABA International’s Spring Meeting in April in Washington, DC.

Sincerely yours,

Vandana Shroff
Erik Wulff

 

 

By Kavita Mohan

United States Court of Appeals for the Seventh Circuit rejects Indian Muslim’s religious persecution asylum petition

Khubeb Vahora, a native and citizen of India, sought asylum in the United States claiming persecution based on his Muslim faith. The Immigration Judge (“IJ”) denied asylum and granted voluntary departure, and the Board of Immigration Appeals (“BIA”) affirmed. The United States Court of Appeals for the Seventh Circuit affirmed. Vahora v. Holder, 626 F.3d 907 (7th Cir. 2010).

Vahora and his parents left India for the United States in 2003 after Mr. Vahora witnessed two Hindu men holding down a Muslim man while a third Hindu man stabbed him during the 2002 riots in Gujarat. Once in the United States, Vahora’s father attempted to obtain a change of visa status to an employment based non-immigration visa. However, in 2005, when Vahora was 16, his illegal status came to the attention of law enforcement and the Department of Homeland Security thereafter initiated removal proceedings.

Vahora challenged the BIA’s conclusion that he had not established past persecution or a well-founded fear of future persecution. Vahora further asserted that the IJ who initially denied asylum erred in failing to administratively close his case at the outset, because, as a minor child in the custody of his parents, his case should have been treated together with that of his parents. Finally, Vahora claimed that the IJ failed to advise him of the potential ability to adjust his status through his father’s employment-based visa and that this failure required reversal and remand by the Seventh Circuit.

The Seventh Circuit found that the BIA’s conclusion that the harms suffered by Vahora did not rise to the level of persecution was supported by substantial evidence. Vahora did not present the Seventh Circuit with factually analogous cases in which petitioners were found to have suffered past persecution. The Seventh Circuit had, in fact, previously rejected claims in cases similar to Vahora’s. Vahora’s claim that the Hindu men responsible for the stabbing had inquired about him from his grandparents and a shopkeeper near his Uncle’s home was not sufficient to establish the possibility of future persecution on a country-wide basis, as required by federal regulations.

Next, the Seventh Circuit held that the IJ did not abuse his discretion in refusing to administratively close Vahora’s case. The record did not demonstrate that Vahora had properly made or maintained his request – Vahora had no grounds for immigration relief through his family, and had produced only incomplete information about the status of his parent’s case.

Finally, the Seventh Circuit rejected Vahora’s claim that the IJ should have informed him that he was eligible for relief through the adjustment of his status based on the possibility that his father’s request for change of status would eventually be permitted and his father may eventually have obtained an immigration visa. This chain of events was too speculative to impose a duty on the IJ. Further, there was no prejudice to Vahora. Vahora had never represented that his father’s application for a change of status was successful and in fact, his father was the subject of removal proceedings.

Illinois Appellate Court holds that Indian family court complied with Uniform Child Custody Jurisdiction and Enforcement Act in determining that parties resided in India in international custody dispute.

An Illinois appellate court recently held that the Illinois trial court erred in determining that Illinois had exclusive and continuing jurisdiction in an international custody dispute in which both parents maintained residences in India and the United States. In re Marriage of Akula, 935 N.E. 2d 1070 (Ill. App. 2010).

In 2002, the circuit court of Cook County entered a judgment dissolving the marriage of Malini and Vikram Akula and awarding Malini sole custody of their son, T.B.A. Several years later, in August 2009, Malini and Vikram enrolled T.B.A. in the International School of Hyderabad and Malini entered into a four-year lease for a home in India. The following month, Malini obtained a residential permit from the Indian government extending through April 2013.
Malini and T.B.A. returned to Illinois for a week in September 2009, after which they both went back to Hyderabad. In October 2009, Malini returned to Illinois without T.B.A. for back surgery and to attend a conference. While Malini was in the U.S., Malini and Vikram had an argument about T.B.A. and Vikram filed a series of petitions in family court in Hyderabad seeking sole custody of T.B.A. Malini, in turn filed a series of petitions in Illinois, claiming that she considered Illinois to be her and T.B.A.’s permanent residence.

The Indian family court found that both parties and T.B.A. were now “ordinarily residing” in Hyderabad, and that T.B.A., who was then in third grade, could not be moved from school in Hyderabad until he completed fifth grade. The Illinois trial court granted Malini summary judgment on the issue of jurisdiction, concluding Malini and TBA resided in Illinois, and Illinois had exclusive, continuing jurisdiction over the parties and subject matter under the Uniform Child Custody Jurisdiction and Enforcement Act (“UCCJEA”). The circuit court certified for appeal the issue of whether it had properly ruled that Illinois had exclusive and continuing jurisdiction because the Indian family court did not make a judicial determination in substantial comformity with the UCCJEA.

Under the UCCJEA, continued and exclusive jurisdiction is lost when the child, the child’s parents, and any person acting as a parent no longer reside in the state in which the original judgment was entered.

The Illinois Appellate Court held that the Indian family court’s finding that the parents and child are “now ordinarily residing” in Hyderabad necessarily implied that the presence of Vikram, Malini, and T.B.A. in India was not temporary or transient and that they did not presently reside in Illinois. The Court held that the Indian family court acted in substantial conformity with the requirements of the UCCJEA as enacted in Illinois, and that the Illinois trial court erred in its determination that Illinois had continued and exclusive jurisdiction over this case.

Kavita Mohan is a co-editor of India Law News and can be contacted at kavita.mohan@gmail.com.

By Krishna Palagummi

This article provides an overview of H-1B visa program, quotas, and how quotas and recent changes to the program impact businesses of Indian origin. The H-1B temporary work visa category is used by employers to bring skilled professionals from overseas to work in the U.S.  In order to obtain an H-1B visa, the position must require at least a bachelor’s degree, and the individual being petitioned for the H-1B visa must have at least a bachelor’s degree or its equivalent in a related field.  The Immigration Act of 1990 established for the first time a numerical limit, or cap, on the H-1B visa category.  The cap was set at 65,000 visas per each fiscal year (“FY”), which for immigration purposes typically begins on October 1^st and ends on September 30^th of the following year.

