The L-1 visa is designed for intracompany transfers: moving an employee from a company’s foreign office to its U.S. office. But what if a company doesn’t have a foreign entity at all — just an employer of record (EOR) arrangement abroad? We recently tested this exact question for a client. The answer is yes.
Why Companies Are Turning to EORs
In the search for top talent, employers increasingly look abroad, often without much concern for which country a candidate happens to be in. Rather than standing up a foreign entity, many companies now use employer of record services — providers like Pebl, Deel, Oyster, and Papaya Global — to handle compliance, payroll, and benefits administration for employees hired overseas. Gone are the days when hiring internationally meant first establishing a foreign legal entity.
That’s not to say foreign entities are obsolete. Companies still set them up when it makes sense. But given how easy EORs make international hiring, the tipping point for forming an entity is usually somewhere around ten or more employees abroad.
The Basic L-1 Requirements
To qualify for an L-1 visa, a company generally must show that:
- It has offices both inside and outside the United States.
- The employee has worked abroad for at least one year.
- The employee’s role abroad was managerial, executive, or involved specialized knowledge.
- The employee is coming to the U.S. to perform a managerial, executive, or specialized knowledge role.
Multinational employers often favor the L-1 for good reason: there’s no annual numerical cap (unlike the H-1B), no restriction on when in the year you can apply, and no prevailing wage or education requirements.
So How Does a Company Without a Foreign Entity Qualify?
The key is that the L-1 doesn’t require a formal foreign entity — it requires a foreign branch office. If a company employs enough people abroad through an EOR to credibly argue that the arrangement functions as a branch office, an employee working under that arrangement may still qualify for an L-1.
That’s exactly what we argued for a recent client, which had only a U.S. entity but employed more than a dozen people abroad through an EOR. We successfully established that this EOR arrangement functioned as a foreign branch office, and the employee in question had the specialized knowledge and tenure needed to qualify for the L-1.
If you’d like to learn more about how to bring your best foreign talent to the U.S., please contact your Meltzer Hellrung attorney.
