Understanding Work Authorization and Its Importance

When hiring talent internationally, one of the biggest challenges for US-based companies is navigating work authorization requirements. Work authorization ensures that employees are legally permitted to work in a particular country, aligning with immigration laws and compliance standards.

Managing these requirements effectively is critical to avoiding costly mistakes and ensuring a smooth hiring process. In the US, every fiscal year (October 1st – September 30th), approximately 140,000 employment-based immigrant visas are made available to qualified applicants under the provisions of U.S. immigration law.

In this blog, we will explore the importance of work authorization and provide insights into the process, along with its role in building compliant and effective remote teams.

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What is Work Authorization?

Work authorization is the legal permission granted by a government that allows an individual to be employed in a specific country. It typically comes in the form of work visas, permits, or employment authorization documents, depending on the country’s regulations. While natural-born citizens automatically have employment authorization, foreign nationals must secure approval through immigration channels before they can legally work.

The process varies by country, with some having strict controls, while others are more flexible to attract international talent.

Who Requires Work Authorization?

In general, any individual seeking employment outside their country of citizenship requires work authorization, though some exceptions apply based on specific agreements. Here's who typically needs a work authorization:

• Foreign professionals and expats on international assignments
• International students wanting to work during or after their studies
• Asylum seekers and refugees
• Temporary workers and seasonal laborers
• Spouses and dependents of visa holders
• Individuals with specialized skills or extraordinary abilities

Difference Between Work Authorization and Work Permit

A work permit is a specific type of work authorization that grants non-citizens the legal right to work in a country, such as the United States. Work permits are official legal documents that can either be temporary or permanent. In the U.S., work permits are typically verified through Employment Authorization Documents (EADs) and may cover international students working under Optional Practical Training (OPT).

Next, let's understand different types of work authorizations.

What are the Types of Work Authorization?

Work authorization comes in various forms, depending on the country’s immigration policies and the type of employment being pursued.

Here are some common types of work authorization:

• Work Visa: A permit allowing an individual to work in a specific country for a set period, often linked to a particular job or employer.
• Work Permit: A document granting foreign nationals permission to work in a country, typically requiring a job offer before issuance.
• Employment Authorization Document (EAD): A card issued by the government allowing foreign nationals to work while awaiting a permanent residency status or visa application.
• Temporary Worker Visa: A short-term visa granted to workers in specific sectors such as seasonal labor or specialized fields.
• Intra-company Transfer Visa: Authorization allowing employees of multinational companies to work in a different country branch temporarily.

Table on Types of Work Authorization

Understanding the different types of work authorization is crucial for ensuring compliance and selecting the right pathway for your international talent.

Next, let's understand the documents required for work authorization.

Documents Required for Work Authorization

To apply for work authorization, individuals need to provide specific documents that verify both their identity and eligibility to work. The required documentation can be grouped into categories based on their purpose: establishing identity, proving employment authorization, and verifying status for certain applicants, such as students or minors. Below is a breakdown of the necessary documents, including those for students.

Documents to Establish Identity

These documents are used to verify the person’s identity. Commonly accepted documents include:

• U.S. passport or U.S. passport card
• Permanent Resident Card (Form I-551) or Alien Registration Receipt Card (Green Card)
• Foreign passport with a temporary I-551 (ADIT) stamp or a machine-readable immigrant visa (MRIV)
• Driver’s license or state-issued ID card
• School ID card with a photograph
• Voter’s registration card

For minors (under 18 years old), any of the following documents may be used:

• School record or report card
• Clinic, doctor, or hospital record
• Daycare or nursery school record

Documents to Establish Employment Authorization

These documents are necessary to verify that an individual is authorized to work in the U.S. Common documents include:

• Social Security Account Number card (unless marked with restrictions like "Not Valid for Employment")
• U.S. birth certificate issued by the Department of State
• Native American tribal document

Documents for Students

In addition to the standard documents, students may need to provide specific paperwork to establish their eligibility to work, particularly if they are on a student visa. Examples include:

• F-1 or J-1 visa documentation
• Form I-20 (Certificate of Eligibility for Nonimmigrant Student Status)
• Form DS-2019 (Certificate of Eligibility for Exchange Visitor Status)
• Employment Authorization Document (EAD) for students on Optional Practical Training (OPT) or Curricular Practical Training (CPT)

Each document plays a key role in confirming both the identity and work authorization status of the individual applying for work. The specific combination of documents required may vary depending on the applicant’s circumstances, such as their citizenship status or visa type.

