B1 Visas - Unauthorized Employment v. Permissible Business Practices

 

Introduction

b1 visaBoth the Immigration and Nationality Act (INA) and federal regulations are univocal in prohibiting businesses operating in the United States from employing foreign nationals who lack an employment authorization (limited or open market) to work in the United States. The prohibition is based on the public policy of protecting the local workforce. However, businesses may associate with foreign nationals on B1 visas to conduct certain types of limited business activities in the United States, provided that they do not rise to employment for B1 business visitors. Unfortunately, the relevant statutes, regulations, and immigration agency guidance do not always give clear answers for whether an activity by a B1 business visitor constitutes business permissible under B1 status, or whether it constitutes impermissible employment. This is also true in other areas of immigration law.

In this article, we will utilize relevant statutes, regulatory instructions, and the most current immigration agency policies to look at which practices are permitted for businesses operating in the United States and B1 business visitors, and which practices clearly cross the line to employment prohibited under B1 business visitor status. We will also explain the broader ramifications of the interplay between the definitions of “business practice” and “employment” in current federal government guidance. We will lay out the high stakes for running afoul of federal law and rules that prohibit the unlawful employment of foreign nationals in the United States, and ultimately argue that, in light of the possible penalties, businesses operating in the United States and nonimmigrants not authorized to engage in employment in the United States, including the B1 business visitors, should always exercise utmost caution with their mutual dealings. When in doubt about whether or not future activities will remain within the bounds of that which is permissible under, but not limited to, B1 status, businesses and B1 business visitors should seek advice from experienced immigration council. In the case of uncertainly, a business is well advised to seek a proper employment visa for a B1 business visitor if there is any possibility that his or her activities may be considered “employment.”

Overview of b1 temporary business visitor status

The relevant statutes and regulations

Foreign nationals coming to the United States to conduct business, and not to perform skilled or unskilled labor, are those for whom are B1 temporary business visitor visas are intended.1

In order to be eligible for a B1 business visitor visa, the applicant must demonstrate to a consular officer both that he or she intends to depart the United States at the expiration of B1 status, and that he or she will definitely be able to enter a foreign country when he or she departs.2 Furthermore, the applicant must demonstrate that he or she will be financially able to carry out the purpose of the business visit.3 Consular officers are required to deny a B1 visa application if the evidence provided by the applicant does not satisfy the statutory requirements for issuance of a B1 visa.4

“Business” is defined by regulations pertaining to B1 visas as including “conventions, conferences, consultations, and other legitimate activities of a commercial or professional nature.”5 “Business” in the regulatory sense for B1 visas excludes “local employment and labor for hire.”6 The applicable regulations explicitly allows B1 business visitors to supervise or provide training at construction sites provided that they are otherwise qualified for B1 status.7

B1 business visitors may not be admitted to the United States for more than one year. However, may be granted extensions of temporary stay in increments not exceeding six months each.8

Guidance in the foreign affairs manual and adjudicator's field manual

Businesses operating in the United States will likely find that the statutes do not provide anything close to absolute clarity on whether many activities fall within the activities permitted under B1 status. However, the U.S. Department of State (DOS) Foreign Affairs Manual (FAM) provides more guidance on how government authorities interpret what is and is not permissible under B1 business visitor status. The United States Citizenship and Immigration Services (USCIS) Adjudicator's Field Manual (AFM) provides guidance on how USCIS officials are instructed in evaluate and adjudicate issues pertaining to B1 business visitors.

The FAM makes clear that B1 business visitors may not receive a salary or remuneration from an American source for services rendered in the United States while on B1 status.9 A B1 business visitor is permitted to receive an allowance or reimbursement for expenses incidental to his or her stay, provided that they do not exceed the expenses the allowance is intended to cover.10 United States businesses and B1 business visitors will want to exercise extreme caution in ensuring that any such allowances do not qualify as “salary,” which could trigger legal sanctions for both.

