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Microsoft & Intel Get a Pass On Higher H-1B Fees

theodp writes "Criticizing companies that outsource high-paying American jobs, Senator Charles Schumer described Indian IT company Infosys as a 'chop shop'. (Nine Indian companies accounted for 20,000 H-1B visas as of 2007. In 2008, Infosys held 4,500 of the visas; the number was down by a factor of 10 in 2009.) The comments came as the Senate scrambled to fund the $600M Mexican Border Security Bill by hiking application fees for H-1B and L-1 visas. The Senate measure increases H-1B visa fees by $2,000 per application on firms that have 50% or more of their employees on this visa. Schumer pointed out that the bill would not affect high-tech companies such as Intel or Microsoft 'that play by the rules and recruit workers in America,' although they are among the biggest beneficiaries of the H-1B program."

27 of 209 comments (clear)

  1. did i read that right by TheRealQuestor · · Score: 5, Funny

    why do the words Intel and Microsoft just not sound right sitting next to "Play by the rules"?

    1. Re:did i read that right by Anonymous Coward · · Score: 5, Informative

      Posting as an AC due to the high number of H1B's in my office. But they don't work for us. They work for the contracting company we hire. The contracting company will get the bad press, slightly increase the per hour fee and the big company will point out that they're hiring American and not mentioning that they're contracting a lot more jobs than they hire and the contractors are rarely (if ever) American.

    2. Re:did i read that right by anagama · · Score: 5, Insightful

      While the starting salary may be $65k under our present system, it can't be said that in the absence of the H1-B program, the starting salary would still be only $65k. It used to be that when labor was short wages would rise, and that when labor was abundant, wages would fall. Since the whole globalization craze, that sea-saw balance of power between between labor and industry is gone, because with a whole world out there capable of living on dollars/day (something completely impossible in America), there is never a chance for labor to be short and for workers to get their payoff for suffering through the times when labor is abundant. In essence, we've created a system that always has a labor surplus leading to lower wages (or no wages) for everyone -- from the low skilled workers in the textile industry, to highly educated people in technical fields.

      --
      What changed under Obama? Nothing Good
    3. Re:did i read that right by BBF_BBF · · Score: 3, Interesting

      Yes, it's just an incredibly huge bonus for them if they can hire the person really cheap [vs hiring a non-import].

      If indeed, Microsoft and Intel are following the rules, they must pay AT LEAST the average wage in the local area, so they're not going to save all that much. Abusers don't follow that rule, they "report" that they pay the average or more, but then don't pay that amount to their H-1B employee aka Slave labor. However, one could argue that the companies can get top rung foreigners for average US worker prices, thus are really underpaying the foreigners.

    4. Re:did i read that right by NormalVisual · · Score: 5, Insightful

      A large number of the H-1B professionals who work for MS and Intel and other tech companies, have come in the same way, by competing against other qualified candidates, including Americans, for the same salary, and proving themselves to be the best candidate.

      The mere fact that they're competing against qualified American programmers is indicative of a problem. The H-1B program is predicated on the fiction that there aren't enough qualified Americans to fill the open positions to begin with.

      --
      Please stand clear of the doors, por favor mantenganse alejado de las puertas
    5. Re:did i read that right by Anonymous Coward · · Score: 5, Insightful

      No one is arguing that Intel, Microsoft, et. al. cannot start up divisions in foreign countries using the local labor pools and import the goods. The argument is that they are importing foreign nationals for the sake of undercutting local salaries under the false premise that skilled labor cannot be found in sufficient quantities locally.

    6. Re:did i read that right by Bill_the_Engineer · · Score: 3, Insightful

      If indeed, Microsoft and Intel are following the rules, they must pay AT LEAST the average wage in the local area, so they're not going to save all that much.

      You left out the part where Microsoft and Intel are keeping the local average wage low by using H-1Bs.

      Also, what determines the local average wage and how often are the companies audited for compliance? I think you'll be disappointed by the answer.

      However, one could argue that the companies can get top rung foreigners for average US worker prices, thus are really underpaying the foreigners.

      Why ignore the top rung US workers or were you implying that US workers can't be top rung?