The H-1B quota was met for the first time in FY1997 and again in FY1998.  This was primarily because of the booming information technology industry in the U.S.  In 1998, under the Clinton Administration, Congress passed the American Competitiveness and Workforce Improvement Act (ACWIA), which temporarily increased the cap from 65,000 to 115,000 for FY1999 and FY2000, and then reduced it to 107,500 for FY2001.  However, because of the increasing demand for H-1B workers in the U.S., Congress passed the American Competitiveness in the Twenty-First Century Act in 2000, which further raised the H-1B quota to 195,000 for FY2001, FY2002, and FY2003.  Beginning FY2004, the H-1B cap was reduced to its pre-ACWIA number of 65,000.  In 2004, Congress passed the Consolidated Appropriations Act, which created a special H-1B quota of 20,000 visas per year for U.S. advanced degree holders (master’s degree or higher).  Since FY2005, the H-1B quota has two categories – the general H-1B quota continues to be 65,000, while the U.S. master’s quota is 20,000 visas per year.

Traditionally, the 65,000 H1-B quota was cumulative of all countries around the world.  However, in 2003, the United States entered into free trade agreements with Chile and Singapore, which created a new visa category (H-1B1 visa) within the 65,000 H-1B quota.   Effective January 1, 2004, the H-1B1 visa category provides Chile with 1,400 visas and Singapore with 5,400 visas each year.  This means that the general H-1B quota available to the rest of the world is only 58,200 in any given year.  Unused H-1B1 visas from Chile and Singapore are generally added to the subsequent fiscal year’s H-1B quota in the first 45 days.

For the past 12-15 years, there has been intense debate about the quota system for the H-1B visa category.  If there is a quota system, then what should the quota be?  If the quota system should be discarded, then how should the number of H-1B visas be determined?  There have been arguments presented for and against the H-1B quota and more importantly, for and against the H-1B visa program itself.  In order to better understand the H-1B quota, the downside of having numerical limits on the H-1B visa category, and how this impacts businesses of Indian origin, one must first consider and analyze the historical data surrounding H-1B visas.

 

Year	Total Available	Date Quota Reached Cap
FY1999 [10/1998-09/1999]	115,000	06/15/1999
FY2000 [10/1999-09/2000]	115,000	03/21/2000
FY2001 [10/2000-09/2001]	195,000	Unused: 31,400
FY2002 [10/2001-09/2002]	195,000	Unused: 115,900
FY2003 [10/2002-09/2003]	195,000	Unused: 117,000
FY2004 [10/2003-09/2004]	65,000	02/17/2004
FY2005 [10/2004-09/2005]	65,000 + 20,000	10/01/2004
FY2006 [10/2005-09/2006]	65,000 + 20,000	08/10/2005
FY2007 [10/2006-09/2007]	65,000 + 20,000	05/26/2006
FY2008 [10/2007-09/2008]	65,000 + 20,000	04/03/2007
FY2009 [10/2008-09/2009]	65,000 + 20,000	04/07/2008
FY2010 [10/2009-09/2010]	65,000 + 20,000	12/21/2009
FY2011 [10/2010-09/2011]	65,000 + 20,000	Ongoing as of 12/2010

 

In FY1997 and FY1998, when the quota was 65,000 visas per year, it was met quickly, prompting Congress to increase it to 115,000 for FY1999 and FY2000.  However, as shown above, the H-1B quota was met in about eight months in FY1999 and in about four months in FY2000, despite the significant increase in available visas.  However, in the years that followed, from FY2001 through FY2003, several thousand H-1B visas went unused.  When the quota was decreased to 65,000 (+20,000 U.S. masters) between FY2004 and FY2009, all H-1B visas were used.

These statistics reflect the reality of business needs in the United States.  Between 1997 and 2000, when industry was booming, there were significant filings.  Between 2000 and 2003, a combination of factors resulted in unused H-1B visas including, but not limited to, a substantial increase in the H-1B quota, a change in the U.S. administration in 2000, and the terrorist attacks in the U.S. on September 11, 2001 which resulted in an economic downturn.  Between 2004 and the early part of 2008, a combination of factors including steady economic growth, scarcity of qualified professionals in the U.S. to fill positions, and a decrease in the H-1B quota resulted in the H-1B quota being met shortly after opening on April 1 of each year,.  Once the global recession began in December 2007, many industries suffered large losses, resulting in smaller hiring budgets, including fewer visa sponsorships.  This is reflected in the number of H-1B filings for FY2010, which remained open until December 2009.  The FY2011 H-1B quota has not been met as of the date of this article (January 17, 2011).

 

H-1B Quota – Usage by Indian Companies

A substantial portion of H-1B visas each year is used by companies of Indian origin, that is, companies either owned by persons of Indian origin in the United States or India-based companies with ongoing business operations in the United States.  In FY2009, 6 of the top 10 H-1B filing companies were of Indian origin, accounting for a total of 4,654 visas.  This may not appear to be a lot when compared to the total number of visas available, but the U.S. was right in the middle of a deep U.S. recession in 2009.  In FY2008, 7 of the top H-1B filing companies were India-based.  These 7 companies accounted for a total of 11,944 visas.  In prior years, the number of H-1B filings by India-based companies was even greater.  The foregoing numbers do not reflect H-1B filings by other large India-based corporations and hundreds of small and mid-size Indian business entities.

Industry leaders have argued that the H-1B quota should either be increased, or eliminated altogether in favor a system in which industry needs dictate the number of H-1B workers each year.  In his March 2007 testimony before the Senate Committee on Health, Education, Labor and Pensions, Bill Gates of Microsoft Corporation presented a convincing argument that there should be no limit on H-1B visas:

[M]y basic view is that an infinite number of people coming, who are taking jobs that pay over $100,000 a year, they’re going to pay taxes, we create lots of other jobs around those people, my basic view is that the country should welcome as many of those people as we can get, because people with those great talents, particularly in engineering areas, the jobs are going to exist somewhere, and the jobs around them are going to be created wherever those uniquely talented people are…So, even though it may not be realistic, I don’t think there should be any limit. Other countries have systems where based on your education, your employability, you’re scored for immigration, and so these people would not have difficulty getting into other rich countries…

Bill Gates’ view is shared by other CEOs whose companies were in dire need of qualified foreign professionals but were unable to bring them to work in the U.S. due to quota limitations.  In the boom years, the H-1B quota numerical limit was the primary impediment to talented individuals reaching American shores for work.  But beginning in 2007, a new impediment emerged. The U.S. Citizenship and Immigration Services has been involved in heightened scrutiny of every H-1B case being filed, for the stated reason to curtail fraud and speculative employment (“benching”) by some employers. This has resulted in an overly strict adjudication process.  The USCIS now subjects H-1B employers to elaborate and often redundant document submission requirements, far removed from realistic industry practices.  All of this has had a direct impact on thousands of Indian companies.