FAM defines permissible B1 business activities pursuant to standing judicial precedent11 as “activities that are incidental to work and will principally be performed outside of the United States.”12 FAM lists five general activities that B1 business visitors13 may do:

  1. “Engage in commercial transactions, which do not involve gainful employment in the United States (such as a merchant who takes orders for goods manufactured abroad);
  2. Negotiate contracts;
  3. Consult with business associates;
  4. Litigate;
  5. Participate in scientific, educational, professional, or business conventions, or seminars;”14

The list is not necessarily intended to be exhaustive. For example, B1 business visitors otherwise eligible for B1 status are explicitly permitted to supervise or provide training at construction sites. FAM also instructs officials that a foreign national seeking a B1 visa for the purpose of installing, servicing, or repairing industrial equipment purchased outside of the United States, or training others to do so, is eligible for B1 business visitor status, provided that he or she possesses the requisite specialized knowledge and he or she will not receive remuneration from a U.S. source.15 Certain foreign nationals who may qualify for H-1 or H-3 work-based visas may be eligible for B1 visas instead, provided that their source of income (exempting allowances) is not from the United States, and they are employed by a foreign firm that has an office abroad.16 Foreign nationals who are seeking B1 visas exclusively to observe the conduct of business or other professional or vocational activity are eligible for B1 visas, provided that they pay for their own expenses.17

If a foreign national applying for B1 status is applying for the purpose of doing something that is not clearly permitted in the FAM, officials are instructed to obtain an advisory opinion on his or her eligibility for B1 status.18 Whether or not the person ultimately obtains B1 status will depend on the specific facts of the case.

If a B1 business visitor requires an extension of B1 status to complete the purpose of his or her B1 status, the AFM instructs adjudicators to ascertain the purpose of the extension; whether the B1 business visitor has departure arrangements for after the extension, and whether the extension would impair the B1 business visitor's ability to return to his or her permanent residence.19 The B1 business visitor would likely have to prove that in addition to having an intention of leaving the United States at the end of his or her extension of status, the work to be undertaken during the extension continues to be permissible under B1 status.

Rules gleaned from judicial decisions and regulatory memoranda

Many of the rules that we have reviewed from statutes and the two field manuals have been further clarified through precedent judicial decisions, which provided helpful examples of permissible activities under B1 status, and regulatory memoranda.

B1 business visitors are permitted to make various and temporary business visits to the United States, provided that they do not violate any rules of B1 status.20 For example, the Board of Immigration Appeals held21 that a tailor from Hong Kong who took measurements of customers in the United States who were ordering clothing from the company in Hong Kong was acting in accordance with his B1 status.22 However, the Board of Immigration Appeals held in a different case that a painter seeking to exhibit and sell his paintings in the United States was not eligible for B1 business visitor status since his proposed activities involved no international trade or commerce, profits would accrue in the United States, and the applicant would be performing local services or labor in the United States.23

Courts have held that furthering international commerce and business is permissible under B1 status.24 In 1987, the Board of Immigration Appeals held that a Canadian railroad clerk who entered the United States on a daily basis to clear his Canadian employer's railroad cars qualified as a visitor for business.25 In contrast, courts have held that activities to further commerce and business in the United States are not permissible uses of a B1 visa.26

The Immigration and Naturalization Service (INS), predecessor of the USCIS, has held that the profits of a company employing a B1 business visitor must primarily accrue abroad and that its services in the United States (and those pertaining to the activity of a B1 business visitor) must be incidental to international trade and commerce.27

Although B1 workers are not permitted to be paid by an American source, payment from a non-American source may be arranged through United States financial institutions.28 B1 workers may not perform work that is either part of the United States labor market or that a United States worker would be hired for.29

Legal definitions of “employment”

Given that B1 business visitors are not permitted to engage in “employment” in the United States, it will be helpful to look at where either the INA or Code of Federal Regulations (C.F.R.) unambiguously defines “employment” including with regard to foreign nationals who do not have authorization to work in the United States. (Note that while the statute refers to these terms in broad immigration law contexts, there are also applicable to B1 business visitors). The following is a list of actions that a United States employer may not take with a B1 business visitor or any other nonimmigrant not explicitly authorized to be employed in the USA:

