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How can employee turnover affect an EB-5 business?

The EB-5 program requires investors to create 10 full-time, permanent job positions, not to hire 10 individual employees. If an employee quits, then a new employee must be hired as soon as is practical to maintain the job position. When an investor files Form I-829, they must prove that 10 full-time, permanent positions have been created. Investors will likely have to submit their business’s employment records to United States Citizenship and Immigration Services (USCIS).

EB-5 regulations also set out that each created position must last for a minimum of two years. However, this does not mean that each employee needs to work for the EB-5 project for two years. Rather, the position itself needs to last two years, but it can be filled by multiple employees if necessary. USCIS is mainly interested in reviewing the nature and duration of the position, and it allows several workers to fill it throughout the two-year period. In fact, EB-5 investors are allowed to use job-sharing agreements and fill a full-time position with several part-time employees (of course, individual part-time jobs cannot be counted as a full-time position).

Foreign nationals planning an EB-5 investment should note that the job creation requirements for regional center and direct investors are different. Regional center investors are allowed to count indirect and induced jobs—that is, jobs that are a result of the project’s positive economic impact and of the employees’ spending in the locality. In contrast, direct EB-5 investors can count only direct employment—jobs that are created by the project and appear on its payroll.

Before choosing an EB-5 investment opportunity, foreign nationals should carefully examine each available project to make sure that it can generate the needed number of jobs. To be on the safe side, many investors select projects that plan on creating much more than 10 jobs per investor. Real estate developments are perhaps the safest projects when it comes to job creation.