Frequently Asked Questions About the Immigration Consequences of Corporate Restructuring

By Scott M. Borene*

1. If an employer restructures, won’t the foreign workers automatically go along with the other assets and operations?

Not necessarily. Depending on a foreign worker’s status or type of employment authorization, the employer may need to take certain actions as a result of the restructuring plan to maintain the foreign worker’s employment authorization.

2. Is this true with any type of restructuring?

Each type of foreign worker status or employment authorization has different rules relating to restructuring. In addition, different types of merger, acquisition, buyout, etc. may lead to different immigration consequences. In some cases, even a simple corporate name change could result in consequences to a foreign worker.

3. What can a restructuring employer do to prevent a disruption in the employment of foreign workers?

It is essential that the employer consult with a qualified immigration lawyer as part of its preparations for restructuring. An important part of due diligence is assessing the possible immigration consequences of a restructuring prior to completing the restructuring transactions.

4. Is a restructuring likely to cause immigration related damage only to the employer, or could it harm the employees as well?

Restructuring can potentially alter the legal immigration status and employability of employees who are in nonimmigrant status, and those seeking immigrant status through the employer’s sponsorship–the effect goes two ways, to both employer and employee. Also, there may be both immigration risks and immigration opportunities associated with a restructuring.

5. Isn’t this just a paperwork issue? How serious a problem could this be?

Worst case: For the foreign employees who must rely on a nonimmigrant status for employment authorization, the restructuring could make them illegal and deportable (removable). The employer could become liable for civil penalties for undocumented workers. Employment would be interrupted, delayed or terminated unless the new entity takes timely action to obtain the proper type of status or authorization.

6. Restructuring can move pretty quickly, and foreign workers can easily be overlooked in the process—isn’t there a grace period for an employer to get its immigration house in order after a restructuring?

In those cases where formal action is required to preserve the employee’s legal status or employability, for the most part there is no legal grace period. Action is required prior to or contemporaneously with the entity changes.

7. What about foreign workers who have ‘green cards’?

Those foreign employees who have already obtained Permanent Resident (“green card”) status generally do not present a challenge; for the most part, a restructuring will have no consequences to PR’s. It would be prudent to identify those who obtained PR status within the previous two years, and determine if action may be needed to prevent a loss of PR status.

8. You mentioned “due diligence”—what will this entail in the immigration context?

Under the direction of qualified immigration counsel, the employer should complete a review of:

a) Relevant existing and draft corporate records including articles of incorporation, bylaws, resolutions, etc. for the affected entities;

b) All existing I-9 Employment Authorization Verification forms for affected employees regardless of employee’s citizenship or immigration status;

c) All H-1B LCA public disclosure files for the affected entities to determine compliance, since restructuring makes them a more likely target for a U.S. Citizenship and Immigration Services (USCIS) or Department of Labor (DOL) audit;

d) The current and proposed job duties, location of employment, employer’s identity and compensation for all current non-U.S. workers in any of the affected entities, including those who hold TN, H-1B, L-1, F-1 or J-1 status, in order to compare the terms of employment to the terms authorized by the TN employer letter, H-1B petition, L-1 petition, I-20 (CPT) or DS-2019.

9. Will the employer need to complete new I-9 Employment Authorization Verification Forms for all employees?

A new employing entity or entities may “take over” the I-9’s of a predecessor company in some cases. However, in a partial acquisition or spin-off restructuring, new I-9’s may be required. In any event, a prompt audit of the current I-9’s is advisable. In those cases where a new entity can take over the existing I-9’s of a predecessor, it will also inherit the liabilities; if new I-9’s are required, it is an opportunity to start fresh. In those cases where the new employer had to file new employment petitions, new I-9’s must be completed when the new authorization is obtained.

10. What are the possible consequences of restructuring to employees in F-1 Student status?

F-1 students who are working during optional practical training with an EAD card have unrestricted employment authorization and generally no action is needed. In some cases a new I-9 will be needed. However, any F-1 student working in Curricular Practical Training (internship) is authorized based on an endorsement of the Form I-20, showing the employer’s name. These F-1 employees should have the school endorse their I-20’s for employment with the new entity. In addition, notwithstanding the restructuring, students are generally authorized for one year or less of employment, and prompt action may be needed to change to a longer-term employment authorization.

11. What are the possible consequences of restructuring to employees in J-1 status?

J status employees may be employed under a sponsoring organization such as AIPT or CIEE, or the employer itself may be an authorized J program sponsor. In any case, the program sponsor may be required to update the employing entity’s name in their records, but the entity change is not likely to create a status violation or disruption in employment.

12. What are the possible consequences of restructuring to employees in TN status?

Canadians or Mexicans may be employed in TN status under NAFTA. The “successor in interest” rules have not been regularly applied under NAFTA. New authorizations would probably be required before the employee could work for the new entity.

13. What are the possible consequences of restructuring to employees in L-1 status?

A corporate restructuring may alter the continued employment eligibility and immigration status of L-1 international transferees. In many cases, amended petitions must be filed to show changes in the approved relationships between qualifying U.S. and foreign entities.

