Tales of American workers being laid off and replaced by foreign workers on H-1B visas spurred a bipartisan group of U.S. senators to demand the Justice Department investigate the practice. Prominent cases included IT workers laid off at Disney and the California utility Southern California Edison.
“A number of U.S. employers, including some large, well-known, publicly traded corporations, have reportedly laid off thousands of American workers and replaced them with H-1B visa holders,” says a letter signed last year by 10 Senate Republicans and Democrats, including Ohio’s Sherrod Brown.
But probes to date have found that these practices are within federal rules, some experts say.
“American workers can legally be replaced by H-1B workers,” Howard University professor Ron Hira told lawmakers at a Senate hearing last month. “It is extraordinarily easy to pay an H-1B worker much less than an American worker.”
Ban outsourcing?
U.S. Sen. Jeff Sessions, R-Alabama, chaired the hearing and noted that lawmakers have struggled to pass reforms to the program for years.
“The sad reality is that not only is there not a shortage of exceptionally qualified U.S. workers, but across the country thousands of workers are being replaced by foreign workers,” he said.
Sessions and Texas Sen. Ted Cruz in February put forward a bill that would, among other things, set the minimum pay for H-1B visa jobs at $110,000.
Other bipartisan bills, such as one put forward by Brown and Sen. Chuck Grassley, R-Iowa, would raise wages less drastically and expand measures meant to prevent H-1Bs from displacing American workers.
“My bill would close loopholes in the program and provide increased protections for both American workers and visa holders,” Brown said in a statement. “It would also enhance the U.S. Department of Labor’s authority to exercise strong oversight of the program, helping to ensure that companies give U.S. workers a fair shot at a fair wage.”
Other proposed measures would increase the number of H-1B visa-holders entering the country.
The tech industry trade group IEEE-USA, meanwhile, is encouraging displaced workers to file complaints with the DOJ under a current law that prevents discrimination against U.S. workers.
“We strongly support immigration,” IEEE-USA government relations director Russell Harrison said in an interview. “But American citizens should be allowed to take jobs in their own country. We now have a business model built around the premise that jobs will be off-limits to Americans.”
Harrison, whose organization represents 5,500 Ohio workers, said lawmakers should seek a simpler solution.
“We think you should just ban outsourcing,” he said. “You should not be able to fire an American and replace them with an H-1B.”
‘Industry killer’
The perceived impact of these proposals on IT jobs in the Midwest varies among industry leaders.
Arvind Handu, talent acquisition director for the Pittsburgh IT firm Visvero, said H-1B visas are vital for helping companies that need a temporary gush of workers to scale up projects in areas that don’t have large pools of skilled workers.
Visvero has only 30 employees, about a third on H-1B visas and all in the U.S., compared to major H-1B users that have hundreds of thousands of employees here and overseas, and seek tens of thousands of visas every year.
Handu said using H-1B visas are a last resort for him because they cost 30-to-40 percent more than local workers. He said making it easier for workers to leave the large H-1B firms and join companies like his would keep open the pipeline of skilled workers while addressing concerns that they push down wages.
“If the program were such that an H-1B, rather than being linked to the employer, was much like a green card and became an employment visa the worker would have, that would essentially make it a freer work place and the wage effect, if there were one, would be addressed.”
But Ken Conley, owner of the Cleveland IT consulting firm Main Sail LLC, said forcing outsourcing companies to pay higher wages would address the “unlevel playing field.”
“(H-1B visas) dramatically push down the salary structures. There’s less people going into the information technology in school,” he said. “It’s a huge job and industry killer for us.”
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