In addition to burdening H-1B employers with painfully elaborate document requirements, there was another roadblock to the H-1B visa category recently.  In August 2010, a bill in the U.S. Congress passed into law which substantially increased the H-1B and L-1 filing fees for certain employers.  Employers with 50 or more employees out of which 50% are in the H-1B or L-1 categories are now required to pay an additional $2,000.00 per H-1B and $2,250.00 for an L-1 visa. The chief sponsor of the fee increase bill was Senator Charles Schumer (D-NY), who said: the bill raises fees on H-1B visas (for temporary skilled workers) for companies who have more than 50 percent of their employees on H-1B visas (this does not affect U.S. tech companies).  The bill also raises fees on L visas (given to multi-national transferees) for foreign companies.  The L visa is often used by foreign companies to circumvent the requirements of the H-1B visa.

Senator Schumer’s bill intended the fee increase to impact “non-U.S. tech companies,” or in other words companies of foreign origin.  To be sure, most companies utilizing the H-1B visa category happen to be of Indian origin.  This piece of legislation, although not specific in its language, specifically targeted Indian business.  Despite the protest from the Indian government, the fee increase remains in place.  As a result, there has been a further drop in the number of H-1B filings over the past few months.

In order for the U.S. to again attract talented professionals from around the world, it must break itself from the unwritten protectionist policies by addressing the H-1B quota issue, easing the visa adjudication process by making it more fair and reasonable, and desisting from passing draconian laws that have a direct negative impact on businesses of foreign origin.

 

Krishna Palagummi is an immigration attorney and advises companies in finance and technology industry domains.  He primarily handles business/employment immigration matters.  His practice is based in New Jersey.  He may be contacted at  kpalagummi@gmail.com

Sudhir Shah

It is always good to be attached to your roots! No matter how far the bird flies, it comes back to its nest at dusk. Indians residing abroad have a strong emotional bond to their mother country, and desire to stay connected and even participate in its development. For such persons, ease of travel to India is an important consideration. Foreigners are required to obtain a visa to enter India through air, land, or water. At the port of entry, an immigration check is conducted, which starts with the traveler answering questions on an arrival card, formally known as a Disembarkation Card, such as name, age, sex, nationality, place of birth and current address, intended address in India, and purpose and duration of stay to India. The foreign national has to furnish his passport, visa, disembarkation card and other relevant documents for scrutiny. Of course, increased security is inevitable in today’s climate. Nevertheless, many Indians residing abroad have long sought to return to India with greater ease.

The Constitution of India provides for a single forn of citizenship. Article 9 of Constitution specifically prohibits dual citizenship to any of its citizen who acquires foreign citizenship. The Citizenship Act, 1955 is designed to regulate the procedures for the acquisition, renouncement, and termination of Indian citizenship. The government of India has responded to concerns of Indians residing abroad for easier access to India and greater ability to enter into transactions relating to real property in India by enacting schemes for persons of Indian origin (“PIO”), known as the “OCI Card Scheme,” and the “PIO Card Scheme.” Although these schemes do not entitle a PIO to dual citizenship of India, they provide many valuable benefits.

Overseas Citizenship of India (OCI)

In September 2000, the government of India established the High Level Committee on the Indian Diaspora under the Chairmanship of Dr. L. M. Singhvi. The Committee submitted its report to the Prime Minister on January 8, 2002. Based on the recommendations of the Committee, the government of India decided to provide for Overseas Citizenship of India (OCI). The OCI Scheme took effect on December 2, 2005 through the addition of section 7A, 7B, 7C and 7D to the Citizenship Act, 1955. Although it may be referred to as dual citizenship, Overseas Citizenship of India is not dual citizenship of India and OCI card holders are not at par with Indian citizens.

Eligibility to become an Overseas Citizen of India

A foreign national who was eligible to become citizen of India on January 26, 1950 or was a citizen of India anytime thereafter, or belonged to a territory that became part of India after August 15, 1947, provided that his/her country of citizenship allows dual citizenship in some form or other, is eligible to become an Overseas Citizen of India. Minor children and/or grandchildren of such persons are also eligible to become Overseas Citizen of India. However, if the applicant has ever been a citizen of Pakistan or Bangladesh, then he/she will not be eligible for an OCI status.

The foreign national spouse of an eligible person can apply for OCI status only if he/she is eligible in his/her own capacity. Also, foreign-born children of Persons of Indian Origin are eligible to obtain an OCI card only if either of the parents is eligible to become an OCI. If both parents are Indian citizens, hold Indian passport and their child is a citizen of another country by birth, then such child cannot become an overseas citizen of India. However, such child is eligible to apply for a Person of Indian Origin Card. After the child turns 18 years old, he/she can apply for an OCI Card.

A person registered as an OCI is eligible to apply for Indian citizenship under section 5(1)(g) of the Citizenship Act, 1955 if he/she is registered as an OCI for five years and has resided in India for at least one year out of the five years before making such application. However, such person would have to renounce foreign citizenship because there is no provision of dual citizenship in India.

Benefits of an OCI Card

Section 7B of the Citizenship Act, 1955 confers certain benefits on holders of an OCI Card, such as:

• An OCI Card holder does not require a visa to visit India. An OCI Card itself is a multiple entry, multi-purpose life long visa to visit India.
• An OCI Card holder is exempted from periodic registration at the FRRO or the local police authorities regardless of the extent of stay in India.
• An OCI Card holder is issued for life and has no expiry date.
• An OCI Card holder and his/her family can use the NRI quota to obtain admission in educational institutions in India.
• An OCI Card holder can work and accrue salary from an Indian employer.
• An OCI Card holder may acquire, hold, transfer and dispose of immovable property in India except agricultural or plantation property.
• A PIO card holder may enjoy similar facilities under various housing schemes of Life Insurance Company (LIC), the State Government or other government agencies as provided to non-resident Indians (NRIs).
• At Immigration check posts, there are special counters for PIO and OCI card holders for speedy clearance.
• A PIO or OCI card holder is not obliged to pay extra fees applicable to foreign nationals at tourist sites such as national historical monuments.

