News & Articles

H-1B Visa for Entrepreneurs and Start-Ups

In 2011, the USCIS and Obama Administration created incentives to encourage
start-up companies and increase job opportunities. The intention was to stimulate the United States economy and job market by making H-1B visas available to entrepreneurs and start-ups. However since then, installed regulations have made the process more challenging than expected. The USCIS took notice of the recent confusion and decided to address some of the misunderstandings.

Background for H-1B Visas to Entrepreneurs and Start-ups

h-1b visas to entrepreneursPreviously, many foreign nationals had to leave the United States because visa options were stringent upon self-employed founders. Often the only options were to apply for an E2 investor visa or an EB-5 immigrant visa. Though, to acquire an E2 investor visa the applicant must be a member of a E2 treaty country and the EB-5 requires the applicant to substantially invest in the business. In 2011, the Obama administration decided to re-interpret existing immigration laws in light of start-ups. The purpose was to bring highly skilled individuals from across the globe to benefit the U.S. economy and stimulate job creation. The immigration laws now authorize H-1B visas to entrepreneurs who possess a majority or 100% ownership in the businesses. The H-1B can also be extended to the sole employee if the applicant is able to demonstrate the employer-employee relationship.

The Challenges

Since 2011, the employer-employee relationship was difficult to establish for the H1B visa. However recent USCIS statements have defined the required documentation for this type of relationship. The USCIS has determined that it will allow sole employees under the employer-employee relationship if  “… the petitioner provides evidence that there is a separate Board of Directors which has the ability to hire, fire, pay, supervise or otherwise control the beneficiary’s employment, the petitioner may be able to establish an employer-employee relationship with the beneficiary” This means that there is a separate party within the company which controls the employee’s employment. Acceptable evidence for sole employees seeking H1B is providing documentation of:

  • investors 
  • preferred shareholders
  • terms and conditions of employment

Even more recently, the USCIS has designed a specific portal to further distinguish the necessary documentation for employer-employee relationships in start-up businesses.

H1B visas to entrepreneurs may still have issues within the category. For applicants who have already started a business in the United States and did not receive H1B or EAD approval, their business functions may be seen as unauthorized employment.

H1B Entrepreneurs and Start-Ups Considering Permanent Residency

Applicants who are considering permanent residency status must understand the possible long term options. H1B entrepreneur applicants may file for PERM labor certification sponsorship in order to receive a green card, however, it may be difficult to obtain through the U.S. Department of Labor. This is due to the applicant’s ownership interest in the sponsoring company. If the applicant wishes to stay in the United States permanently, it is likely the applicant will have to find other visa options.

If you are seeking H1B as an entrepreneur or start-up business, please contact our Miami immigration lawyers for further information. SGM Law Group specializes in employment immigration and we routinely help start-up companies file H1B visa and green card petitions successfully.

Comments are closed.