International: Transferring employees to Canada or Mexico after an unsuccessful US H-1B Lottery

In brief

The FY 2021 US H-1B Lottery is now complete and employers have been notified whether their requests to file H-1B Cap Subject Petitions were accepted under USCIS' new electronic preregistration system. While one option may be to file an H-1B Cap registration request on behalf of these employees next year, this option would not provide employment authorization in the short term. Many employees in this situation are likely on US student visas and may be new and/or junior hires who employers want to keep within their company due to their great potential.
For companies that have Canadian or Mexican affiliates, a temporary assignment abroad may provide a means for the company to continue employment in a same or similar time zone and may also provide new paths to US work authorization in the future as an intracompany transfer. While travel restrictions due to COVID-19 may not allow for an immediate assignment, employers should begin conversations now to be ready to act once travel reopens and before US work authorization expires.

Transfer to Canada?

Canada has a number of work permit categories that depend on a the employee's nationality, work experience, education and prospective occupation. Individuals with at least one year of skilled, full-time work experience in the US may be eligible for an intra-company transfer (ICT) work permit if they will perform a similar occupation in Canada. Those working in a position that requires specialized knowledge would need to be able to demonstrate that they possess advanced expertise and company-specific knowledge of the organization's products, services, tools and methodologies. Initial ICT work permits may be issued for up to three years, and may be extended at least once. In some cases, there is a prevailing wage requirement which must be met for ICT applicants in a specialized knowledge position. In cases where the ICT work permit does not apply, other work permit strategies may be available based on the company's global mobility practices, and/or on the employee’s nationality.
Also depending on the employee's nationality, they may be able to submit their work permit application at the border. Otherwise, employees would need to apply for their work permit at a visa office before travelling to Canada. It may take several months before a person can begin working in Canada. As such, if a company is considering transferring their employees to Canada, we would recommend contacting a member of our Canadian immigration team for an assessment of the employees' work permit eligibility.

Transfer to Mexico?

Mexico has three applicable types of visas and immigration statuses. Their authorization and issuance depends on the time that the employee intends to stay in Mexico:  

  1. Visitor Business Visa / immigration status (no more than 180 days)
  2. Temporary Resident Visa / immigration status (1 – 4 years) 
  3. Permanent Resident Visa / immigration status (more than 4 years)

Visitor and Temporary Resident Visas / immigration statuses have two different modalities: 

  1. Lucrative activities (remuneration paid by a Mexican person or entity)
  2. Non-lucrative activities (remuneration paid abroad. Not authorized to receive any kind of compensation from a Mexican person or entity)

All visas in the modality of lucrative activities require a prior authorization requested by the employer before the National Migration Institute (INM). In all cases, Permanent Residents are allowed to perform activities paid by a Mexican source, without a special authorization. Nonetheless, the only alternative for a foreign national to become a Permanent Resident would be to apply as a retiree / pensioner. There are other alternatives derived from family bond with Mexicans or Permanent Residents. 

Future United States Planning

Even if the US H-1B Lottery wasn't successful this year, there may be other US options available in the future. The company may again pursue the H-1B Lottery in 2021 on the employee’s behalf. Additionally, there may be alternative US immigration options available to the US company (i.e. the O visa) in the near term or, after a one year assignment abroad with an affiliated company abroad, there may be the option to transfer the employee back to the US on the L-1 or E-1/E-2 visa.

Our US, Canadian and Mexican global immigration team, as well as our immigration attorneys around the globe, would be happy to discuss the options for and viability of assigning these affected employees at your company's locations abroad as well as any path for returning these employees to the US.

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