Restrictions on an Overseas Citizen of India

• An OCI Card holder is not entitled to an Indian passport.
• An OCI Card holder cannot vote in India.
• An OCI Card holder cannot be a government employee.
• An OCI Card holder cannot be a candidate for Lok Sabha, Rajya Sabha, Legislative Assembly, and Legislative Council.
• He/she cannot hold constitutional posts such as that of President of India, Vice President of India, Judge of Supreme Court or High Courts of any state in India.
• An OCI Card holder cannot buy agricultural or plantation property in India. However, such persons can inherit the same and also sell or transfer such agricultural/plantation land in India.

Documents required for an OCI Card

• The application form for an OCI Card is divided into two parts. Form XIX Part A of the application form must be submitted online. It can be downloaded from the website http://www.mha.nic.in. After submitting the same, Form XIX Part B of the application form can be downloaded online and then filled in by hand in capital letters.
• A photocopy of the first and last page of the presently held foreign passport.
• In case the application is filled in India, an applicant must provide a copy of a valid visa to India or a residential permit for a minimum valid period of three months and copy of the all the pages of the Registration Certificate issued by the FRRO.
• Evidence of self or parents or grand parents,
o Being eligible to become a citizen of India at the time of commencement of the Constitution; or
o Belonging to a territory that became part of India after August 15, 1947; or
o Being citizen of India on or after January 26, 1950.
o These documents could include:
• Copy of the Indian passport; or
o (ii) Copy of the domicile certificate issued by the competent authority; or
o (iii) Any other proof as applicable.
• Evidence of relationship with the parent/grand parent, if Indian origin is claimed mainly on such relationship.
• Person of Indian Origin card holder must submit proof of being one. An attested photocopy of a PIO Card must be submitted along with the application.
• Four recent passport sized photographs with light colored background.
• An application fee of US $275 or equivalent in local currency through a bank demand draft payable in favour of “Pay and Accounts Officer (Secretariat), Ministry of Home Affairs” at New Delhi. PIO Card holders must pay an application fee of US $ 25 or equivalent in local currency. Should the application be filed in India, a fee of Rs.14,230/- is to be paid by demand draft and PIO Card holder needs to pay Rs.1,290/- in the same manner. In case of a minor PIO Card holder an amount Rs.7000/- is to be paid. There is no provision for a reduced or no fee OCI Card.
• Two photocopies of the Demand Draft paid for the OCI Card.
• A photocopy of the Surrender Certificate, in case the applicant was ever an Indian citizen and renounced Indian citizenship to become a foreign national.

Registration as an Overseas Citizen of India

An applicant who resides outside India should submit his application either to an Indian Embassy or Consulate of India having jurisdiction over the country of which the applicant is a citizen. If the applicant is not living in his/her country of citizenship, then the application may be submitted to either an Indian Embassy or Consulate of India having jurisdiction over the country where the applicant is ordinarily resident.

If a person wants to apply for an OCI Card while he/she is staying in India, then it may be done either by submitting the application in person or by sending it through Speed Post or Registered Post. The application may be filed at the Ministry of Home Affairs (MHA). Applicants can also file their applications with the respective Foreigners Regional Registration Officers (FRROs) in Delhi, Mumbai, Chennai, Kolkata, Amritsar, Hyderabad and Bengaluru.

Once the application is filed, there is a preliminary scrutiny of the submitted documents, after which the Indian Mission (Embassy) registers the applicant as an OCI and refers the case to Ministry of Home Affairs, India for further verification and inquiry. Should any adverse information be found during the preliminary scrutiny, the case would be referred to the Ministry of Home Affairs, New Delhi, India (“MHA”). The MHA may approve or reject the grant of registration within 120 days from the date of the receipt of the application. If the grant of registration as an OCI is approved by the MHA, the Indian Mission/Post shall register the person as an OCI.

If the Indian Mission, after preliminary scrutiny, registers the applicant as an OCI, the application shall be furthered to the MHA for additional verification and inquiry. During the verification, if any adverse information comes to light, the registration of the applicant as an OCI may be cancelled under section 7D of the Citizenship Act, 1955. In case the application is filed in India itself, then the registration of the applicant as an OCI would be done by the MHA and the above stated procedure would be followed. The complete procedure of registration as an OCI and granting an OCI Card may take 5 to 6 months. An applicant must present in person along with relevant documents to collect his/her OCI documents. None of the OCI documents would be sent through post or mail. An authorized person on behalf of the applicant may collect the OCI documents and the passport.

When a person is registered as an OCI, a permanent ‘U’ Visa (Universal Visa) is placed on his/her passport in the form of a sticker. Along with this visa, an OCI registration booklet will be provided to the OCI Card holder. On every visit to India, the overseas citizen of India would have to show the U visa on his foreign passport at the port of entry. In case the passport expires, the U Visa can be transferred to the new passport. However, until it is transferred, the old passport must be retained and produced on every visit to India.

Renunciation of Overseas Citizenship of India Card

An OCI Card is valid for the life of the holder. However, an OCI Card may renounce his/her OCI card by making a declaration and submitting it to the Indian Embassy or Mission in their home country where the OCI registration of such person was accepted. After receiving such declaration, the Indian Embassy may issue an Acknowledgement Form XXII A under Section 7C of the Citizenship Act, 1955. Once the person has ceased to be an Overseas Citizen of India, every minor child of such person shall also cease to be an OCI.

Cancellation of Overseas Citizenship of India Card

Section 7D of the Citizenship Act, 1955 provides that the Central Government may cancel the registration of an OCI card holder under certain circumstances. If any person registers as an OCI by means of fraud, false representation, or concealment of any material facts, the OCI status of such person will be cancelled. If the Overseas Citizen of India shows disaffection towards the Constitution of India, then the OCI card may be cancelled. If it is ever found that an Overseas Citizen of India has, during any war in which India may be engaged, unlawfully traded or communicated with an enemy or been engaged in, or associated with, any business or commercial activity that was to his knowledge carried on in such manner as to assist an enemy in that war, or the Overseas Citizen of India has, within five years after registration as an OCI, been sentenced to imprisonment for a term of not less than two years, then the Central Government of India may cancel the registration of an OCI Card holder. Also, if the Government of India is of the view that it would be necessary to do so in the interest of the sovereignty and integrity of India, the security of India, friendly relations of India with any foreign country, or in the interests of the general public, an OCI registration of a person may be cancelled. Once a person’s OCI status is cancelled, he/she would be blacklisted for all future visits to India.

