India Pulls Out the Stops in Opposition to H-1B Provisions in Immigration Reform Bill

    If you thought the H-1B provisions of the Comprehensive Immigration Reform bill introduced in the Senate last week by the “Gang of Eight” are causing a stir here in the United States, you should see what’s happening in India. I’ll give you a hint: They’re not happy.

    There’s even talk in India of playing the World Trade Organization card. According to an April 20 article on The Hindu Business Line, Biswajit Dhar, director-general, research and information systems in the Indian government, cited a possible violation of global trade rules, and warned that India is prepared to take action. This excerpt from the article explains what they’re so upset about:

    According to the provisions of the Bill, if an employer has 50 or more staff , and if more than 30 per cent (but less than 50 per cent) of them are on H1B or L1 visas, a fee of $5,000 for each additional worker will have to be paid. In case the number of workers on such visas cross 50 per cent, the fee would go up to $10,000. H1B is a work permit for temporary specialty workers, while the L1 visas are issued for intra-company transfers that allow companies to relocate qualified employees to US offices. … A number of Indian IT companies have publicly expressed their apprehensions, saying the Bill would affect them adversely.

    And this quote from Dhar explains the argument India is raising:

    The draft Bill is at an initial stage. We do not have to act just now. But the contents certainly seem to be against the provisions of the General Agreement on Trade in Services. We have kept a strict watch on the developments and would take action when required. … Under the GATS, the US is obliged to issue 65,000 work visas to foreigners every year. It cannot put conditions on that. … There are a set of rules governing the issue of H1B visas and L1 visas and these have to be followed uniformly. The US cannot say that it would not penalise companies while issuing 65,000 visas and the penalty would kick in after the threshold.

    In this country, meanwhile, there appears to be a concerted effort underway to pressure the Gang of Eight—the bi-partisan group of senators that introduced the bill—to back off. For example, Prashanthi Reddy, an immigration attorney in New York, is claiming that “if the bill passes in its current version it will kill the IT consulting business model,” and she’s encouraging IT staffing companies to write these senators to oppose the H-1B provisions in the bill. She has even posted a sample letter on her website for them to use. Here’s an excerpt:

    I am writing to you regarding the concerns I have with the proposed H-1B “Outplacement” Provision under consideration for inclusion in the Comprehensive Immigration Reform bill. I am the owner of an IT Staffing Company in ________, __. … I have been informed that there is proposed language in the current draft of the Comprehensive Immigration Reform bill that would bar my company from accessing the H-1B visa program. I urge you to oppose inclusion of the so-called “Outplacement” Provision which seeks to prohibit “Labor for Hire”. … Proponents of the “Outplacement” Provision may suggest that it will protect against fraud and abuse within the H-1B visa program. There should certainly be a high level of concern regarding fraudulent visa applications, protecting American workers, and also protecting the potential H-1B workers from being taken advantage of by unscrupulous employers. The FDNS Site Visit program already implemented by USCIS has had a tremendous impact on reducing employer violations, and efforts along this line should increase. At the same time, we should not restrict legitimate employers from sponsoring H-1B workers by prohibiting the placement of an H-1B visa holder at the worksite of another employer. If these restrictions are imposed, it would have a devastating impact on my business and would actually cause the work to go to other companies who would perform the work offshore—an outcome that would be highly undesirable for my business and the U.S. citizens I employ.

    It appears unlikely that the senators are going to be all that receptive to the staffing companies’ rallying cry. According to an April 22 article on, one of the members of the Gang of Eight, Sen. Dick Durbin (D-Ill.), is making no secret of his impatience with the way the H-1B visa program has been usurped by Indian IT outsourcing companies. Here’s an excerpt from the article:

    During the Senate Judiciary Committee hearing on Monday, [Durbin] ticked off a list of India-based IT companies—including Infosys, Wipro and Tata Consultancy—that have been among the top recipients of H-1B visas in recent years.

    “Americans would be shocked to know that these H-1Bs are not going to Microsoft,” Durbin said, directing his comment to Microsoft General Counsel Brad Smith. “They’re going to these firms, largely in India, who are finding workers, engineers, who will work at low wages in the U.S. for three years and pay a fee to Infosys or these companies. I think that is an abuse of what we are trying to achieve here.”

    Americans would “be shocked to know that most of the H-1B visas are not going to companies like yours—they’re going to these outsourcing companies,” Durbin said.

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