      --
      These comments are my own and do not necessarily reflect the views or opinions of my employer or colleagues...
  2. Nothing to do with Intel or Microsoft? by RAMMS+EIN · · Score: 5, Informative

    FTFS: ``The Senate measure increases H-1B visa fees by $2,000 per application on firms that have 50% or more of their employees on this visa.''

    And Microsoft and Intel evidently are below this 50% limit. As far as I can tell, this isn't Microsoft and Intel "getting a pass", as the title states. No company is being singled out here. It doesn't matter who you are, what matters if you have 50% or more of your employees on H-1B visa.

    --
    Please correct me if I got my facts wrong.
    1. Re:Nothing to do with Intel or Microsoft? by mysidia · · Score: 5, Insightful

      Yeah... 50% total is also easy for big companies to avoid, by making sure to have plenty of employees performing non-skilled labor that count. They could actually aim to hire minimum-wage non-technical employees in advance in order to reduce the proportion of H1B workers. It could still be more cost-effective than hiring skilled labor from local applicants.

      They ought to require firms applying for H1Bs to report number of workers in various categories or types of work, and if you have 50% or more of your employees performing any particular type of work on H-1HB visa , then the higher app fees apply for workers in that category...

      So e.g. if >50% or your secretaries or H1B, or >50% of your support personnel are H1B, if >50% of your accountants/managers are H1B, or if >50% of your engineers are H1B....

    2. Re:Nothing to do with Intel or Microsoft? by Anonymous Coward · · Score: 5, Interesting

      FTFS: ``The Senate measure increases H-1B visa fees by $2,000 per application on firms that have 50% or more of their employees on this visa.''

      And Microsoft and Intel evidently are below this 50% limit. As far as I can tell, this isn't Microsoft and Intel "getting a pass", as the title states. No company is being singled out here. It doesn't matter who you are, what matters if you have 50% or more of your employees on H-1B visa.

      Every Infosys site I have been on has been 99% India citizen staffed. When they go back to their country for personal reason like marriage or death another one flies over and takes their place. Maybe 2% of US citizens is all I have ever seen in any department run by them.
      Talk about Cliques

    3. Re:Nothing to do with Intel or Microsoft? by copponex · · Score: 4, Insightful

      Microsoft has 90,000 employees. Intel has 83,000 at least. Considering that there are around 100,000 H1B recipients, you could place nearly all of them at just these two companies and they wouldn't have to pay a dime for any applications, since it would be less than 50% of their employment.

      Trickle down tax policies favor monopolies, and anything that taxes a company based on allowed percentage is going to favor huge corporations. But that's entirely the point. Start a ten man company with six H1B recipients, and you're looking at 12,000 in taxes. Microsoft can hire 44,000 H1B recipients and not pay a dime for the application fee.

      Every company that hires people from outside the United States should be given zero incentives to do so. Otherwise they have no incentive to train an American for the same job, or to support public education measures so America can produce better workers.

    4. Re:Nothing to do with Intel or Microsoft? by toastar · · Score: 3, Interesting

      FTFS: ``The Senate measure increases H-1B visa fees by $2,000 per application on firms that have 50% or more of their employees on this visa.''

      And Microsoft and Intel evidently are below this 50% limit. As far as I can tell, this isn't Microsoft and Intel "getting a pass", as the title states. No company is being singled out here. It doesn't matter who you are, what matters if you have 50% or more of your employees on H-1B visa.

      You must not be from america..... Or you failed you high school civics class. Of course it's worded this way, if it said the specific companies that didn't get taxed it would be a bill of attainder. The question is who it targets, 50% sounds like a round number, but you would be surprised at how many people probably lobbied to get it set that high. A good question is which companies would have been hit if it was set to 25% or 75%.

  3. why? by Anonymous Coward · · Score: 3, Interesting

    And why does it make sense to tax legal immigration to fight illegal immigration? As if legal immigration causes illegal...

    1. Re:why? by cappp · · Score: 3, Informative
      It's part of the general insanity of US immigration. I have friends that attended elite American universities and earned graduate degrees in the hard sciences - mechanics, biological sciences, physics and so on - and struggled to be allowed to stay in the US. These are people who have invested huge amounts in the American economy, provided skilled intellectual labour during their time in the country, and threw themselves into politcal and charitable volunteerism. Most spent 8 years in the country and were invited to leave as soon as possible after graduation - or perhaps after a year of work experience training. That's madness.

