May 1998 - Abuse of Foreign Workers American Style

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The H-1B  "Crisis"
May 1998

The following outstanding pages courtesy Law Offices of Carl Shusterman
has no affilliation with Carl Shusterman or another american attorney.

An excerpt from MIGRATION NEWS Vol. 5, No. 5, May, 1998
by Philip Martin, University of California, Davis CA 95616

On April 2, 1998, the Senate Judiciary Committee approved, 12-6, a bill
(S 1723) that would raise the visa ceiling from the current 65,000 annual
limit to a maximum 115,000 for each of the next five years (95,000 H-1B
visas would be available in FY98). The approved bill does not include
layoff protections for US workers.  For example, US employers do not now
have to certify and would not be required by S1723, to certify that they
did not lay off US workers to make room for the H-1Bs.

The Kennedy-Feinstein alternative bill, which would have raised the visa
ceiling to 90,000 for three years, and reduced the duration of H-1B visas
from six to three years, failed on a party-line vote, 8-10. About 44
percent of the H-1B visas go to workers in computer-related fields,
including programmers and engineers.  Another 26 percent go to physical and
occupational therapists.

Most employers fax a one-page form to the Labor Department which states
that any H-1B workers employed will receive prevailing wages and benefits,
and that there is not a strike in progress.  Unless the form has obvious
inaccuracies, the US Department of Labor must approve it within seven days.
The employer then asks the INS to issue the H-1B visa.  The INS certifies
that the foreigner meets the minimum criteria-- a bachelor's degree or
equivalent work experience--and issues visas.

Many of the H-1B workers are foreign students graduating from US
universities, and many remain with the employer who obtains an H-1B visa
for them while that employer sponsors them for a green card, or permanent
immigrant status.  One immigration attorney noted that hiring an H-1B
worker gives high-tech companies "a long-term employee," since the foreign
worker is obliged to remain with the sponsoring employer to expedite the
application for a green card.

Most newspaper reports expressed skepticism about the high-tech labor
shortage.  The New York Times on April 20, 1998 reported that the ten US
companies that imported the most H-1B workers in FY97 were "body shops" who
imported foreigners with the minimum BS degree for computer and software
installation and maintenance.  Mastech Systems Corp., for example, has
1,733 H-1B employees; H-1Bs were 80 percent of its work force.  Tata
Consultancy had 1,110 H-1Bs; Syntel, 675; and Computer People and Wipro,
about 446 each.  Intel, by contrast, has three percent or 2,000 employees
hired with H-1B visas, and most of them have master's degrees or

An exception to the general skepticism was a San Jose Mercury News
editorial on April 5, 1998, which noted that there is less controversy over
forecasts of future employment--demand--than of future US workers
available--supply.  It is hard to estimate supply because many of those
employed in computer occupations were trained in other fields, while some
of those trained in computer science are employed as managers or work in
other occupations.
The US Department of Labor changed the way it calculates prevailing wages
for temporary H-1B workers and for foreigners hired permanently as
researchers by universities and federal research agencies.  In a 1994 case,
Hathaway Children's Services (91-INA-388), the Board of Alien Labor
Certification Appeals held that prevailing wages should be calculated using
wages from all workers employed in similar occupations, private and public.

Since universities and federal research labs typically pay lower wages than
private firms, that calculation raised the wage universities had to offer
to foreigners and US workers.  The new DOL rules create exceptions for
universities and federal research labs, requiring them to pay wages for
similar persons employed by universities and federal research labs, with
the rationale that their research is for the public good, rather than for

Microsoft has 17,000 US employees, plus at least 5,000 temporary employees,
including 1,500 who have worked for Microsoft for one year or more.  Most
temps work under renewable three-month contracts, earning higher hourly
wages than regular employees, but having fewer benefits. At least one
appeals court has held that Microsoft owes the temps compensation for the
benefits that they did not receive because they were temps.  The number of
temps in the US economy has increased from 800,000 in 1986 to 2.5 million
in 1997.

