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Remote Work: U.S. Businesses and Canadian Subsidiaries With an H1B Visa

Remote Work: U.S. Businesses and Canadian Subsidiaries With an H1B Visa

Oct 28, 2020 | Business, Remote Work

Hiring Canadians makes sense for many U.S. companies. Industries such as IT struggle to find adequate personnel to fill specialized computer-related positions. Companies face losing valued employees following the presidential proclamation this summer. It could impact an employee’s ability to renew his/her H1B visa.

Challenges to H1B Visa Renewal

Many workers in the U.S. have H1B visas. This non-immigrant visa allows the worker to remain in the U.S. for up to 3 years before renewal, and another three years after that. Individuals cannot apply for it, and must have their employer complete the request on behalf of the worker. The H1B is one of the few visas considered “dual intent”. This designation means that an H1B holder can simultaneously apply for, and accept, a Green Card while working in the U.S.  

Unfortunately, in recent years the H1B has become increasingly difficult for companies to obtain for their workers. There is an annual cap to visas that varies from fiscal year to fiscal year. According to Rohit Mittal of Stilt.com, the cap is divided into two categories.

  • Regular Cap=65,000
  • Specialty Cap=20,000

The regular cap includes all employers that are requesting visas for non-masters degree level employees. The formula for determining this segment of the total cap is pretty straight forward. According to sources, the regular cap is equal to the annual cap for XXXX year, less the H1B1 cap for XXXX with the unused H1B1 cap added in from the previous YYYY year. Once that number is reached, an additional amount of requests is added as a buffer against rejections and denials. 

H1B Under Trump

Recently, as of this writing, most visa issuance has been suspended by the Trump administration. The emergency measure was enacted to protect the U.S. labor force in the wake of the novel coronavirus pandemic. The proclamation only had effect on new visa issuance. Those with current H1B visas can complete their visa terms.

Renewal for employees who have reached the term of their visa could prove problematic. Companies have several options to overcome the hurdles posed by the temporary visa issuance freeze.

  • Canadians holding H, L, or J non-immigrant visas are not affected.
  • Employees issued visas prior to June 24, 2020 are not affected.

Valued workers can consider relocating to Canada if they face visa denial in the U.S. This cross-border option for remote work presents many benefits for both employers and employees. Take advantage of viable immigration options that the U.S. doesn’t offer. Don’t allow immigration policy to affect the quality of your staff.

Can Your Employee Work Remotely?

Canada is especially well suited to help U.S. companies retain valued employees. Canada’s proximity to the U.S. and its favorable immigration policies combine to create an excellent way to keep staff working remotely

  • Canadian Express Entry
  • Creating an American business subsidiary in Canada

These two options can provide a quick fix to U.S. visa issues. The Canadian Express Entry is similar to the American L1 visa. It requires that the employee demonstrate the same skilled worker qualifications that apply in the U.S. This works well if your company already has a branch in Canada. Once the employee has the Express Entry Visa, they can live in Canada and work. The Canadian branch of the company can also function as the foreign talent acquisition arm of the company until the U.S. immigration policies return to normal.

Creating an American subsidiary of your business in Canada is an important business decision to consider. What are the pros and cons of having elite workers versus local talent? Is it important that your business hire the best candidate?  You can outsource through a Canadian Partner Organization, but this likely won’t help you retain your current trained, experienced employees that depend on U.S. visas.

Conclusion

For many businesses it is integral to hire outside the U.S. because there is a lack of skilled workers in many industries. Companies are forced to look overseas to meet demand. When your business depends heavily on a skilled foreign workforce, it makes sense to invest in operations across neighboring borders. Contact us for help if your valued employees face visa denial.

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We hope you learned a lot regarding building retention processes for your out-of-country staff. Investing in standardized relocation and retention processes isn’t just about logistics; it’s about building a future-proof workforce that thrives in today’s globalized world. By prioritizing your employees’ well-being and career goals, you create a win-win situation for both your company and valued talent.