The United States–Mexico–Canada Agreement (USMCA) was signed on 30 November by the presidents of the U.S. and Mexico and the prime minister of Canada. When ratified by the three member countries, it will replace the North American Free Trade Act, which went into effect in 1994 and has been the framework for trade on the continent for a quarter of a century.
Trade relations between nations, and the treaties that address them, not only regulate the flow of goods and merchandise, but also reflect general attitudes and trends regarding cross-border movement in general. As the USMCA awaits ratification, three immigration experts who addressed the topic at Worldwide ERC®’s Americas Mobility Conference, one each from Canada, the U.S., and Mexico, agree on at least one thing—the switch from NAFTA to the USMCA won’t change a whole lot for workforce mobility.
The USMCA “didn’t make any significant changes to what we already know in NAFTA,” says Liane Cooney, partner and manager of the Virginia office of Berry Appleman & Leiden. “Nothing has changed, realistically speaking,” agrees David Garson, national managing partner at Garson LLP in Toronto.
“The USMCA has largely kept Chapter 16 intact,” Garson adds, referring to the section of NAFTA titled “Temporary Entry for Business Persons.” Numerical limits on professionals have been removed but, Garson points out, “I don’t know of any professionals that were denied entry because they reached the limit.” Of more concern is the fact that “as the world has changed, as technology has changed, as we’ve become more advanced, it’s become somewhat obvious that a lot of these professions should have been amended or changed. And they haven’t been.”
Vicente Fabela, immigration manager for Staff Relocation Services de México and a legal consultant to the Mexican Congress on politics, immigration, and comparative law, calls this omission “a very important issue with the ‘new NAFTA.’ We have a new trend in the technological occupations, such as programmers, software development engineers, and so on, and these occupations were not updated.”
The three experts also assign more weight to factors in each of their own countries than any mobility-related changes the USMCA will bring.
Canada: Multiple Agreements
Garson points out that Canada has other treaties in addition to NAFTA/USMCA that can sometimes represent better avenues for temporary workers to enter the country. “In the sense of the NAFTA, there’s basically four ways that somebody can come to Canada: as a business visitor, as a professional, as an intracompany transferee, or as a trader and investor. So Canada has said a good way to get temporary workers into Canada is to make alliances and agreements and treaties with countries throughout the world.”
In addition to the USMCA, Canada and Mexico are also parties to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), a free trade agreement among Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Singapore, and Vietnam. Many of the provisions in the CPTPP were “taken directly from the NAFTA,” Gerson notes. “Because Mexico is part of the CPTPP, if you have a national from Mexico, you can look at, all right, is this better under the NAFTA, or is it better under this agreement? And in certain categories, it’s a strategy.”
U.S.: Dramatic Shift
For the U.S., much more important than the potential change from NAFTA to the USMCA is what Liane Cooney calls a “dramatic shift” in terms of immigration policies that affect workforce mobility. “We’ve seen unprecedented scrutiny and denials,” she reports. “It’s challenging, and it’s creating a lot of uncertainty for the business communities, and certainly for the individuals that are impacted.”
Cooney attributes much of the change to the “Buy American, Hire American” (BAHA) executive order issued by U.S. President Donald Trump in April 2017. Because of BAHA, immigration and mobility professionals are seeing additional scrutiny in applications that are being filed under NAFTA—more so at the Canadian border than at the U.S. Consulates in Mexico, according to Cooney. “We’ve got people who have been in the U.S. for many years, maybe as a management consultant, and when now applying for a renewal, they’re told they no longer qualify.”
On the regulation side, agencies such as U.S. Citizenship and Immigration Services (USCIS) and U.S. Customs and Border Protection have tightened up adjudications and how they review petitions. Numbers of H-1B petition denials and Requests for Evidence (RFEs) have spiked. “They came out with a policy that said we will no longer give deference to a previous approval,” Cooney adds. “So if you have an employee who was an H-1B worker and maybe had two or even three previous approvals, the fourth time may not be lucky, because they’re now looking at every petition as though it was the first time it was filed.”
Worksite enforcement has also increased drastically due to the use of new government technology to carry out I-9 inspections. “Look at doing an audit of your company’s I-9s just to be prepared,” Cooney suggests.
“The one piece to keep your ears open for is the new ‘Jared Kushner’ immigration plan,” she adds, referring to a proposal by Trump’s adviser and son-in-law that was unveiled in May. “What we expect is fewer family immigrants and more high-skilled, merits-based-employment immigrants.”
Mexico: Everything Is New
In addition to the lack of updates to the USMCA’s professions list, Vicente Fabela says, important factors affecting workforce mobility in Mexico currently include advantages granted by Mexico for the labor mobility of its commercial partners and Mexico’s steps to reform its labor legislation.
“We have a new president, a new Congress—everything is new, politics is new in Mexico,” Fabela says. Consistent with commitments made under the USMCA, he adds, “Mexico has been working to develop new rules for investment in energy, for immigration, and to develop our labor rules. This is really important for Mexico in this moment.” The Mexican Congress enacted a labor reform law on May 1.
“With the new reform of the labor law, we are trying to achieve a consolidation of democracy of unions and freedom of association of workers,” Fabela says. An especially important provision, in Fabela’s view, is the election of union leaders by secret vote. “We know that this issue with union workers in Mexico is a little bit dark,” he says. “So we will review all the collective agreements in Mexico within a term of the next four years” with an eye to “transparency and accountability in the management of union dues and finances” and “with a perspective of gender equality, with representation of women in the organs of the union.”
“We have new rules,” Fabela says, “but we need to apply and develop the work life in Mexico in the next years.”