Important to clamp down on how L work visas are used.
By Sujeet Rajan
NEW YORK: American corporate greed? Myriad legal loopholes in US visa laws easily exploited? Visa violations by Indian IT outsourcing companies?
Which of these will the US Department of Labor determine in an investigation it has launched into Indian IT service giants Infosys and Tata Consultancy Services (TCS), is the prime cause of 500 plus layoffs recently at Southern California Edison?
The answer perhaps is all three reasons, and much more.
The New York Times said in a report: “The Department of Labor has opened an investigation into two India-based outsourcing companies for possible violations of rules for visas for foreign technology workers under contracts they held with an electric utility, Southern California Edison. The power company recently laid off more than 500 technology workers. Many said they were made to train replacements who were immigrants on temporary visas, known as H-1B, brought in by the Indian firms, Tata Consultancy Services and Infosys. Senators Richard Durbin of Illinois, a Democrat, and Jeff Sessions of Alabama, a Republican, announced the investigation after they were notified by the department.”
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Exacerbating the issue was also the widely reported layoffs at Disney in Florida, announced last October, where over 250 employees in the IT section dealing with data from theme parks were laid off and forced to train their replacements from India on work visas employed by Cognizant; refusal or ‘bad attitude’ meant no severance packages for the workers who received pink slips.
There was widespread condemnation of the so called use of ‘knowledge transfer’ sessions where fired American workers at Disney were humiliated by having to teach their replacements to take over jobs.
Sessions and Durbin released a statement, following the Department of Labor announcement: “A number of U.S. employers, including some large, well-known, publicly-traded corporations, have laid off thousands of American workers and replaced them with H-1B visa holders. … To add insult to injury, many of the replaced American employees report that they have been forced to train the foreign workers who are taking their jobs. We’re pleased to hear that the Labor Department is taking a first step to stanch this tide of visa abuse.”
The investigation comes also at an awkward time for the Obama administration who had recently announced a slew of new rules and regulations meant to give relief to IT companies in India, including being able to send more workers on L work visas, to the US. The big three IT companies based in India – Infosys, TCS and Wipro, cheered the news. Cognizant, based in the US, welcomed the move too.
Related Story: Students on F1 visas may be allowed to work for 6 years in the US, like H-1B visa holders
At the same time, with campaigning for the 2016 presidential elections in almost full swing, there is growing perception that the issue of economic growth, creating jobs, even at the cost of appearing protectionist, and contrary to free market spirit, may be a mantra that will be accepted by the general masses, liberal or conservative, who are fearful of job losses and slipping into financial abyss.
However, the correct message has not yet been able to be delivered with precision by any of the candidates, be it Democrat or Republican. The issue is confusing for most Americans, as there are opposite viewpoints in the mainstream media, with some experts saying opening up jobs for more skilled foreign workers is the way to lurch the country forward to greater economic growth. Others saying it will lead to economic perdition.
The issue of immigration, however, has firmly entrenched itself as a major topic for the elections. Depending on when the Department of Labor releases its report, and what it intends to do with Infosys and TCS, penalize them if need be, could have a major impact on the way candidates vying for the White House change their rhetoric to the issue, closer to the polls.
In interviews The American Bazaar conducted on the issue, it emerged that the use of L visas, or rather to put it more succinctly, the way it’s used, by most of the major IT service companies is a sticking point; may be at the heart of the thorny issue.
Most of the sources spoke on condition of anonymity. But the consensus veered towards adhering to the laws of the land. If a worker from India takes up a job in the US, it has to be on merit, and the pay has to be on par with other comparable workers in the industry, said most of those interviewed.
All sources agreed that IT service companies from India are now much more conscientious of US laws, than in the past. They try their best to adhere to the rules, as far as H-1B visa rules are concerned. There are only 85,000 of those visas issued every year, with 20,000 of them reserved for graduates of accredited educational institutions in the US.
But when it comes to L visas, it’s a different ball game altogether, and perhaps the US labor department will look closely into that.
L work visas are given to those employees who are based overseas and then transferred to the US branch, to support and lead staff. The provisions of the visa make it clear that it has to be used in a way to supplement the staff, in often leadership positions, or as skilled personnel who handle other employees.
Some sources interviewed say most Indian IT companies flout the rules of the L visa, as employees are contracted out to do troubleshooting work for US companies. The salary of these L visa workers are determined not by US laws, but by the parent companies like Infosys, TCS and Wipro. Some L visa workers are paid only in India, and file their tax returns also there. They also have a hard time to be able to file for permanent residency, unlike H-1B visa workers.
As far as shortage of IT workers in the US is concerned, most say there is a genuine shortage of skilled talent.
Vinson Palathingal, President, Amaram Technology Corporation, based in Vienna, Virginia, says he is frustrated by his inability to hire skilled talent he needs to develop his business. He is stymied in not getting adequate H-1B workers, due to the lottery system. This year, he had filed for 10 H-1B workers, but managed to get only four positions filled.
“People can talk about unemployment in the US but the fact is that there is real shortage of skilled IT personnel, for jobs like computer programmers, analysts,” said Palathingal, in an interview to the Bazaar. “In India, there is plenty of talent to be found, college graduates and mid-level professionals can code, do Java; it’s hard to get enough graduates here who know all those skills well.”
Palathingal comes down hard on Indian IT companies who flout US immigration laws by misusing the L work visas.
“L1 visa workers are made to work outside of company locations, which is a violation of the law,” he said, adding that big companies, who have legal teams and the resources to fight the government, do it, and get away with it too.
According to Palathingal, L1 visa workers should be used to work only in leadership positions. He plans to bring a skilled IT worker soon from India on an L visa to handle some of the operations in his office.
Most people understand, some scornfully, that the end goal of all corporates, in the US or India, Disney or Infosys, Southern California Edison or TCS, is to maximize corporate profit. However, for most, it’s the ethics of how you eke those profits is beginning to matter too.
At the heart of the Department of Labor investigation is the American conscientiousness that what was done at Disney, a palpable feeling that it was not the ‘American’ way to do things, even if to fire an employee.
It’s one thing to fire a long-standing veteran employee, totally another to force him to train a foreign replacement being paid a fraction of his salary, with the same skill set, to do the same job he was doing for the last 20 years.
Outsourcing is one thing, but to have that person at the other end of the phone in India rattling off your credit scores, brought to your office in the US to take over your job and tell you to your face what you credit scores are and then to wave you adieu as you are forced to walk out of the job, is another matter altogether.
TCS and Infosys responded today to the Department of Labor investigation, saying they are not aware of it, reported The Economic Times.
“The US Department of Labor (DOL) regularly selects a percentage of visa and labour condition applications for extra scrutiny in the IT industry. We work closely with the DOL to assist them in this activity in the ordinary course of our business. We have received no indication of any broader investigation of Infosys visa practices,” Infosys said in an emailed reply to queries sent in this regard.
TCS responded: “TCS maintains rigorous internal controls to ensure we are fully compliant with all regulatory requirements related to the US immigration laws including those related to H-1B visas.”
(Sujeet Rajan is the Editor-in-Chief of The American Bazaar)