Conclusion

An OCI Card provides practical advantage to its holder in traveling to India for business or employment. It also provides them with better legal rights while acquiring real estate and other moveable or immoveable properties in India without obtaining approvals from the Reserve Bank of India. This scheme was mainly launched to benefit the Indian Diaspora and provide them with hassle-free travel to their motherland. The number of OCI applications is on the rise. In 2006, the number of OCI cards issued was 6,279 whereas 10,457 OCI cards were issued in 2009. We expect that in the years to come, many more foreigners of Indian ancestry will opt for Overseas Citizenship of India cards.

Sudhir Shah is an Advocate based in Mumbai, India. He can be contacted at sudhirshah@sudhirlaw.com.

Hanishi Ali
Gabrielle M. Buckley

Lawful immigrants often wait years to obtain lawful permanent resident (LPR) status in the United States, or what is commonly referred to as a “green card.” Historically, relatively few people with LPR status absented themselves from the United States for extended periods of time. As businesses have become more international and employees are regularly transferred around the world, maintaining LPR status has become an important issue. After receiving LPR status, a person may opt to pursue a short-term career opportunity abroad or return to their home country for a few years for personal or family reasons. Many, however, forget the important requirement of maintaining their LPR status after it has been obtained.

This article will provide practical recommendations to assist LPRs in maintaining their lawful status if they are required to remain outside of the United States for an extended period of time. Additionally, this article will discuss the option of voluntarily surrendering LPR status, and its ramifications. We note that maintaining continuity of residence for naturalization (citizenship) purposes is a different issue from maintaining LPR status. This Article will address only the issue of maintaining LPR status. In order to ensure continuity of status for citizenship purposes, an LPR should not be outside of the United States for more than six months at a time.

Maintaining LPR Status

Under the Immigration and Nationality Act, an LPR is accorded the status of a “special immigrant” who is “lawfully admitted for permanent residence and one who is returning from a temporary visit abroad.” Generally, a person with LPR status in the United States may travel freely in and out of the United States. A returning LPR may present a Permanent Resident Card for admission to the United States if coming back to an “unrelinquished” lawful permanent residence in the United States after a “temporary absence” abroad not exceeding one year. LPR status may be lost, or deemed abandoned, if the United States Department of Homeland Security (“DHS”) believes that the LPR did not intend to reside permanently in the United States.

The issue of abandonment of LPR status is extremely complex, and decisions have varied from court to court, based upon the facts and circumstances of each case. LPR status is not a legal right but a revocable privilege, which means that an LPR may lose his or her LPR status. Some LPRs incorrectly believe that as long as they enter the United States within a 12 month period they will not be at risk of losing their status. The fact that an LPR enters the United States once a year, or even more frequently, for short visits may not be sufficient to maintain status, and s/he could still be found to have abandoned his or her LPR status. On the other hand, an LPR who lives outside the United States for over a year is not regarded as automatically abandoning his or her green card either. This may sound confusing but, in essence, whether one has abandoned his or her LPR status depends on the “intent” of the LPR rather than the length of time outside the United States. Intent of the LPR is a key factor, and DHS and the courts will look at whether the LPR intended to return to the United States to permanently reside.

Once a colorable claim to LPR status is made at the port of entry, the burden is on the DHS to prove the LPR has abandoned his or her permanent residence by clear, unequivocal, and convincing evidence. A colorable claim is made when the LPR presents an unexpired Permanent Resident Card and asserts that s/he has not abandoned his or her residence in the United States. The DHS and courts generally look at the following objective factors to determine an LPR’s intentions:
• The length of the person’s absence from the United States;
• The purpose for the person’s departure;
• The existence of facts indicating a fixed termination date for the stay abroad;
• A driver’s license issued within the past year reflecting the same address as that recorded on immigration documents;
• The continued filing of U.S. tax returns as a resident of the United States;
• The name and address of a U.S. employer and evidence that a salary has been paid in the United States within a reasonable period of time;
• Evidence of property ownership, whether real or personal, in the United States;
• The location of the LPR’s close family members;
• The location and nature of the LPR’s employment, e.g., U.S. versus foreign employer, permanent versus temporary employment abroad, fixed-term employment, etc.;
• Whether the LPR applied for a re-entry permit before leaving the United States;
• Where the LPR’s children have been educated.

The DHS Examination Handbook also sets forth items for inspection officers to look for when questioning an LPR with regard to his or her intent. These include possession of a round-trip ticket when entering the United States, and immigration entry documents showing the U.S. address as a hotel or “in care of” someone else. Courts have not looked favorably upon LPRs who take jobs abroad or enroll in long-term study abroad, such as a Ph.D. program. On the other hand, courts have been more understanding as to LPRs who need to remain overseas with family members who were under political threat or terminally ill.

Recommendations to Protect LPR Status

Unfortunately, there is no guarantee that anything but continued residence in the United States will ensure that a person will retain his or her LPR status. For LPR’s who must depart from the United States for employment or other reasons and wish to protect their LPR status, we recommend that they take the following steps:
• Obtain or apply for a re-entry permit before departing from the United States if the person will be out of the country for more than 10 months.
• Retain any real property they own in the United States, particularly property in which they have actually resided.
• If they own no U.S. real property, maintain a U.S. address, even if it is the home of a friend or relative.
• If the LPR will be employed abroad by a foreign corporation, obtain a letter from the employer indicating the length of time of the foreign assignment, including, if possible, a statement indicating that the employee will be transferred back to the United States as of a definite date.
• Keep bank accounts and credit cards active in the United States.
• Keep U.S. driver’s license current, ideally listing a U.S. address where they have actually resided.
• File federal income tax returns as a permanent resident.
• If possible, become a naturalized citizen before embarking on a lengthy absence from the United States.