      Interesting portion of the article

      H-1B visa fees can add up. There are a number of other add-on fees as well: a $500 antifraud fee that is required for any new H-1B and L-1 visa user, and a fee for training U.S. workers that scales from $750 to $1,500, depending on the size of the company applying for a visa. Many companies also pay $1,000 extra for what's called premium processing to accelerate handling of the visa. And legal fees can run as high as $2,000.

      and

      The H-1B fee increase is going to cover only a fraction of the $600 million the Senate wants for border security. The largest H-1B user in 2008 was Infosys, which accounted for 4,500 visas that year. A $2,000 fee increase would have added about $9 million to its visa bill.

    2. Re:why? by jcr · · Score: 3, Insightful

      That reminds me of one man I know who attended the University of Maryland, and got a computer science degree. He was from Hungary, and at the time, anyone shipping so much as a Z80 to Hungary was looking at hard time. This guy could have built a VAX from TTL parts from memory, and our brilliant government wanted to send him and his skills back behind the iron curtain.

      -jcr

      --
      The only title of honor that a tyrant can grant is "Enemy of the State."
    3. Re:why? by tempest69 · · Score: 3, Insightful
      The problem I see with the H1-B is kinda backwards.. The companies are able to really abuse these workers. Now even If I don't care an ounce about these people - it's still bad news for me. When it comes time for death march coding it destroys the leverage of the local workers to make appropriate demands for compensation. When it comes time for raises it becomes harder to compete with the people who are here at lower pay grades.
      The problem I see is the H1-B's are locked in to their jobs, and nearly indentured servants. My problem is that the Hungarian will work for 30k and they expect an American with that level of skill to work for a mere 45k. Though with some relaxing on the H1-B the Hungarian could go on to find 6 figure work. Working at a project appropriate to his skill level.
      My take is that we should keep the high end labor.. it makes the US richer, it makes the immigrants richer, and it means we have more top end people working the hard problems.

      Storm

  4. Legal challenges are a comin' by PinkyGigglebrain · · Score: 3, Insightful

    I can already see smaller companies going to court to claim that they are being unfairly burdened by the higher cost.

    Right or wrong this is going to cause some fur to fly.

  5. Is that a viable business model? by gmhowell · · Score: 5, Insightful

    If 50%+ of your employees are H1-B's, I would suggest that your business model is not viable in the United States.

    --
    Jesus was all right but his disciples were thick and ordinary. -John Lennon
    1. Re:Is that a viable business model? by Hognoxious · · Score: 4, Insightful

      Care to explain? If a company is doing it there and not going out of business it would appear to me that it's very viable indeed.

      --
      Confucius say, "Find worm in apple - bad. Find half a worm - worse."
  6. You are right by Sycraft-fu · · Score: 4, Interesting

    This is just spin to try and make MS look like the bad guys getting special treatment. The reality of the situation is that if companies hire a majority of American (meaning either citizen or resident alien) employees then they don't pay the extra fee. MS and Intel were noted in the article as tow companies that "play by the rules" and hire a majority of American workers, but they were not given special dispensation.

    My guess is the logic is twofold:

    1) It is to help protect American jobs and encourage companies to hire local. After all if it costs more to hire H-1B employees, then it is not as attractive a proposition.

    2) To derive the funding for the measure from a relevant source. The measure deals with immigration, so companies that bring in the most immigrants get to shoulder the burden. While it isn't a direct thing (since the bill is about southern border security) it is still related.

  7. Do these H1-B stay in the US by calagan800xl · · Score: 5, Interesting

    As I've been the beneficiary of an H-1B with Microsoft, I know very well that MS also does a good job at sending H1-B permit holders back home after 1-2 years, before they get a green card. They actually paid for my 1-way ticket back to Europe. I'd be interested to see what is the proportion of H-1B visa holders who end up staying permanently in the US and which company hired them.

  8. Re:Tax H1-B to fight illegal immigration? by ultranova · · Score: 4, Insightful

    After all, a big reason why workers come over on the program is because we genuinely lack enough skilled labor to meet our needs at reasonable price levels.