Under a 1986 tax law, most computer programmers cannot be independent
contractors; they must be employees of a company such as Microsoft, or of a
body shop such as Mastech Systems that sends them from job to job. A few
programmers have tried to incorporate, but the IRS has aggressively audited
companies using one-employee corporations created by programmers.

Foreign physical and occupational therapists are also admitted with H-1B visas,
and there is some dispute over whether there is a shortage of therapists in
the US.  The percentage of newly certified occupational therapists who were
foreign-trained rose from three percent in 1985 to more than 20 percent in
1995.  Most projections expect a surplus of therapists; a result of an
increase in new programs begun to remedy a shortage in the 1980s.

However, firms that are in the business of importing foreign therapists and
placing them in US hospitals and nursing homes argue that there is a
continuing need for foreign therapists. Some endorse a proposal to create a
separate H-1C visa for therapists, thus making more H-1B visas available
for programmers.


The Wall Street Journal on April 23, 1998 described the motions that
employers go through to satisfy labor certification; employers must prove
that there are no US workers available before they can get permanent visas
for the foreign workers they want to be cooks, diamond cutters or
accountants.  DOL officials say that labor certification is a sham.  In
most cases, the foreigner is already working for the US employer, and the
US employer merely wants to convert the foreigner from temporary worker or
illegal worker to permanent immigrant.

About 60 percent of 24,000 foreigners waiting for permanent immigrant visas
on the basis that no US workers are available are temporary workers, usually
H-1Bs.  In the case of an Iranian H-1B working on computer systems for a
New York bank, the bank agreed to sponsor him after four years as an H-1B.
The application for a permanent visa, filed in October 1995, had not been
acted on as of April 1998, with final action expected by September 1999.

The Wall Street Journal noted that many of the foreigners US employers seek
to sponsor for the 140,000 immigrant visas available (for workers and their
families) are to be found among the 350,000 foreign students who come to
the US each year. Two-thirds of the foreign students are Asians.  After
graduation, foreign students are permitted to remain in the US one more
year for "practical training."

DOL spent $51 million on labor certification activities in FY95, and $31
million on labor certification activities in FY97, helping to explain why
the backlog has increased from 40,000 in 1995 to 104,000 in 1998.  The wait
between employer application and the granting of a visa for needed skilled
workers is typically four years, so many employers use the H-1B visa as a
stop gap until certification is completed.

Employers send ads for US workers to state labor offices, which must approve
them before they are published.  Americans who apply are referred by the
labor office to the employer, but DOL has no authority to compel the employer
to hire them.  Employers are required to provide reasons for not hiring
each US candidate they reject.  If DOL does not accept the employer's reasons
for rejecting the US worker, the employer can appeal to the Board of Alien
Certification Appeals to obtain certification to hire the foreigner.

Many foreigners and their employers use labor certification to win
immigrant visas, but the partnerships are often soon terminated: one-third
of the foreigners awarded permanent work visas, the Labor Department has
found, leave their US employers within a year.

  • David Cay Johnston,
    "How a Tax Law Helps Ensure Scarcity of Programmers"
    New York Times, April 27, 1998.
  • Barry Newman,
    "Foreigners Seeking U.S. Work Visas Often Land in a Bureaucratic Hell"
    Wall Street Journal, April 23, 1998.
  • Jeri Clausing,
    "Use of Visas by Technology Companies Is Under Fire"
    New York Times, April 20, 1998.
  • Miranda Ewell,
    "Tech worker shortage: fact or fiction?"
    San Jose Mercury News, April 5, 1998.

  • Jan 96  Hypocrisy
  • Sep 97  Abolish the INS
  • Jan 98  Total breakdown imminent
  • Feb 98  The INS is still a giant devil
  • Mar 98  The emerging Crisis
  • Apr 98  The INS Scam
  • May 98  This Page
  • Next report
    Don't  skip  these  pages
  • American Policy Regarding Immigration
  • How do Americans abuse foreigners?
  • Why do Americans abuse foreigners?
  • Apartheid American style

  • References  for further reading
  • Public Opinions

  • My experience in the United States
  • Seeking representation in NJ at U.S. D.C.
  • Read my 1995 article published in Civil-Rights
  • See related articles in PUBPOL  
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