January 30th, 2009

Tough times for H-1B visa holders

Posted by Brian Sommer @ 10:11 am

Categories: Current Affairs, India & Services, Outsourcing, Professional Services, Selling Professional Services, Service Providers

Tags: U.S., Job, H-1B Visa, Worker, H-1B, Human Resources, Labor Relations, Brian Sommer

The Firms That Use These Workers Could Be Hurt, Too!

When Microsoft announced its layoffs this week, they also indicated that a number of non-U.S. workers will get the ax. Computerworld posted these remarks regarding Microsoft’s layoffs:

Microsoft Corp. said it is cutting a “significant number” of foreign workers as part of the layoff of 1,400 employees last week, a number that is due to reach 5,000 over the next 18 months. The company isn’t detailing how many of the workers losing their jobs are in the U.S. on a visa, however.

Microsoft has been urged by Sen. Charles Grassley (R-Iowa), a leading critic of the H-1B program, to protect the jobs of U.S. workers over foreign workers. In a letter last week to Microsoft CEO Steve Ballmer, Grassley demanded that U.S. workers get priority in keeping their jobs.

H-1B visa holders may see more problems. In a piece by the Economic Times
, U.S. Senators Grassley and Durbin plan on re-introducing legislation that would force U.S. firms to first fill positions with U.S. workers before seekers non-U.S. personnel. Their story states:

The move, if implemented, would drastically increase costs and make it difficult for the Indian IT companies to send employees onsite at a time of wrenching economic slowdown. The bill will also ask these companies to pay the prevailing wages to H-1B workers, making offshore outsourcing more attractive, and onshore resources costlier by 20-30%.

Part of this interest in H-1B visas is understandable as one only has to look at the growing unemployment scene in the U.S. The economy is costing thousands their jobs every day. Legislators will be under pressure to get constituents back to work. If these legislators want to get re-elected, they need to be seen as doing something on this matter. Since non-U.S. workers don’t vote in these elections, they are the easiest group to throw under the bus.

Offshore firms will also feel the backlash. Depending on the final form of the proposed legislation, offshore firms may need to pay U.S. wages to these workers and do a better job of proving they aren’t displacing U.S. workers. It could make the sale and delivery of offshore work a lot more expensive.