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back to article India's outsourcers fume over new US immigration bill

Indian outsourcing body NASSCOM has labelled a new immigration bill being considered by the US as “discriminatory”. The Border Security, Economic Opportunity and Immigration Modernization Act could bring in sweeping reforms including limiting the number of H-1B visas – the class of visa granted to temporary foreign workers – …

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Stop

Well duh

Of course it's discriminatory. It's meant to be. The mere fact that there are 'visa dependent companies' should be a clue. H-1B's were not created so you could run a shell company and staff it with cheap foreign labor. They were created to fill temporary gaps in the US workforce.

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Re: Well duh

Yeah. And quite a few countries have already planned or committed to similar adjustments.

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Meh

Just remember

When they outsource and bring in foreign workers, those workers are not paid in the currency and country they are working in.

These workers are paid in their country of origin and in the currency of their origin and at a lower rate hence the 'cheap labour'. Also save an inordinate amount of tax.

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Anonymous Coward

Re: Well duh

Similar quality and priced resources are now available on shore anyway:

http://www.newtechusa.com/ppi/talent.asp

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Anonymous Coward

Re: Well duh

but why not call it the:

Stop annoying Indian call centres bill

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Yes but

"Indians working for the country’s outsourcing giants in the US have contributed more than $15bn in taxes and social security payments in the past five years."

If they were replaced by American workers, they would contribute more than that $15bn and not take money out of the country. That's the point.

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Ummm

There are many ways to look at how the money flows.

Sure, 15bn spent by IT workers living in USA would trickle through the economy and employ a whole lot of pizza workers, car salesmen, etc etc.

But 15bn spent in India probably gets a lot more development done. That means more products developed, more manufacturing and services delivered, and a lot more money flowing through the economy in other ways.

Which would end up contributing the most to US society is hard to tell.

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Anonymous Coward

Re: Ummm

"gets a lot more development done"

not if you take into account rework required afterwards in many cases

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Re: Yes but

You assume there are $75 billion worth of latent IT talent in the US ($15bn in taxes at an average rate of 20%, actual rate is irrelevant) to replace these outsourcers.

Presumably you are also upset that outsourcers/near-shoring cost less than hiring American workers, so you are must also be happy with American industry being less efficient if the practise was removed.

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Re: Ummm

The 15bn is his taxes figure. Those would be spent here (at least mostly). But given the wage arbitrage of these companies, that probably represents $3-10bn less in taxes than if they staffed legitimately.

As to the wages being spent here or there, global GDP gains tend to favor the rich or the locales where the increases occur. Sure, some then flows onward, etc., but I have a very hard time believing raising another poorer nation's productivity has a profound positive effect on 99% of the richer nation's populace.

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Anonymous Coward

Re: Yes but

You're assuming that say, 100 outsourcing staff do the same amount and quality of work as 100 native population? Have to say, that doesn't tally with most of the stories I heard, some from people *managing* the outsourcing.

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Anonymous Coward

Re: Yes but

I don't have enough fingers to count the number of times I heard someone managing an entire TEAM of india devs who complained it would have been cheaper and much less time consuming to do the coding himself instead of asking his "team" to do it. Why? Because, as a culture, Indians are generally extremly ill suited to IT work. Why? I have no idea. It's just something you end up noticing when you are forced to work with them for a while. They appear to have a mental blockage to logic or something.

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Not making sense

As far as I can tell, the H1-B visas are for foreign workers to come into the USA to work there - I should know, I did 6 months' work in the USA under one of these babies.

Outsourcing (especially offshoring to India) means that the work goes to India and the workers do not enter the USA. There is no reason why more stringent restriction on H1-Bs would impact this practice.

Unless of course large US companies want to outsource to smaller US companies which build their staff mostly out of H1-B workers. But since large companies do this is order to get rid of staff, there should be plenty of local talent for these smaller companies to use instead of H1-B workers.

Or am I missing something?

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Holmes

Re: Not making sense

Yes, you are missing something.

It is not about Outsourcing, it is about NearSourcing... where you go through the same process as outsourcing, but the IT person comes and works in your office.

IBM do this alot in the UK. In fact many large companies contain IT folk who are employed by another company with a contract to provide them.

In this case the people provided are coming from India and this business is still profitable for the supplier as an imported worker from India under an Indian contract and paid in Rupees is still way cheaper than a local worker.

This is only possible due to this visa. Additional restrictions on this visa means this business model is under threat.... which explains the comments above of "no shit sherlock".

Is it clearer now or do you need to re-read the article...

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Anonymous Coward

Re: Not making sense

And they seem to manage to stick here afterwards like flies to shit. It's a backdoor through immigration controls...And means that pay for indigenous employees is artificially restricted....