  • May not hire, which is defined as using a “contract, subcontract, or exchange entered into” to obtain the labor services of a B1 business visitor30
  • May not refer for a fee, which means that a business may not by any means refer a B1 business visitor for employment or remuneration in the United States31
  • May not solicit for a fee, which means that a business may not solicit a B1 business visitor for employment or remuneration in the United States32

Terms defined by the statute of interest to U.S. companies and B1 business visitors are:

  • Employer, meaning a person or entity who engages the services of an employee for wages or remuneration33; an employee is consequently a person who provides services or labor to an employer for wages or remuneration34
  • Employment, meaning any service performed by an employee for an employer in the United States35
  • Independent contractor, meaning an individual (or entity) who contract with another entity to do a piece of work according to his or her own methods, and is subject to control only as to results36 (Note that since B1 business visitors may not receive salary or remuneration from a United States source, they may not enter into this arrangement with an American business, and if they stated an intent to do so in a B1 visa application, they would be denied the visa)

Finally, for determining whether something is or is not employment, the regulations use the term pattern or practice, defined as “regular, repeated, and intentional activities, but does not include isolated, sporadic, or accidental acts.”37 In the case of adjudication over whether a B1 business visitor's conduct was “employment,” immigration officials and courts would likely consider whether the actions in question constituted “regular, repeated, and intentional activities,” which if found to do so, could trigger legal penalties.38

Potential penalties for employers and nonimmigrants violating employment rules

Since the purpose of this article is to help employers and B1 business visitors not violate rules on employing B1 business visitors, we will not address and detail the process by which charges that a B1 business visitor engaged in unlawful employment are adjudicated here. Instead, this section will give a brief overview of the potential ramifications of unlawfully employing B1 business visitors, so that both United States businesses and B1 business visitors understand the significant stakes involved if they are found to fall on the wrong side of applicable laws and regulations.

Potential penalties for employers

Employers who employ nonimmigrants including holders of B1 status may face fines for employing foreign nationals who lack authorization to work in the United States.39 These fines depend on many factors, such as the circumstances leading to the unauthorized employment, the size of the company, and whether the company has a history of similar violations.40 Employers may be found culpable of criminal violations involving B1 business visitors due to pattern or practice violations.41 Typically, criminal sanctions for unlawfully employing foreign nationals who do not have work authorization are pursued only for “serious and repeat offenders who have clearly demonstrated an intention to evade the law.”42

Potential penalties for B-1 temporary business visitors

B1 business visitors found to have engaged in unlawful employment will likely have their B1 temporary business status stripped and be put into removal proceedings. Furthermore, having a period of unauthorized employment while in the United States would likely significantly impair their ability to subsequently reenter the United States.43

Conclusion

While the statutes, case law, and agency guidance help shed light on what constitutes “business” activities as defined as permissible under B1 business visitor visas, there are many situations that may not be on their face permissible or impermissible. B1 business visitors should always err on the side of caution and not engage in actions that go beyond what they were explicitly granted a B1 visa for. Businesses associating with B1 business visitors, or any other foreign nationals who lack employment authorization (since the laws, regulations, and agency guidance regarding the employment of foreign nationals unauthorized to work in the United States apply to immigration law in general, not just those on B1 status), should ensure that all of their actions are clearly in line with what is permitted by statutes, regulatory instructions, and current immigration agency policies. In the case of uncertainly over any given action, businesses and nonimmigrants including B1 visitors should consult with experienced immigration attorneys to ensure that a given action is explicitly permissible under current laws and regulations. In the case of ambiguity, a business will likely be advised to seek a proper employment authorization for the B1 business visitor.

