L-1 vs H-1B Visa - Which one is better?

Both L-1 and H-1B Visas are the most sought-after work visas in the US. While they have quite a few similarities, they also have some major differences, and they both have their pros and cons. In this guide, we will discuss the similarities and the differences between the L-1 Visa and the H-1B Visa and help you understand which one is better suited for you.

What is the L-1 work visa?

Also known as the Intra-Company Transferee visa, the L-1 work visa is a non-immigrant visa category that many large multinational companies use to transfer employees from other countries to their U.S.-based branch or related company temporarily.

Eligible workers under the L-1 visa can be categorized into two specific types of visas — L-1A and L-1B. L-1A visas allow qualified employees of multinational companies to be transferred to the U.S. in a managerial or executive capacity. The L-1B Visa, on the other hand, allows workers to be transferred to the U.S. because of their specialized knowledge in a specific domain or in terms of a proprietary product or process. 

L-1A visa holders are allowed a maximum stay of seven years in the U.S while specialized knowledge employees on L-1B visas are allowed to stay for a maximum of five years. 

What is the H-1B work visa?

The H-1B work visa is also a non-immigrant visa that allows foreign professionals to work in the U.S. Eligible workers under this visa type have typically worked in specialized occupations before entering the U.S. For example, a specialist in the field of medicine is in high demand for U.S. health institutions. In such cases, that person may be more likely to be awarded an H-1B work visa to transfer to the U.S., provided that he or she meets the other qualifications.

Before applying for an H-1B visa, the candidate must submit evidence that their educational degree(s) and breadth of knowledge correspond to the specialized occupation being petitioned in their visa application. 

The prospective U.S. employer will have to demonstrate the lack of qualified local applicants for the position and prove that work actually exists for the H-1B visa holder they wish to sponsor.

If you’re interested in getting an H-1B visa, it’s important to know that the current quota is capped at 65,000, with an additional 20,000 reserved for master’s degree holders. H-1B visa workers may stay in the U.S. for a maximum of six years, with an initial approval allowing for three years of stay that can be extended for an additional three years, if desired.

Key differences between L-1 vs H-1B visas

1. Visa objective

The L-1 visa is for candidates who already work at a foreign branch of a company with a U.S. branch or that plans to open operations in the U.S. The H-1B visa, on the other hand, is for foreign national candidates who plan to work for a U.S.-based employer in a specialized capacity.

2. Educational requirements

If you're interested in an L-1 visa, the good news is that there's no education or degree requirement. Securing an H-1B visa, however, will require you to have a bachelor's degree (or equivalent) and work in a specialty occupation that also requires a bachelor's degree. 

Important note: For the L-1B visa, USCIS may question whether you actually possess “specialized knowledge” without having a certain degree.

3.  Prior work experience requirement

Another key difference between the L-1 visa and H-1B visa is that L-1 visa applicants must have worked in a related company outside of the U.S. for at least one year in the last three years before their desired entry to the U.S. For the H-1B visa, there's no requirement for minimum work experience.

4. Annual quota limitations

There's no limit on the number of L-1 visas that can be issued in a fiscal year—which is great news for eligible candidates.  

Unfortunately, this is not the case with the H-1B visa where a maximum of 65,000 visas are issued within a fiscal year.  Lotteries for available H-1B visas are usually held in April every year for processing by October in the same year.

If you’re a master’s degree holder, you may have a higher chance of attaining one of the 20,000 available visas reserved for postgraduate degree candidates.

5. Department of Labor approval

In theory, U.S. workers can’t substitute L-1 visa holders, so there’s usually no need for the U.S employer to submit a Labor Condition Application (LCA) specifying the shortage of qualified personnel in the domestic work pool to fulfill the responsibilities required for a position. 

For an H-1B visa application, however, an LCA certified by the U.S. Department of Labor (DOL) is required. To receive approval from DOL, the U.S. employer must submit the LCA (also known as the Department of Labor Form ETA-9035) electronically through the iCERT Portal System. 

6. Application periods and procedures

Applications for H-1B visas open on the first business day of April of that fiscal year, whereas there is no such fixed timeframe for L-1 visa applications. The applications for both types of visas, however, are similar. For the L-1 visa, the applicant's company has to be responsible for filing Form I-129 with USCIS, along with evidence establishing the relationship between the U.S.-based company and its foreign branches. For the H-1B visa, the sponsoring company should file Form I-129 along with the approved LCA. 

7. Prevailing wage and payroll

For the L-1 visa category, there are no specific prevailing wage requirements. However, if the worker is paid unreasonably low wages, this may be flagged. For H-1B holders, on the other hand, they must be paid according to the prevailing wage or higher than the actual wage paid to others who have similar experience and qualifications for that position within the company.

In terms of payroll, L-1 visa holders can be on the payroll of the U.S. employer and/or the foreign company that they transferred from, while H-1B visa holders must be on the payroll of their U.S. employer.

8. Maximum duration of stay

The maximum length an L-1 visa holder is allowed to stay in the U.S. is seven years (five years in the case of an L-1B candidate) with no possibility of extension. H-1B visa holders, on the other hand, may remain in the country for a total of six years with the possibility of extension, provided the individual has taken certain steps toward lawful permanent residency. Make sure to consult an immigration attorney to determine the conditions for the extension.

9. Changing employers

Employees on an L-1 work visa are usually not allowed to change employers while maintaining their L-1 visa status. They may, however, transfer to another company that is a qualifying member of the multinational group (parent, subsidiary, sister company, or local branch) that filed the original L-1 visa petition. In order to transfer to a new company, the new employer is required to file a new L-1 visa petition for the foreign national.

On the other hand, H-1B portability provisions allow foreign workers on an H-1B visa to transfer their visa to a different employer without compromising their H-1B visa status. These employees won't have to obtain permission from their previous employer before making the transfer and can usually proceed to their new employment as soon as the new employer files the H-1B visa transfer petition, even without waiting for USCIS approval. They are, however, required to complete all contractual agreements and abide by non-compete laws. 

10. Commencing new operations in the U.S.

Foreign companies that don't have a U.S.-based affiliate or branch may use the L-1 visa to send an executive or specialized knowledge employee to the U.S. to establish one. This is different from the H-1B visa, which requires that the sponsoring company must be based in the U.S. before they can file an H-1B petition to hire a foreign worker. 

11. The path to a Green Card

L-1 visa holders can typically file for a Green Card in the EB-1C visa category while L-1B candidates will usually need to have a labor certification to be eligible. Similar to L-1B visa holders, H-1B visa candidates may also need LCA filed on their behalf through DOL before they can apply for a Green Card.

12. Eligibility for spouse to work

If you come here on an L1 visa, your spouse is going to come on an L2 visa, and they can start working immediately, and there is no requirement for an EAD However, if you come here on an H1B visa, your spouse would enter the country on an H4 visa. They are not allowed to work here until the I-140 process is complete, after which they can apply for the EAD and then work.