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Anonymous Coward

Re: Not making sense

A common route is go to Eastern Europe, marry a local, then travel to UK having mostly bypassed EU visa regs, then travel to USA (the dream destination) benefiting from EU-US visa cooperation.

Or bypass the Eastern Europe bit and go straight to UK, marry a local, benefit from EU-US cooperation on visas .. etc... only UK gals aren't so much in need of cash (and population demographics are more balanced), so that may be harder.

But Eastern Europe is getting wise to it already... billboard ads about "fictitious marriages".

Another variation... marry a Eastern European (EU) gal in UK.

Usually the guys concerned have no respect for their "wife" and play around, as it is often simply a paperwork issue for them although the girl may not be told that. However, if their wife finds out and actually divorces them for bad behavior re other girls, they are back to square one in Europe regarding visas and travel...... and might actually have to go home.

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FAIL

Re: Not making sense

... and that makes you... shit?

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Unhappy

Re: Not making sense @jeremy 3

Ah, that's a better name for the thing. We still call it 'outsourcing' over here, though I've pointed out that the term isn't quite right as the only 'outsourcing' component is that the resource works for another company than the one that pays him his salary.

I used to be stuck under this scheme for 5 years. It's horrible, and over here in Mexico it has become the unofficial standard. A big bank which is a strong branch from a very well known European bank recently went full evil and created an entire NearSourcing branch, moving most of the IT people into that. All of the work, without the privileges of working in a bank ... because you don't work for the bank. Get it?

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Anonymous Coward

Re: Not making sense @jeremy 3

Sounds familiar.

Two years ago, the company I worked for announced that our entire division was to be transferred lock, stock, and people to an Indian engineering company. Pay and employment were guaranteed for 18 months, but any who chose could depart immediately with a salary continuation package. The deal was a transparent ploy to transfer knowledge followed by far worse working conditions. I took the salary continuation and I've been quite happy since.

PS: Hewlett-Packard was caught bringing in H1b bods and paying them shite wages back in the 1990s. I've boycotted H/P since.

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Anonymous Coward

Re: Not making sense

I think that the percentage of the indigenous female UK population that would consider marrying a heathen third world import would be incredibly tiny....Even the Eastern Europeans in general wouldnt be that desperate...

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PT
Stop

Re: Not making sense

Lest we forget the actual reason for the H1B program, as succinctly stated by former Fed chairman Alan Greenspan .....

"...by opening our borders to large numbers of highly skilled immigrant workers, we would provide a new source of competition for higher earning employees, thus driving down their wages."

How ironic that the destruction of well-paid American jobs has been so successful that the Government is now considering scaling back the program because it hits them in the pocket.

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Re: Not making sense

Just to be clear it is also offshoring. Infy, Cognizant, etc. will also use these visas to staff analysts who forward requirements for the work to be done offshore. I'm not at all arguing the truth of what you indicated, just pointing out that both aspects are heavily relying on this visa.

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Anonymous Coward

Re: Not making sense @jeremy 3

Sounds precisely how Fred the Shred's company were operating. Not even permitted to speak to "the bank staff" according to contracts. What were they afraid of, exactly, something to do with them repeatedly paying many weeks late to the point that people quit for companies that "actually pay"? You know, unlike, *banks*, say.

And after being not paid for weeks late, the unpaid Xmas "holidays". Burn in Hell, Santa! Oh I feel a mood coming on, nurse!!

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Anonymous Coward

Re: Not making sense

It happens, trust me. And in Ireland etc with the same 2 parties, if you see what I mean.

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Re: Not making sense

{Lest we forget the actual reason for the H1B program, as succinctly stated by former Fed chairman Alan Greenspan .....

"...by opening our borders to large numbers of highly skilled immigrant workers, we would provide a new source of competition for higher earning employees, thus driving down their wages."

How ironic that the destruction of well-paid American jobs has been so successful that the Government is now considering scaling back the program because it hits them in the pocket.}

Though known for long long speeches he was probably by far usually the smartest person in the room and when he said stuff like that made him also the man with the most common sense in the room. Short term profits in exchange for long term economic stagnation where your profit just stall was what he tried to tell them and they ignored him, off shored most of the computer industry, and created this crap economy. Guess they should have listened like stupid poor me did and understood every word of wisdom that came out of his mouth.

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Re: Not making sense

The percentage is higher and their offspring better known to you than you might imagine - Cliff Richard, Rhona Mitra, Engelbert Humperdinck, Juliet Prowse, Rupert Penry-Jones, Diana Quick, Ben Kingsley, George Orwell, Alistair McGowan, Norman Douglas Hutchinson, Stuart Clark, Henry Gidney and Rahul Gandhi, amongst others.

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AGR
WTF?

I find it hard to sympathise when an industry that has grown through lobbying and political influence and bases its business model on this complains about the political process.

