March 08, 2013

From March 1 to September 30, 2013, the United States (U.S.) Government’s automatic spending cuts (“sequestration”) on certain government services will come into effect. The cuts are anticipated across virtually all major sectors of the government, including reducing budgets of the U.S. Department of State (DOS) and U.S. Customs and Border Protection (CPB).

While all agencies await their final 2013 budget revisions, companies and assignees are advised that these agencies are already warning of possible near-term effects on how quickly foreign travelers may enter the U.S. to how quickly U.S. citizens can obtain new or emergency passports. Also, as this is a ten-year policy, future sequestration measures could adversely impact Global and U.S. immigration services.

What is Sequestration?

Sequestration is a federal fiscal policy designed to automatically reduce the U.S. government’s overall deficit, or debt.

Over the next ten years, the sequestration will be budget cuts totaling approximately US$1.2 to $1.5 trillion to be divided equally between domestic and defense programs.

March 1-September 30, 2013 marks not only the first fiscal year in which an estimated $85 billion in cuts will take place, but the cuts are compressed into a much shorter period of seven months versus a full fiscal year. (The U.S. Government’s fiscal year is the accounting period running from October 1st to September 30th.)

Due to this shortened window of time, agencies are already warning of possible reduction of services beginning as early as next week. Significant reductions in force and/or curtailment of certain services could begin on or after April 1, 2013.

What Does Sequestration Mean for Global Mobility?

Global immigration compliance is the engine that drives a truly successful global mobility program. Failure to obtain the appropriate entry status or work/residence permits for employees compromises a company’s business travel and overseas assignment program.

With regard to sequestration and its effect on Global immigration, current and future reductions to the DOS and CPB budgets alone may affect several immigration services that support U.S. and foreign workers. These services range from U.S. citizens obtaining emergency passports abroad (American Citizens Services), clearing immigration control at all U.S. ports of entry (border enforcement) and the ability to authenticate documents originating from the United States in support of visa applications (global immigration).

Specifically, the international community is noting U.S. Secretary of State John Kerry’s recent warning that further reduction of the DOS’s budget could adversely impact overseas diplomatic functions and services at U.S. embassies and consulates as well as DOS services provided in the United States.

For instance, if the DOS Passport Agencies furloughs or reduces staff, this could result in increased wait times to apply for new and renewal U.S. passports and creating delays for employees in need of traveling overseas. In a recent post, the DOS has already made mention of the effect of this year’s budget sequestration (http://travel.state.gov/passport/passport_5535.html).

For customs and border enforcement, the CPB has posted an advance warning on its website (http://cbp.gov/xp/cgov/newsroom/advisories/info_seq_cbpops/seq_faq.xml) regarding possible port of entry wait times, particularly during the height of summer travel.

For global assignees needing U.S. support documentation to file business visitor visa and/or work and residence permit applications, sequestration could delay obtention of such documents as FBI Identification Records or obtaining DOS authentication (i.e., an “Apostille) of certain documents.

In addition, U.S. states may experience a “trickle-down” effect of reduced federal spending on state and local services. Delays ranging from requesting an assignee’s local police records to obtaining certified copies of birth, divorce and marriage records could adversely impact immigration processing times.

ACTION ITEMS FOR EMPLOYERS

As indicated above, near-term impacts will not be fully known until this year’s cuts are announced. Of course, over the next decade, the long-term impact will be measured during each fiscal year.

Depending on how deeply sequestration affects U.S. Government services, companies are advised that the Global immigration component of any overseas assignment may directly or indirectly be affected by cuts that may occur with little to no advance warning.

From a Global immigration perspective, companies and employees alike should keep themselves informed of current U.S. border enforcement and U.S. consular processing changes and guidelines.

Examples of what impact sequestration could have on the global mobility of employees are as follows:

  • Foreign national employees needing to obtain visas at a U.S. consular post outside their home country. These employees should work with their global immigration supplier to determine the visa requirements and length of stay for consular processing in a particular destination country. Unforeseen delays in obtaining a U.S. visa could impact the employee’s ability to remain in the destination country.
  • Also, unforeseen delays in obtaining a U.S. visa or other immigration status (e.g., U.S. Green Card) may directly impact an employee’s ability to apply for visas or enter other countries, particularly for travel to Canada, Mexico and certain Caribbean and European Union countries.
  • U.S. citizen employees assigned abroad should review the overseas citizen services offered by the DOS (http://travel.state.gov/law/citizenship/citizenship_775.html) and are also strongly encouraged to register themselves with the U.S. Bureau of Consular Affair’s STEP program (https://step.state.gov/step/). Depending on when cuts are announced, U.S. citizens should be aware that some services offered by U.S. consular posts may change with little to no advance warning.
  • Companies and assignees alike are forewarned that sequestration is on course to be a ten-year fiscal policy that, depending on yearly budgetary needs, could alter availability of government resources and lengthen processing times.
  • Companies are forewarned to build in some level of flexibility in situations where urgent Global immigration services may be required. These services would include, but are not limited to: obtaining expedited issuance of U.S. passports or adding additional visa pages; issuance of emergency passports for U.S. citizens abroad and the ability to quickly assemble and authenticate U.S.-originating documentation for use in overseas immigration applications.
  • Global and U.S. companies are advised to work with their U.S. immigration suppliers to ascertain any possible impact on the processing of U.S. work authorizations and all U.S. immigration-related matters, inclusive of current visa processing times at various U.S. consular posts.
  • Foreign national workers based in the United States are again reminded that their U.S. immigration status could directly or indirectly affect their ability to travel overseas.

Caveat Lector | Warning to Reader

This is provided as informational only and does not substitute for actual legal advice based on the specific circumstances of a matter. Readers are reminded that Immigration laws are fluid and can change a moment’s notice without any warning. Please reach out to your local Pro-Link GLOBAL specialist should you require any additional clarification. This alert was prepared by Glenn Faulk, Senior Manager, Knowledge Management.

Information contained in this Global Brief is prepared using information obtained from various media outlets, government publications and our KGNM network of immigration professionals. Written permission from the copyright owner and any other rights holders must be obtained for any reuse of any content posted or published by Pro-Link GLOBAL that extends beyond fair use or other statutory exemptions. Furthermore, responsibility for the determination of the copyright status and securing permission rests with those persons wishing to reuse the materials. Interested parties are welcome to contact the Knowledge Management Department (km@pro-linkglobal.com) with any additional requests for information or to request reproduction