"E" Category Trader or Investor Visas

By: Elaina Smiley, Joel Pfeffer, Gary M. Sanderson

Foreign nationals seeking to sell products in the U.S. market or investing in a U.S. business need to consider whether they qualify for the “E” visa category. E visas are available to nationals of one of 82 countries that have treaties with the U.S. for either trading or investing.

The trading visa is available to companies owned by a national of a treaty country and planning to sell goods and/or services in the U.S. An investor visa is available to nationals of a treaty country who invest in a U.S. enterprise or who manage a U.S. enterprise for an investor of the same nationality. The investment must be significant with a potential for a return on the investment that goes beyond the investor’s salary for working the investment.

In the case of a company selling its products to the U.S. market, the application will require a business plan that outlines the company’s history, product, sales force and how it will develop trade to the U.S. It is often helpful to supply letters or purchase orders from U.S. customers.

In order to apply for an E investor visa, the applicant must be in the process of investing in or establishing a U.S. business or office. A detailed business plan is critical to the process. The business plan will show how the business will make money; how the foreign national applicant is qualified to manage the business; and how the investment will generate more income than the applicant needs to make a living through growth in value or employment of U.S. workers. The business plan must include financial projections for at least three years. The process also requires a showing that funds have been transferred to the U.S. If an existing business is being purchased the funds may be deposited to an escrow account with the condition that it will be returned if the visa is not issued. One question that needs to be considered is how much money must be invested. There is no single answer. The required amount is what is normal for the type of business that is being started or purchased. If it is a manufacturing business it will require a greater investment than a service or retail business. An expert opinion may be necessary.

For most countries, the E visa can be approved for up to five years. Often the consulate will approve a start-up business for less time and the applicant will need to apply again for another visa after a few years. At that time the consulate will want to see U.S. tax returns as evidence of the profit and health of the business. The visa can continue to be renewed as long as the applicant is managing the business and the business is profitable. This visa does not lead to a green card or permanent status in the U.S. Other types of investment visas are available for permanent (green card) status for investments of $500,000 or $1,000,000. E visas can be obtained for smaller investments.

Proposed Amendments to FLSA Overtime Exemptions

Elaina Smiley
es@muslaw.com
412.456.2821

On June 30, the Department of Labor (DOL) issued proposed amendments to the Fair Labor Standards Act (FLSA) overtime exemption tests that will make more employees eligible for overtime pay.

Under the FLSA, employers must pay workers time-and-a-half wages for time worked in excess of 40 hours in a work week. Currently, workers are exempt from the overtime pay requirement if their job duties fit the FLSA’s definitions of executive, administrative, and professional categories, and the employer pays a minimum salary of $455 per week or $23,660 per year. The DOL amendments propose to change the salary requirement to $921 per week, but the DOL footnotes that by the time of publication of the final rule the salary requirements will likely be $970 per week or $50,440 annually.

The FLSA also exempts “highly compensated employees” from overtime pay. To qualify as a “highly compensated employee,” employees perform non-manual duties of an executive, administrative or professional worker and are paid at least $100,000 annually. The DOL’s proposed amendments would increase the total annual compensation requirement to $122,148 per year.

The DOL also proposes to establish a method for automatically updating the salary levels on an annual basis based on economic considerations.

The DOL did not make any specific proposals to modify the standard duties tests for the exemption categories, but is seeking comments on whether the tests are working as intended and whether the tests should be modified. Specifically, the DOL requests comments on whether it should adopt a test similar to California’s which requires 50% of an exempt employee’s time to be spent performing exempt duties. The DOL expressed concern that the current test may allow employers to classify certain employees as exempt even though they spend a significant amount of their time performing nonexempt tasks. In particular, the DOL is concerned about lower level managers in the retail and restaurant industries who are currently exempt from overtime pay requirements because they supervise two or more full time employees. Despite their supervisory responsibilities, these managers perform a substantial amount of non-exempt work such as running cash resisters, stocking shelves, cleaning and filling in for non-exempt workers.

There is a 60-day comment period for the proposed regulations. The DOL has not said when it will issue the final rule, but it will most likely not take effect until mid-2016. Employers should start reviewing their employee classifications now to determine whether they will need to reclassify employees or increase salary levels.

For more information contact Elaina Smiley.

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