When your only goal is to reduce and/or eliminate legal immigration, the effect on American jobs can be lost. The Trump Administration is expected to release today or tomorrow, new rules which will severely restrict the use of the H-1b visa. The majority of H-1b visas are used by IT professionals. The effect of restricting IT professionals from doing work in the U.S. will be to push IT work off-shore to countries like India, Canada, China and others who welcome ingenuity and the tax base that IT professionals bring to communities. Large Indian IT houses are already salivating at the idea of having one more sales point as they pitch off-shore development and outsourcing of IT work. Check out this article from last week in the NY Times. Could this Administration be so ignorant of the consequences of its actions ? The obvious and sad answer is yes !
The NFAP has published a study on H-1b usage. One of the more interesting finds is that sponsorship of new H-1b petitions by the traditional Indian off-shore houses has fallen. The assumption is that this is the result of the roadblocks designed to make it more difficult for staffing/consulting companies to place H-1b workers at 3rd party sites that started with the 2010 Neufeld memo and has been on steroids since the current Administration took control. This is a reasonable interpretation but, what is a more interesting question is whether or not these large Indian outsourcing houses have been able to use these roadblocks to their advantage to encourage more projects to be moved overseas and, if so, these roadblocks have ultimately served to decrease the number of US jobs and increase the number of outsourced projects. Unintended consequences can often be quite the bitch.
In a recent scathing editorial/opinion piece, published in the Huffington Post, the use of H-1b visas and outsourcing were linked together. The premise of the piece was that all outsourcing is bad and that H-1b workers at lower wages are used to replace US workers. For once, it would be nice if an elected official or in this case a wannabe would do enough research to at least get some of their facts straight regarding the H-1b visa.
Recently, the U.S. Chamber of Commerce, along with a number of large U.S. employers urged President Obama to restore the L visa program. They charge that the changes in the application of the law by the USCIS and the US Consulates in India have gutted a program that promoted international business and spurred U.S. job growth. The fact that the denial rate of L visas has increased over 300% in the past few years with NO change in the legislation or regulatory scheme is alarming. They claim that the change in the application of existing law is politically motivated and being driven by Senators Grassley and Durbin and these efforts have resulted in an increase in outsourcing of U.S. jobs and an impediment to IT job growth in the U.S.
TechServe Alliance announced that Senator Cornyn (R-Texas) has written a letter to USCIS Director Alejandro Mayorkas urging the Director to consider the implications of the Neufeld memo and its impact on the IT Staffing and Consulting industry. The Senator urged the Director to meet with industry officials to fully understand the impact of this policy. There is evidence that the Neufeld policy has led to a greater outsourcing of IT jobs overseas, severely limited the creation and growth of small and medium sized IT businesses which, have long been acknowledged as critical in ecomoic growth and curtailed US domestic hiring. It is hoped that those were unintended consequences and that the Director will take a personal interest in this critical issue.
Recently, the USCIS, particularly, the California Service Center has imposed requirements on IT staffing companies employing H-1b workers that are not found in any statute or regulations. The requirement to produce contracts from parties with which the petitioner has no direct relationship is impossible to meet and the Service Center knows it ! That, is in fact their aim, to be as obstructionist as possible. Instead of applying the statutes passed by Congress and the regulations promulgated through the Administrative Procedures Act and subject to notice and comment i.e. a hearing by the public, they have chosen to arbitrarily act in an uniformed and misguided attempt to “protect the helpless Amercian worker” Kudos to the goal but, the execution gets a resounding “abject failure”. I happened to have a case recently that represents the idiocy of the Califronia service Center policy. The Petitioner (Co. A) had a contract with Co. B who had a contract with Co. C (the end client). For those of you who are familiar with the staffing industry, such an arrangement is the norm rather than the exception. Entire cos. are built on such contrcatual relationships. The CSC demanded the contract between Co. B and C, and my client who has no relationship with Co. C could simply not produce the required contract. Alternative proof, including a letter from Co. C verifying the relationsip and the job description was produced but, ignored by the CSC and the case was denied. I, being filled with righteous indignation, advised my client to file an appeal because surely the appeals unit would look at the evidence with a fair and unbiased eye and approve the petition. Unofrtunately, I told my client that the filing fee for an appeal is $585.00, attorney fees were ridculously exorbidant, and it would take 14-18 months for the case to be heard, and I added, in the interim, the employee could not keep working but, would have to leave the US and wait abroad for a decision. (clearly, the lack of a speedy appeal process and interim work authorization is one of the reasons that the CSC can act with such incredulity. There are simply no repurcussions when they flaunt the law and turn a blind eye to facts and evidenec submitted) My client, being a brilliant business person, had another option. He simply convinced the Co. B and C, the end client to move the project overseas to his development office in Secunderabad, India. Two of the three U.S. workers assigned to the project at the end client were offered the opportunity to transfer to India and when they declined, 3 more off-shore positions were created for Indians abroad. Way to go California Service Center ! In one failed swoop, you were able to keep an H-1b worker from working in the U.S., paying taxes, renting an apt, buying a car, etc. all horirble things, and at the same time, eliminate the work for 2-3 U.S. workers. I’m sure they appreciated you “protecting” them. But, hey look at the bright side, you made 3 Indians in Secunderabad very happy ’cause they now have a new project to work on.