Now, let's understand the steps to identify an employee's work authorization.

Verifying Work Authorization: A Guide for Employers

When hiring new employees, verifying their work authorization is a legal requirement that protects both the employer and employee. To ensure compliance with federal regulations, employers must utilize specific tools and procedures to confirm an employee’s eligibility to work. Two primary tools used in this process are Form I-9 and E-Verify.

Form I-9: Employment Eligibility Verification

Form I-9 is a mandatory document that all employers must complete when hiring a new employee. It verifies the identity and work authorization of individuals in the U.S. The employee fills out the form and provides supporting documentation that establishes both their identity and eligibility to work. Employers are required to retain this form and keep it on file for a specific period, ensuring that it is available for inspection by federal agencies if necessary.

Key points about Form I-9:

• Mandatory: Required for all employees hired in the U.S.
• Social Security Number: Does not require a Social Security number.
• No Photo Requirement: Identity documents (List B) do not need to include a photo.
• Reverification: Form I-9 must be used to reverify expired employment authorization.

E-Verify: The Web-Based Verification Tool

E-Verify is a voluntary, web-based system that allows employers to verify the information provided on Form I-9 electronically. This tool cross-references the data entered by the employer with records available to the Social Security Administration (SSA) and the Department of Homeland Security (DHS) to confirm whether the employee is eligible to work in the U.S.

Form I-9 is required for all employers. However, E-Verify is optional for most employers. The exception is when federal contracts or state laws mandate its use. Employers with federal contracts that contain the Federal Acquisition Regulation (FAR) E-Verify clause must use E-Verify as a condition of business.

• Key points about E-Verify:
  
  1. Voluntary: For most employers, participation in E-Verify is optional.
  2. Social Security Number: Requires the employee’s Social Security number.
  3. Photo Requirement: Requires a photo on identity documents (List B).
  4. Reverification: Cannot be used to reverify expired employment authorization.

When E-Verify is Required‍

While E-Verify is a voluntary program for most employers, there are specific circumstances in which employers are required to use it:

• Federal Contracts: Employers with federal contracts containing the FAR E-Verify clause must enroll in E-Verify.
• State Legislation: Some states mandate the use of E-Verify for employers within their jurisdiction, especially for business licensing purposes.
• Legal Requirements: Employers may be required to use E-Verify because of a legal ruling or government order.
• In conclusion, employers can utilize Form I-9 and E-Verify to ensure that their workforce is compliant with U.S. work authorization laws. While Form I-9 is mandatory, E-Verify provides an added layer of security to confirm employment eligibility, particularly for employers involved in federal contracting or those located in states with mandatory E-Verify laws.

Now, let's explore how work authorization impacts global hiring.

‍The Impact of Work Authorization on Global Hiring

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Work authorization is a critical factor in global hiring as it dictates whether a company can legally employ talent from different countries. Companies must ensure compliance with each country’s unique employment and immigration laws to avoid legal complications. The process of obtaining work authorization can affect recruitment timelines, costs, and the scalability of hiring in international markets.

Here’s how work authorization impacts global hiring:

• Legal Compliance: Ensures companies follow local labor laws and immigration regulations, reducing legal risks.
• Recruitment Delays: The time it takes to secure work permits and visas can lengthen the hiring process, impacting project timelines.
• Cost Considerations: The costs associated with obtaining work authorization, such as visa fees and legal expenses, can increase the overall cost of hiring.
• Scalability: Countries with strict work authorization requirements may limit a company’s ability to quickly scale its workforce in that market.
• Global Expansion: Understanding work authorization requirements is essential for companies planning to expand internationally while staying compliant with local laws.

Navigating these challenges effectively ensures that global hiring efforts are smooth and legally sound.
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Conclusion‍

In conclusion, work authorization is a vital component of global hiring, ensuring legal compliance while enabling businesses to access talent across borders. Understanding and managing these requirements is essential for companies aiming for smooth international expansion.

Managing overseas hiring can be challenging due to complex immigration laws, payroll systems, and local compliance. Wisemonk’s Employer of Record (EOR) services offer a seamless solution by handling work authorization, payroll, and compliance for international hires.With our comprehensive features, we simplify recruitment and workforce management, with no local legal entity required.

Take the next step in building your global team now! Reach out to us today to explore our pricing and discover how Wisemonk can make hiring internationally effortless and efficient.