Two laid-off U.S. workers recently testified before a U.S. House of Representatives committee that they were fired by IT companies and replaced with cheaper labour brought to the U.S. under a worker visa program designed to fill jobs needing special skills.
Patricia Fluno, a programmer from Orlando, Fla., said she and about 14 other employees of Siemens Information and Communications Networks Inc. were laid off in mid-2002 and forced to train their replacements from India.
“We lost our jobs and we had to train our replacements so there would be little interruption to Siemens,” Fluno told the House International Relations Committee. “This was the most humiliating experience of my life.”
A Siemens representative didn’t return a phone call seeking comment on Fluno’s testimony.
Republican and Democratic members beat up on the L-1 visa program, which allows companies to transfer their foreign employees with special knowledge of the company or managerial or executive skills to the U.S. Lawmakers called for limits on the number of L-1 visas granted each year and new rules that would allow enforcement against abuses of the L-1 program, which is often used to fill technology jobs.
The L-1 visa program is making it easy for U.S. companies to move jobs overseas, lawmakers argued. “America is in danger of losing that level of prosperity which allows us to work as an agent for positive change in the rest of the world,” said committee chairman Henry Hyde, an Illinois Republican. “… Are we being lax in the ‘off-shoring’ of American jobs, often facilitated by ‘in-shore’ training first given to L visa holders right here in the United States, so they can take new skills — and American jobs — home with them?”
The lone voice defending the current L-1 visa program during the hearing said no evidence exists of widespread abuse in the program. Harris Miller, president of the Information Technology Association of America (ITAA), said abusers of the program should be prosecuted, but he feared changes to L-1 rules would trigger a trade war that would hurt U.S. IT companies, which export more IT products than are imported into the U.S.
Miller called the L-1 program a “critical tool” for U.S. IT companies needing to fill critical jobs. U.S. IT companies often prosper by bringing in specialists, resulting in more jobs for U.S. workers, he added.
Harris’ organization opposes any limits on L-1 visas and most new rules designed to reform the program. Instead, he called for a better definition of the “specialized knowledge” needed by many L-1 applicants, because some companies may have too broadly defined the category. An applicant is supposed to have specialized knowledge of the company’s products, service, research, equipment, or other functions or advanced knowledge of the company’s processes and procedures.
“The L program is not broken in any fundamental way,” he added. “However, it can be improved.”
The L-1 visa program has a five-year limit on employees with specialized skills staying in the U.S. and a seven-year limit on executives. But unlike what has been done with its cousin, the H-1B visa program, Congress has not limited the number of L-1 visas granted each year, and the number has grown from just over 75,000 in 1992 to more than 328,000 in 2001, according to the Federation for American Immigration Reform. The ITAA’s estimates are lower; the organization estimates about 121,000 new L-1 visa holders entered the U.S. in 2001.
Representative Tom Lantos, a California Democrat, agreed that the definition of “specialized knowledge” is too broad, but he called for additional changes to the program. He called for the House to support the L-1 Nonimmigrant Reform Act, which would require L-1 workers to be paid the prevailing wage and would prohibit L-1 workers from displacing U.S. workers. The bill, one of at least three pieces of legislation before Congress that are intended to reform the L-1 program, would also allow fines of up to US$1,000 for each violation of L-1 rules.
Lantos accused some U.S. companies of using the L-1 visa to drastically lower wages. “What we are dealing with is high-tech indentured servitude,” Lantos said. “We are dealing not only with a loophole of gigantic proportions, but also a scandal of gigantic proportions. It’s up to the Congress to rectify the situation, and I fully anticipate we shall.”
Representative Brad Sherman, a California Democrat, also called for a tax of US$2,000 to US$3,000 per month paid by companies for each L-1 worker employed. The money could pay for investigations into L-1 misuse, Sherman said.
Programmer Sona Shah, a former employee of outsourcing service provider ADP Wilco, agreed with Lantos that abuses in the L-1 program exist. She accused her former employer of hiring Indian workers for a fraction of U.S. wages while declining to give work to U.S. employees in its New York City office. Shah, fired in April 1998, and a former coworker from the U.K. are now involved in a lawsuit against ADP Wilco, a subsidiary of Automatic Data Processing Inc.
A representative of ADP Wilco declined to comment on Shah’s testimony. U.S. workers weren’t the only victims; Indian workers were paid about half the prevailing wage of U.S. workers doing similar jobs, according to information Shah provided the committee. “This is not an issue of Indians versus Americans,” said Shah, who was born in India but is a U.S. citizen. “This is not about being anti-Indian or anti-immigration. This is about reforming corporate abuse of unregulated visa programs that are out of control.”
The ITAA’s Harris called the stories from Shah and Fluno “isolated cases.” “We believe the program is fundamentally sound,” he added. “If (companies) have violated the law … then they should have the book thrown at them.”