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  1. INA § 101(a)(15)(B)
  2. 8 C.F.R. § 41.31(a)(1), § 41.31(a)(2)
  3. 8 C.F.R. § 41.31(a)(3)
  4. INA § 221(g)(1)-(3)
  5. 8 C.F.R. § 41.31(b)(1)
  6. Id.
  7. Id.
  8. 8 C.F.R. § 214.2(b)(1)
  9. 9 FAM 41.31 N11.1
  10. Id.
  11. Matter of Hira, 11 I&N Dec. 823 (BIA 1966)
  12. 9 FAM 41.31 N7
  13. The forthcoming list has six items, but the sixth, “Undertake independent research,” pertains to a different type of B1 visitor than concerns the topic of this essay
  14. 9 FAM 31.31 N8
  15. 9 FAM 41.31 N10.1
  16. 9 FAM 41.31 N11
  17. 9 FAM 41.31 N10.4-2
  18. 9 FAM 41.31 N7
  19. AFM 30.2 § (c)(2)(B)
  20. Ira J. Kurzban. Kurzban's Immigration Law Sourcebook: A Comprehensive Outline and Reference Tool. 14th ed. ALIA Publications, (2014), 876, citing Matter of B- & K-, 6 I&N Dec. 827 (BIA 1955); Matter of Hira as examples of cases where this conduct was held as permissible under B1 status; citing Matter of Minei, 11 I&N Dec. 430 (RC 1965) where a foreign painter was selling his work in the United States as an example where conduct was held to be in violation of B1 status
  21. Matter of Hira, 11 I&N Dec. 823 (BIA 1966)
  22. Note that he also was in the United States temporarily, had an intent to return, and was receiving no salary from an American source.
  23. Matter of Minei, 11 I&N Dec. 430 (RC 1965)
  24. Kurzban 876, citing Karnuth v. U.S. Arbro, 279 U.S. 231 (1929); Mwongera v. INS, 187 F.3d 323, 329 (3d Cir. 1999) [was not permissible]; Matter of Neill, 15 I&N Dec. 331 (BIA 1975) [not permissible]; Matter of Opferkuch, 17 I&N Dec. 158 (BIA 1979) [not permissible]; Matter of Duckett, 19 I&N Dec. 493 (BIA 1987) [eligible for B1]
  25. Matter of Duckett, 19 I&N Dec. 493 (BIA 1987)
  26. Kurzban 876
  27. Kurzban 877; citing Matter of Sriniasan, Case No. A23-192-575 (C.O. 1982), reprinted in 70 No. 35 Interpreter Release 1189 (Sept. 13, 1992)
  28. Kurzban 877; citing Letter, Miller, Deputy Asst. Comm., Adjudications, CO 214b-C (Nov 5, 1992), reprinted in 70 No 7 Interpreter Releases 221, 239-40 (Feb 22, 1993)
  29. Kurzban 877; citing Memo, Williams, Regional Director Western Region, WRINS 70/20 (undated, c. 2000), published on ALIA InfoNet at Doc. No. 03040190
  30. 22 C.F.R. § 274a.1(c)
  31. 22 C.F.R. § 274a.1(d)
  32. 22 C.F.R. § 274a.1(e)
  33. 22 C.F.R. § 274a.1(g)
  34. 22 C.F.R. § 274a.1(f)
  35. 22 C.F.R. § 274a.1(h)
  36. 22 C.F.R. § 274a.1(j)
  37. 22 C.F.R. § 274a.1(k)
  38. Kurzban 333, citing INA § 274A, 8 U.S.C. § 1324a, IRCA
  39. Kurzban 1733, citing INA § 274A(e)(4), 8 U.S.C. § 1234a(e)(4); 28 C.F.R. § 68.52
  40. Kurzban 1733-35, 39, citing INA § 274A(e)(4), 8 U.S.C. § 1234a(e)(4); 28 C.F.R. § 68.52
  41. Kurzban 1740, citing 8 C.F.R. §§ 274a,19m 1264a.10
  42. Kurzban 1740, citing H. Conf. Rep. No 1000, 99th Cong. 2d Sess. 86 (1986), reprinted in 1986 U.S.C.C.A.N. 5840 at 5841
  43. See Mwongera v. INS, 187 F.3d 323, 329 (3d Cir. 1999) for an example of someone who was found to violate B1 status being denied reentry into the United States on a new visa.

Resources and materials:

Kurzban, Ira J. Kurzban's Immigration Law Sourcebook: A Comprehensive Outline and Reference Tool. 14th ed. Washington D.C. ALIA Publications, 2014. 333, 876-77, 1733-35, 39-40,. Print. Treatises & Primers.