Throughout the campaign season, President-Elect Trump vowed to re-negotiate the North American Free Trade Agreement (NAFTA), which he characterized as the “worst trade deal in history.” Mr. Trump has threatened US withdrawal from NAFTA, absent satisfactory renegotiation with Mexico and Canada, our NAFTA partners. This threat has serious implications for the TN (Trade NAFTA) immigration category. With a new and radically changed administration, employers need to reduce their exposure to immigration risks associated with sudden changes in policy.
TN: Canadian and Mexican Temporary Professional Workers
The TN temporary immigration category is available exclusively to citizens of Canada and Mexico. The category is further limited to a designated list of professional occupations.
The TN category is widely utilized by US businesses. Companies with offices in the US and Canada and/or Mexico often rely on the TN category for key members of their workforce. The advantages of the TN category include an abbreviated application process, unlimited extensions and no annual limit or “cap” on utilization.
NAFTA Uncertain Under Trump, Assess TN Alternatives
The future of NAFTA is uncertain under a President Trump. Thus far, Canadian Prime Minister Justin Trudeau has stated that he is ready to discuss and renegotiate NAFTA. Mexican Foreign Minister Claudia Ruiz Massieu has confirmed Mexico’s willingness to “modernize” NAFTA, but not renegotiate. In light of this, companies which rely on the TN category should evaluate long term options and plan for the possibility that the TN category could be changed or eliminated, permanently or temporarily.
Primary Alternative Options
Permanent Residence: Unique Commuter Option
There is no limit on the number of years a person can hold TN status. Thus, there are many foreign nationals who have worked in the US in TN status for many years. Some of these individuals alternate between working in the US and working in Canada or Mexico. With the uncertainty brought on by a Trump administration, both for the TN category and US immigration in general, it is time to consider permanent immigration options for these long term employees.
US permanent residence (green card) status via employer sponsorship is typically a lengthy process. However, for native-born citizens of Mexico and Canada, the outlook and time frames are more favorable than for nationals of India and China. Additionally, there is a unique provision in the law which allows a US permanent resident to reside in a foreign contiguous territory and commute to a job in the US. Thus, it is possible for an employee to reside in Canada or Mexico as a US permanent resident, provided the individual commutes to a job in the US.
H-1B: Cap Timing Hurdles
The H-1B temporary professional worker category is a potential option for many current TN employees. Almost all designated TN positions require a bachelors or higher level degree as a prerequisite. Thus, these positions often fit neatly into the H-1B category requirements.
The primary hurdle for employers considering the H-1B category is the annual limit or “cap.” Cases filed for first-time, cap-subject beneficiaries can only be filed during the first five business days of April annually. Companies should identify their H-1B candidates by January each year, so ample time remains for H-1B petition preparation. Complicating matters further, the H-1B cap limit is not sufficient to meet the demand in this category. Thus, the US Citizenship and Immigration Services (USCIS) conducts a lottery each year to select the cases which will go forward. Cases which are not selected are rejected. It is not uncommon to have to pursue this category over more than one cap season, as the volume of filings is typically more than twice the annual numerical limit.
L-1: Intracompany Transferees
The L-1, intracompany transferee, category is another option which may be available to TNs. The L-1 is appropriate for some of the TN employees working for multinational companies. Executives and high- level managers fall within L-1(A); specialized and advance knowledge employees fall within L-1(B).
As the L-1 category is reserved for transferees, that is, employees who have worked for the company abroad for at least one full year in the last three years prior to coming to the US, planning is required. Decisions about employee relocation, to and from the US, should include an analysis of the implications of the timing on L-1 eligibility.
E-1/E-2: Not an Option
While both Canada and Mexico are currently able to utilize the E-1 (Treaty Trader) and E-2 (Treaty Investor) categories, these, too are tied to NAFTA. NAFTA is the treaty underlying the E-1 and E-2 categories for Canada and Mexico. Thus, the fate of these categories is also dependent upon the fate of NAFTA.
Permanent Residence Provides Greater Stability
Both the H-1B and L-1 categories have been the target of substantial criticism in recent years. Both categories have seen restrictions and enhanced compliance changes, such as the addition of USCIS visits to the employment site. These categories have limits on the maximum period of stay. Ultimately, long term employment of foreign nationals requires employers to pursue green card options. US Permanent Residents have far more security than those in temporary categories and are indefinitely eligible to live and work in the US.