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Clark Hill 2023 Automotive & Manufacturing Industry Outlook: Immigration Update

September 5, 2023

Labor Shortages in Key Professional and Technical Positions

Despite recent layoffs in many industries, automotive and manufacturing employers continue to experience difficulty hiring for key professional and technical positions with in-demand skill sets. If employers cannot find qualified US workers to fill these roles, employers may need to consider hiring foreign nationals.  The following describes potential temporary visa categories for hiring foreign nationals.

H-1B Visas

To qualify for an H-1B visa, the foreign national must have a bachelor’s degree and work in a job that requires that type of bachelor’s degree. H-1Bs are numerically limited and a lottery is held each March. The 2023 lottery saw an unprecedented demand with more than 780,000 entries for 85,000 visa numbers. If a foreign national already holds an H-1B visa, they are usually not subject to the lottery and can transfer employers upon filing a new H-1B petition. H-1B visas have minimum wage and Labor Condition Application requirements.

TN Visa

The TN visa is available to Canadian and Mexican citizens who will be employed in the US in one of a list of specific occupational categories, including Engineers, Accountants, and various types of Scientists. Canadian citizens can apply directly at a US Port of Entry. Mexican Citizens must apply at a US Consulate in Mexico, prior to entry into the US. The TN is limited to the specific job categories listed in the USMCA (formerly NAFTA) and the employee must meet the requirements for the applicable category, which typically equate to US Bachelor’s degree.

E Visas

To qualify for an E Visa, the employee must be a citizen of a country with which the US maintains a treaty of friendship, commerce, and navigation, and who will work for an entity in the US that is ultimately majority-owned by a person or a company that holds the same citizenship. For example, Germans only qualify for E visas for majority German-owned companies, and Canadians only qualify for E visas for majority Canadian-owned companies. To qualify, there must be a substantial amount of trade of goods, services, or technology, principally between the US and the treaty country (E-1), or there must have been a substantial amount of capital invested in the US business (E-2). The E visa applies to the principal owner or investor and those in executive, supervisory/managerial, or essential employee positions.

L Visas

The L visa is available to foreign nationals moving from related foreign operations to US operations.  Foreign national employees must have worked 1 of the last 3 years for the foreign operation before coming to the US. The US and foreign companies must have a parent, subsidiary, branch, or affiliate relationship. The L-1A is available for managers and executives. The L-1B is available for employees who have specialized knowledge of the company’s products and processes.  For companies that have substantial revenue or a large US workforce, a Blanket L petition may be an option to allow for faster abbreviated L visa cases in the future.

F-1 Student Visas

The F-1 visa is for foreign nationals who attend school in the US. Certain F-1 students may be eligible for work authorization in an occupation related to a degree, which is granted in the forms of Curricular Practical Training (CPT) and/or Optional Practical Training (OPT). If a student is authorized for CPT employment while completing their degree, no employment authorization card is required, work authorization is granted on the student’s I-20 and will describe the employer, number of hours authorized, and length of employment. If the F-1 student is authorized for OPT employment, the F-1 student must apply for an Employment Authorization Document (EAD) from USCIS before working in OPT status; certain students in technical (“STEM”) fields can apply for a 24-month extension of OPT status for a total of 3 years of work authorization, typically starting after graduation. Employers should consider that F-1 students may need to be sponsored for an H-1B visa at some point to receive additional work authorization in the US and selection in the H-1B lottery is not guaranteed.

Employment-Based Green Cards

For employees already in the U.S. in temporary work status, an employer may wish to sponsor the employee for permanent residence (a “green card”). Generally, there are three stages to obtaining an employment-based green card, with an exception for intercompany managers, who skip the first stage. During the first stage of PERM (Program Electronic Review Management Form 9089) labor certification, the company must conduct extensive recruiting and advertising for the position, and evaluate the qualifications of applicants for the position, to demonstrate to the Department of Labor there are no qualified US workers ready, willing, and qualified to perform the particular job.

Once the PERM is approved, employers may file the second stage, Form I-140, confirming that the sponsored employee has the qualifications for the PERM job.  The third stage, the Adjustment of Status (AOS) application that results in a green card, may only be filed once the employee’s priority date (their “place in the green card line”) is current. The entire process takes between 2 years and up to 8 or more years. Sponsoring directly for a green card without first having a temporary work visa is also an option. This option requires the above PERM and I-140 steps and then consular processing for permanent residence by the foreign national. This can be a time-consuming process when the foreign national enters the United States for the first time as a permanent resident and can take two or more years. However, with long-term planning, this can be a desirable and viable option for employers.

Sponsoring for US Citizenship

Many employers ask about sponsoring existing or future employees for US citizenship. There is no direct route for an employer to sponsor an employee for US citizenship. If an employee has gone through the employment-based green card process, the employee may individually choose to file for US citizenship no earlier than 4 years and 9 years after the green card was granted.

Business Visitors to the US

Certain individuals can enter the US using the Visa Waiver Program (VWP) (also referred to as ESTA), which enables citizens of designated countries to travel to the US for tourism or business for 90 days or less without first obtaining a visa. Countries not included in the VWP (including India, China, and Brazil) need to apply for a B-1 visa at a US Consulate abroad before entering the U.S. Entering the ESTA program or using a B-1 visa generally allows for attendance at business meetings and conferences, but the individual may not work in the US. Employers should not be tempted to allow business visitors to work in the US as there is potential Form I-9 civil and criminal liability for the employer and working without authorization in the US puts at risk the employee’s ability to enter the US in the future.

The views and opinions expressed in the article represent the view of the author(s) and not necessarily the official view of Clark Hill PLC. Nothing in this article constitutes professional legal advice nor is intended to be a substitute for professional legal advice.

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