Other Issues Related to Maintaining LPR Status

Tax Status
LPR’s generally are required to file federal tax returns as “residents” of the United States. In fact, case law has held that failure to file a federal U.S. tax return as a resident can be evidence of an intention to abandon LPR status. An LPR is considered a resident for income tax purposes. Therefore, even if the LPR does not earn any income in the United States, but earns income overseas in another currency, s/he is required to report his or her worldwide income as a U.S. resident. Depending on whether the United States has a tax treaty with the LPR’s country of citizenship, the LPR may be eligible for foreign tax credit to avoid double taxation. It is essential that the LPR consult with international tax/accounting advisors on all tax implications.

Re-entry Permits

When an LPR knows that he or she will be leaving the United States and will not be able to return within the next year, the LPR may apply for a “re-entry permit” with the DHS before departing from the United States. A re-entry permit is an entry document valid for up to two years, and the LPR must arrange to return to the United States prior to the expiration of the re-entry permit in order to make an application for a new permit, which also must be made when the LPR is physically in the United States. Each new application for a re-entry permit will be subject to increasing scrutiny by the DHS with regard to the LPR’s intentions; therefore, this should not be considered a long-term solution.
A re-entry permit does not guarantee the LPR’s readmission to the United States. It does certify that the U.S. government has accepted the person’s trip abroad as temporary. It should also be mentioned that an absence of more than one year from the United States will break the period of continuous residence required to become a citizen, even if a re-entry permit is issued.

Abandoning LPR status

Conversely, with increasing labor mobilization to fast growing economies such as India and China, many LPR’s find it burdensome to fulfill the responsibilities and requirements of maintaining LPR status and voluntarily abandon their status. A person may voluntarily abandon LPR status by filing Form 1 407 at a U.S. Consulate in the LPR’s country of residence or at the port of entry, and turning in his or her Permanent Resident Card. Abandonment of LPR status is an irreversible process. Individuals who surrender their LPR status may be entitled to travel on a non-immigrant visa to the United States in the future or pursuant to the Visa Waiver program, if applicable.
Abandoning LPR status can have serious tax implications. Certain long-term residents who have held LPR status for any part of 8 of 15 calendar years ending in the year they lose their status by abandonment or revocation are required to pay an “exit tax” on all global assets pursuant to The Heroes Earnings Assistance and Relief Tax Act of 2008.
“Covered” individuals are generally those with a net worth of $2 million or those who have paid $147,000 in income taxes in the past five years. LPRs who think that they might abandon their LPR status at some point should contact their tax professional prior to the 8th year of LPR status.

Conclusion

The law involving retention of LPR status has evolved primarily through case law, and has not been consistently applied or interpreted. Consequently, we can offer only guidelines, not hard-and-fast rules, as to how LPR’s who must be absent from the U.S. for extended periods of time may retain their permanent resident status. Under certain circumstances, an LPR may choose to either apply for U.S. citizenship or abandon their LPR status prior to their departure.
Hanishi T. Ali is the founder and managing partner at Mithras Law Group, based in Greater Boston, and is a qualified attorney in the United States, and a registered Solicitor in England and Wales, as well as Scotland. She can be contacted at hanishi@mithraslaw.com.
Gabrielle M. Buckley is a Shareholder with Vedder Price P.C. and chairs its Business Immigration Practice Group. Ms. Buckley serves on the ABA Commission on Immigration and is a past chair of the International Section’s Immigration & Nationality Committee. She can be reached at gbuckley@vedderprice.com.

Poorvi Chothani

“Globalization,” “the world is flat,” “reverse migration” – these are just some of the words used to describe the increasing movement of business and people across borders. The borders over the Internet are virtually non-existent. U.S. citizens of are accustomed to visa-free travel to most countries and, when necessary, are readily granted short terms visas. However, it is more difficult for an individual to move to another country for work. Business decisions are usually driven by economic opportunities; only later are the hurdles of moving people across borders addressed.

This article will describe some of the critical issues that arise in the cross-border movement of people.   These issues are especially relevant to Indian companies as they continue to establish new ventures or buy existing businesses outside India. We also answer common questions about Indian business and employment visas, with a focus on the increasing, inward flux of foreign nationals, many of whom are either returning to their country of origin or are expatriates eager to participate in India’s economic growth.

Issues in Global Immigration

Immigration laws differ from country to country but most are intended to protect local work forces and national security. In a post 9/11 world, security has been of paramount concern and in a post recessionary world, protecting the local work force is gaining importance. Many countries have special visa arrangements by way of treaties or otherwise, facilitating visa free travel or preferential treatment. For instance, under the North American Free Trade Agreement, citizens of member countries enjoy specific privileges with regard to travel within the region for work or business. Also, under the Visa Waiver Program, many European countries, the U.S., the U.K., Singapore, Japan, Australia, New Zealand, among others, permit visa free pleasure or leisure travel for their citizens for short periods.   Additionally, several European countries have collaborated to issue Schenegen visas to third country nationals, facilitating short visits for business or pleasure.

The visa category required for travel generally depends on the nature of the proposed activity in the foreign country. The duration of stay may sometimes influence the visa category.   It is important that the employer examines the laws of the country that the employee will visit and determine whether a business visa or work permit will be required. Travel for business is routine, especially among personnel of multinational companies. A business visa, which is usually easy to obtain, is suitable for short visits to explore business opportunities and to meet with clients or business associates. Employers often believe that sending individuals in connection with short-term assignments is permitted on a business visa. However, such individuals are often engaged in gainful employment or are involved in activities for which an employment visa is required. Failure to obtain the appropriate visa is a violation of the law and could result in deportation of the individual, detention in some instances, or pecuniary penalties.

Visa Processing Time and Validity

Visa processing time often depends on a combination of the applicant’s nationality and the country she proposes to visit.   The duration of the visa also varies considerably. For instance, the U.S. often grants multiple entry business visas with a validity of 10 years while the immigration officer at the port of entry in the U.S. determines the length of stay on each visit. A business visa for India may be granted for a maximum of five years permitting multiple entries but the duration of stay on each visit is limited to a maximum of six months. However, U.S. nationals could be granted business visas with a validity of 10 years.   In the U.K., applicants may ask for a specific duration, but officers are at liberty to grant a visa for a shorter duration.