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Anonymous Coward

It's just a way for managers to get rid of local staff and pay pittance for IT.

However what the managers don't realise is just because the Outsourcer says "Yes" to there requirements doesn't mean what they get will will be any good.

My bosses used to get pissed off with me when I'd point out that their requirements where self contradictory. They gave it to the offshorers who coded it and it was a pile of cr*p and then it was always our fault as Analysts even though we'd pointed out what was wrong.

Of course my managers must be more intelligent as they are the boss, even though they can't even turn on a computer without help :o

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Anonymous Coward

For years these arseholes have been telling domestic IT workers 'You don't like it? Tough, that's business' when they fired them to outsource the job to India. Now they get it back, all of a sudden they're pulling the racism card?

What is it with IT companies thinking they have a God given right to make all this money without having to give anything back in tax, jobs, etc? They almost seem offended by the idea.

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Anonymous Coward

@murph

Exactly, the whole problem with globalisation is that it's allowed large multinationals to act like parasites, siphoning cash out of economies and stashing it offshore, local workers too expensive?, no problem just ship a few thousand "skilled employees" from halfway round the world where the average wage wouldn't cover an average local employees yearly travel bill, rent a house for 10 of them to share and charge the rent, flights, meals etc. back to HMRC as expenses, whilst also avoiding paying any NI on either the employee or the company side, being careful to rotate your slave workers out every year before they become liable.

Once done stash you money in some offshore tax haven having given the Government a small kick back and reminding them how many people you employ!

I worked freelance for more than 20 years in the UK, and saw the market effectively destroyed in 5 years by both Labour and Conservative Governments, and salaries on the perm side have dropped by at least 10 thousand a year in that period, at one point DBA and Project management jobs were being advertised "At or near minimum wage" on the Jobcentre website, the vast influx of poorly trained staff from these jokers has led to many a project manager or test manager's stress levels rising.

I have left the UK now for somewhere where the local labour market is better protected from onshoring abuse, and have no intention of returning unless I have to, and there are lots of other Brits who have done the same thing.

Glad to see America has finally seen sense and is clamping down on these leeches.

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Anonymous Coward

Re: @murph

I left too, fed up with indentured labour being swapped in en masse regardless of the end result, generally as the result of direct bribery to individuals or corruption. I have seen the people in question, "the enablers", "the bribed" usually fired for it later, in case you think I am just speculatiing about that part.

How would say, lawyers, politicians, engineers, doctors feel if their profession was opened up to a minuimum-wage race to the bottom? You know, qualifications required, but if you are from certain countries, it is perfectly OK to study the university or commercial *actual exam answers* and sit the exam with your class and tutor present in case any questions are tricky, or get someone else to do it.

Come on Doctors and lawyers, and Accountants, you like? Wanna part of that? You just know you do! How about HR people, you want to be replaced comlpetely by a bunch of much cheaper HR people from, say, Moldova, working for a 3rd party company? Who in this case would only be permitted to work with other HR people from the country, you know, for "team communication reasons" ;)

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Pint

Re: @murph

I know of a lawyer, specializing mostly in bankruptcy and immigration cases, who HAS offshored a goodly portion of his data entry to the Philippines. The woman who was his office manager here is now managing the entire operation in the Philippines. All the data entry work is done in Manila, then emailed to the office in the SF Bay Area, where it is proofread, then filed in the appropriate court, by email. Works for him.

Gotta pretend that's a glass of wine... but it must be wine o'clock in the Philippines...

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Coat

NASSCOM

I built a Nascom in the seventies... oh, wait...

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Anonymous Coward

Tough Luck India

America protects home market jobs, get over it. It's an socioeconomic issue, not racism.

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Anonymous Coward

Equality

They may be discriminatory against non-US workers. However, they are not racist or country specific - as a UK citizen, I will also be subject to these restrictions. It does not matter if I am white from the UK, tanned from Spain or more tanned from India. There is no racism here, these policies are equally applied.

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Coat

"Border Security, Economic Opportunity and Immigration Modernization Act"

Wot, no acronym? What were the Merkins thinking!

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JC_
Bronze badge

Re: Wot, no acronym?

Rearrange the title to "Border Immigration and Opportunity Modernisation Economic Security" Act and you get the BIOMES Act, there to protect the local ecosystem.

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Anonymous Coward

Re: Wot, no acronym?

"National Opportunity, Border Limits And Control Key Systems" Act surely...

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Bronze badge
FAIL

isn't that the whole point?

"It puts restrictions on our ability to service our customers and prevents our ability to have a level-playing competition in the US.”

A level playing field? Who are you trying to kid?

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Anonymous Coward

Re: isn't that the whole point?

