Cayman Islands: New Immigration Law Expected To Take Effect

Last Updated: 19 October 2011
Article by Nicholas Joseph

Term Limit exeption permits and ten year permits expected to become reality.

The Immigration (Amendment) (No. 3) Bill and its supposed "suspension" of rollover are expected to pass into effect shortly. Subject to a constitutional challenge which has been raised, the Governor's formal assent and subsequent gazetting are required before it formally becomes law. The new law will not actually suspend rollover; rather, it will create two new types of work permit, the Term Limit Exemption Permit ("TLEP") and Ten Year Work Permit. For employees who are not presently designated as key, a TLEP offers a potential limited reprieve. However they will still be rolled over upon expiry of any TLEP issued, absent substantial other changes to the legislation.

Term Limit Exemption Permits

TLEPs seek to provide only temporary respite for some employers who find themselves unprepared for expatriate employees reaching their seven year term limit, and not otherwise having lawful grounds to seek and obtain permission for their continued employment. Employers that have employees who are crucial to operations, and who they would like to keep in the long term, should continue to make applications for Key Employee designation. This remains the only way to ensure that an individual will become eligible to apply for Permanent Residence when they reach eight years.

The TLEP system will not provide employers with the ability to obtain an extra two year work permit for all employees. Indeed, applications for TLEPs will be accepted from the date the new law takes effect (the "appointed date") and will only be granted for one year (or less) at a time. Application can then be made for renewal of the TLEP, but the authorities will only allow a TLEP to be granted up to (at least) the two year anniversary of the appointed date (the "cut-off" date).

Employers will only be able to make application for TLEPs for employees where:

  1. their final work permit expired within 30 days prior to the appointed date, on the appointed date or after the appointed date (but before the cut-off date) and they had not applied for Permanent Residence; or
  2. they are working by operation of law on the appointed date on the basis of an application for Key Employee, and that application is later (but before the cut-off date) denied.

Accordingly, the TLEP system does not extend term limits from seven years to nine years. Indeed, at the cut-off date, all TLEPs will cease to apply and workers must stop working and leave the Islands unless they have obtained a different permission. It is important to remember that it is not presently possible for anyone who has passed their term limit to apply for Key Employee, and TLEP holders are not expected to be able to become Permanent Residents.

TLEPs will need to be applied for and granted with the same considerations as apply to other work permit grants and renewals. A TLEP is not a rubber stamp; in fact, efforts to employ a Caymanian in the position applied for must still be made and in many cases advertising will continue to be required. No one will be entitled to a TLEP. This is however academic in many instances, since a denial can be appealed and the worker can continue to work until the appeal is decided or the cut-off date, whichever is sooner.

The Law was drafted and brought before the legislature quickly, and the issues which it seeks to address are pressing. It is apparent that the Government's plan is that during the next two years, it will seek to address the term limit issues once and for all. Unfortunately, it is possible that allowing a new category of persons who are not key employees to continue working past seven years may inadvertently create significant and complex issues for employers and the authorities alike.

Immediate concerns include:

  1. An obligation on employers (pursuant to the Labour Law) to pay up to seven weeks' severance (and possibly up to another seven weeks' compensation for unfair dismissal) which may now fall on any employer whose employee has been rolled over without the employer making a bona fide (and failed ) application for a TLEP in respect of that worker;
  2. How to treat workers for an interim period where their final work permit has expired and they are yet to apply for a TLEP;
  3. Whether those who are subject of an application for a TLEP after their final work permit has already expired will be able to continue to work in the interim;
  4. How the authorities intend to deal with the possibility of persons under a TLEP being able to work for "any employer"; and
  5. The prospect of persons who are denied a TLEP (but appeal) and therefore are permitted to work by operation of law pending a determination of their appeal and, at eight years of residence, being able to apply for Permanent Residence. Conversely, those who are granted a TLEP on first application will not be given that benefit.

Ten Year Work Permits

The new Law also provides, for the first time, for the concept of a Ten Year Work Permit. TLEPs are entirely distinct and separate from Ten Year Work Permits, although both permissions will allow persons to work past the seven year term limit without being designated as "key".

The holders of Ten Year Work Permits will naturally be able to apply for Permanent Residence with the Right to Work once they have been legally and ordinarily resident in the Cayman Islands for eight years, and there will be no need for them to apply for Key Employee.

The Ten Year Work Permit will only be available in certain (but as yet undefined) prescribed occupations and industries. There is no provision which makes them extendable or renewable, but with holders instead being expected to qualify for Permanent Residence before the permit's expiry and thereafter (if they desire) to move on to naturalization and ultimately, the Right to be Caymanian.

Conclusion

There are likely to be many more issues that will come to light once we start making actual applications for TLEPs and Ten Year Work Permits, and it is impossible to predict what all of them will be. Of course, relevant regulations and / or policy directions may also be introduced..

Given the importance of precise timing for the application for a TLEP and the presumably high standards expected for Ten Year Work Permit applications, it may be important for persons seeking these permissions to obtain advice.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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