Global Employer Services Newsletter August 2020

How will President Trump’s proclamation on immigration affect your business and talent strategy?

On 24 June 2020, the President issued an Executive Order limiting immigration into the U.S., which is said to protect the country’s labor market, as COVID19 continues to strain the U.S. economy.  

The proclamation has prohibited entry for workers and their accompanying dependents, who are outside the U.S., and applying under the following temporary visa categories: J1 for certain categories (i.e. interns, caregivers, etc.), L1 (intra-company transferees), and H1B (specialty occupation professionals) and H-2B (non-agricultural workers). The proclamation also extends existing restrictions on certain immigrant visa categories, which were issued by a previous proclamation on 22 April 2020 and will remain in effect until 31 December 2020.

While these measures will be a challenge for businesses seeking to employ foreign workers in the U.S., Trump’s proclamation is not a complete shut down on U.S. immigration.  The Presidential Proclamation does not impact:

  • Workers already in the U.S.
  • Workers outside the U.S. who currently have valid H-1B, H-2B, L-1 or J-1 visas
  • Filings with USCIS for change of status, extension, or amendment applications
  • Other non-immigrant categories, such as E, TN, or 0-1 visa categories
  • Canadian citizens applying under the restricted visa categories
  • Cases where there is a national interest, or where the work is related to the US food supply chain.

President Trump’s proclamation, which restricts many foreign workers from working in the U.S., in combination with the uncertainty of the Trump administration’s immigration policies, stands in sharp contrast to Canada’s more immigration-friendly policies.

Canada has long considered immigration as a core pillar of its economic success.  Even amid the COVID19 pandemic, Canada’s Immigration Minister has reiterated that immigration will drive Canada’s recovery.  Canada offers over 100 programs targeting skilled and semi-skilled workers, with built-in pathways to Permanent Residence.  Therefore, the proclamation opens up a number of opportunities in Canada.

Opportunities to consider

If you are a U.S.-based employer seeking to retain your foreign workers who cannot renew their visas in the U.S.:

Consider opening a Canadian branch, subsidiary, or other qualified entity where you can transfer your talent for up to seven years. To qualify, certain conditions must be met, for both the employer and employee.  Further, you may subsequently assist your talent to obtain permanent residency in Canada as the procedures are more straightforward and with greater certainty in Canada than the U.S.

If you are an employer (U.S. or non-U.S.) seeking to bring foreign workers to the U.S:

Consider hiring Canadian citizens, since Canadians are exempt from the Presidential Proclamation, and may continue to apply for the restricted visas.  For non-Canadian citizens seeking work visas to the U.S., additional visa options may be available under treaty or investment categories, or under national interest or food supply exemptions.

If you are a Canadian-based employer seeking to fill skills gaps by hiring foreign workers:

Consider hiring the foreign workers impacted by the Proclamation.  Canada’s work permit pathways are available year-round, generally with no caps, and apply to a variety of high- and low- skilled occupations.  The Government of Canada has introduced a number of high and low skilled occupations where a labour market impact assessment is not required.  Further there are special pathways in Canada to support foreign workers to apply for permanent residency directly while being issued a Work Permit support letter to work in Canada during the processing of the permanent resident application.

Although the Proclamation has created significant challenges for companies hiring foreign workers in the U.S., employers are encouraged to consider using Canada as an alternative destination for their global talent.  Canada offers a stable and open immigration environment, with a variety of tax incentives. Cross-border mobility planning requires a fulsome review of your company’s business objectives, its activities in each jurisdiction, as well as the immigration and tax consequences. Speak with your BDO tax and immigration professional to discover the best pathway to achieve your talent objectives.

For more information, please contact:

Debra Moses

Joanne Sun

Doreen Buksner