    No, you don't. You, like all non-third-world economies, lack skilled labour willing to work at subsistence wage. This is the corporate definition of "reasonable price level", and is what offshoring and immigration labour is meant to fix. After all, the top 1% holds only a third of all wealth, so there's plenty of room for improvement.

    --

    Forget magic. Any technology distinguishable from divine power is insufficiently advanced.

  9. Re:Protectionism by another name by Mikkeles · · Score: 3, Insightful

    They can; but just because a company hired someone does not entitle that person to be allowed to live in (or even visit) the US.

    --
    Great minds think alike; fools seldom differ.
  10. Who needs H1Bs anymore? by Foolicious · · Score: 3, Interesting

    My (now former) company simply opened multiple large IT ffices in places like Gurgaon, Mumbai and Noida, so they don't have to get H1B workers. (They were first opened as BPO offices.) American workers are slowly laid off (always in small numbers every few months) or lost by attrition, new workers are hired in those Indian offices and work for the Indian subsidiary of that company. Those offices have grown by leaps and bounds since they were first opened in 2002-3ish. So that company doesn't "outsource" anything or get any H1Bs. Whether or not that's a dirty trick is another discussion. Everyone will have their opinions.

    I would say that any H1B in this economy is pretty frustrating if just based on perception (and perception tends to be reality...); I guess I just don't believe there aren't enough American workers to do those jobs.

    --
    Please don't use "umm" or "err" or "erm".
    1. Re:Who needs H1Bs anymore? by rickb928 · · Score: 4, Insightful

      I know your former company, and they have changed their temp labor policy recently. In fact, the mix of foreign workers has been changing from largely Indian nationals to Asian nationals. But the offices worldwide still exist, and show no signs of being dininished.

      Offshoring is still in progress. But I'm being converted as we speak.

      It's a tangled mess, but I'm still disappointed. We just got a new temp in who is in the U.S. on an H1B. Seriously, they are doing the very same job that dozens of U.S. citizens did in 2008m the VERY SAME JOB. And many of those U.S. citzens that were laid off in 2008 are still looking for that work.

      It's abusive, and has been for a long time. H1Bs need to be reduced dramatically. There are, repeat ARE, citizens that can do the work.

      --
      deleting the extra space after periods so i can stay relevant, yeah.
    2. Re:Who needs H1Bs anymore? by TheGratefulNet · · Score: 3, Insightful

      There are, repeat ARE, citizens that can do the work.

      US citizen, here. been laid off for many months. have been horrified by the lowball offers that come in, trying to take advantage of the perception of the 'poor economy'.

      american-born workers are looking for jobs and yet we continue to import and outsource jobs.

      if only those in power would feel what its like. that's all I ask. have them walk in our shoes for a while.

      not only is there ageism happening in high tech, but its reverse discrimination when local born guys can't even find jobs since its 'cheaper' to hire imports (and then throw them away, which always does happen, btw). its just a mess all around. this isn't leading to any kind of stability, its just a run for short-term profits. it will harm everyone in the long-run, though (short-term thinking often does).

      I repeat, this exists because those who control the laws feel none of our pain. they simply don't "get it" or still believe in this misguided concept of 'trickle down' (give the rich company owners lots of power and eventually those 'below' will benefit. that never happens, either, btw.)

      --

      --
      "It is now safe to switch off your computer."
  11. Re:Open World by anagama · · Score: 4, Interesting

    If your skillset is such that other people can compete easily then distinguish yourself, don't just advocate the medieval practice of limiting people's freedom of movement.

    So if you went to school to become a nurse, but now the employers are importing them the Philippines, you should go back to school to become what, a programmer? After figuring out employers are just importing programmers, what do you, go back to school to become an accountant? But that won't be safe either. Maybe the only good thing to train for is college professor.

    In the medieval system you advocate, the middle class disappears because there is no hope for having a middle class job. Some few people become super-rich, and most Americans become poorer and poorer until we look any third world country. In essence, you say we should give up 70 or 80% of our income so we can become a poor unstable country with all chaos that goes with that. I think it is a bad deal for us. Yeah, selfish, but when did it become our duty to impoverish ourselves?

    --
    What changed under Obama? Nothing Good