- Talent Management
Over the past five days, some Americans have been wondering, “Can I just move to Canada?” In fact, even before election night was over, the Canadian immigration website crashed due to the high number of Americans attempting to come up with a “exit plan.”
There is a widespread perception that moving to Canada is an easy and viable option. In reality, moving from the United States to Canada (or moving from Canada to the United States) is no simple matter.
Canada is a separate country and all U.S. citizens require a passport to enter and if they want to stay for more than a visit, they require a visa. As in the United States, of course, visas are not simply given out to anyone who shows up at the border. Visas are awarded primarily for work-related reasons and in some cases, to foreigners who can bring large sums of investment money into the country. In addition, in Canada, many employers have restrictions on hiring foreigners (e.g., in higher education, search committees can only hire foreigners when there is proof that there is no qualified Canadian available to fill the position).
The bottom line is that hiring foreign workers is a complicated matter and one that may or may not be advantageous to organizations and workers. This means that on both sides of the border, employers are often reluctant (and even unwilling) to hire foreign workers.
There is no question that in a global economy, hiring foreign workers can be good for business. First, in terms of talent recruitment, when you cast the net wider, you increase your potential to tap into the very best talent on the market. Second, foreign workers also hold the potential to bring new ideas, perspectives and networks into your organization. Yes, you get top talent but along with your foreign hires, you also expand your networks and potential for business outside the United States. Third, when you hire foreign workers, you also increase the diversity of your organization. Again, in a global economy, having a workforce comprised of workers from many linguistic, ethnic and racial backgrounds is a major asset.
Ask anyone in your HR department and they will tell you, hiring foreign workers is never easy. First, you’ll likely need to acquire a visa for the worker. This means entailing an immigration lawyer to put together an application. While some organizations put the onus on the employee, in most cases, foreign professionals expect their would-be employer to do the work and cover the cost of any visa application. If they are bringing a spouse and/or children, the paperwork will be more complex and complicated. Of course, without a visa, your employee will not be able to access social security number and without a social, payroll will be unable to process any payments.
All and all, expect the process of onboarding foreign employees to take longer and cost more.
For workers, there are many advantages to moving abroad. Working in a foreign local can expand one’s networks and enable one to acquire new skills and knowledge. In some countries, spending a period of time working in the United States (or another major foreign market) can also increase one’s currency on the job market back home. In addition, if you currently live in a local with a low valued currency, working in the United States and sending money back home can even be a way to kick start investments or build a business in your home country.
If you’re a U.S. citizen, don’t assume that you’ll leave your U.S. tax liabilities behind when you move to Canada, Greenland, Auckland or anywhere else in the world. In fact, depending on your status, you may find yourself paying taxes in more than one country. While there are taxation rules that mitigate some tax burdens for foreigners, in reality, many foreign workers end up paying more taxes (not to mention higher tax preparation fees, since they usually need to file tax returns in two countries with two different accountants). If you have children, the tax situation may be even more advantageous if you stay put (e.g., a Canadian on a TN1 visa working in the United States who has two children has no easy way to claim tax credits for their dependents, even while living and working in the country, and a similar situation holds true when U.S. workers move to Canada with children).
Finally, there’s the actual cost of moving you and your family (and once again, expect a foreign move to cost more both due to the potential distance and due to the potential tax liabilities of moving property across the border). In addition, moving to a new country may impact you on other levels (e.g., consider what will happen to your retirement savings, whether or not they can be moved to your new location and what you may lose by pulling out of a retirement plan before it matures).