Employment visas are generally issued for a minimum statutory period or for the duration of an employment contract, depending on the host country. In-country renewals or extensions may be permitted, but it is important to file timely applications and ensure that the foreign national worker does not fall out of status during the term of the employment.   Also, for most extensions, it will be necessary to show continued employment, and evidence of having complied with local tax and social security contributions among other things.

Visa applications are generally filed at the appropriate consulate of the host country that has jurisdiction over the individual, usually based on the place of her residence.   Consular posts are sometimes restricted from accepting applications from third-country nationals unless these individuals can provide evidence to show that they are lawfully resident in the jurisdiction where they file the application. Additionally, applications from a third-country national could be subject to additional checks or referred to the host country’s consular post in the foreign national’s home country. This could lead to unpredictable and/or extensive delays.

Some countries extend preferential visa privileges to nationals of specific countries. For instance, citizens of the European Union (“E.U.”) get preferential treatment in E.U. member countries. Also, some E.U. countries grant visa privileges to non E.U. countries, including the U.S., which enables nationals of these countries to enter the E.U. country where they wish to work and process the work authorization in country.

India extends privileges to foreign nationals who are persons of Indian origin (PIO’s) or are married to Indians or PIO’s. Meeting staffing requirements in India by employing foreign nationals who could be eligible for Overseas Citizenship of India or registration as PIO’s is advantageous because these categories permit visa-free employment, are not subject to a minimum salary requirement, and are either permanent or have extensive validity periods. Additionally, such individuals have preferential in-country registration requirements or are exempt from registration.

Almost all countries have laws that strictly prohibit the employment of unauthorized foreign nationals. The consequences of employing unauthorized foreign nationals may include fines and/or criminal action for lack of a visa or for missing or inadequate paper work. The company may also face a temporary or permanent ban on employing foreign nationals. In addition, the foreign national may be deported due to a visa or work authorization violation.

Employment Visas

It is important to understand the employment sponsorship requirements of the host country. Countries such as India, Australia, and the U.K. require that a formally incorporated entity or registered sponsor employ the foreign national. Therefore, it may be impossible to post an individual in a country where there is no qualifying entity. In other countries, it is necessary that the business entity in the host country is an affiliate or branch of the foreign entity where the foreign national was employed, often for a stipulated period of time. Informal affiliations with local businesses may not fulfill this requirement. Yet, in other countries such as Canada and the U.S., highly skilled workers could file petitions themselves to obtain independent work authorization.

When identifying employees for international postings, it is necessary to determine that the individual has the required qualifications to obtain an employment visa for the host country. Most countries have basic requirements to ensure that foreign nationals are not going to usurp jobs for which domestic workers are available. It is necessary to justify, at the very least, that the foreign worker is important for the employer, has important skills that are in short supply and/or will be employed at a high level post.

An employment visa is generally granted to render specific services in the host country.   Once the visa has been granted, the employee might be questioned by immigration officers when she arrives at the host country to begin her job. If the employee cannot clearly describe the job duties or what she describes is not consistent with what has been stated in the visa application, then she may be denied entry into the country. Each employee being deployed abroad should be carefully briefed about her visa, the specific laws that apply to her, or her employer and the job, as well as the consequences of a failure to comply with these laws. Even when describing the employee’s job duties in the visa application it is critical to ensure that the description is accurate and consistent with the visa requirements.

Many countries have laws requiring the payment of a minimum salary to foreign national employees.   For instance, no foreign national in India may be paid a salary of less than USD 25,000 per annum. In the U.S., employees on an H-1B visa (temporary workers) have to be paid the prevailing wages depending on the location of the work site, the qualifications of the individual, and her experience. In the U.K., intra-company transferees must be paid a minimum, prescribed salary if the transfer is for 12 months or less. The minimum, prescribed salary is higher if the work is for more than 12 months and/or if applying for an in-country extension. Similarly, under Australia’s 457 visa (temporary work visas), the employer/sponsor must ensure that the terms and conditions of employment provided to 457 visa holders are no less favorable than those provided to Australians to perform equivalent work in the workplace at the same location. If there is an Australian worker in this workplace performing the same duties as the foreign national, then the foreign national has to be paid the same salary as the Australian worker, unless the salary is more than AUD 180,000. Additionally, no foreign national should be paid less than AUD 47,480, nor should she be employed in a job for which the market rate is less than AUD 47,480.

Family Members and Dependents

In most instances a foreign worker is permitted to bring her spouse and children. Few countries extend this privilege to same sex partners, civil union or common law partners, or those in similar relationships. Most countries permit children to live with the working parent as long as they are minors. An important factor to be considered when deploying foreign nationals with families is whether the spouse (or qualified children) can work in the host country. Some countries and/or specific visa categories permit dependents to work. India, however, does not permit this and the spouse and/or qualifying children must obtain independent work visas.

Income Tax and Social Security Benefits

Though income tax and social security benefits are not strictly immigration issues, it is important to consider these issues when an individual is employed in a foreign country.   For instance, this is extremely essential when employing U.S. nationals because they are subject to tax on global income no matter where they are situated. As a result, an individual could be subject to double taxation unless there is a double taxation avoidance agreement between the U.S. and the host country. In most countries other than the U.S., income tax is generally levied on the basis of physical presence of the individual and/or a nexus between the source of income and the country levying the tax.

Immigration Implications of Certain Corporate Actions

As Indian and U.S. companies expand their operations locally and globally they often acquire existing businesses. Other corporate changes that typically have immigration consequences are stock or asset acquisitions, mergers, consolidations, initial public offerings, spin-offs, corporate name changes, changes in payroll source, and the relocation of an employer or its employees. Most corporate actions involve a large pool of employees, some of whom may be foreign nationals in the host country. Business lawyers often overlook the immigration issues relevant to these foreign nationals, resulting in serious consequences.

The consummation of a transaction by a corporation may have significant implications. First, visas or pending applications of employees could potentially be affected by the deal. Second, employers are generally barred from hiring unauthorized employees and are required to maintain documentation demonstrating that each of their employees is legally permitted to work in the particular jurisdiction where they are employed. Finally, companies may also be required to file additional documents to legalize the status of certain employees. Importantly, when acquiring a company in the U.S. one may have to address immigration issues with multiple government agencies, including the U.S. Citizenship and Immigration Services, or the U.S. Immigration & Customs Enforcement, the enforcement bureau of the U.S. Department of Homeland Security. Likewise, similar agencies in the U.K., Canada, Australia, and the E.U. enforce immigration regulations.

