The North American Free Trade Agreement (NAFTA), signed into law in 1993, eliminated trade barriers and increased investment opportunities between the three signatory countries, the United States, Mexico, and Canada. After more than 25 years, the agreement was seen to require revisions, particularly as to labor, digital trade, and data flows. A revision to NAFTA, called the United States, Mexico, Canada Agreement (USMCA), has passed both the House of Representatives and the Senate with broad bipartisan support.

The new treaty is expected to become effective in the spring of 2020, after ratification in Canada. A proposal to the USMCA would have changed the Treaty NAFTA visa (TN visa), but it did not materialize.

During the negotiations, in accord with the President’s “Buy American, Hire American” Executive Order, the Trump Administration reportedly wanted to reduce the scope of TN visa status by limiting the number of eligible professions and, possibly, capping the number of visas available. Canada and Mexico wanted the opposite – to expand the number of eligible professions and update the listed professions to bring them more in line with current technological demands. None of these changes were incorporated into the USMCA.

However, the Department of Homeland Security is applying a higher level of scrutiny to the TN visa category. New guidelines were issued regarding the economist category. Now, a broad range of other professions related to economists, such as financial analysts, market research analysts, and marketing specialists, will no longer qualify for TN visas. Credentials are being questioned and even those who already hold TN status may have renewals denied.

Canadians are seeing additional restrictions at Ports of Entry. Previously, it was possible for a Canadian citizen to obtain L-1 visa status, either for an initial approval or a renewal, at the border, without having to file an application with USCIS. However, in 2019, without issuing any policy memo, Customs and Border Protection (CBP) began refusing to adjudicate anything other than an initial L petition or applications for intermittent or commuter Ls at the border. All other categories of Canadian L visas now require costly filings by petitioning employers with USCIS. Employers can expect long processing times, or having to pay an additional $1,440 fee for expedited “premium processing,” not to mention dealing with the costs and delays of Requests for Evidence this type of visa has drawn lately.

In the meantime, Canada is taking advantage of stricter scrutiny of all U.S. work visas by “inviting” frustrated companies to move their offices, or just their employees, to Canada. Even during the USMCA negotiations, Canadian Prime Minister Justin Trudeau was encouraging companies to consider their new two-week fast track employment visa process. Whether this will affect U.S. policies, remains to be seen.

If you have any questions about TN or Canadian L visa statuses, or the USMCA, please reach out to a Jackson Lewis attorney.

According to the DHS Fall Regulatory Agenda, the Administration is planning further restrictions to immigration regulations that, if enacted, will affect employers.

Over the past few years, DHS has changed the way it reviews H and L visa petitions from employers, which has resulted in significant increases in Requests for Evidence (RFEs) and denials. The rate of RFEs for H-1B visas has gone from 6% in FY 2015, to 24% in the third quarter of 2019. Denial of L visas has increased from 24% in FY 2016 to a current rate of 34%. The Administration’s proposed rules, if approved, would codify the review processes that produce these higher denial rates. Further, by going through the regulatory process, DHS will neutralize one of the arguments petitioners challenging denials are making in U.S. District Courts: that the denial was a violation of the Administrative Procedures Act (APA).

December 2019: “Strengthening the H-1B Nonimmigrant Visa Classification Program”

This new rule will revise some definitions (e.g., “specialty occupation” and “employer-employee relationship”) and ensure H-1B employees are paid wages that do not depress pay for American workers. This likely will be consistent with the RFEs many petitioners have been receiving. These question whether certain occupations really require a bachelor’s degree in a specific field, whether there is a bona fide employer-employee relationship when employees are working at third-party worksites, and whether a Level I job can qualify as a “specialty occupation.”

March 2020: “Removing H-4 Dependent Spouses From the Classes of Aliens Eligible for Employment Authorization”

Continuing its three-year campaign to rescind the policy that allowed dependent spouses of workers in H visa status to obtain Employment Authorization Documents (EADs), the Administration is predicting that the new regulation will be out of the Office of Management and Budget (OMB) and ready for final publication in spring 2020. A case challenging the legality of the H-4 EAD rule has been pending in federal court since before President Donald Trump’s inauguration. In early-November 2019, over the Administration’s objection, the Circuit Court of Appeals for the D.C. Circuit sent the case back to the District Court for a review on the merits. The case had been “paused” for close to three years because, the Administration argued, the case was about to become moot since the DHS intended to rescind the H-4 EAD rule. Eventually, the court grew tired of waiting. Perhaps the new rule will be published before the court acts.

September 2020: “Strengthening the L Nonimmigrant Classification”

This new rule would increase the requirements for L visas by redefining “specialized knowledge” and the employer-employee relationship. The regulations will also address appropriate wages for L-1 beneficiaries, even though there is no statutory wage requirement for this type of visa. The Department of State may have launched a “test balloon” on Ls. It had heightened the standard for evaluating Blanket L applications at Consulates from a “preponderance of the evidence” standard to a “clear and convincing” standard in an October 2019 Foreign Affairs Manual (FAM) change that was later withdrawn.

September 2020: “Enhancing the Integrity of Unlawful Presence Inadmissibility Provisions”

This rule makes it more likely for students and others in F, M, or J status to become out of status and subject to bars to U.S. re-admission for prior unlawful presence. USCIS’s attempt to do this with a policy change has been enjoined.

Presidential proclamations, policy announcements, and changes in the standard of review by administrative agencies can contradict the regulations those agencies implement. When that occurs, the government may be sued to enjoin implementation of the policy. By carefully wording responses to RFEs, and filing appeals for denials, employers can increase the chances their petitions will be approved. Policies that end up codified as regulations, however, make law suits against the government for violations of the APA less likely to prevail, and could make approvals for some employer petitions more challenging.

Jackson Lewis attorneys will continue to monitor this rulemaking and provide updates as they become available.