To be fair, they didn't specify what kind of level exactly they had in mind, presumably a really really shitty one, or who their competitors were, presumably *the entire US population* in this case ;)

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Paris Hilton

And what DO they mean

What do they mean by "service our customers," eh?

Paris. Because

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Anonymous Coward

Re: And what DO they mean

Well, if the *money* bribes and share offers to "susceptible" middle-managers don't work... ;)

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Just a proposal ...

This is proposed - I have noticed that politicians often propose to do something, takes the heat out of people like us, and then it all just dies away, then it is too hard to pass into law, veto etc..

Lets see if this gets anywhere - I bet not, too many rich and powerful interests at stake.

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"There is discrimination because it is based on visa dependent companies versus non-visa dependent companies" - Som Mittal, NASSCOM

There is "discrimination" in every decision. Most forms of it are perfectly acceptable. Choosing chocolate over strawberry ice cream is discriminating, too. Do you know what else is discriminating? Excluding citizens from legitimate consideration in your business model in their own nation. NASSCOM BLATANTLY practices age, race and gender discrimination--three forms that ARE actually legally defined forms of wrongful discrimination--with religion at least anecdotally lumped in as well. The combination of hubris, disdain, ignorance and/or stupidity in his comment is astounding.

And just how many billions of tax dollars are being lost from under-/unemployed workers, suppressed wages and unemployment benefits?

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Gold badge

H1-B system was broken

"Unless of course large US companies want to outsource to smaller US companies which build their staff mostly out of H1-B workers. But since large companies do this is order to get rid of staff, there should be plenty of local talent for these smaller companies to use instead of H1-B workers.

Or am I missing something?"

You're not missing a thing. The H1-B system was intended to allow hiring workers for positions where local workers are not available. For instance, I hear that nuclear reactor techs tend to be shipped over from Germany along with the reactors they are operating, because there are not locals trained in operation of these systems. Fair enough.

The problem is this system is widely and systematically abused. They will list a job with, say, 10 years experience in Windows 2008, C#, Fortran, Cobol, and System/360 assembly. They will reject anyone who says "no" to any of these (even the physically impossible 10 years experience with a 5 year old product), and call the person out for lying if they say "yes". This job can be listed for 1 day in tiny print in 1 town newspaper (possibly across the country from the town the job is actually in...); they don't really want people to apply, they want to show that qualified people *don't* apply. Several companies have been caught out red handed doing the impossible interviews and odd ads, but the fines never come. Then they will claim they couldn't find anyone, and go hire H1-Bs (who don't meet their requirements either of course but are willing to learn -- of course, most of the people applying were willing to learn.). This was initially done to force down wages below what locals would work for, but now is so ingrained that there are people willing to work for the lower wages (the economy is bad) and they STILL won't hire them, because they are used to hiring H1-Bs. There's large amounts of high quality IT and computer science talent sitting unused in the US because of this system.

I'm shocked (Well, not really, the US political system is broken and ineffective)... Anyway, I'm shocked that it took this long for the feds to do anything about this broken H1-B program but I'm glad they finally are. Hopefully it's effective.

I expect these Indian firms to be outraged -- they may charge the firm receiving H1-Bs a "finders fee" for finding them employees, and may ALSO charge the employees they supply a "finders fee" for finding the employees work -- it's a cash cow for them and it's at risk.

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Anonymous Coward

Today, in most highly developed economies (US, UK included), the main sources of revenue for State budgets are Personal Income Taxes, Social Security Contributions, sales taxes, value added tax - they make about 85% of budget revenues. Governments rely almost exclusively on sucking dry their population! Multinational corporations and big business bring in between 5 to 10 % of all government revenues worldwide. It has been estimated that each year, all the multinational corporations rob the world population of over USD 1 trillion in taxes legally not paid, but morally due. This makes about 10% of the global GDP. The western governments have no power to change the tax laws. These laws carefully crafted to enable uncontrolled shift of power to the multinationals. In ten years, what we have now in the US (0,04% of the population controlling 85% of the national assets) will be the norm in all countries, that is, the whole world will be in possession of some 400000 banksters and Madoff-type financiers, military contractors and corrupt politicians. The time is really high for a profound change, and you can bet the change will not come from the governments. Just as it was once unthinkable that the III Reich, Soviet Union or other complex dictatorships would be overthrown, we can hardly imagine that today's world order should collapse. It would, when most of us, citizens of the world, realize that we are being exploited by our governments, inefficient multinational organizations and mega corporations and their henchmen.

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Questionable Motives

If they’re willing to sponsor their workers for green cards (which apparently most of these India firms do not do) they will, within a year, be able to get in under the “FacebooK” exception that provides that H-1B workers who are beneficiaries of permanent worker visa applications don’t count as H-1B visaholders with respect to dependency.

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