Applying for and receiving permanent residence rights in some countries, such as the U.S., may take several years and require a variety of filings with three different government agencies. The effect of corporate action on employees depends on the stage of each individual’s process at the time the transaction closes. The transfer of pending applications to the acquiring company also depends on whether it assumes all of the rights, duties, obligations and assets of the acquired company. Even the simple act of a corporate name change may result in immigration delays and/or compliance issues. The acquiring company and foreign national employees could face different issues depending on whether the transaction is a stock or asset sale or if the business is simply being reorganized.

Before closing a corporate merger or acquisition, or restructuring of a business, one should consider the following:

• Weigh the pros and cons of the acquisition or restructuring from an immigration perspective.
• Examine the potential cost involved in legalizing foreign national employees.
• Examine employment and immigration records to determine the level of existing compliance and the effect of potential compliance requirements.
• Identify all employees that are currently in immigration or visa status that might require additional filings in order to maintain their lawful status or continued employment.
• Check for unlawful immigrant employees.
• The company being acquired should have an authorized representative execute a sworn statement on behalf of the acquiring company expressly acknowledging the assumption of all obligations, liabilities and undertakings arising from or under attestations.

Conclusion

Transnational companies need to carefully assess immigration related issues before deploying personnel abroad, or engaging foreign workers. A similar analysis should be done before any corporate changes to ensure compliance and avoid problems, delays, and inconvenience.

Indian Employment and Business Visas – Frequently Asked Questions

Poorvi Chothani

What visa category should one apply for?

The visa category generally depends on the nature of proposed activity in the foreign country. It can be a business visa for short visits to attend business meetings, explore opportunities, establish businesses, purchase or sell industrial products, or to undergo training, among other things. In most instances, an individual who wants to work or take up employment in India requires an employment visa.

How long does it take to process an Indian visa?

The processing time depends on a combination of the applicant’s nationality and the consular post where she is eligible to file the application.

How long can a foreign national be employed in India?

An employment visa may be granted for an initial period of two years or the duration of the employment contract, whichever is less. It can be extended for one year at a time for a maximum of five years, after which the foreign national must obtain a new visa from her home country. There is no cap on the total duration of employment in India.

Do you need an Indian employer?

Yes, there has to be an Indian entity that will employ and sponsor the foreign national’s Indian visa application. In some instances, if there is no qualified Indian employer, a business affiliate or client may qualify as the sponsoring entity. The sponsoring entity must provide evidence of registration of a company under the Indian Companies Act, 1956, or proof of registration of a firm in the State Industries Department, the Export Promotion Council, or other recognized authority, industrial or trade body.

What qualifications should an individual possess to apply for an Indian employment visa?

The individual should be a highly skilled and/or qualified individual on a higher post, such as technical expert, senior executive, or manager, and should have important skills that are in short supply. Employment visas are not granted to individuals who will be employed in routine, ordinary, secretarial, or clerical jobs in India. The law does not define these terms and visa applications are adjudicated in an ad hoc manner at the discretion of the adjudicating officer.

What activities are permitted on Indian employment visas?

An employment visa is generally granted to render specific services in India.

Is it necessary to pay foreign nationals a mandatory salary?

In India, with limited exceptions, foreign nationals have to be paid a basic salary of more than USD 25,000. Payments made by way of perquisites to the foreign national cannot be included when computing the basic salary.

What benefits can be availed by family member and/or dependants of the applicant while on a dependant visa?

The spouse and children of a foreign national, who has been granted an employment visa, are generally granted co-terminus “X” or dependent visas. Dependents cannot take up employment in India on a “X” visa. If they wish to work, then they need independent employment visas.

Are foreign nationals working in India subject to Income Tax and Social Security payments?

All income earned by the foreign national while she works in India is taxable in India and the employer is subject to a withholding requirement. In some instances, the foreign national is deployed to India but continues to remain on the payroll of a foreign company. The Indian employer or sponsoring entity is responsible for compliance with the foreign national’s tax liabilities in India. In addition all residents in India are taxed on their worldwide income.

Additionally, employers and employees are required to contribute 12% of the salary to the local Public Provident Fund, with the employer withholding the employee’s contribution from her salary. In most instances, foreign nationals cannot benefit from these contributions unless there is an applicable totalization or Social Security agreement between India and the foreign national’s home country, granting credit to the foreign national for such contributions in her home country.

Under what circumstances are visa extensions or renewals granted?

In cases where business visas have been granted for a period of less than five years the visa may be extended for an additional period provided the gross revenue from the business activity (for which the visa was initially issued) is not less than INR 1 crore (approximately USD 220,000) per year. This revenue has to be achieved within two years of establishing the business. The first extension in such cases must be obtained from the Ministry of Home Affairs. The Foreigner’s Regional Registration Offices or the Foreigner Registration Offices may grant subsequent one-year extensions for a period that does not exceed five years from the date of first issue of the business visa.

An employment visa extension is granted where the application is timely filed and the Indian entity ensures that the foreign national worker is not out of status during the term of the employment.   Also, for most extensions, it is necessary to provide evidence of compliance with local tax and social security contributions among other things. Extensions of employment visas are granted for one year at a time, permitting the foreign national to live and work in India for a maximum period of five years from the date of first issue of the visa. After five years, the foreign national must leave the country and apply for a new visa in the country of her nationality.

Can third country nationals apply for Indian visas at a particular consular post?

An Indian visa is generally issued from the country of origin or from the country of habitual domicile, provided the period of residence in the latter is two or more years from the date of visa application. If the applicant has been a resident in a particular country for less than two years, her application will be decided at the discretion of the consular officer. The Indian consular post in the applicant’s home country is informed after the visa has been issued.

 

 

Poorvi Chothani is a founder and managing member of LawQuest, a law firm in Mumbai, India, and a Vice Chair of the India Committee. She is admitted to the New York State Bar with an LL.M from the University of Pennsylvania, and is registered as a Solicitor in England and Wales. Poorvi has been practicing law in India since 1984 and is admitted to the Bar Council of Maharashtra and Goa. She can be reached at info@lawquestinternational.com.