Recently a lawsuit has been filed in New Jersey against Indian run outsourcing companies, which systematically misuse H1B VISA norms and discriminate American college graduates and favours South Asian, especially Indian workers in the United States.
These outsourcing companies clients include fortune five hundred companies like MasterCard, FedEx, Capital in banking, Atlantic Richfield company, etc. according to information filed in the lawsuit.
Around more than 53000 employers in the United States use the H1B program in 2019 alone, and the top 30 H1B employers accounted for more than one in four of all 389000 visa petitions approved by the U.S. Citizenship and Immigration Services(USCIS) in 2019 itself.
Major Tech giant Microsoft, the seventh-largest H1B employer in 2019, has alone given 35 percent of its positions on Labor Condition Applications as Level 1 and two-fifths as Level 2. In total, Microsoft assigned more than 77 percent of its H-1B positions as Level 1 or Level 2, a wage level well below the local median wage.
What is the H1B visa?
The H-1B is a visa in the United States under the Immigration and Nationality Act, section 101(a)(15)(H) that allows U.S. employers to employ foreign workers in speciality occupations temporarily.
A speciality occupation requires the application of specialized knowledge and a bachelor’s degree or the equivalent of work experience.
The duration of stay is three years, extendable to six years; after which the visa holder may need to reapply.
Nearly 5,00,000 migrant workers are employed in the United States under H-1B status.
Why is it in issue now?
Due to the COVID-19 crisis in America and worldwide, around 30 million people in America lose their job in the last few weeks. Whereas many H1B immigrants, who work for low wages compared to natives are working from home. This irked the jobless American graduates and students, which lead to questioning the whole H1B program.
What is the response from the U.S. government?
The report by the Economic Policy Institute, titled “H-1B visas and prevailing wage levels”, mentioned that, ‘Department of Labor of the States, cheats many millions of American graduates by allowing employers to import foreign contract workers at below-market wages’.
Consequently, an Executive director for the Center for Immigration Studies Mark Krikorian called on the President to suspend the H-1B program, a visa used to recruit highly skilled guest workers from other countries over native skilled American graduates.
The Trump administration recently issued an executive order that could block nearly 360,000 green card applications annually and effectively cut immigration levels by roughly one-third.
President Donald Trump has directed his deputies to draft policies that would transfer jobs from visa workers back to Americans who have lost jobs in the coronavirus crash.
Criticism against the H1B visa program
The H-1B is an important, but a deeply flawed, vehicle for attracting skilled workers to the United States. This is misused by a majority of H-1B employers, including major U.S. tech firms, to take advantage of the program by recruiting migrant workers.
A total of 60% of all H-1B jobs are assigned wage levels that are well below the local median wage.
The visa program resulted in the suppression of salaries for college graduates in the last twenty years.
Some H1B employers use an outsourcing business model to provide staff for third party clients rather than employing H1B workers directly. This will help those companies to evade the tax and avoid visa provision to H1B workers.
What is the impact on H1B visa holders and other countries?
India alone generates 80 billion U.S. dollars in the year 2019 from the outsourcing companies based in the United States. This can give you a clear picture of the magnitude of outsourcing and it’s earning across South Asian nations and other countries worldwide.
But due to COVID-19, induced economic crisis made the companies to reduce their staff level. When the outsourcing companies decide to cut their cost expenditure, these high paying visa holders become first-line victims compared to other workers.
According to a study by Jeremy Neufeld, an immigration policy analyst, working at the Washington DC-based think tank Niskanen Center, nearly 250000 guest workers seeking a green card in the U.S. and about two lakh of them on H1B visa could lose their legal status by the end of June. Thousands more who are not seeking resident status may also be forced to return home.
So immigrants who are H1B visas, are under the fear of losing a job. If they lose a job, they have to find a new employer within 60 days to claim legal immigrant rights. Otherwise, they are considered illegal immigrants and will get a black mark on their visa status in the upcoming years. Consequently, they may lose the chance of getting legal residency rights again. Finding a new employer, who is willing to sponsor the work visa within 60 days is a complicated process even out of the economic recession and lockdowns.
It is nearly impossible to repay the student loan taken by the students to do Masters in U.S. Universities, from their earnings in their home country like India. So those who are on loans obviously face financial burden for a few more years.
Companies may face discrimination lawsuits if they fire US-born workers and prefer H1B holders. So many companies are not in the state to take a risk in the middle of the COVID-19 crisis.
The criticism against the H1B visa program is an ancient issue, but this time it is aligned with a massive number of job losses of the natives in America due to the pandemic outbreak. And the current Republican government in the U.S., as its election prospects and slogan ‘America First’ may use this crisis into a political opportunity for the upcoming election in November.
Overall, H1B visa holders’ career is in jeopardy, and many were told that pandemic took only a few weeks to collapse the whole thing, which they have built-in so many years together in the U.S.
The currency transfer is also subjected to severe restrictions from the federal government. On the other end the Indian government and other countries too, are not in a position to support them, the maximum they can do is provide airlift facilities, that also at their own cost.
All these things, in the long run, may affect the so-called rat race, that is a number of students going to the U.S. for higher studies, NRI bride/groom tag, forex reserves on the Indian economy, foreign remittances, and massive tax to U.S. government from the top universities. All we can do is wait and watch how things turn shortly.