How IT companies exploit H-1B visa loopholes

It hardly needs saying that immigration policy should not undermine Americans' jobs, wages or working conditions. The problem is that what some companies want -- cheap, exploitable, disposable labour -- is exactly what the system can be twisted into giving them.

Former workers at Walt Disney World in Orlando or at Southern California Edison, the power utility, can tell the story. Those two companies recently laid off hundreds of tech employees, who were replaced by temporary workers recruited by outsourcing firms based in India.

These are only two of many troubling episodes involving the H-1B programme, which provides up to 85,000 visas a year to foreigners, mainly highly skilled technical workers. The programme was created to allow companies to fill gaps in their workforce with specialized employees they cannot find in the United States. But the law has loopholes, and companies here and overseas ruthlessly exploit them. A huge industry has risen to meet labour demand in the information-technology sector, with the imported workers being employees of the outsourcing firms.


On Thursday the Labor Department announced it was investigating two of the largest companies that supply H-1B workers, Infosys and Tata Consultancy Services, based in India. Senators including Jeff Sessions, R-Ala, and Dick Durbin, D-Ill, asked for the inquiry after reports that Southern California Edison turned to Infosys and Tata for H-1B workers even as it was laying off 540 workers, many of whom said they had to train their replacements.

The New York Times recently reported a similar story at Disney, which contracted with HCL America, a branch of an Indian outsourcer, and laid off 250 workers. Some workers said they were asked to stay on to train the newcomers who took over their jobs.

A mass influx of foreigners doing the jobs of the workers they displace is clearly not what the law intended. Congress surely did not want to give companies a more efficient means of slashing payroll costs while pushing more people to the curb. But despite common perceptions about the H-1B law, it does not require companies to recruit American workers before looking overseas.


The program badly needs reforming, which even members of Congress who are otherwise far apart on immigration issues agree on. Sens. Durbin and Charles Grassley, R-Iowa, have proposed tightening the rules to require companies to work harder to find people in this country to fill jobs, to post job openings on the Labor Department website and to pay fairer wages. They would also give the government more authority to investigate fraud, and added protections for H-1B workers, who themselves are vulnerable to exploitation because of their dependency on their employers.

Many of these good ideas were contained in a Senate bill to overhaul the immigration system. That bill died, killed by hard-liners in the House who objected to its provisions for unauthorized immigrants.


That was a tragedy, because worker protection has always been a core ideal of comprehensive immigration reform, which would include allowing 11 million unauthorized immigrants to seek legal status and work without fear.

With no immediate possibility of such an immigration overhaul, opportunistic tech companies are pursuing their own narrow agenda, pushing for vast increases in H-1B visas. That might help their recruiting problems, but leave much of the system as dysfunctional as ever. Better to fix immigration with the right goals in mind: a fair deal for all workers and their families.