14. What are the possible consequences of restructuring to employees in H-1 status?

Although the Visa Waiver Permanent Act of 2000 amended USCIS 214(c) so no amended H-1B petition is required in many restructurings, USCIS has advised that amended petitions be filed to facilitate the reentry of H-1B employees who travel internationally. In addition, 20 CFR 655.730(e)(l) requires that a specific sworn statement by the new entity be placed in the LCA public disclosure file prior to the worker’s employment with the new entity.

15. If the employer has sponsored a foreign employee for a green card, but the employee’s adjustment application has been pending six months or more and not yet approved, what will a restructuring do to the green card application?

Those foreign employees who have pending I-485 applications for Adjustment to Permanent Resident status (based on a particular employer’s sponsorship) which were filed at least 6 months prior to the restructuring will likely not have negative consequences if the I-140 petition has been approved and if the employee will continue in a “same or similar occupational classification.” The new employing entity should provide a letter or employment agreement drafted with the assistance of immigration counsel that could be interfiled with the pending adjustment applications.

16. If the employer has sponsored a foreign employee for green card status, the employee filed their adjustment application less than six months before the restructuring, and the employee’s case has not yet been approved, what will a restructuring do to the green card application?

Those foreign employees whose I-485 applications may have been filed less than six months prior to the restructuring event may be able to proceed with their adjustment applications by showing that the new employing entity is the “successor-in-interest” to their original sponsoring employer. A detailed letter from the new employing entity to USCIS may be sufficient, but it is also possible that USCIS would request that the new entity file new I-140 petitions. (Note: the immigration rules regarding “successor-in-interest” are complex and ill defined. Great care should be taken with each affected worker’s immigration case in consultation with immigration counsel.)

17. What if the employer’s Labor Certification has been approved, but the employee has not yet filed the I-485 Adjustment Application for green card status or applied for an Immigrant Visa?

Foreign employees who have not yet filed I-485 applications based on the employer’s sponsorship will most likely not be able to proceed to adjustment unless the new entity provides new I-140 petitions, which may be filed concurrently with the I-485 applications if an immigrant visa is currently available in the applicable category. USCIS would determine if the new entity qualifies as a “successor-in-interest.” New I-140 petitions would also be needed for employees who apply for an immigrant visa at a U.S. consular office rather than filing an I-485 adjustment application.

18. If an employee is in the green card process, with a pending I-485 adjustment application, should the employer file a new nonimmigrant petition to transfer the employee to the new entity?

Not necessarily. Even if the particular nonimmigrant status requires approval of a new employment relationship, the employer may be able to sidestep many of the nonimmigrant status issues for employees who are in the PR process by relying solely on Advance Parole and Employment Authorization cards for work and international travel, allowing their nonimmigrant status to lapse. Workers with pending I-485 adjustment applications are eligible for employment cards and advance parole travel documents. Each foreign employee’s circumstances should be examined on a case-by-case basis to determine if the restructuring will “kill off” the employment authorization, and if so, what is the best solution for the particular worker.


*Scott M. Borene is the Founder and Managing Attorney of Borene Law Firm, P. A. The immigration lawyers now with Borene Law Firm have more than 70 years of combined professional experience helping clients with U.S. and global visa and immigration projects. Scott Borene was selected by other lawyers as 2018 Lawyer of the Year in Immigration Law as noted by The Best Lawyers in America and Minnesota Monthly magazine. He has been repeatedly recognized as one of the Top 20 Lawyers in the World “most highly regarded by other lawyers” in corporate immigration law. He is listed in the Best Lawyers in America and acknowledged as an Immigration Law Super Lawyer. He is often called upon to act as an “expert’s expert” to advise other experienced immigration lawyers on complex immigration matters. Scott Borene is a past Director and a past Member of the Board of Governors of the American Immigration Lawyers Association (AILA), the world’s largest professional organization of immigration lawyers. In 2002, he was the founder and Conference Chair of AILA’s Global Immigration Summit in New York City, the world’s largest conference of global immigration lawyers. He has written many articles on immigration law and is a frequently invited expert speaker on immigration topics at AILA National Conferences and other major national and international legal conferences. He is the Editor-in-Chief of many leading professional reference books for immigration lawyers including The Global Immigration Guide: A Country-by-Country Survey and The Global Immigration Guide: Crossing Borders for Business, AILA’s most comprehensive books on Global Immigration. He served as Editor-in-Chief of Immigration Options for Academics and Researchers (2005), AILA’s leading Expert Occupational Handbook on immigration issues in higher education. He is the author of Dr. Yes – Some Practical Strategies for the Diagnosis and Treatment of Immigrant Visa Cases of Health Care Professionals. Scott Borene attended Harvard University in Cambridge, Massachusetts as a National Merit Scholar. After graduation from Harvard, he attended William Mitchell Law School in Minnesota. Scott Borene has more than 30 years of experience helping employers obtain work visas for key international talent. Scott Borene can be reached at

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